Nexe Innovations Inc has targeted early 2023 to be in production at its 54,000-square-foot facility in Windsor, Ontario for both component and finished goods manufacturing.
The compostable materials technology specialist said the move will support the development of a vertically integrated manufacturing operation, with advantages including limited supply chain risks, IP protection, higher operating margins, and a lower carbon footprint.
In a statement, the company noted another key advantage has been to accelerate the R&D process in-house, which has led to additional enhancements to the compostable process, resulting in the Nexe pod composting in as little as 17 days, down from 35 days in an industrial composting facility.
READ: Nexe Innovations sees continuing progress on transitioning to vertically integrated manufacturing process
Nexe has hired Chris Murray, who has 20-plus years of experience in the coffee and consumer packaged goods industry in Canada and the US and the company said a focus for 2023 would be scaling operations and sales, adding it was in active talks with various potential customers.
A key part of the sales strategy is to target private label and co-manufacturing segments to reliably fill the production capacity as it comes online.
“By the end of 2024, we expect the company to have a total production capacity of around 500 million units per year for the coffee segment,” the company said.
Nexe pointed out that the fully compostable packaging market is still in its infancy and consumers are willing to pay more for sustainable options.
But the capacity to meet the increasing demand is limited and therefore the new Windsor facility will strengthen Nexe’s position within the industry.
“We expect 2023 will be a pivotal year as our scaled production comes online,” Nexe said.
“We maintain a strong balance sheet with around $28 million in working capital and minimal debt to support our operations as we scale and start to generate sales" it noted.
Contact Jeremy at jeremy@proactiveinvestors.com