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Specialty Foods Manufacturing: a Sectoral Analysis

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Specialty Foods Manufacturing: a Sectoral Analysis SPECIALTY FOODS MANUFACTURING: A SECTORAL ANALYSIS Shoshana Krieger Dominique Kaschak Diana Denham UP 237A Sectoral Analysis Instructor: Goetz Wolff UCLA Urban Planning, Fall 2010 1 SPECIALTY FOOD MANUFACTURING IN LOS ANGELES COUNTY Executive Summary ................................................................................................................. 5 Introduction ......................................................................................................................................... 5 Methodology ......................................................................................................................................... 5 Why Study Specialty Foods Manufacturing? ............................................................................. 5 Main Findings ....................................................................................................................................... 6 Recommendations .............................................................................................................................. 8 Specialty Food Defined ........................................................................................................... 9 Food Manufacturing Defined .......................................................................................................... 9 Defining Specialty Foods .................................................................................................................. 9 Our Definition and the Industrial Classification System (NAICS) .................................. 10 Structure of the Industry .................................................................................................... 12 Food Manufacturing........................................................................................................................ 12 Looking at Food Manufacturing Subsectors ........................................................................... 14 Specialty Food Manufacturing Employment .......................................................................... 20 Concentration Ratios ...................................................................................................................... 22 Outsourcing, Offshore Subsidies ................................................................................................ 23 History of Mergers, Buy-Outs, & Business Failures ............................................................. 23 Internal Composition of the Industry ............................................................................. 25 Options for Production Facilities ............................................................................................... 25 Site Requirements ........................................................................................................................... 29 New Technologies ............................................................................................................................ 31 Research and Development and Product Design ................................................................. 31 Supply Chain, Inputs and Outputs.................................................................................... 34 Supply Chain ...................................................................................................................................... 34 Inputs ................................................................................................................................................... 35 Outputs ................................................................................................................................................ 36 Finances .................................................................................................................................... 42 Profitability ........................................................................................................................................ 42 Ownership/Subsidiaries ............................................................................................................... 44 Sources of Capital and Reinvestment ....................................................................................... 45 Financial Pressures ......................................................................................................................... 45 Markets and Customers ....................................................................................................... 48 Accessing Markets ........................................................................................................................... 48 Marketing ........................................................................................................................................... 48 Market for Specialty Foods is High in Los Angeles .............................................................. 50 Consumer, Intermediate or Producer Goods ......................................................................... 50 Basis of Competition ....................................................................................................................... 50 Stability ............................................................................................................................................... 52 Customers ........................................................................................................................................... 53 Market Segmentation ..................................................................................................................... 54 Consumer Product Concerns ....................................................................................................... 56 Trade .......................................................................................................................................... 59 Trade Patterns in Food Manufacturing ................................................................................... 59 2 U.S. Top Trading Partners in Food Manufacturing .............................................................. 59 NAFTA .................................................................................................................................................. 60 Proportion of Export-Related Jobs ............................................................................................ 61 Exporting Specialty Foods ............................................................................................................ 63 Spatial Distribution, Cluster and the Locational Advantages of L.A. County .... 64 Zoning .................................................................................................................................................. 64 Spatial Distribution......................................................................................................................... 65 Location Quotients .......................................................................................................................... 66 Spatial Concentrations of Related Industries ........................................................................ 67 Clusters ................................................................................................................................................ 69 Commodity Chains .......................................................................................................................... 34 Related Sectors ................................................................................................................................. 69 Geographic/Historic Turning Points ........................................................................................ 69 Specialty Food Manufacturers Reasons for Locating in L.A.............................................. 73 Labor and Workforce ........................................................................................................... 76 Race, Immigration Status, Place of Origin............................................................................... 76 Gender ................................................................................................................................................. 78 Age ......................................................................................................................................................... 80 Wages and Skill Levels ................................................................................................................... 82 Are Specialty Food Manufacturing Occupations Good Jobs? ............................................ 86 Production Workers ....................................................................................................................... 87 Unions .................................................................................................................................................. 88 Benefits................................................................................................................................................ 90 Multiple Shifts, Overtime .............................................................................................................. 91 Temporary Workers ....................................................................................................................... 92 Occupational Safety and Health Administration .................................................................
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