Klement Sausage Co. is seeking a $5 million loan from the Milwaukee Economic Development Corp. to help build inventory ahead of a planned shutdown of its Chase Avenue plant.
The 60 to 90 day shutdown is needed to accommodate a 5,000-square-foot expansion and renovation of 50,000 square feet at the company’s plant at 2650 S. Chase Ave., according to the company.
The $5 million loan will provide the working capital to support an inventory build-up to meet customer demand while the plant is shut down for the construction project.
Klement’s announced plans for the $7.5 million expansion at a groundbreaking in early October.
At the time, Klement’s chief executive officer Tom Danneker told BizTimes the company was also considering closing its older facility at 207 E. Lincoln Ave. but would operate it in 2019.
The company “is planning a plant expansion in order to combine operations of the Chase Avenue and Lincoln Avenue facilities. The company will move all Lincoln Avenue operations to the Chase Avenue location,” according to MEDC documents summarizing the loan.
In an email, Klement’s spokeswoman Becca Herrmann said a final decision on long-term plans for the Lincoln Avenue plant has not been made.
The MEDC documents put the price tag for the expansion at $8,883,000, higher than the $7.5 million previously announced. Herrmann said the increased figure accounts for contingencies, but the investment is expected to be less than $8 million.
Klement’s is also projecting the addition of 13 new jobs over the next two years, according to the MEDC documents.
Danneker emphasized in October that even if the company does close the Lincoln Avenue plant its overall employment in Milwaukee would grow.
