Tip Top has confirmed it will close its Newcastle-based bakery in coming months, blaming poor bread sales and a changing market.
The Gateshead business is expected to wrap up baking in July and the site will be repurposed as a depot.
The decision will see 79 workers laid off and marks the end of a long history of baking in the Newcastle region.
Hunter Business Chamber CEO Bob Hawes said the decision was disheartening.
“Tip Top is an iconic brand in this region and while we understand the depot will remain, it will be sad to see production move out of the Hunter with an impact on regional jobs and employment,” he said.
“We’re pleased Tip Top will maintain a distribution operation from the site and are hopeful this will keep any flow on impacts in realms such as product supply from other businesses to a minimum.”
Tip Top, owned by George Weston Foods, will send all local production to bakeries in Bendigo and Chullora.
“Market conditions in Australia remain challenging and Tip Top has made the difficult decision, after careful review, to reshape its bakery network in Newcastle,” a statement from the company said.
“With its core bread business in decline, Tip Top is regrettably stopping production at its Newcastle facility in early July.”
Newcastle based drivers, merchandisers and sales team members will not be impacted by the site changes.
The business is reportedly in talks with bakery staff about redundancy packages and re-deployment opportunities, with career transition support offered to all employees.
United Voice, the union representing the bakery workers, has labelled the move as a blow to local people.
“This morning Tip Top has regrettably taken a decision to close the operation of the Gateshead manufacturing plant,” a union spokesman said.
“Understandably this decision has come as a blow to everyone who has worked so hard at Gateshead – many for a number of years.
“United Voice is supporting it’s members through this difficult time.
The union confirmed it is in talks with Tip Top to ensure workers receive ‘the best possible support and assistance during this difficult period’.
The union will be going after redundancy, company-provided counseling, opportunities for retraining some staff and redeployment should they wish to take alternative roles up.
Tip Top reaffirmed that the closure was not a sign of things to come and said it ‘remains strongly committed to the Australian market’.
“While any business decision that impacts its people is always a very difficult one, this change ensures Tip Top is operating in the most efficient way to compete as a daily fresh business in a dynamic and changing market,” the business statement said.
In 2003 it was announced that at least 100 workers would lose their jobs at the Gateshead factory. George Weston Foods moved jobs from the local factory to the company's $135 million bakery in Sydney.
At the time the regional secretary of the Liquor, Hospitality and Miscellaneous Workers Union, Carmel Cook, said the move would all but finish off the once-strong baking industry in Newcastle.
According to Tip Tops website, the company bakes in excess of one million products per day for distribution to supermarkets, food service, fast food outlets and stores throughout the country.
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