Lotte Japan
When Japanese chocolate manufacturer Lotte decided to bring their production line up to date, rather than investing in new equipment, they opted for a major retrofit. This decision not only brought significant financial savings, it also led to reductions in their energy usage and in the environmental impact of their operations – major benefits in today’s business climate.
Tim Hornyak, May 2023
At the No. 7 factory in Lotte’s Urawa plant in Urawa, north of Tokyo, machines extend for tens of meters down the floor, and the air inside the factory is thick with the sweet aroma of chocolate mass. There are rows of roll refiners, which grind the ingredients down to the micron level to make the fine chocolate mass used in Lotte’s mainstay Ghana brand chocolate bars. Alongside them are a large number of conching machines, which add the final adjustments to the taste and flavor of the chocolate, and mixers that ensure the chocolate is a homogeneous mass.
Lotte is one of Japan’s best-known chocolate manufacturers. Step into any convenience store or supermarket in Japan, and you are sure to see chocolates, candy, biscuits, gum, and ice cream from Lotte.Its products, like Choco Pie cakes, Toppo biscuits, and Koala’s March cookies, are on just about every kid’s snack menu. The company is also active globally. It owns Wedel in Poland as well as several production sites in Southeast Asia, Indonesia, Vietnam, and Thailand.
The core of what makes its chocolate goodies possible is reliable equipment from Bühler. The relationship between the two companies goes back nearly half a century. The machines in the No. 7 factory were built over 20 years ago, and yet they look and perform like new models, with modern touch-panel controls and the latest equipment. This is the result of a major retrofit carried out by Bühler in Lotte’s project.
Lotte’s history stretches back to 1948, when it began producing and selling chewing gum in Tokyo. Since then, Lotte has expanded its business by introducing chocolates, candy, ice cream, and biscuits, in a range of highly original, high quality products, growing to establish a solid position as a general confectionery maker. Moreover, to maintain its position as one of the biggest confectionery makers in Japan, Lotte is always seeking to improve its efficiency by incorporating new manufacturing technology and equipment. In 2018, the company realized that it needed to address improving the mix of old and new machines for chocolate production to ensure sound maintenance and management of equipment for this essential part of its mainstay business. The company decided to concentrate all the machines in one place and retrofit the older units. This was a huge challenge due to the massive size and complexity of the equipment.
“In confectionery manufacturing, we have worked with Bühler for a long time because of the high quality of our products. No matter how much we use the machines, if they are maintained regularly the quality of the products does not change,” says Takao Okada, manager in the machinery engineering department at Lotte’s Urawa Plant. “In this project, Bühler managed the relocation planning and installation of old and new machines, and in 2022 we finished relocating, concentrating and retrofitting the machines, and finally completed the new factory project.”
In confectionery manufacturing, we have worked with Bühler for a long time because of the high quality of our products. No matter how much we use the machines, if they are maintained regularly the quality of the products does not change.
Takao Okada,
manager in the machinery engineering department, Urawa Plant, Lotte Co., Ltd.
The retrofit was a large-scale project, one of the biggest in the world that Bühler has undertaken for any single customer. A large number of machines were retrofitted, including roll refiners, conching machines, and mixers. As part of the operation, more efficient drive units were installed, as well as modern touch-panel controls and state-of-the-art, full-featured safety devices, including safety barriers and sensors that eliminate any dangerous situation to provide powerful safety protection for machinery operators.
“Bühler has focused on enhancing the safety features of its machines over the years. Moreover, in this project, in addition to our paramount requirement of safety, we also covered energy savings, and cost,” says Kazushi Terada, assistant manager in the machinery engineering department at Lotte’s Urawa Plant. He estimates that the retrofit has saved Lotte about JPY 3 billion (around CHF 20 million) compared to buying all new machines.
In this project, in addition to our paramount requirement of safety, we also covered energy savings, and cost.
Kazushi Terada,
assistant manager in the machinery engineering department, Urawa Plant, Lotte Co., Ltd.
The benefits of retrofitting are readily apparent, especially in this era of rising inflation. The equipment installation cost to the customer is significantly lower than the case of new equipment. Bühler’s machines have an extremely long service life and can last up to 30 to 50 years. Control systems and electrical equipment for the machines, however, must be renewed every 10 to 15 years. By installing better drive units, customers can also realize energy savings of 20 to 30 percent. That’s a major advantage in countries like Japan, where utility companies have increased the average price of electricity by 50% over the past few years and are planning further increases of about 30 percent. For a large-scale production site such as Lotte’s Urawa Plant, that can mean monthly electricity bills, already around €700,000, will rise by some €235,000.
Initiatives have been taken to reduce electricity in various parts of the plant. Positioned at one end of the machine floor is a large display of numbers indicating current power usage. If the factory exceeds the maximum monthly amount contracted with its electricity utility, subsequent electricity charges increase sharply, and the factory is taking measures to prevent this.
Through the energy savings, the project has also enhanced Lotte’s efforts to become a more sustainable business. For the newly built No. 7 Factory, the company incorporated energy-saving initiatives into the building itself. On the high-ceilinged floors of the new factory, the company installed a displacement air conditioning system that concentrates on the areas where people work and creates temperature stratification, thereby reducing electricity usage. The company procures cocoa beans, one of the company’s most important raw materials, only from sustainable sources. All of these measures are part of a heightened awareness of the environmental impact of the business and a commitment to making reductions and transitioning to more sustainable alternatives where possible.
“Confectionery production requires the operation of a lot of cooling equipment,” says Okada. “We have installed the latest freezers using environmentally friendly refrigerants that don’t contribute to greenhouse gas emissions for the cooling tunnel in our chocolate manufacturing line and our ice cream manufacturing equipment. It’s the first in the world to use CO2, a natural refrigerant, to cool the ice cream and was installed here at the Urawa Plant.”
There are many other benefits to retrofits, too. “Retrofits are very useful to extend the lifetime of our machines. They help not only with energy savings but also with reducing food loss because stable operation mitigates the amount of substandard product that has to be disposed of,” says Koichi Yashiro, head of customer service at Bühler. He was involved with the Lotte retrofit project from the beginning.
In the retrofit project, older machines are upgraded so that they essentially become new machines. Along with increased quality and energy savings, other benefits include reduced production troubles, increased safety, greater spare parts availability, and a sense of confidence for the equipment maintenance management team, according to Yashiro.
The retrofit also brings older equipment to a level that is ready to integrate digitalization, a factor that brings with it current and future benefits, he adds. For Lotte, it meant bringing several generations of machines up to the same level, which also helps the management of equipment maintenance and the operators who run the machines.
“At Bühler, we don’t just sell new machines, we support customers to use their existing machines with the best performance over a long period,” says Yashiro.
At Bühler, we don’t just sell new machines, we support customers to use their existing machines with the best performance over a long period.
Koichi Yashiro,
Head of Customer Service at Bühler Japan
This was not only one of the biggest retrofits Bühler has ever carried out, it was also completed against the background of severe supply chain tensions around the world.
Yashiro opened a door at one end of the factory floor and pointed to a large number of control panels neatly housing logic controllers (PLCs) running the machines. Procuring this vitally important core piece of the retrofit was the most challenging job because of the difficulty sourcing semiconductors and other parts over the past few years. The coronavirus pandemic and conflict in Ukraine caused a worldwide chip shortage and severely impacted other supply lines as well as international travel. Bühler engineers from Europe were unable to travel to Japan for the Lotte project due to entry restrictions. Despite these challenges, Bühler was able to source the parts, ship them by air, carry out the modifications and installation work with just its own Japanese staff, and finish the job on schedule by September 2022.Close coordination and cooperation between Bühler Japan, Bühler head office in Switzerland and Lotte was the most important element in overcoming these difficulties.
This was a great source of pride for Yashiro but, more importantly, it was an important successful result for Lotte. The peak period for chocolate production starts from the beginning of autumn. If the retrofit had not been completed on time, it would have had to be delayed to the following spring, causing a major obstruction to production plans.
“Bühler was able to integrate the new and old machines in the retrofit, adding features like remote control of conching,” says Terada as he sums up the project. “This was a great benefit that allowed us to increase operational efficiency.”
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