BULLA Dairy Foods has reinforced its commitment to the Victorian town of Colac as it starts works on its $8 million innovation centre.

The 2710 sq m facility will focus on testing and manufacturing new and emerging products, the Geelong Advertiser reports.

The expansion, coinciding with Bulla's 90th anniversary of operations in Colac, will also provide for all of Bulla's local administrative staff, who are spread across three sites, to work under the same roof.

Bulla's chilled operations general manager, James Downey, said the facility reinforced the company's commitment to Colac, in terms of employment and investment.

"We're confident that our role as one of Australia's leading dairy companies will only strengthen which, in turn, will support employment in western Victoria for years to come," he said.

Bulla employs more than 500 staff across its three Colac sites and Melbourne bases at Mulgrave and Derrimut.

The development, which gained council approval late last year, is expected to be finished by late 2012.

It will include research, technical, sensory and pilot plant capabilities.

Planning documents show the site will host 153 car parks and be landscaped along the southern and eastern edges.

"Bulla Dairy Foods will be releasing information on the site's development as and when the various stages occur," Mr Downey said.

The Colac Otway Shire Council estimates the value of Bulla's total investment in Colac is worth about $200 million.

Bulla buys from southwest producers Fonterra, Murray Goulburn and Warrnambool Cheese and Butter.

Read more at the Geelong Advertiser