Food Factory Design in Australia: How to Build World-Class Facilities for Less
Watch the full episode on YouTube: https://www.youtube.com/watch?v=wK0kiBg3N0Q
Ask anyone in government, industry, or media why Australia struggles to compete in food manufacturing, and you’ll almost certainly hear the same answer: labour costs. The story goes that countries like China, Vietnam, and Thailand can produce food products so cheaply because their workers earn a fraction of Australian wages, and there’s simply no way to compete.
It’s a compelling narrative. It’s also largely wrong.
Pete Taitoko has spent over 30 years in food manufacturing engineering, working with everyone from multinational corporations to first-time founders. He’s the founder of RMR Process, one of Australia’s leading food process design and manufacturing consultancies. And he’s quite open about the fact that the labour cost argument doesn’t hold up to scrutiny.
The Automation Reality
The assumption behind the labour cost argument is that overseas factories are filled with cheap workers doing tasks that would cost significantly more in Australia. But modern food manufacturing — even in traditionally “low-cost” countries doesn’t work that way.
Chinese food manufacturing facilities, for example, are heavily automated. They import state-of-the-art automation equipment from Europe and the United States. Their production lines look remarkably similar to what you’d find in any advanced manufacturing nation. The number of people on the factory floor is often comparable to an Australian facility running similar volumes.
This isn’t to say labour cost is irrelevant. It’s one factor among many. But it’s not the decisive factor that industry commentary tends to make it. The gap between Australian and overseas labour costs, once automation is factored in, is far narrower than the headline numbers suggest.
The Capital Cost Problem
So if it’s not labour, what is killing Australian food manufacturing projects?
Capital cost. Specifically, the upfront investment required to establish manufacturing operations in Australia in the first place.
Pete sees this constantly. Companies come to RMR with viable products, clear market demand, and a genuine desire to manufacture in Australia. The business case works on the operational side — margins are achievable, volumes are there, the product quality is right. But the capital expenditure required to get the facility up and running makes the ROI timeline unacceptable.
And the numbers are getting worse. Australian construction costs have escalated dramatically, driven by demand in residential and infrastructure sectors, skilled trade shortages, and materials inflation. A new-build food manufacturing facility that might have been marginal five years ago is now clearly uneconomic.
The result? Projects that should happen in Australia get moved offshore. Not because the ongoing cost of manufacturing here is uncompetitive, but because the cost of getting started is too high.
Engineering the Solution
This is where food manufacturing engineering becomes the critical discipline. If the barrier is capital cost, then the solution has to come from how we approach facility design, construction, and fit-out.
Pete’s approach at RMR Process centres on a few key principles:
Repurpose before rebuilding. Australia has a significant stock of existing industrial facilities that can be converted to food-grade manufacturing environments. The cost of fitting out an existing shed to world-class standards is a fraction of a new build. The facility doesn’t need to be purpose-built to be fit for purpose.
Right-size the automation. Over-automating a facility is one of the fastest ways to blow out a capital budget. The engineering challenge is matching the level of automation to the actual production requirement — enough to keep labour costs manageable without front-loading capital that won’t deliver returns for years.
Design for the process, not the building. Start with what the product needs, not what the architect wants. The manufacturing process dictates the facility layout, the hygiene zones, the material flows, and the equipment placement. Get the process engineering right and the facility follows.
Plan for staged investment. Not every capability needs to be in place on day one. A well-engineered facility allows manufacturers to start producing at a viable scale and add automation, capacity, and capability as revenue grows.
This is process engineering applied to the business problem, not just the production problem. It’s about making the numbers work so that manufacturing stays in Australia.
A Smarter Conversation About Competitiveness
The labour cost narrative has real consequences. It shapes government policy. It influences investment decisions. It discourages entrepreneurs who might otherwise bring manufacturing onshore.
But it’s based on outdated assumptions about what manufacturing actually looks like in 2026. Modern food processing is an engineering discipline, not a labour-intensive cottage industry. The competitive equation is determined by process efficiency, facility design, supply chain configuration, and capital deployment — not by the hourly rate on the factory floor.
Australia has world-class agricultural inputs, proximity to the fastest-growing food import markets on the planet, and a quality reputation that commands premium pricing in export markets. The fundamentals are strong.
What’s needed is a smarter approach to the capital barrier — one that focuses on engineering solutions rather than accepting the status quo.
Talk to RMR Process
RMR Process helps Australian food manufacturers solve the capital cost equation through intelligent facility design, process engineering, and project management. If you’re evaluating a manufacturing project and the numbers aren’t stacking up, it’s worth a conversation.
Download our factory cost comparison guide or contact the RMR Process team to discuss your project.