Sussex bakery business Forfars will move its factory to Newhaven this year creating around 12 more jobs in the town.
The company is quitting its base, Home Farm industrial estate in Moulsecoomb, in a bid to reduce costs and expand its operation.
Forfars said there were a number of food production businesses based in Newhaven already and with this growing trend, the town could become a food production hub in the future.
Production director Matthew Cutress said: “We started our search some 18 months ago and looked in all parts of Sussex but we needed to stay relatively close to Brighton to accommodate our staffing as well as our retail units.
“Sussex is very challenging for a fresh bakery operation.
“Our products have to be close to the point of retail and given that 50 per cent of our market is in the sea and the other 25 per cent by the downs, you can imagine that site selection is not easy.
“Our attraction to Newhaven was driven by the site. We are located on Avis Way and as well as a good production unit, we have a great deal of yard space, which is essential for an operation like ours.
“The Beddingham roundabout can be a real snag in peak rush hour but given that most of our distribution is before 6am, we are not too hampered by this.
“Newhaven gives us a cost effective production facility and it is well suited for food production.
“There are other food operators in the area and we suspect that if the momentum maintains, you could see Newhaven as a bit of a food production hub - Foodhaven!”
Forfars employs 150 people at Home Farm, has 16 shops, snack delivery vans and serves 40 wholesale customers including ASDA and Co-Op.
Forfars said there would be no job losses as a result of the move, adding the new production unit in Newhaven would pave the way for the introduction of a more efficient business model.
Using the very latest baking equipment and lean production methods, Forfars will be able to make more products and make more profit while reducing its overheads and commercial workspace requirements by more than 5,000 sq ft.
To support the relocation of the new Forfars production and storage facility in Newhaven, Locate East Sussex has helped the firm secure funding of £230,000.
Funding was secured through East Sussex Invest 3 Regional Growth Fund money won locally by East Sussex County Council and delivered in partnership with Locate East Sussex.