Dykal HoldingsWynyard Poultry Processing Plant – Ted Baas

1.0 Introduction

1.1 Industry Overview

Currently a poultry farm has been raising chickens and selling them to Lilydale processing plant. Lilydale limits the weight of chickens they purchase to 1.75kg in order to supply KFC throughout the province. However, by using the terms set out by Lilydale the farm is unable to maximize the potential of its chicken barns and therefore is currently exploring ways to increase production.

Essentially the idea has been to extend the chickens growing period from the current 37 day cycle to a 56 day cycle. This would eliminate the period in which the barns are vacant. In turn this would increase the chicken’s weight and therefore make them unsaleable to Lilydale. Therefore the idea is for the farm to expand into a market of both Halal (Islamic) and non-Halal chicken by opening its own processing facility.

The concept of opening a live kill poultry processing plant which uses procedures approved by the Islamic community will allow for the proper promotion of the chicken into a niche market. The plant will be constructed at VIS-A-VIS; an old bottling building located in Wynyard in close proximity to poultry suppliers. Presently the existing structure has been gutted and has the potential to be renovated into the proper processing facility.

Over the past few years chicken has become a health alternative to red meats. This creates a large expanding potential market within the Prairie Provinces (Muslim Population Statistics website, 2003). The Halal market is also expanding as immigration increases and the population of Islamic people increase in the Western Provinces. This creates the potential for the development of a new chicken processing plant to service the needs of the consumers and the highly expanding niche market.

1.2 Mission Statement

“Dykal Holdings, a Saskatchewan based company, will strive to meet the needs of all customers by providing competitive prices and a premium, value-added product while providing a pleasant working environment for all employees.”

1.3 Business Goals

The business goals of Dykal Holdings are to:

· Form a ten year financial analysis as to the projected outlook of the processing plant.

· Convert an existing building into a high revenue business by generating high amounts of sales capital

· Develop a production plant which uses processing techniques that satisfies the Islamic ethnic groups.

· Establish a successful marketing plan in order to penetrate the Halal chicken market and the existing poultry market.

· To achieve a 20% profit, before income taxes on gross sales of $4.54 million in the first year of operation

· Grow sales less allowances for returns of Halal poultry, to $9.39 million within the first 10 years of operation.

1.4 Policy

Current legislation puts chicken production under a quota system. This means that for a producer to produce and sell chicken they must have a quota from the government. This quota assigns the number of kilograms of chicken the producer will grow per 56 day cycle. However this quota does not affect where the chicken is sold to, therefore Dykal Holdings is able to sell the processed chicken outside of Saskatchewan, with the only requirement being that the plant is federally inspected (Ted Baas, 2003).

In order to ensure that poultry processed at the facility will be classified as Halal a number of special criteria must be followed; the animal must be slaughtered by a Muslim, a Jew or a Christian. The animal should be held and its throat should be slit with a very sharp knife to make sure that the three main blood vessels are cut. In addition to this the animal must be facing east. While cutting the throat of the animal (without severing the spinal cord), the person must pronounce the name of Allah or recite a blessing which contains the name of Allah, such as "Bismillah Allah-u-Akbar" (The Most Kind, The Most Merciful).

Dykal Holdings plans on obtaining certification from a number of Islamic groups. This will be done in order to express the authenticity of the product to the consumer. This process is easily accomplished; representatives from the groups often travel to the processing plant in order to inspect the facility firsthand. Once they are satisfied that the requirements are being fulfilled the product is certified. Additional random checks of the plant will also be conducted throughout the year.


2.0 Operations Plan

2.1 Organizational Structure

Dykal HoldingsYKAL HOLDINGS will be established as a corporation. Refer to Figure 1 The following isfor a visual representation of the organizational structure.

Figure 1. Organizational Structure of Wynyard Poultry Processing PlantDykal Holdings.

2.2 Site Plan

Site Plan

The plant is located in Wynyard on Highway 16. There is a service road along this highway to allow easy access to the plant. The offices and front entrance to the plant are on the north side of the building, facing the highway. There is sufficient parking located on the northwest and southeast corners of the property. The receiving and shipping docks are located on the south side of the building. (See Appendix A)

In the next fiveten years Dykal Holdings does DYKAL HOLDINGS is not expecting any additions to the site as the expansion is already incorporated into the site design.

2.3 Building and Floor Plans

Building and Floor Plans

The building is 42,388 square feet, ******* square feet. Tthis includes 34,334 square feet***** square feet for manufacturing and. Ooffice space totals 8,054 square feet***** square feet which includes space for offices, locker rooms, showers, and atrium and a board room. (See Appendix B)

The processing line will accommodate a 50% planned increase in production therefore the plant layout will not change in the next five years.

2.4 Work Plan and Flow of Work

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Work Plan and Flow of Work

2.4.14.1 Process Flow

a. Birds will be received by truck in crates. Two shipments of birds will be received over the day; the first shipment in the morning and the second just before noon. Each shipment will contain 5,000half of the daysday’s birds. Birds will be removed from crates and hung on shackles facing east. Figure 2 shows letters a – n in a flow chart. .

b. b. The hand slaughter line will run on the same line as the stunning line, the stunner will not be implemented when the Halal chickens are being slaughtered. Birds must be hand killed; being sure that the spinal cord is kept intact when the neck is silted, which can be done at the killing point on the line, in the same location the non-Halal bird’s throats would be slit. Each bird must be blessed by a Muslim, Jew or Christiann individual of Islamic decent before it is killed to grant Halal certification. This person will assist in the slaughter of the chickens, whether processing Halal or non-Halal chickenotherwise. After the birds have been hand killed they will be bled the same as non-Halal birds and continue on to be further processed.

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c. c. To keep birds separate (Halal and non-Halal) a gap will be left between the Halal chickens and non-Halal chickens, if both methods are utilized on the same day. This is the same criteria followed by other processing facilities such as ****. Maple Leaf Pork in Brandon to keep vegetable fed hogs and non-vegetable fed hogs separate. When not killing for the Halal

Figure 2. Process Flow Diagram

market, the birds will go through the stunner. The bird’s throat is then cut and is allowed to bleed for 1.5 to 2 minutes before dressing begins.

d. d. Both Halal and non-Halal birds will be treated the same from here on. The birds are lowered into a scalding tank, which is at 52°C. The speed of the line ensures that the birds are in the water for the correct amount of time. The scald tank is set up so the birds go through the same tank twice; the purpose of this is to minimize that area required for scalding in the plant. The scald water must be agitated to ensure uniform temperature throughout. After the birds are through the scald tank they go into the plucker. This machine is equipped with rubber fingers and brushes the feathers off the bird.

e. e. The defeathered bird then goes through a Head Puller that pulls the neck out straight, and cuts it off leaving the neck intact. This method of head removal will be beneficial when it comes to eviscerating the bird. Next on the line the birds go to the Hock Cutter. Here the bird’s feet are cut off and the bird drops down onto a conveyor that will lead to the evisceration tables. The feet stay on the shackles until they reach the Foot Unloader where the feet are taken off and the shackles move through a washer and then back to be reloaded with live birds. There is a viable Asian market for the feet, but for the purposes of this study they will not be considered.

f. f. The birds now on the conveyor will be rehung onto the evisceration line. Next, a series of workers will be stationed here, and will manually eviscerate the birds. in a series of steps. A cut is then made around the vent, being careful not to cut intestines; this cut must be large enough to fit a hand into. Next a drawing tool is inserted into the cut and the offal is pulled out. The heart, liver and gizzards are removed and go to the giblet room. Next an incision is made on the crop which is removed by hand. The lungs are removed by a vacuum operated lung pistol. With the use of a pneumatic neck shear, the necks with skin are harvested. The bird then goes through an outside bird washer. The wash cabinet has a series of water spray heads that line the conveyor. The water is chlorinated when it comes out of these nozzles. The nozzles rotate as they clean the carcass. The cleaning process takes about one minute.

g. g. The heart, liver and gizzards move into the giblet room where they are hand cleaned and packaged in plastic bags. The gizzards must be sliced open, washed out, and then skinned. Again there is a lucrative market for these products which will not be considered for this study.

h. h. After the birds have been cleaned they are cooled. An air chiller will be used, which will decrease the temperature of the carcass from 35°C to 5°C. The birds are being cooled in this manner as a premium air cooled product. A water chilled system is more economical, however does not create as high of quality product as water is added to the chicken, which is unflavoured by consumers.. Some birds will be left whole and others will be further processed. The birds also pass through a carousel weigher and grader. After the birds are chilled they leave the line by an unloader. The shackles pass through a washer and return to the hanging line.

i. i. A portioning machine will be used to cut the birds into pieces. The machine is equipped with an arm that is pointed towards the operator. The carcass is placed in the groove of the machine and the arm pushed down to cut the bird into two pieces. Other pieces of chicken can easily be made by cleavers and knives. Most of the product sold will be cut into pieces and sold as chilled fresh product. Note that our this product will not be deboned as this is a very labour intensive process and requires highly trained personnel to decrease wastes.

j. j. The whole birds will go through a blast chiller to freeze them extremely fast before entering a freezer room. Only a small portion of the whole birds will be sold frozen, the ones to be sold in the Halal market. The non-Halal market will be sold fresh, chilled whole chickens. The whole birds must be frozen as there is not a large enough market for fresh whole birds.

k. k. The Halal whole chickens product will be vacuum package and weighed. Vacuum packaging has been chosen as it will increase shelf life by eliminating the amount of oxygen in the package. The Halal pieces will be boxed into 5 kg lots and sold as legs, thighs, breasts, and wings. Any of the Halal processed chicken will have a Halal certified sticker added to the package to keep it distinguished from non-Halal chicken. The non-Halal product will be sold in large crates to individual stores. There will be separation of breast, thighs, wings, drumsticks, and whole chickens, all of which are sold chilled and fresh. All the products (Halal and non-Halal) will have the vegetable grain fed label on, as well as the air chilled label.

l. l. The cut product will then be placed into coolers and shipped out within two days to our wholesale buyers (IGA).

m. m. The whole birds will be placed in freezers. They will be shipped on the same truck as chicken pieces, just as a frozen product rather than freshHalal chicken will be shipped once aevery other week to different locations through the same distributor as the non-Halal.

n. The product will be delivered to the wholesale buyers by truck (CoolX). The truck must be refrigerated for transport so products do not spoil.

Non-edible waste such as the feathers, heads, and intestines are transported by water through the floor gutters to the pits. The solid wastes are separated from the water wastes. From here the offal will be stored and disposed of at the Wynyard Waste Facility. Other disposal options, such as rendering may be looked at in the future. As this time the use of a rendering process is not beneficial for Dykal Holdingsla. Water from the feather separator will be recycled to the feather gutter by a recirculation pump. The remainder of water will be disposed of through the sewers. Refer to Appendix C for a visual representation of the above process.