Baskin-Robbins says 80 people will lose their jobs as the company closes its ice cream production plant in Peterborough, Ont. this fall.
Baskin-Robbins says that despite working around the clock, the facility is not able to keep up with demand.
The ice cream chain says modernizing the plant to add capacity isn’t feasible.
Ice cream for Baskin-Robbins shops in Canada will be produced at Scotsburn Dairy of Truro, N.S., where some Baskin-Robbins ice cream is already made.
The ice cream chain has 113 franchised shops in Canada with approximately 550 full-time and part-time employees.
The company says the closure, slated for October, is in line with its strategy to move completely to third-party companies to manufacture its ice cream.
“Peterborough is the only remaining manufacturing facility we operate in North America,” Peter Laport, vice president of global strategic manufacturing and supply, said in a release.
“We believe it makes sense to focus on our core skills of franchising, retail and product innovation, rather than ice cream production.”
Currently, the Peterborough plant makes ice cream for about a third of the 4,200 Baskin-Robbins shops outside the U.S. Ice cream produced there for locations outside of Canada will shift to Dean Foods.
All plant employees will be offered severance compensation and benefits such as counselling and career planning help.
The company expects to incur one-time charges of about US$16 million to $18 million to close the plant. Beginning next year, it expects annual savings of $4 million to $5 million.