Finland-based Fazer Confectionery has announced plans to cease operations in Karkkila in winter 2021 and move production of xylitol pastilles and chewing gum to the company’s factory in Lappeenranta.
Fazer says it will begin negotiations with the 22 permanent and five contract-based employees affected by the closure of the Karkkila factory, based in southwest Finland. The company says it will support those who are terminated in finding new employment.
To better respond to evolving consumer demand, Fazer says it needs to strengthen its development of xylitol products. Its goal is to offer more consumer-driven products, more compelling and innovative tastes and shapes, and different sizes and packaging formats.
Fazer says it does not have the development possibilities at its facility in Karkkila as it does in Lappeenranta, where it has invested nearly €25 million ($29.54 million) since 2015. Transferring production to the southeast Finland site will offer the efficiency and capability to remain competitive in the long run.
“Fazer believes in Finnish production,” says Mika Salomaa, head of Fazer Confectionery supply chain. “By focusing the production to bigger units, we can manufacture high-quality products more efficiently, which is a prerequisite for us to maintain our competitiveness. Also, when different types of products are manufactured in one factory, we are able to provide our employees opportunities to expand their knowhow and skills, and hence ensure the continuation of our operations also in exceptional circumstances.”
Nonetheless, Fazer also announced it will begin negotiations with 121 employees at the Lappeenranta factory for temporary layoffs resulting from the COVID-19 pandemic. The company said a decline in travel retail has decreased sales of single-candy packages, though sales of its mixed candy packages have increased.
The temporary layoffs are for a maximum of 90 days per employee during the current year. Negotiations are set to begin Aug. 31 with the goal of completing them within a 5-day period.
