New manufacturing plant
In May 2010 the Phoenix Packaging Group announced its plans to build a new manufacturing plant in Pulaski County of Virginia, US. The new plant, named Phoenix Packaging Operations, functions as a subsidiary of the company. Phoenix Packaging invested $20m in the facility, which was opened in March 2011.
The Virginia plant is constructed in Pulaski County’s industrial park in a building that was previously used by Findlay Industries. It occupies 108,000ft² and can be expanded to 300,000ft². The facility produces thermoformed rigid plastic and disposable products for the US market. Pulaski County is also home to Phoenix Packaging’s North American headquarters.
Phoenix Packaging analysed more than 40 possible locations in six US states – Georgia, Kentucky, North Carolina, West Virginia and Tennessee – for setting up the new plant.
Virginia was finalised within six months out of the 40 surveyed due to its geographical location and availability of qualified workforce. Lower energy costs and incentives provided by the state and local authorities also contributed to the state being chosen.
Packaging products manufactured by the company are used in the food, drinks, tableware, bottled water, cosmetics and margarine industries, for products such as ice cream, margarine, desserts, yoghurt and coffee.
Phoenix Packaging has been supplying high-end speciality packaging products to the US market for the past nine years. With an increased demand from the market and in production volumes, the logistics costs incurred on exports needed to be reduced.
Setting up a new plant near its fastest growing market, therefore, became essential. With the construction of the new facility, Phoenix Packaging’s technical team is also able to provide personalised services to its customers in the US.
The project generated about 240 new jobs in the region over three years and helped reduce growing unemployment rates in Virginia.
The new plant boosts the local economy and adds to the existing plastics capacity in the region.
Phoenix Packaging has already ordered the equipment required for the plant, including extrusion, thermoforming and printing machinery. This machinery processes polystyrene and polypropylene for producing rigid thermoforming packaging.
The project was granted $850,000 by the Governor’s Opportunity Fund. The Virginia Economic Development Partnership (a marketing organisation) and authorities of the Pulaski County acted together to bring the project to Virginia.
The project received a range of other incentive packages, worth more than $4.8m, which include the waiving of rent and local tax rebates for 17 years. Phoenix Packaging is qualified to obtain rail access grants from the Virginia Department of Rail and Public Transportation. The company can also take part in the Virginia Enterprise Zone (VEZ) programme.
The VEZ programme was created by the Virginia Department of Housing and Community Development to provide state and local grants to companies that invest and generate employment in Virginia’s enterprise zones. It also provides regulatory flexibility to companies and focuses on local infrastructure development.
In addition to the grants awarded to the project, local authorities in Virginia were especially forward in meeting various other needs of the company. The authorities helped to create the right programme to provide training to the workforce for the new plant.
The Virginia Department of Business Assistance is expected to develop a training programme for the project through the Virginia Jobs Investment Program.