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Shape Foods Back With Skeleton Crew

“We’re just in the process of getting some product put out in the marketplace.”

– Jim Downey

Brandon’s Shape Foods’ cash flow arteries may have clogged in the fall of 2008, but the company is now back on the road to health, according to its CEO.

The $30-million flax-crushing plant built in 2006 on the east side of Brandon that filed for voluntary receivership about 18 months ago is now operating with eight employees, down from 65 at its peak.

“We’re just in the process of getting some product put out in the marketplace,” said CEO Jim Downey, former MLA for Brandon-Souris and deputy premier, who took over day-today operations at the facility in July of 2009.

“We’re a little slow on sales, but we’re just getting it going. We’re getting the feet under it again.”

At the time of Shape’s original closing, rumours suggested that it was an early victim of the global credit crunch, but Downey said that it was mainly cash flow problems that were behind the closure.

“Like every other startup, it takes quite a bit of money to get the product to the market. And quite frankly, it’s a new product, and it takes cash to bring it to the market and show people how to use it,” he said.

The plant was built with $9 million in loans, of which $4.5 million was extended by the local Vanguard Credit Union and $4.1 million from the provincial government under the Manitoba Industrial Opportunities Program.

Shape Foods is currently operating with other financing sources, and hopes to bring in some more investment.

There are currently no plans to contract more flax this spring, but Downey hopes that business might return to normal by next year. Supplies of sunflower oil are sufficient for current blending needs, he added, but more flax may be needed within a year.

Some old inventory is still left over, but fresh bottling work and test runs are being done at the plant, he said, and product – both oil and meal – is finding its way into the United States market. Future plans include sales in Canada as well as offshore.

“We’re in the early stages. We’ve still got a steep hill to climb.”

According to news reports, he and three other principal investors bought Shape’s assets in June of 2009 for $5.1 million.

The 70,000-square-foot plant produced blends of flax and sunflower oil pitched as a heart-healthy salad dressing rich in omega-3 fatty acids.

Although it was originally pitched as “flax oil for the

masses” grown under conventional agriculture instead of the more costly organic versions, there is still a need to prevent genetically modified flax such as Triffid from contaminating raw material supplies, especially for sales into offshore markets, he said.

Shape Foods uses a proprietary bottling process designed to greatly increase the shelf life of flax oil, which is notoriously short lived without refrigeration.

Shape Foods founder and president, Bill Vincent, who owns the bottling and preservation technology, is still working with the Brandon plant, added Downey. [email protected]

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