Okay. Well, welcome. Welcome to the Freshpet Kitchens, everyone. Thank you very much for coming in the middle of a pandemic and crappy weather outside, but we really appreciate all of you being here, and we hope that it's worth the journey that you've made to get to see us. I also hope for those of you who this is a second or third visit, that you'll notice the significant advancements that we've made, because that's what we're trying to show you today. We're trying to demonstrate to you how we have advanced manufacturing at the Freshpet Kitchens in a way that will create some near-term and medium-term economic value, but will also create some long-term strategic advantages for us. For a long time, we've talked about many other aspects of this business, and we've given you data galore, as Bill Chappell always reminds me. Where is Bill?
We're getting started. There he is. We've told you all kinds of things about the top line of this company and many of the ways in which we create revenue. What we want to show you is how we meet the demand that we create, and hopefully you can see from that there's significant opportunity for us to have manufacturing as a core competency and strategic advantage, and then certainly feel good about where we're going. For those of you who don't know me, I am Appa's father or pet parent, I guess, is the right term. But if you haven't had a Zoom call with me in a while, you won't have recognized that photo. But if you have, you've seen that's my virtual background. That is Appa.
She's the fourth Samoyed my wife and I have had since we got married 34 years ago, and she lives here locally because that's where we live. What I would like to do is do some quick introductions of a few people. Unfortunately, one of the most important people is not here today, and that is Steve Weise. Steve is the Executive Vice President in charge of our manufacturing operations and has been with us since 2015. We recently announced that his role will shift in anticipation of his retirement at the end of next year. Steve came in this morning but wasn't feeling well, and I said, "Go home." Otherwise, he would be here, but you should know he is every bit involved and engaged in our business.
Another person who is not here who is also very engaged with us is Dick Kassar, who I think many of you know. Dick is serving as our Vice Chairman. He was our CFO prior to Heather becoming the CFO. Dick is on his way to Hawaii for a wedding. He wishes he could be here, but he's obviously not available. One other person who's not here is the Plant Manager for the Freshpet Kitchens, Rafael Velez. Rafael had previously scheduled a family vacation, he's not here. Having said that, despite those folks being gone, I hope you'll take away there's a tremendous amount of organizational depth that we've built in the organization here at Freshpet. I can't start a meeting without having our safe harbor statement. You've all seen these before. You know what they say.
I'm going to give you a quick view of the agenda. I'm going to outline for you a business update and also take you through the long-term vision for us as a company. We're going to turn it over to our manufacturing experts, and you'll get a sense for the depth of our team. Ricardo Moreno, who is our VP of Manufacturing, Michael Hieger, who is the SVP of Engineering, and Willie Everett, who is our Ennis site leader, they will tell you about the things that we've done to build manufacturing expertise. Scott, whom I think all of you know, Co-founder and COO, will take you through our Pets, People, and Planet and the sustainability work that we've done in the broader area of ESG. Justin Joyner is also here. Justin leads our ESG work now.
He's the Director of Sustainability for us, and he's been with us for quite a long time, and he's really an expert in that area. I'll take you through the governance roadmap, and then we'll break, and we will do the tours. We have, I think, a pretty good tour lined up for you. I want to start with a quick view, though, on, since in the middle of COVID, I want you to feel safe being here. I want to start with, Tomas is here. There's Tomas. One of the actual very positive outcomes of the world of COVID is we realized after we hired nurses and athletic trainers to screen our people at the door, that they actually were serving a much broader purpose than just the normal health screening. We now have Tomas on staff with us.
He is actually an employee of St. Luke's, which is the big healthcare provider locally, but he is full-time on staff here because we realize the significant benefits of having a healthcare person on staff to help avoid injuries, take care of the broader health than just COVID. He's now doing this as part of a broader program with putting in athletic trainers in manufacturing facilities, and it's a pilot program, but we are thrilled with it. An added benefit is Tomas is a native Spanish speaker, and we have a lot of native Spanish speakers who are employees here. We're glad to have him here, and he is here not just during the day. He comes in various times, so he sees all of our employees all the time. Thank you, Tomas. I also want to turn it over to Steve Mondschein.
The world of COVID has obviously impacted us significantly as a manufacturing facility. I wanted Steve just to tell you what we're doing here to keep people safe so you know how we're keeping you safe, but also what we've done to keep people safe. This will be a real quick review. I want him to talk to you a little bit about it. He's in charge of health and safety for us.
All right. Good morning, everybody. Welcome. I just wanted to go through some of the things that we have done to keep both our team members safe here and also any visitors like you are today for us. First thing, if you have noticed, we do require masks. We go by the CDC guidelines. We follow them very closely for the COVID guidelines that they put out. At this point, we are requiring masks of everybody, even if they are vaccinated. That's why you are required to wear a mask today. As you saw when you came in this morning, we have health screening for anybody that's coming into the facilities. They ask questions, they take your temperature, and those types of things. If you notice, we also have scanning devices for times when we don't have a health screener here.
We have 24/7 coverage of health screening of anybody coming into the facility. Mandatory negative test or vaccination required of all visitors. You guys have experienced that coming in. Ventilation, when this first started, we really took a hard look at our ventilation within our facilities. We upgraded our filtration in our area. Our production areas are already HEPA filtration. There's HEPA filters in our production areas. We looked at our office areas and upgraded those areas from a, if you've heard or you're familiar with ASHRAE guidelines, we went from a MERV 8 filter up to a MERV 13 filter, which is the highest we're able to do with our systems without doing a whole redesign of our system.
Our filtration here and the amount of air changes per hour that we get are well above any type of ASHRAE guidelines that are put out regarding any type of ventilation. Sanitizing, we have daily sanitizing. Our team members go throughout the facility every day and sanitize high-touch areas. We also, on a biweekly basis, we bring in an outside firm, to come in and do cleanings of all of our office areas and all of the high-touch areas as well, just as an added measure of protection. As you notice, we do follow social distancing as much as we can. Outside, we've added some picnic tables, some tents, some things like that to keep our team members safe and, when they're taking breaks, give them some extra areas, so they're able to social distance while they're taking breaks. Just, again, a quick overview.
If you do have any questions throughout the day or anything like that, I'll be available. Tomas will be available to answer any of your questions. I'll turn it back over to Bill. Thank you.
Thanks, Steve. All right. I'm going to jump right into it. What we're going to do is the business update part first, just so we get the questions out of the way, then we'll turn into the longer-term vision. Since we just did our earnings announcement two weeks ago, there's not a whole lot of new developments. What I want to talk about is basically the answers to the questions that we've gotten from some of you, as well as others, in the period after the earnings. We just want to talk you through this. All these slides, by the way, will be available, posted on our website, as soon as the session is completed today. These are the four questions that we've heard most commonly from folks. What happened to the Nielsen in July? When will Freshpet's consumption growth re-accelerate?
Are the Freshpet capacity expansion plans on track? When will the margins, both adjusted gross margin and adjusted EBITDA margin recover? We want to try to address those as quickly as we can so we can move on to the broader topic that you all traveled here to see. I want to start with what happened in the Nielsen in the month of July. We have a third-party warehouse we use. It's the largest third-party warehouse company, cold storage company in the country. Like many other people, they had significant labor issues at the beginning of July and into the middle of July that prevented them from getting our product that we were producing shipped.
What the chart on the left shows you is, in the green line, is what our shipments out of that facility were on a rolling 30-day basis for this year, with the yellow line being last year. You can see there was a fairly sizable drop that happened in the month of July. That was not a production issue. We were producing plenty. We were shipping it over there, and it was sitting in tractor trailers not unloaded into the warehouse, and they were having a hard time keeping up. We have now addressed that with the third-party provider. They are having lots of labor issues like other people are. We think that it is now resolved, at least for the time being. As you can see, that line goes back up fairly steeply, and we are off to a really good start in the month of August.
That did impact, as you see on the chart on the right, that shows TDPs, which I view as the best proxy for our out of stocks that's publicly available. That's data through 7/17. Unfortunately, we'll get the next four weeks of data, weekly data, we'll get that next week. You can see, we peaked at the beginning of July, and then it went down. I guarantee you, when we see the data for the last two weeks of July, it will also be down, because when you don't ship well, it takes a while till it shows up at retail, and it kind of trickles down through retail. We are comfortable based on the uptick that we're seeing in August, that it is coming back as we've now got the shipments going out the door.
There's about a two to three-week lag from when the shipments fall off to when you start seeing an impact in retail. That's why the Nielsen looked a little bit soft in the month of July and into the very beginning of August. I also want to remind you, and this is a chart that I've shown with a little bit more detail on, and this answers the second question about when will our consumption growth re-accelerate. We've been saying for quite some time that this year is going to be like a bow tie, where we're going to have a big gap versus year-ago, early in the year. It was going to narrow. Right now, this week is probably the narrowest it will be for the entire year, and then the gap will get bigger.
The reason it's going to get bigger as it goes on is because last year, we went basically dead flat, as you can see on the yellow line. That Nielsen number didn't deviate by more than $50,000 a week against a $10 million base for the balance of the year, with the exception of being the weeks of Thanksgiving and Christmas. We went flat because we ran out of capacity last year. This year, we aren't running out of capacity, and we have advertising support on the year till the end of the year. We expect to follow that green line up, and that's where the data is showing. It's going up in this direction.
The way you get to, with the consumption numbers we've got, the way you get to the guidance that we gave you is based on the idea that we expect to average 25 points of POS ahead of year ago for the second half of the year. It will be 15 points at the beginning of the second half. It'll end the year at somewhere in the mid-30s, average will be 25. The shipment, though, will be different because last year we undershipped consumption by nine points, and this year we're refilling trade inventory, we'll overship by about 10 points. 25% consumption growth will turn into 44% net sales growth. That's how we arrived at our guidance and why we raised our guidance, is because we're very comfortable that this is what is happening. Next question was are the capacity plans on track?
The chart on the left shows, you'll see when you go down on the floor today, we are producing very well. We actually had a record production week last week. You can see that as the yellow line and the uptick on it compared to the year ago, that's before we add another line of production that comes on September 6th at Kitchens South, incremental production coming online. We feel very good about our ability to supply the demand that we have this year. The chart on the right is one you've seen before. I would just tell you, we've checked off all the boxes that we have come up to so far, we're on track to complete all the projects that we had, with the most imminent one being this Kitchens South Line 2 starting up on September 6th.
We had a review of that project yesterday, and we feel very comfortable that it's going to get going, and we'll start off with a two-shift operation, which will help us meet all of our needs. At this point, August production is over 50% up versus year-ago. If you actually look at last week, it was over 60% ahead the same week year-ago. We're doing very well on production. These are all the projects we've talked about. Everything is moving along the way we want it to. You'll hear more from Willie about how we're doing at Ennis in a little bit. You should also know that Kitchens South Building 2, the design work is underway. We're selecting what kind of lines those are going to be. That process is underway. We've also begun doing the planning for Ennis phase II.
We don't have to commit to that for a little while, but we're doing the planning that goes with it. You can see in gray the new technology that we're talking about. We are actually going to be implementing that first round of that technology at Line 3 in Kitchens South, which starts up between Christmas and New Year's of this year. We'll get a chance to see whether that works, because that could be the next generation of our manufacturing expertise. When will the margins recover? We obviously took a step back on margins, in part due to our own temporary operating inefficiencies and also in response to some inflation. I want you to think about it this way, and I'll give you a few more metrics around it, but we are taking a price increase effective on 11/29.
It's orders effective 11/29, so it'll be shipment sometime in December. It will have a de minimis impact on this year. That price increase is expected to fully offset ingredient, packing materials, labor, and freight inflation on a dollar basis. We also are expecting incremental efficiencies will neutralize any inflation on a margin basis over time. It won't be instantaneous, but it will happen over time. We are doing a new ERP system launch. It's planned for November. That will eliminate the 200 basis points of temporary freight inefficiencies when fully implemented. You should think of that as being done and operating well by the end of this year. Our labor strategy, which we announced on our earnings call and we've been rolling out to our production team here, will reduce the temporary operating inefficiencies.
Basically, we think we're going to have a much stabler and stronger workforce, and that we think will drive operating improvements during the first half of 2022. The final point I just want to remind you is when we start shipping from Ennis in the second quarter of next year, we will have start-up costs and be subscale in 2022 and the first half of 2023. There might be a little bit of margin erosion that comes from being subscale. We're very convinced as you'll see later on that the underlying technology, underlying operating efficiencies are very robust. This is sort of a graphical representation of what I just told you, but you can see how we're applying the core capabilities that we're going to talk about today.
Innovation, taking care of our people, sanitation, speed, and automation, and how those will collectively impact our business over the near term and over the long term, and where there's some helps and where there's some hurts, and we'll go through this in a little bit more detail later on. We are on track to deliver our long-term goals from a margin perspective. What you can see is we're absorbing some of those near-term pains on operating inefficiencies and growing into capacity. The offsets that we've got and the things that we're taking will get us to the place where we said we would be at $1.25 billion in capacity. We'll have that at 25% adjusted EBITDA margin, largely driven by SG&A improvements, we will have the gross margin back to where it had been.
At $2 billion in capacity, we think we'll have a significant advancement in the gross margin. I want to shift gears and move from where we are in the current quarter, where we are in the year to kind of map out a little bit of the long-term vision so you can see how the manufacturing fits and where we're going. Those of you who were at our Investor Day at Nasdaq back in February of 2020, kind of for interesting time to have been in New York. If we all known what was coming next, I don't know that we would've gone to New York. We told you in that presentation that we think that Freshpet has a chance to be one of those brands that changes the world.
We described what that means, is that the brands that change the world are brands that change things we do every day. Mark, do you want to put a spot right here? There we go. Change things we do every day. They reflect significant changes in society's values and priorities, and they leverage technology to make the previously impossible possible or more broadly available. What we talked to you about, how those brands all do that. Our mission fits within that, is we're trying to awaken the world to a better way to nourish our pets. In essence, it's reflecting many of those changes that we see in society and the way people think about their pets. It's not a surprise. We introduced you to this concept at that Nasdaq, Zooeyia, which is, in essence, the health benefits that humans derive from their interactions with pets.
Early in life, you can acquire immune benefits from your interaction with the dander of your cat or the saliva of your dog. Later in life, you get psychosocial development, where you learn how to treat an animal, and you expect the animal to treat you well. It catalyzes social interactions. You go out for a walk with your dog, and when you go out for a walk with your dog, you meet people. It encourages you to get exercise because you want the dog to get exercise, and also when things aren't going well, it gives you support for coping and recovery. We think that synergy between humans and pets is going to continue to drive long-term growth and adoption of pets because humans will recognize the benefits. We see that.
A lot of talk has been made about dog ownership and what happened with dogs during COVID. The American Pet Products Association now has their results out on what the pet population looks like. What you can see is dog ownership is growing. The household population with dogs is now 69 million households have a dog. 54% of households have a dog. We think that bodes well for us. That's up considerably from 2018. It's about 5% a year in penetration growth for households with dogs. Millennials are the largest share of the dog food market today. The last time we presented this data, they were actually 34%. Now 33%. The reason they dropped down a little bit was not because they declined, they actually have more dogs.
It's because the Millennials, or the Gen Zs behind them, became a bigger share of the pet population. The attributes that they're looking for, Millennials are looking for in their pet foods are basically what Freshpet is. High-quality ingredients, non-GMO, locally sourced ingredients, all kinds of things that they're looking for, that tell you they're looking for a higher quality experience for their pet. Not a surprise. We think the share of Millennial households with a pet though will plateau within a few years, while Gen Z will be on the rapid rise through the next decade. The simplest way to think about this is, if I'm a Gen Z-er, and think of Gen Z as a population cohort being 18 years of age, 18-year range, only six of those 18 years have already reached the age of 18. There's another 12 years to come.
Between the age of 18 and the age of 24, 50% of those Gen Z-ers will get a dog in that six years. By the time they get 24, roughly 50% of them will have a dog. We have 12 more years coming of Gen Z-ers getting dogs, and that's a huge opportunity for Freshpet over the long haul. If you consider that there's about 4 million Gen Z-ers who are entering adulthood each year for the next decade, and they're all having fewer kids, and dogs are replacing their kids. This is a huge opportunity for us. Gen Z is a growing segment of the pet market, as we all know. You can see the percentage of them that got a dog since the COVID began and what percentage of the pet-owning population. They're at 15% today.
You should expect that Gen Z will peak out somewhere in the mid-30s and maybe the high 30s as a percentage of dog-owning population by the time they are fully mature. They're choosing Freshpet even more than the previous generations. This is the data we gathered over the last year. It talks about their likelihood to try Freshpet, they're double what you would see from the baby boomer generation or from Gen X. Their predisposition for a product like Freshpet is very strong. You've also seen, as we described, Freshpet's prime prospects. They're 30% of dog households, it's growing, they basically have the values of the next generation. We have not updated the size of the addressable market from the $20 million we last gave you at the beginning of 2020.
We believe, based on all the demographics, that we expect this to continue to grow. On that basis, we think that Freshpet is a brand that will change the world. We've got this model that you've all seen before, which is our feed the growth model, where we're creating scale and leverage through our accelerated growth rate. The one thing that I don't think people fully appreciated when we first launched this in 2017 and refreshed in 2020, was we view this as a productivity loop where you go around each time. Unlike the laps on a track at a car race where you go the same speed every lap, this thing actually picks up speed as you go.
Each time you go around, you get a higher degree of velocity because what you did in the previous lap provides momentum, scale, leverage, that then you can capture and drive a much higher rate of growth. We've demonstrated accelerating growth rate for each year for the last four years, and we certainly believe that we can continue to do that. It also creates a very interesting marketing model that provides strong household unit economics. It's very simple. We invest in media. Media converts to a household that is a Freshpet household at a very consistent rate over a long period of time. That converts into loyal users at a very consistent rate over a long period of time, and that creates what we would basically think of as an annuity. This is sort of a simple way to measure the lifetime value of that investment.
It costs us about $50 to acquire a household. It's been a little higher than that, but it's been lower than that, and it's been on a general downward trend over time. In fact, in 2020, it was significantly below that, but we think that might have been a little bit of an anomaly. It costs us about $50 to acquire a household. If you use the current buying rate data of an average buying rate of $130, that's today, it's not the number in the future. What you can see is that the average consumer will be spending $130 a year. Our average pet is our dog is four years old. They live to 10-13, so you have eight years left. That gives you about $1,040 worth of lifetime purchases from that investment of $50.
At a contribution of 40%, we end up with $416 of contribution. If you subtract out the marketing investment of $50 and the fridge investment, this is where I divided their purchases against the lifetime value or cost of a fridge. Their $1,000 is a share of what fridges would have as revenue over that eight-year life. It's about $20. Their share of the cost of a fridge is about $20. That $50 investment we've made has turned into over $400 or six times return. What's even more interesting is that when that dog finally passes away, there's a very high likelihood you'll get a second dog or a third dog or whatever number you're on, and over 90% of those dogs will consume Freshpet. They'll start on Freshpet.
This annuity has a life beyond the current dog, beyond the eight years that I've described. Our goals that we've talked about before, getting to 11 million households at the 23% trigger from where we were at the end of 2019 or 2020, and then also the buying rate going up to $162. We've seen lately that it has skewed a little bit more towards buying rate in the last two quarters because of our out-of-stock issues. You should expect that the penetration gains will start again when we get the in-stocks and the advertising going, but still growing at 19% penetration rate is nothing to sneeze at. We talked about our goal of $1.25 billion and 25% adjusted EBITDA margin, and those remain unchanged.
All that then serves to create this model that we've talked about, a fortified business model that provides strong competitive insulation with every one of those boxes gets scale. This added scale creates greater insulation for us. It is very clear to us that we will get competition. In fact, many of you probably are aware that we have a new competitor arriving right about now. A new competitor is coming, is a single retailer, very limited product assortment, and a premium priced product showing up in a very small number of stores, but we are having a competitor show up. We've now seen it. This isn't the first time we've had a competitor.
If you remember, back in 2016, the Australians who pioneered this category came to this country with a product lineup that was much broader than what we're going to see in the first incarnation from our new competitor. They had a variety of different product forms under the Farmers Market name, and it was sold in H-E-B stores in Texas. They had a fridge program. They had a broad product lineup. It was a pretty extensive program. Four years later, we were outselling them seven to one and they left. They then came back after talking to virtually every retailer in America, and in talking to all the retailers, they finally got PetSmart to take them. They were in 700 stores with a rebranded proposition under the Billy + Margot brand name, and they were in those stores for about one year.
At the end of the year, we were outselling them six to one and they exited, and we bought the fridges. Once we bought the fridges, we saw another 35% increase in our net sales. I'm not here to tell you that if we get competition, we will deliver seven to one or six to one result. What I can tell you is we've seen this movie before. We know how it plays out, and we know how to be successful in that environment. In the end, we are accumulating. What you'll see today is we've demonstrated product technology mastery. We have broad scale distribution, scale and manufacturing distribution, broad awareness, an expanded lineup, and loyal users. The whole program, we think, creates a very large consumer franchise that we think is the first.
Today is all about showing you how brands change the world. In this case, we've told you about how Freshpet changes the things you do every day, feeding dogs. We've told you about how Freshpet reflects the humanization of pets, changing society values and pets. What you're going to see today is how we've leveraged technology to make the previously impossible possible and more broadly available. You're going to see the Freshpet Kitchens magic, and the simplest way to think about it is we start very clean. You have to start very clean if you want to create a fresh product with an extended shelf life. We then add fresh, frozen, and dry ingredients. We mix in significant cooking expertise, and there's a lot of art to that. We package it just right.
A lot of art in the packaging that we do and what the packaging looks like and how it works. It becomes delicious and nutritious, and you get a happy, healthy dog. We do that all in a way that's good for Pets, People, and Planet. That's, in essence, what you're sitting here in this building, what you'll see today, and what this is all about. By the end of today, we hope that you'll understand how we deliver outstanding nutrition that delights pets through our mastery of the cooking process. It's not as straightforward and simple as you might think. We deliver consistently outstanding quality through the increased use of automation, and that's a big step change versus the Kitchens 1 that you'll also see. We use best-in-class sanitation and product protection practices to deliver outstanding quality without the use of artificial preservatives.
You'll see how we can continue to improve those practices, particularly when we get to Ennis. You'll see how we're using higher-speed equipment to increase throughput that enables us to keep costs down and reduce labor intensity. You'll learn how we are continually seeking ways to make Freshpet more environmentally sustainable. You'll see how we're investing in R&D to increase our mastery, driving further improvements in quality, cost, reliability, and workplace safety. You'll see how we're investing in and care for the people who work here every day. If we do all that well, what you'll see is that the manufacturing technology that we practice here can drive margin improvement. What this chart shows you is how we have several different things going on that shape the margins over time. The form mix that we have.
The form mix, as we've talked about many times, is increasingly moving towards bags from rolls, and there's a margin impact of that over time. The facility mix, stuff that we pack and produce versus what's packed by our partner at Kitchens South. There's obviously a margin difference when you account for the margin of our partner. You look at the technology and the technology advancements that we've made, and that Ricardo and Michael will show you today. As the technology, more and more of our facilities are operating against the later and later generations of technology, what you'll find is that those provide the offsets to any headwinds we might have from a form mix or a facility mix, and allow us to get to our margin targets and potentially beyond.
I want to turn it over now to Ricardo Moreno, who is our VP of Manufacturing. Ricardo joined us last December. He's got a long history in the food business. He came to us, interestingly, his wife, he grew up in Venezuela, but he came here to go to school, Lehigh University, for his master's degree, and now he finds himself back living in Bethlehem. We're thrilled to have him join our team and provide the focus and intensity on manufacturing, that's what he's been doing, and he's going to talk to you about the journey that we're on and what some of the results are that we've achieved. Without further ado, here we are.
All right. Thank you, Billy. All right, the piece of the manufacturing vision that I'm here to talk to you about is I have the privilege to show you the journey that we've experienced, that Freshpet has gone through. It's exciting for me to put this in front of everyone. You can see here how we've evolved in our manufacturing journey. We started in Quakertown in a little corner of this facility. Then we purchased Kitchens 1 next door, installed the first couple of lines, expanded that Kitchens 1 for the next couple of lines. Last year, we opened Kitchens 2 here, where we're sitting, and we also opened up Kitchens South. Next year, we're going to be starting up Kitchens 3 in Ennis, which Will is going to be talking about, and then we're in the process of designing Kitchens South.
There's a lot of pride behind where we've come from to where we are. I'm very excited to see where we're going towards. Throughout the whole journey, we've enabled innovation. You can see on the left, we started with our rolls, we introduced bags, we created Fresh From The Kitchens, we created Small Dog. You see towards the right, Homestyle Creations with patties, our multi-protein Homestyle Creation, and more to come. All throughout this journey, we've enabled and continue to enable innovation. We've also increased speed, right, and throughput. You can see that when we were in Quakertown, we were putting out about 18 rolls per minute. Here in Kitchens 2 , we're putting out 32 rolls per minute. In bags, we started with a very modest six bags per minute. We're heading up to 50 bags per minute here in Kitchens 2.
When you think about it, we used to put every 10 seconds, we put one bag out, whereas here, every 1.2 seconds, we're putting a bag out. Big, big step up in speed. Not only speed, we've also increased efficiency, right? It's not only faster processes, but more efficient processes. You can see here, for rolls and for bags, the improvement on the labor efficiency depicted as pounds per team member per hour. Not only faster processes, but more efficient, too. All enabled through technology and automation, which you will see. We've also enhanced our team member experience throughout this whole journey, right? From expanded benefits with free meals for our team members, gym membership, we've introduced behavioral safety. We have launched our Freshpet Academy, which provides progression opportunities for all of our team members.
We've introduced TWI Training program, most recently, we are increasing our compensation and revamping our Freshpet Academy with an accelerated strategy to progress our people through the whole steps of the Freshpet Academy. We keep our people as the core of our business. We continue to invest in our people to enhance their experience in Freshpet. We have also expanded employment. You can see 2015, about 200 people, and we're projecting to be about 1,500 by 2025. Where we sit right now, right there in 2021, that yellow bar, which is Bethlehem, we have about 633 people who are active team members on this campus in Bethlehem today. We continue to enhance employment throughout our journey. As you can see at the top, some of the key milestones to get to that level of employment.
We have also improved sustainability of all of our facilities in this journey. We match all of our electric energy usage with renewable energy certificates from wind energy in Bethlehem. We are a land-free campus in Bethlehem. We have installed a combined heat and power, or CHP, highly efficient system here in our facilities. Most recently, last year, we installed and commissioned our wastewater treatment plant and also a rainwater recapture system for irrigation. We're using low carbon concrete in the construction of our Ennis facility, and we will have an on-site solar energy generation system in our Ennis facility. We're not done. We continue to evolve in all of our environmentally sustainable programs in Freshpet. Each step of the way, we have enhanced our manufacturing expertise.
Whether it's in our cooking processes, our mastery of our cooking processes, whether it is in our innovation with new products through technology, automation, introducing speed, introducing more environmentally sustainable programs, whether it is improving our best-in-class sanitation processes, and ultimately also enhancing our team member experience. Each one of those milestones, each one of those steps that we've taken, we've touched several of those buckets. Ultimately, we're building a $2 billion worth of net sales capacity business. You can see on the left, basically a timeline based on milestones, and then on the right, year by year. By 2025, we're projecting to have $2 billion worth of sales capacity. We're also doing a well-balanced blend of bags and roll lines. As you can see here, by 2025, we're projecting to have 13 bag lines and eight roll lines across all of the sites.
If you see through the matrix, you'll see that we will have at least two of each one of the lines in each site, on each site, which provides business flexibility, business continuity. It's a well-balanced blend of lines. The exciting piece is that we're not done. We have significant opportunities still to improve on in all of the different buckets. Whether it's in the automation bucket with Automated Guided Vehicles, even higher speed packing lines, improved and enhanced CIP or clean-in-place systems for sanitation, technology enhanced training processes for our team members, energy recapture applications in our sustainability bucket, and new products, new forms, new packaging. The cool stuff is not only that we know that those opportunities are there and we acknowledge them, but we're exploring a bunch of them already.
It's been an exciting journey up until now, and there's a lot of excitement on what's to come. All right. Now, I'm going to introduce Michael Hieger. If anyone deserves credit for this journey that I've put in front of you, from the very inception of Freshpet, all the way to what you will see today here in Kitchens, you'll see it in Kitchens 1, you'll see in Kitchens 2. If anyone deserves credit for that evolution, that progression, that technology introduction, and ultimately that operational improvement, it's Michael. He's been the architect, the designer, and ultimately the lead for all of this Bethlehem campus that you will see today in the tour. Michael will touch specifically on Kitchens 2 and some of the key highlights on how we've added tremendous value with our Kitchens 2.
Thank you, Ricardo Moreno. Welcome to Kitchens 2.0. Today we're going to quickly go through some of the improvements that we've done from Kitchens 1.0, which you'll see on your tour later today, and then the improvements that you've seen over here in 2.0. It's been quite the journey to get here. We bought this property back in 2015. We started the engineering and design work back in 2017. June of 2019, we finally broke ground on the facility for construction, and then September of 2020, we went through commissioning to get the line started up and start getting products going down the lines. While we were doing that design process, we really kept four things in front of us we were wanting to achieve.
We wanted to increase our team member safety, we wanted to increase our product quality, we wanted to increase our efficiencies and throughput. We also wanted to make sure that we were being nice to the environment and increasing our sustainability. We did that in a lot of different ways. We used automation to increase our team member safety by designing and building and installing a frozen block separation system. Those systems are in place, which you'll see on your tour later today, and our team members don't have to go through some of the back-breaking and painful tasks they have to do over in Kitchens 1 to get those frozen blocks apart. It was a good use of some automation. We've also used automation in our dry batching process.
Over in Kitchens 1, you'll see it's a lot of manual weighing and it's a lot of moving those 50-pound bags around. We put an automated system in here in Kitchens 2.0 and don't have to go through those steps anymore. Again, enhancing our team member experience. We also use automation to change the way we handle our inclusions on the roasted to meal line. Over in Kitchens 1.0, we do a lot of manual mixing of inclusions and manual moving of those inclusions around. Over here in Kitchens 2.0, we installed an automated system to fully automate all of that and take a lot of those tasks away from the team members out on the floor. To increase product quality, we again used automation to install inline leak detectors.
What those do, they are testing each of the cases and the pouches of product going down the line to ensure that we have the highest product quality in those pouches, ensure we don't have any leaks in those pouches. That's on the roasted meal line. On the chub line, we increased our chilling capacity, so we can run our chub machine faster. It's worked out for us very well. We also want to make sure that we were thinking about throughput capacities. We ended up installing double ovens on the roasted meal line here. It really has worked out well for us. It's increased our capacity. It's working out well. It also forced us to put in a high-speed pouch line. You'll see that on a part of your tour today as well.
We want to make sure that we were taking care of the environment. We are capturing the rainwater that falls onto the building here in some of the parking lot areas. We're using that to irrigate the landscape and the lawns around the facility as well. We put LED lighting throughout the building. All this lighting here, as well as out on the production floor, all LED lighting. We also installed a wastewater treatment plant, and we'll talk a little bit more about that in just a minute. I think we're going through an update. Trying to restart. It just died. Well, it's probably going to take a few minutes to just come back to life. Keep going or wait for it? If anybody needs a five-minute restroom break, they're out around the corner. Coffee's in the next room.
We're just going to take a three-minute break for those on the webcast. If you can just hang with us for a few minutes, we'll be back.
[Break]
Okay, we're back. Michael, can you continue, please? Thank you.
All right. We can blame Microsoft for that, and we will make sure that we disable that update next time we get together. Anyway, back to our conversation and our presentation here.
That's a Java update.
Don't talk about Microsoft that way.
They can hear us. Anyway, back to this slide here. This slide is pretty straightforward and simple. Essentially what we have done, we have doubled our throughput here on the roasted meals line, and we've essentially kept the staffing the same as we have on one line over in Kitchens 1.0. It's been very nice to us from a gross margin standpoint.
Some of the environmental impacts and sustainability things that we have worked on here in Kitchens 2.0, we are purchasing wind power for renewable energy. We talked about the LED lighting throughout the facility. From a waste perspective, we are a manufacturing facility. We do produce waste. We just want to be really smart in what we do with it. All of our cardboard and plastic, we recycle all of that. Our organic waste, and that may be product that hits the floor, may be product that's left over at the end of a run, we end up sending that to an anaerobic digester, and they process it and eventually turn that into fuel for electricity. Our inorganic waste goes to a waste-to-energy facility, and again, it's used for fuel for electricity. We are a landfill-free site here in both Kitchens 1 and Kitchens 2.
We also installed a wastewater treatment facility, got that up and running over the last year. What that essentially is doing is separating the solids from our wastewater. We can then take those solids and give those to an anaerobic digester. Again, they turn that into fuel for electricity, and getting the solids out of the wastewater reduces our surcharges to the municipality sewer and puts less of a load on their system as well. We're also working with a vendor, and we're very close to getting something going with them to be able to turn that waste stream directly into biofuel of those solids. If that is the case, it would be a nice cost reduction for us as well. That's some of the upgrades that we've done here in Kitchens 2.0. Are there any questions on anything?
We'll see a lot more on the tour. Yes, we will see a lot more of this out on the tour in just a few minutes. All right. We will next turn it over to Willie Everett, who is our site leader down in Texas, Ennis for Plant 3.
Thank you, Michael. I appreciate you getting that update out of the way for me. Good morning, everyone. I get the opportunity to talk about Ennis 3.0. Really excited to be able to spend a few minutes with you this morning. This is the site plan for Ennis. We're on 68 acres. We have 52 of those are developable. Ennis, Texas, is the bluebonnet capital of Texas. Bluebonnet's the state flower of Texas. It's also the home of the National Polka Festival, if you like to polka. Kitchens 3.0 in Ennis, construction is on time for a Q2 startup in 2022. You're going to see all the technical advances that we have made from 1.0 to 2.0 in Ennis. You're going to see additional improvements that will drive not only increased sanitation, quality, throughput, and sustainability.
Freshpet's mantra of continuous improvement is on display every day, every time we add capacity. You're going to see a much improved, more productive, safe, quality plan. This is off a drone video. This is just a clip off a drone video. We take drone videos every two weeks. Rather than see a picture, I'm going to play a little bit of last Friday's drone so you can see what's going on on the site. Before that starts, down here on the right-hand side is the south side of the plant. That'll be shipping and receiving. The north side of the plant, this is phase I. Phase II will attach to that. You can see we're putting on our evaporative condensers now in the middle of the roof. You'll see a yellow 990 ton crane that is putting that up.
As you go through this site, we're coming around again, down the south. Warehouse finished goods is down here in the lower corner. As the drone pans this way, it's looking south. Probably goes all the way past those trailers on the left-hand side. You'll see again, we're putting the evaporative condensers for the production space up on the platforms right now. You get over to this side, that's going to be receiving, freezer, meat cooler, dry ingredients. That building that's there to the right is our central utilities building. It's 35,000 sq ft, and that's where all our power, ammonia, water, compressed air will come from. Our evaporative condenser's about 30, 40,000 pounds, thus the need for a 990-ton crane. Give you one more look as we come to the front of the building or to the north side, excuse me.
Here's big yellow, Yeller as we call it. This is the north side of the building. phase II will match up to that at a later time. It's a very active site, a lot going on, just wanted to share a little bit of that with you. We started design of this facility two years ago next month. We had a design team. I was the only Ennis employee at the time, Michael and many Bethlehem teammates helped us create the design criteria. Number one of the design criteria was to make sure we maintain the Freshpet culture. Number two was roasted meals separation. How do we separate that line? Number three was separation of pre- and post-cook.
What you're going to see today is a real example of executing a design criteria that was created with myself and many Freshpet experts who have done this before. That's a little bit about the drone video. Where I want to start is I want to start with sanitation. Like Bill said, start clean. What we've done in this area is we have physical separation between all raw and cooked areas in the facility. Each line that we have is capable of being shut down, cleaned and sanitized without affecting any other line or any other area in the plant. We can clean when we need to with no impact to production. We have a cascading air pressurization scheme. What that means is we want the most positive air pressure in the most sensitive areas, the packaging areas, and the chilling areas.
That allows us to make sure that of the pre-cook side, that's the most negative air pressure in the plant. We maintain this positive air pressure throughout the very sensitive areas of the plant. We're doing little things, but they do make a difference. We're using a centralized high pressure system for cleaning. It'll be the first one for Freshpet. Again, how do we always get better every time that we add capacity? This will reduce cleaning time. It saves 42% of the water compared to how we do it today. We're installing CIP systems, more CIP systems on major pieces of equipment. What that does is it makes it more efficient. It's less physical work for sanitizers to have to scrape, to have to do those type of things. It gets us up and running faster. We look at automation.
Just a few of the things. We'd have several pages, but just going to show one. A few of the things that we're automating. Leak detection. You heard Michael talk about leak detection, and we do it by the case. Before that, we did it on a random check. The way we're getting better and making improvements in Ennis is we'll actually check every bag before it gets into the case. We'll have x-ray detection. We'll have x-ray detection of all incoming raw materials in our on-site chicken processing building, which will be up and running in the third quarter of 2022. In addition, we'll also leverage the x-ray detection of finished product on the rolls line that Michael and team put here. Automated guided vehicles. It'll be our first foray into AGVs.
It's been really good to be able to build a greenfield site to where we can ensure that AGVs will not have any problem navigating the Ennis kitchen. Improve team member experience. I am truly grateful to work for a company that has such a long line of sight that invests in training. We will have 75 Ennis full-time employees that'll be trained here in Bethlehem in Plant 2, where 90% of the same equipment will start up in Ennis, Texas. We've had 10 people here for six weeks. We have another 14 people that show up on Sunday. By the end of it all, we'll have 75 teammates here learning that will take that knowledge back to help facilitate a very efficient start-up of Kitchens 3.0. We have a certified apprenticeship program from the U.S. Department of Labor.
This is the first apprenticeship program in the state of Texas for a food operator. One of the neat things about this is it also speaks to our people value. For those that complete this program on our dime, with their time, that they'll walk away with an associate's degree in business administration after a period of three years if they stick with this apprenticeship program. It's also going to make sure we have more higher trained people. At the end, they walk away with something very tangible as well, besides the skills. We're going to use augmented reality in our training. I heard somebody talk about TWI, training within industry. This augmented reality is going to help streamline the training from the trainer standpoint to the trainee. It's something that we've already been working on, doing a little work with it already.
I think it's going to be a much more efficient way. Get out of paper. Somebody doesn't have to carry books. They basically have a glass where they can pull up anything, any training material on any piece of equipment in the plant. Improved work environment. There's so many things that we're doing there. We'll go into a frozen pallet grinder. What that does is rather than throwing frozen blocks of meat, we'll dump it by the pallet. That's a lot less physicality when it comes to working in our processing areas. There's really one benefit that I like about this, especially, is it opens up the applicant pool to the processing area where the physical demands of the job are not near as much. Again, that really helps us to widen that applicant pool. We got reduced exposure to dry ingredient dust.
We continue to build on what we did here in 2.0. We'll also have a minor auto batch system, which will be one addition that we have relative to the 2.0. Speed and throughput improvements. Overall, in phase one, we'll increase speed and throughputs by over 10%, relative to 2.0. We have a unidirectional flow for the production lines, and the so what of that is it allows a lot more area, space, to be able to clean equipment, to move equipment in and out, to keep it in a straight line from one side of the plant to the other. Reduced workload. Talked about the reduced block handling. Minor ingredient batching is automated now, will be automated in Kitchens 3.0. Clean-in-place systems that we talked about. We continue to push equipment vendors to help get us farther along in the use of clean-in-place equipment.
Again, the so what of that, it gets done quicker, it's safer. People aren't having to do a lot of manual hard scraping to do those type of things. Again, I think it increases the size of the applicant pool when we make these type of changes. Finally, AGVs to deliver raw materials and finished goods to the production lines into the warehouse. Sustainability improvements could give a whole talk on that with all the great work that we're doing in sustainability when it comes to Ennis. Start off with water. We're installing an ultrafiltration system on our wastewater treatment plant that will filter 74 million gallons of processed waste back into the utility section, and we'll use that for ammonia compressors. 200,000 gallons a day of water that we'll be using. We're using MBBR, which is a moving bed bioreactor, for cleaner treated wastewater.
We will far exceed what the city specifications are. We have a great relationship with the city of Ennis. This is one more way that we can prove that to them. Energy, like Michael, we're doing the LED lighting. We'll have combined heat and power units that'll produce 5 megawatts of our own energy. We'll have 2 megawatts of solar power with full battery backup. Bottom line, the Ennis 3.0 kitchen will be able to supply 7 megawatts of its own power even if the grid is down. Waste recycling will carry on the tradition of being landfill-free.
Some of the things, though, that we're doing, again, as we continuously improve, we're taking our cooking grease waste, which is a waste product today, we're taking it through, it bypasses our wastewater treatment system, goes through a FOG buster with a fat, oil, and grease buster, and then into a tank. We have three biodiesel companies that are going to buy that cooking grease because it's a very good feedstock for biodiesel production. We're taking something from a waste to a revenue stream, and more importantly, it's going into biodiesel. It's restarting. Let's see. If you look from a sustainability standpoint, don't look at these guys over here. All the structural steel that we used, 93% recycled structural steel. We're using 3 million tons, excuse me, 3,000 tons or 6 million pounds of steel in this building.
We're using 24,000 cubic yards of low carbon concrete in phase I. It really doesn't matter whether it's part of the construction or part of the running of the operation. Freshpet takes this view of how can we make our lives most sustainable when it comes to our operations. Kitchens 3.0 will meet its objectives of improving sanitation, quality, and throughput, all while providing for a more sustainable operation. I appreciate your time. A man that needs no introduction, I'll say it anyway, Scott Morris, president of Freshpet.
Hey, Bill. Thanks a lot. The thing I find amazing is that the guys that are fixing, building everything for our entire company, unfortunately, have crashed the computer twice. Hopefully I'm not going to have that happen. Anyway, it's great to see everybody in person. Eyes up is always good. It really is terrific to see everybody. I'm going to touch on our sustainability work. Let me start with posing a question to you guys. If you guys were able to think about your company, if you were able to start from zero, literally zero, start all over, what would you do? How would you do it? Who would you ask to come and work with you? How would you change things? Under math, I see smiles or smirks, I'm not sure. It's really pretty amazing if you think about it.
We were able to do that. We were able to do that with Freshpet, and it's kind of empowered us along the journey. We released the sustainability report last week. There's a ton of information in there. What I want you guys to do is tell a little bit of the story of how we got here and how it's part of our company and why it's important. It's not something we're doing out on the side. It's really core of everything we've done for many years. I do want to start at the very, very beginning. This is myself, a gentleman named Cathal Walsh, one of the other founders. There were three of us. When we really started the company, we did say, "Well, how do we want to make pet food? Who do we want to work with?
How do we want to do it? How do we want to work together?" It really allowed us to really think about what was the kind of company that we wanted to build, and it's a tremendous opportunity to do it, and glad with all the progress that we've made over the years. The reality is, it wasn't the two of us. There was a founding team of people. There were actually 34 people that were on that founding team, and those people are super important today. The vast majority of those people are still here today with the company, and they really form an incredible backbone. Many of the people that are here, that you see pictured here, some of the people that are in the room, Michael and I have worked together in three different companies.
Worked together at Purina, worked together at Meow Mix, and we've worked together really since the very beginning of Freshpet, and there's multiple of them. It's pretty amazing. I always equate it to a great basketball team. When you see a great basketball team playing, they don't even have to look where the other guy is. They're just being able to pass the ball, and it's true of the people that we've worked with for many years, and that's why we've been able to be successful across the many things that we've done for a long time. The next thing is, we had this idea of like, "Hey, how should we make pet food? What should it be like? What should it look like?
How should it be?" We really kind of weighed into this idea, and I'll talk about the food in just a minute a little bit more. We made a huge commitment. We brought our food to market, and what started happening was the phone started ringing. Literally, the phone started ringing. People started calling up and going, "Hey, my dog won't eat anything else. He's eating this." The next thing was, "Wow, my dog was really sick, and now he's better." "My dog was having skin issues." All the way to, "My dog was dying. I fed him this, and I swear it gave him six more months of life or one year." We hear it over and over and over and over again. What that did, that great product really became really a foundation of our purpose.
What we found over time is that purpose of having great food and doing things in the right way created passion within our organization. I would tell you that every organization needs to basically have an incredible purpose because it creates that passion for the people that work there. It's the decision of, do I care about the product? Do I care about the work that I'm doing? Are you motivated to, you know what? I'm going home, or I'm passionate about what we're doing, bringing together to market and how we do it. That purpose creates incredible passion. We also had with that group, we had great values. Many of us have worked together for many years.
We really had good fundamentals and the values, everything from the way we talk to each other, the way we work together, having passion in the work that we do, to the way we, I always call it, do the right thing. How do we do the right thing? Another one that we talk about all the time, make sure everyone wins. How does everyone win? If you work hard, you can figure out a way to make sure everyone's winning. We had those things in place. What we may not have had all the way figured out, we went to consumers, and we started asking them. We gave them an assignment, and this was back in 2010, okay? It is important because it tells you the story of how we got here.
We went to consumers, and we said, "What would Planet Freshpet look like?" We asked them to create collages and bring them into the focus groups and talk about them. I wanted to share, I dug these up because I thought it was kind of cool because it's going to tell you why sustainability has been so important to our organization. This is one of the first collages. You'll see love, peace, recycling. There's a stick-figure farmer down here. There's a barn. Seems like a pretty good place. Another one. There were tons of these. There were probably 25 or 30 of these collages, and every one of them, the themes are unbelievably consistent. You have flowers, plentiful fruit, the sun is shining, healthy people outdoors exercising. In this one, you see more recycling symbols, people really close to the earth, organic.
Again, this was back in 2010. This was back in 2010. This one, peace on Planet Freshpet, more kind of nature scenes or natural scenes. Respectful people live on Planet Freshpet. Being in touch with Mother Earth. Here's one that I love. I should hang this in my office. Total Purrfection, right. Same theme over and over and over again. Look at this healthy choice menu. You can see no longer this way. You can kind of get a feel for what was going on. What we realized were two key things when we did this work. First of all, we had done a really good job bringing our company and our brand to market. People believed in what we were doing. They believed that we were doing it the right way. They were inspired by it, excited about it.
What happened is our inspiration to them actually ended up inspiring us. What we realized is we were good, but they expected us to be extraordinary. They expected us to be great. It forced us to rise to the occasion and develop, take the team, take the values that we had, take the products that we had, and then finally a vision that they helped us create, and it helped us create this idea of Pets, People, Planet. You guys, you probably have heard us kind of go on about it. That's how this came together. I mean, it was pretty wild because, again, we were on a really good path, but they inspired us to be extraordinary and pull it together. You're kind of wondering, well, this Pets, People, Planet stuff is good.
It is so important because there's two groups of people that's extraordinarily important for today. The first group is the consumer. The consumer expects companies to operate this way. We've been doing this for 10 years. You'll hear from Justin in just a minute. He took the last 10 years of work that we have done as an entire organization around sustainability, and he has actually made sense of it into a report that we shared last week, as I mentioned. The second group that is so important, it goes right back to that purpose equals passion. Of course, we have a purpose around food, but doing things the right way is what really motivates and keeps the organization excited, and really passionate about what we're doing. Really important. Everyone's seen nourishing Pets, People, and Planet.
One of the things that we've really started talking more and more and more around is who has pets here, actually? Who has pets? Sorry, I can't see anyone on the phone. The majority of people have pets. I will share with you've heard this before, Bill mentioned it earlier, this idea of zooeyia. People live longer, healthier lives with pets, and there's a whole host of reasons why. It's everything from purpose to having a pet, being responsible, emotion. It's microbiome stuff, which Gerardo's not here, but you'll see him on the tour. Ask him about that. There is a whole list of reasons why. It's activity. It forces you to get outside. We love that, and we want to make sure that we're making the best healthy pet foods so people and pets can have longer, healthier lives together.
If you have an organization that is only focused on sustainability and doesn't have a great product and a really strong business strategy, honestly, from the very beginning, we were not perfect. We screwed a lot of stuff up along the way and we're far from perfect. If you don't have a great business strategy, if you don't have this, Bill shared this earlier, that's a charity. We're not a charity. We are focused on sustainability because it's great for our business, it's great for our people, the people in the company, and also our consumers. I don't think this video is going to work because we're on the other computer, right? We'll see.
The relationship with our pets has evolved. We're now pet parents. We love our pets as children, and they love us back. They bring us joy. They remind us to play and inspire us to improve our lives. They're our travel partners. They celebrate with us and comfort us when we need them. We rely on them, and they rely on us. We would do anything to make them happy, and in return, they do the same for us. Freshpet was founded to change the way we feed our pets forever. Delicious meals that give pets the nutrition they need, so we live longer, happier, healthier lives together. All of our recipes are made from real, farm-fresh ingredients, sourced with a commitment to becoming the most sustainable pet food.
Achieving success while caring for our team members and our communities is not only the right thing to do, it helps ensure the long-term sustainability of the company. Our landfill-free kitchens in Pennsylvania use renewable energy, reclaimed rainwater, and best-in-class safety and quality protocols to help ensure every meal is sustainable and nutritious. Thanks to technology like on-site solar panels and heat capture, the new kitchens in Ennis, Texas, will further our mission to producing nourishing fresh food while doing it in a way that is good for Pets, People, and Planet.
Hopefully the video gave you a little bit of a highlight of some of the things that we're doing. We're going to talk in more detail. Justin can talk in more detail in a minute. I want to take you through a handful of highlights that I'd like to make sure that you take away, because this is an enormous area with a ton of work. The work we've done in sustainability, I've mentioned, it really has been since our founding. It's been baked into our culture. It's how we think, it's how we make decisions, and it goes all the way from how we make our foods to how we think about our interactions in the community to how we work together, et cetera.
If you think specifically about the pets piece, that idea of improving pets' lives, our commitment to our food started when we first started. We couldn't find anyone to co-pack for us because the pet food people couldn't make it. The human food people didn't want to touch it because that was a crazy idea to bring pet food into a human food facility at the time. We took a $5 million leap of faith and built our own manufacturing. The other thing is no one would put refrigerators in because it was an unproven concept. We invested in the refrigerators, right? Our commitment around this has been pretty extraordinary, we believe, in the pets piece. The other thing is this whole idea of the human-animal bond, so we also want to support that. Please take that away.
From a people standpoint, we want people that are missionaries, not mercenaries. We're going to talk a lot about pay here. We want people that are passionate about what we're doing and what we're building here to work in our organization. We think about the people that work here as chefs versus people that are just making stuff. We want them to think of themselves that way, too. From a planet standpoint, the way I talk about it is I want us to think about how can we have the lowest impact, the lowest wave. Everyone's been on a boat at some point. When you look behind the boat, there's always a wake. When you're in the no wake zone, there's literally almost no wake. The boat is moving through the water with no impact. That's how we want to think about our company.
We want to have the lowest impact we possibly can. We want to be a leader in CPG. Why? First of all, from a consumer standpoint, we want to be a leader, and hopefully we're going to demonstrate some of that today. Secondarily, if we are raising the bar, I hope everyone else that is working, not only in pet food but in the rest of CPG, is looking around going, "Wow, I need to do this, too." That's a way for us all to kind of have increasing incremental impact or punching above our weight in CPG. Finally, you'll hear Billy talk a little bit and touch on what we're doing from a governance standpoint. We released a plan last year. It's a long-term plan. We think we're very age appropriate, we've also laid out a really kind of detailed long-term plan around governance.
All right. First one. Looks like we lost a little highlighting here. It's supposed to be about pets, right? I talked about the nutritional ideology, how we make the food, so hopefully everyone is living a longer, healthier life together, but we're also supporting the human-animal bond. The first thing is, how do we think about our ingredients? We want to take as many ingredients as possible that are fresh, unadulterated, not cooked beforehand, et cetera. We want them as simple as possible. We want to take basic ingredients, things that you've heard of, that you can see into our products. We also want to cook them a lot less than anybody else. I always use the analogy of broccoli. If you take broccoli, it's good raw. If you steam it's good. If you cooked it for two hours, you're going to destroy the bioavailability of it.
We do the same thing here. I'm going to show you an amino acid chart in a second. We cook those ingredients as little as possible. You'll see examples of dry and wet food where they're processed much more. It makes a huge difference in the protein or the amino acid availability of the products. From a nutritional ideology, we think this is really important. We've invested in it. We're committed to it. It's how we think about all of the products that we make. The next piece is because of that food, because of the great products that we make, what we see is that 82% of people see a visible difference in a pet's health. We've shared this before, but this is one of the things that keeps us so motivated.
This is why we got those phone calls I was talking about a few minutes ago. It's why there's so much passion around the products that we make across the organization. The next piece is how we think about the human-animal bond. Well, one of those ways, and one of the most extraordinary ways, is to make sure that pets end up in people's homes. We also work with two different groups, with multiple groups, but two of the key groups I want to highlight today is 4 Paws for Ability and also St. Hubert. They're not up here. They are both leaders in their area. One is a shelter in New Jersey. 4 Paws is in Ohio. They do extraordinary work providing assistance dogs for things that are not typical assistance needs.
You can see when people get those pets that 4 Paws trains for them, it is life-changing, absolutely life-changing. It's everything from people with autism to seizures to learning disabilities to all kinds of issues. It is life-changing for those people and we know that when we see the work that they're doing, that that's how people and pets should be living together. We've donated millions of meals, but we also want to support the programs that they're doing around the human-animal bond in general. The next piece, Justin is going to take over and talk about Pets, People, and Planet. Again, this work has been part of our organization, but Justin has done an extraordinary job pulling it together and putting out the sustainability report. I want to thank him for that.
Great. Thank you. I'm Justin. I'm the sustainability director here at Freshpet. I'm really excited to take you through the People and Planet sections of the presentation. I should mention that this is going to be kind of an abbreviated overview of our efforts. I would invite you to go to freshpet.com under the investor section. There's a governance tab there. You can download the full sustainability report. Scott mentioned it before. We really are proud. This is our first year of doing a full sustainability report. It provides a lot of data and transparency that we just haven't ever compiled before. We're excited to hear your feedback on that. Excited to share it with you. As Scott mentioned before, there's a lot of us that have worked together forever.
I haven't gone back as far as him and Michael to Purina
, but I have worked with both those guys for about 20 years now. There's probably 15 of us on the team that have worked together for about that amount of time. It's been an incredible place to work. I think one of the foundational reasons that we've all stuck together is that there are so many great ways that the company takes care of us. We've got 401 programs with matching for every single employee. We've got top-notch healthcare programs for every single employee. We just added tuition reimbursement for employees so that if they want to further their career with Freshpet and learn new skills, they can do that now, and Freshpet pays for that.
They've always thought of ways to take care of employees almost as a family, and it's fostered a loyalty and commitment to the company that, to Scott's point, we almost know each other as family now. It's very easy to share ideas, and it contributes to an efficiency and entrepreneurialship that maybe you don't see with a lot of other companies. It also shows up in our employee surveys. We do an employee survey every year, and this past year, we got an 8.3 Net Promoter Score, which is in the 90th percentile of all companies. We also got an 82% employee engagement, which is four points above typical companies. A lot of benefits there for Freshpet as a company, and then obviously for employees that work with Freshpet. Moving on to Planet.
Environmental sustainability has been a foundational principle at Freshpet. Our mission really is to create the most sustainable pet food in the world. It's not only the right thing to do, and it's something that, as Scott explained, it's kind of where we started when we were such a small company. We chose suppliers to work with that were environmentally sustainable. Like at the time, Bell & Evans supplied a lot of our chicken. We worked with suppliers that were sourced from within a 200-mile radius of these kitchens here for the majority of our ingredients. As we've grown, we've had to expand our reach with those ingredients, but we're still around 50% of our ingredients are sourced within 200 miles of the kitchens. We've always had that as our core DNA, and it was the right thing to do.
What we've also learned is as we try to grow towards 2025 and reaching our growth goals and our household penetration goals, consumers are really concerned about that these days. Billy was talking about millennials and Generation Z. As you get younger in the consumer spectrum, they want to do business with companies that are environmentally and socially responsible. Freshpet is a company that they can believe in because when you look back at our history, we've been doing this for a long time. It's an authentic place we're coming from. We're not just greenwashing our way there or throwing in a few projects. We already covered a lot of our initiatives. I love that some of the manufacturing guys were sharing that because it really shows how deep within the company we care about these topics and we've implemented these topics.
I'll highlight a couple here. One of my favorites is back in 2012, we launched the Nature's Fresh brand at Whole Foods. When we launched that brand, Nature's Fresh was a concept. We had a couple different ideas. Whole Foods said to us, "Hey, we want you to work with this company, Global Animal Partnership." They're a nonprofit. They were working with farms to certify animal welfare standards and help farms raise their chickens and their cows with animal welfare in mind. Whole Foods was committed to buying the chicken breasts and the higher quality cuts of meat. Where we came in is we purchased chicken livers, chicken thighs, the chicken hearts, and we were able to make that program financially more viable for all the farmers.
We were able to give them added value for those cuts of the chickens and turkeys that they might not have been able to sell for a decent price if we hadn't been there. We were their first pet partner. There's a number of other pet food companies that use Global Animal Partnership as their certification, but we're super proud about that. In 2020, we bought about 6 million pounds of animal welfare-certified chicken, turkey from that partnership. 2016, I love this story. I used to be part of the sales team, so we were installing a ton of chillers, and this was something that was near and dear to our heart because we were replacing and swapping out a lot of old chillers with this new model. It's a True TVM 48 model, and we developed it in conjunction with True.
It used LED lighting, a new R290 refrigerant, which is ozone-friendly and also has very low global warming potential. As a result of the new compressor and all that technology that went into it's about 8.5x more efficient than the chiller models that we replaced. What was interesting to hear the backstory on it was that we kind of pushed True to introduce this model. They had already started developing some of the technologies. They just didn't have a major customer to really put it out there. We knew we wanted this technology. We wanted the brighter lighting. We wanted the merchandising ability because this chiller actually holds quite a bit more product than our old models could hold. We were their first major customer, and now it's their number one best-selling unit.
Like Scott and I were talking, this is an example of us kind of punching above our weight in terms of pushing our supplier to do more, which then led to some greater good that we're proud of. We talked a lot about wastewater treatment, and I'll talk some about it in the breakout, but this is an area that's going to continue to receive focus for us, water stewardship, because we know how important it is to us as a business that does use a considerable amount of water. We'll continue to talk about that, and this is going to be really a showcase for that in the future. 2021, we've been really busy. It's not over yet. One of the first things that we started 2021 off doing was trying to document our efforts.
I think by having sustainability as a core foundation of the company, we had done a lot of good, but we necessarily didn't do a great job of communicating how much had been accomplished. We certainly hadn't provided standardized data that made it easy for people to compare our efforts versus other companies. We partnered with 3Degrees and calculated our carbon footprints for 2019 and 2020. We also completed our first CDP questionnaires for climate and for water. Then we published our SASB-aligned environmental metrics. Those are all in our sustainability report. The other thing that we did is, as part of just really wanting to take a leadership role here, is we've committed for 2021 to be carbon neutral now across our Scope 1 and 2 emissions, and that was something we just announced last week.
We are accomplishing that with carbon offsets, all from U.S. projects that have been verified, and we purchased those through 3Degrees, so we feel great about the projects we're participating in. We consider this a starting point. We just feel like there's such urgency behind this topic, and it's something that we wanted to do now rather than wait. The long-term plan is to work with our suppliers, work with procurement, work with our own engineering teams to reduce our carbon footprint so that our reliance on offsets drops. You'll also see in the latest sustainability report our first publicly published supplier code of conduct, and you'll notice it isn't a big legalese-type document. It's not like a sign your name here kind of contract, although there'll be some of that on the back end.
What we wanted everybody to understand is the aspirational aspects of our code of conduct. Our partners, a lot of them, we've been buying food from the same supplier for 15 years, and they've grown with us. They've been there for us. They've helped us. We expect to help them come to a place that'll help us achieve our goals. We are going to start asking them to provide carbon footprint data by 2023, as well as water footprint data by 2023. For some of the vendors, they've already been doing this work. For other ones, they have some work to do. It's going to be a two-way conversation where we can help them elevate their analysis, and then some of them, honestly, they've been doing this longer than us, and they might be able to help us with our efforts as well.
Of course, looking to the future, Ennis, you've already gotten a sneak peek on that. I can't wait to give you the details there. There's been so much great work going on, and it's just going to be a true showcase. For 2025, our commitment is to be carbon neutral on Scope 1, 2, and 3 through the use of emission reduction projects that we've started discussing. We've started looking at some major ways we can work with our suppliers, work with our own internal processes to reduce our emissions. What we can't reduce, we'll be using offsets to get us to carbon neutrality by 2025. We feel like this is a really important claim, a way for us to show leadership here, hopefully spur other companies to follow our lead.
Based on all of our consumer research, we know that our consumers are looking for leadership here, and we think this will be something that'll enhance our brand and help us increase our household penetration. Just to highlight two of our brands, because these are really our sustainability focused brands. Nature's Fresh, been around since 2012. That's like the tip of the spear for us in terms of sustainability, and we continue to refine it. Originally started out with just animal welfare certified protein. It is now carbon neutral as of July of last year. It's carbon neutral across all Scope 1, 2, and 3. Look for that brand to be further cutting edge in the future. Maybe it'll include different ingredients, different proteins, different farms that we partner with, and those will be featured first in Nature's Fresh. Spring & Sprout is super exciting.
That's just launching now. That really is a culmination of all of our consumer research, all of our R&D development, where we know that consumers are looking for a meatless product, they're looking for a vegetarian product, they're looking for a lower carbon footprint product that tastes great and delivers great nutrition for their dogs. When you see this in person, I think you're going to be really impressed. It's got eggs, it's got plant proteins, as well as vegetables and fruits. Just to recap, sustainability really has been a foundational principle for Freshpet as we accomplish our mission of improving the lives of Pets, People, and Planet.
Another big focus as part of our ESG efforts has been governance, and Bill and the whole team did a ton of work on that last year, and we have some updates for him to share with you right now.
Thank you, Justin. I'll be real quick because your next step is to go on a tour. We're very proud of the work that our team has done. It's not just Justin. Justin is clearly passionate about this topic, but it's also the entire organization. We have very many people who are involved in it. I just want to highlight very briefly what we've done in governance, because what we did last year was viewed by most people as somewhat novel, where we laid out a long-term governance roadmap, where we called it the governance transformation plan. It's been guided by our board of directors. This is our board of directors. We feel very good about the board that we've acquired. These folks are very engaged with our business on a very frequent basis, and they bring a wide range of skills.
The way we think about it and what's really important as part of our governance transformation is that we think their involvement is guidance more than it's governance. Ultimately, when we become a fully mature company, it will be much more about governance than it will be about guidance. Right now, it is about guidance, because as we grow, we need to acquire a range of skills. The skills that are accumulated and represented by this team is incredibly helpful to us. Every one of our senior leaders have a tap into one of these people or more to get advice on topics of interest, and we do that very frequently. This is a commitment that we laid out. We laid out a path that was going to take us from a company that was, as Scott described, age appropriate.
There we are, a relatively immature company in 2014 when the company went public. We had all the governance practices of a company that you would expect with private equity backing and a very small, high-growth company. Our goal is to transform that into the practices you'd expect of a fully mature company by the time we reach 2025. Last year, we asked our shareholders for the first step in that in our proxy, and we got a very strong vote of approval for the plan that we laid out, and we feel very good about it. This year in our proxy, you'll see that we have two other items. One is declassifying our board in a staggered process between 2023 and 2025. There's other practices that the board has approved that the shareholders don't have to approve.
We feel like this is consistent with the way we do everything else, which is highly transparent, we do it in a very rigorous and disciplined way, and we do it in a way that is very pragmatic. It matches the growth of the company and the needs of the company to the needs of the shareholders. This plan has been implemented. We'll be glad to answer any questions about it, but this is in our proxy that we just released last week as well. At this point, we think of ourselves as a company that has a founding that's really built on sustainability and good ESG practices as something that we strive for. Our goal is to, over a long period of time, be a very sustainable company. That concludes the formal part of our presentation.
Our plan for now is we'll take questions after the tour. We know we don't want to starve you, but we'd rather have you do the tour and come back and get lunch, and we'll do questions and answer over lunch. The way this is going to work is every one of you has been assigned to a tour group. The number is on your badge, tells you what number you are. We have picked five people who are members of our organization to lead these tours. These folks, I selected them based on their ability to be really good cat herders. If they're plodding you along, that's what I've asked them to do to keep you moving. There are 13 stations that you're going to stop at for, call it, five to seven minutes each.
Each one of them has a poster that explains what it is you're looking at, and there will be a subject matter expert there who will explain to you what you're seeing. The idea is for you to understand all the things that we talked about today in relation to our manufacturing capability, expertise, our innovation, and the way in which we do various elements of sustainability, as well as the other elements of ESG. The five tour guides also represent a variety of different functions within our company. One of them comes from R&D, another one comes from our procurement organization, another one's from manufacturing, one's from HR, and I'm missing one. Who's one other? There's five folks. Sorry about that.
There are five different folks who feel free to ask them any questions about their experiences with the company, what brought them to Freshpet, why they're here. They're here to escort you along the path. The way we're going to get started, though, is your badge tells you where you are. The room where the breakfast is next door, it has all the PPE that you're going to need. You will go from here, go next door, find PPE that fits you, put on your PPE. The guides who are taking you guys are each going to indicate where you are by your number, and they'll meet you over in the other room and begin you on your tour.
We do need to keep you moving along, and when you come back, we could grab lunch, come back in this room, and we will do a Q&A at that point. Are there any questions or did I miss anything? Can I leave my stuff here? Yeah, you can feel free to leave it. This is perfectly safe to leave anything you want here. Great, thanks. What? I'll hold on to it.