FORT SMITH -- Pernod Ricard has started bottling Malibu Rum at its Fort Smith plant, partnering with Wal-Mart Stores Inc. as part of the retailer's commitment to U.S manufacturing.
The France-based spirits producer announced its newest plan for Fort Smith during a news conference attended by Gov. Asa Hutchinson and Cindi Marsiglio, Wal-Mart's vice president for U.S. manufacturing.
Officials said Pernod Ricard has made a "significant capital investment" to move a portion of the work from its sister plant in Canada to Fort Smith, where an estimated 150,000 cases sold to Wal-Mart now will be bottled and produced annually.
Melissa Hanesworth, managing director of the Pernod Ricard plant in Fort Smith, said the decision was the result of ongoing discussions with Wal-Mart that began in December. Reshoring the work will create an additional 6,000 man-hours at the plant over the next year, which could lead to more hours for existing workers, and additional seasonal and full-time employment, according to the company.
"This has been a project that is not only a commercial benefit to both of our companies, but also very positive growth for the economic benefit of Fort Smith," Hanesworth said.
Pernod Ricard recently celebrated its 35th anniversary in Fort Smith. The plant employs about 205 workers and produces 5 million cases of spirits annually for distribution across the U.S and 40 other countries.
In addition to newest plans to bottle Malibu Rum for Wal-Mart in Fort Smith, the plant also produces Kahlua Liqueur, Seagram's Gin and Smithworks Vodka.
Wal-Mart is one of Pernod Ricard's significant customers. Nearly four years ago, the Bentonville-based retailer launched its commitment to purchase $250 billion in American-made products by 2023 and has worked with suppliers who are interested in reshoring production to the United States.
Wal-Mart estimates its efforts could result in the creation of 1 million jobs across the country at the end of the 10-year period. Marsiglio did not provide a specific update on Wal-Mart's progress toward the initiative Monday, but said the company continues seeing "good progress."
"The suppliers of Wal-Mart are the ones partnering with us to lean in," Marsiglio said. "It's hard to move production. It's not easy to make that capital investment, to move lines, do the hiring. But what this whole thing is about the job creation that results in new jobs, more shift hours, seasonal hours moving to full-time hours and everything in between. That all adds up."
Hutchinson commended the partnership between Pernod Ricard and Wal-Mart, saying the agreement has resulted in a "good boost for expansion" and opportunities for employees.
The state is in talks with the Pernod Ricard about an incentives package, but Arkansas Economic Development Commission spokesman Scott Hardin said nothing has been finalized.
Marsiglio said 150,000 cases of rum are a "general estimate" of what Pernod Ricard will bottle and distribute from its Fort Smith plant. She said the figure is based on experience and forecasting from buyers, but that the company believes it will be able to move the product off the factory floor quickly.
Hanesworth said the decision will also provide a boost for local suppliers who will provide the packaging for the product bottled in Fort Smith. She said she believes the initial estimate of bottling and distributing 150,000 cases of Malibu Rum a year for Wal-Mart is "just that initial start."
"You heard Wal-Mart's commitment to continue to grow that and, as that grows, it has a domino effect for us," Hanesworth said. "There's those initial incremental man-hours, which are incremental jobs. Then it will continue to grow."
Business on 10/11/2016