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One Company or Two? (or three)


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#1 daisymayhem

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Posted 25 January 2011 - 03:59 PM

Greetings all.... I'm heading my company's SQF endeavors, and have a question that I can't seem to find an answer for.

I work for an olive oil company with three large buildings on-site; we have a "farm ops" department that grows the fruit, a milling department that makes the oil (for 6 weeks out of the year), and a production department including a bottling line and oil storage facility.

Our CEO is wanting to split the company in to three separate companies. I was thinking this would be okay, I would make the plan for production/bottling, and treat the mill as an "approved supplier."

Problem: though the buildings are separate, the oil is piped from the mill to the production facility. Could we still be considered separate companies if we're connected by a pipeline?

Any comments are GREATLY appreciated! thanks!



#2 stsqf

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Posted 27 January 2011 - 07:08 PM

Greetings all.... I'm heading my company's SQF endeavors, and have a question that I can't seem to find an answer for.

I work for an olive oil company with three large buildings on-site; we have a "farm ops" department that grows the fruit, a milling department that makes the oil (for 6 weeks out of the year), and a production department including a bottling line and oil storage facility.

Our CEO is wanting to split the company in to three separate companies. I was thinking this would be okay, I would make the plan for production/bottling, and treat the mill as an "approved supplier."

Problem: though the buildings are separate, the oil is piped from the mill to the production facility. Could we still be considered separate companies if we're connected by a pipeline?

Any comments are GREATLY appreciated! thanks!


I am curious as to the reasoning the CEO wants to split into three separate? IMO it would be in your best interest to get the entire operation SQF certified since you are truly one company - I also believe it would be difficult to explain to an auditor/certification body that your oil is from a supplier that is actually your own company.

#3 Jomy Abraham

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Posted 27 January 2011 - 10:23 PM

When you split the company, the P and L will be seperated for both the companies. So there will be a competition between the both management to maximize the profit. In case of any production losses ( input Vs Output), both the employees can try to hide and blame the other organization due to the link of this pipe line. It always depend on the size of the pipe line and the minimum quantity required to pass from one company to the other company. If you can control such production losses to protect each organization profits,pipe line may not be an issue ( if there is no legal issues in your country)

please ignore if this is a stupid answer!!

Rgds
Jomy Abraham

Greetings all.... I'm heading my company's SQF endeavors, and have a question that I can't seem to find an answer for.

I work for an olive oil company with three large buildings on-site; we have a "farm ops" department that grows the fruit, a milling department that makes the oil (for 6 weeks out of the year), and a production department including a bottling line and oil storage facility.

Our CEO is wanting to split the company in to three separate companies. I was thinking this would be okay, I would make the plan for production/bottling, and treat the mill as an "approved supplier."

Problem: though the buildings are separate, the oil is piped from the mill to the production facility. Could we still be considered separate companies if we're connected by a pipeline?

Any comments are GREATLY appreciated! thanks!






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