Episode 24: One Potato…Two Potato…The Little Potato Company Builds U.S. Headquarters in WisconsinAugust 7, 2017
With over 300 employees and facilities in Edmonton and Prince Edward Island, Canada, The Little Potato Company isn’t exactly small potatoes. The company has experienced double-digit growth since 2012 and finally decided it was time to set-up its first major facility in the United States.
Sanford Gleddie, a company Vice President who had never conducted a site location search in his life, raised his hand and was charged with finding a U.S. headquarters for the company. And his search led him to the state of Wisconsin and the Wisconsin Economic Development Corporation.
Andy Levine (DCI): So, to kick off this episode, I’m going to ask my highly intelligent co-host, Patience Fairbrother, to answer three questions. Patience, are you ready?
Patience Fairbrother (DCI): I think so, yes.
Andy: Okay. Good, good, good. Question number one, what is the most popular vegetable in America?
Andy: Potato. Okay. See, I think you had a heads-up.
Patience: Did I get it right?
Andy: You did get that right. A lot of people don’t think a potato is a vegetable. It is a root vegetable according to a botanist. It is a vegetable, not a starch, which we sometimes think of it as. So, the second question, how many pounds of potatoes does the average American eat in a year?
Patience: Oh my gosh. Well, now I’m just thinking about McDonald’s French fries.
Andy: And that is the largest consumption, is French fries.
Patience: Oh, really?
Andy: Yes, okay.
Patience: Okay. That makes sense. Okay, pounds per year, just a wild guess, 1,000 pounds?
Andy: Wow, that would be a lot of potatoes. No. According to the National Potato Council…
Patience: Potatoes are heavy, aren’t they?
Andy: …it is 117 pounds per year. So, that’s that.
Patience: Okay. I overshot it.
Andy: Yeah, a little bit. So, finally, which U.S. President gets the credit for introducing French fried potatoes to America?
Patience: Oh my gosh. I don’t know this one.
Andy: This is surprising. Well, take a guess.
Patience: I don’t know. George Washington.
Andy: You’re close. Thomas Jefferson.
Patience: Wow, okay.
Andy: So, it goes way, way back.
Andy: So, anyway, he introduced it at a White House dinner, where it was first served and first sort of got on the radar of Americans. So, today, we’re going to talk about potatoes and a decision by a company called The Little Potato Company, it’s a company based out of Edmonton, Canada, to build its first facility in the United States.
Patience: So, the company looked at seven states across the Northeast and Midwest, and they built their plant, a new $20 million facility that will serve as its first U.S. headquarters, in De Forest, Wisconsin.
Andy: So, welcome to Episode 24 of The Project, “Inside Corporate Location Decisions”. I’m Andy Levine of Development Counsellors International.
Patience: And I’m Patience Fairbrother, also with DCI, and Andy’s cohost of The Project. Today we bring you the story of a Canadian company called The Little Potato Company, (I truly love that name), and their search for a U.S. headquarters.
Andy: The company is just 21 years old and currently employs 340 people, and as you’ll hear from Sanford Gleddie, the company’s Vice President of Agriculture and Business Development, they focus on, you guessed it, little potatoes.
Sanford Gleddie (The Little Potato Company): So, we are The Little Potato Company, and what we do, and all we do, is little potatoes, little creamer potatoes to be specific. So, we focus 100% on the breeding, growing, production, packing, distribution, marketing, and sales of small, creamer-sized, little potatoes. They’re our own varieties. They’re selected for taste and eating experience. They look great, they taste great. We put them in convenient packaging for our potato lovers out there in North America. And it’s pretty simple. That’s all we do. That’s what we do.
Patience: The company has been experiencing double-digit growth over the past five years, and in 2015, they decided it was time to open their first facility in the United States. Building a site selection team was pretty simple.
Sanford: Well, I was the guy who put my hand up and said, “Hey, we need more plant locations and we need more growing regions.” So, it started from there.
Patience: So, with zero experience in site selection, Sanford started to look for a U.S. headquarters location for the company. We asked him about the top three site selection factors on his list.
Sanford: Well, number one is, you know, finding regions where we could grow sufficient quantities of high-quality potatoes. That’s our number one factor. Number two is proximity to customers. And then, number three would be some of the more normal, common-to-everyone factors – a skilled workforce, favorable climate for business, all those sorts of things.
Andy: So, the search began with a basic question: Where can we grow the best potatoes?
Sanford: You know, we came up with a map, and we basically looked at a sales forecast, a logistics model, and analyzed all those results, and we concluded, “You know, we’re going to need multiple plants in the U.S. as we move forward.” And it made sense for us to start with a plant somewhere on the eastern half of the United States. So, what we did then is said, “Okay, so somewhere on the eastern side of the U.S., east of the Rockies, we need to set up a plant, and we need to set up a plant close to where we can grow a sufficient quantity of high-quality potatoes, year in/year out, a very reliable supply in a stored crop-growing region.” So, that kind of limits you, then, to temperate growing regions, so the northern states.
Andy: They started by looking at seven states, but ultimately, they narrowed it down to three top competitors – Illinois, Michigan, and Wisconsin.
Sanford: So, at a high level, we said, “We could make any of these three states work,” but our number one factor continued to be assessing those states as potato-growing regions. So, we went into much more depth on that assessment, both of the soils and the climate, but also of the growers and potential acres available, and things like that. But then, we also did a pretty in-depth business assessment within each state, and we looked at all the typical factors, and we looked at, you know, taxation, at labor law, at, you know, skilled workers, at employment rates, cost of real estate, availability of real estate. All of those factors started coming into play.
Andy: So, had you ever grown potatoes in Wisconsin before?
Patience: So, here’s where we’re going to pivot and hear from Tricia Braun, Chief Operating Officer for the Wisconsin Economic Development Corporation. We asked about the first interaction between the WEDC and The Little Potato Company.
Tricia Braun (Wisconsin Economic Development Corporation): It was kind of an interesting story because our Vice President of International Business Development was at an event with the Consul General of Canada, Roy Norton, who was the Consul General at the time, and he introduced her to The Little Potato Company. And, you know, they just started talking about their business development plans and the fact that they wanted to establish a U.S. headquarters and would be considering locations, primarily in, at the time, I think they were looking at the Midwest and the Northeast.
Patience: And a relationship started to develop between the two entities.
Tricia: With The Little Potato Company, and I think a lot of international companies are this way, is that they’re going into sort of unchartered waters in many regards. And so, what we felt from the company is that they were looking for, not just a site and not just an incentive, but they were looking for a relationship. You know, they were looking for a support system that, you know, would help them along the way, whether it’s navigating the selection process, or the development process, or even things like workforce, or partnerships with universities or growers, producers, suppliers, etc. And I think that’s really where Wisconsin has some pretty strong competitive advantages.
Patience: And there was a strong cultural fit between the leadership of The Little Potato Company and the State of Wisconsin.
Tricia: Wisconsin is so humble, and it’s just part of our nature and who we are. So, when a company like Little Potato comes in and they recognize some of those aspects to our culture, you know, I think it’s a pretty strong testament to the people in Wisconsin.
Andy: So, let’s go back to Sanford and the decision process. We’re still down to Illinois, Michigan, and Wisconsin, three states, but Wisconsin seems to be rising to the top of the list. Were there some elements that caused Wisconsin to sort of rise up to the top here?
Sanford: I know I’m going to sound like a broken record, but the potato, the potato-growing…
Andy: It all goes back to the potatoes.
Sanford: It really does, you know.
Sanford: But, that was big. I mean, the more we dove into it, the more we realized the Central Sands region of central Wisconsin was a really unique potato-growing region, the beautiful sandy soils, everything is irrigated, you know, some of the best growers that you’re going to find in North America. It was really quite phenomenal. Then, on top of that, Wisconsin is, I guess, open for business, was how we felt. Just from tax structure, labor, labor legislation, that whole business environment, it just felt like everyone in Wisconsin was like, “Yeah, come here. Set up. We’re ready to go.”
Andy: What really seemed to seal the deal for Wisconsin was a series of meetings that Sanford had with the growers, the farmers that The Little Potato Company would be working with in Wisconsin. Was there a moment in the process that, you know, you came to the conclusion and sort of said to yourself, “Yeah, Wisconsin is the place. De Forest is the place.” And I’m just wondering if you could, if there was, if you could describe that moment to our listeners.
Sanford: The first time that, with our agronomy team, I met our growers, the people that would become our growers, our farmers in Wisconsin, that’s when I knew we had found the right place.
Andy: So, tell us about that meeting. What happened, how was it set up, and you know, what did it look like?
Sanford: You know, we met four or five different growers on their farms and would, you know, sit in their kitchens or in their farm offices, and every single one, I just really liked them. I mean, it felt, like I said before, it felt at home. It felt, in some ways, like I’d known them for years already.
Andy: As a final question, I asked Sanford if the company planned to open a second facility in the U.S. in the years ahead.
Sanford: Yeah, it looks probable. Within the next two to three years, we’ll have to look at a second location in the U.S., you know, Lord willing that we keep getting the growth and success that we have, and people keep…people like you keep buying our potatoes and eating them.
Andy: I promise to keep doing that.
Patience: That’s probably a good place to end, with Andy promising to eat his potatoes. So, as of last month, The Little Potato Company has hired over 100 people at their new U.S. headquarters facility in the village of De Forest, Wisconsin. At full capacity, the company will produce 800 million servings of potatoes a year at the Wisconsin facility. So, Andy, we’re up to the takeaways portion of the episode. Since you talked to both of our guests this week, let’s hear, what was one of your top takeaways from this episode.
Andy: Sure. I’m going to start off with Sanford. And, to me, it was interesting to be interviewing someone, this was the first and only site selection project they’d ever done in their life. And so, it was just interesting to hear his perspective. They did engage some consultants. They engaged a corporate real estate consultant. They engaged Deloitte as a consultant on this project, as well. But, he was really, you know, back in 2015, when he raised his hand and said, “I’ll do this,” he had no experience in this, and it was very interesting, seeing it through the eyes of someone who is completely new to site selection. It will be interesting to see how, when he does his second project, probably in the Western half of the U.S., I think it’ll be much, much easier for him.
Andy: So, that was kind of number one in terms of my takeaway. The other part of this was, in the end, he did say, and we didn’t cover this in the podcast, but he did say at one point, he said, “Listen, any of these three states, Illinois, Michigan, Wisconsin, any of them could have worked for us, but at the end, there was an intangible that just, we felt the most comfortable in Wisconsin.” And it really came down to that segment where he was going out with his team and they were meeting with the farmers.
When they were meeting with the growers and he talked about them, as you heard in the podcast, sitting down in their kitchens and just sort of talking to them, it was like, “These people are just like people we know in Edmonton, Canada,” and they just felt very comfortable. In the end, that won the day.
Patience: So, that is a wrap on Episode 24 of The Project, “Inside Corporate Location Decisions”.
Andy: Our sincere thanks to Sanford Gleddie of The Little Potato Company for being so open with his story of his first, but hopefully not his last, site selection project. We also have to thank Tricia: Braun of the Wisconsin Economic Development Corporation for sharing the state side of the story.
Patience: Finally, our very special thanks to Kelly Lietz, also with the Wisconsin Economic Development Corporation. This podcast never would have taken place without his assistance.
Andy: The Project is sponsored by DCI. We are the leader in marketing places and have served over 450 different cities, states, regions, and countries. You can learn more about us at aboutdci.com.
Patience: We hope you will keep listening. There are many more projects to come in the year ahead.