Quitting your full-time job to perfect the potato chip may sound like a bad business plan, but it worked for Bill Utz in 1921, when he founded Pennsylvania-based Utz Quality Foods. A leader in the snack foods market, Utz each week produces more than 1 million pounds of potato chips and 900,000 pounds of pretzels. It also makes cheese curls, onion rings, popcorn, and pork rinds, as well as sunflower, tortilla, and corn chips. Utz's snack items are sold throughout the US by national chains, including BJ's Wholesale, Costco, and Wal-Mart. In 2011 Utz acquired Zappe Endeavors, which is known for its Zapp's, Dirty, and California chip brands. Utz is run by third-generation family members.
From its headquarters in Hanover, Pennsylvania, Utz caters to customers nationwide. The company distributes its Utz-brand snack foods throughout the East Coast, specifically across Boston and Connecticut. It also serves the South, Northeast, and Midwest with its Zapp's brand and the East and West coasts with its Dirty and California natural chips.
As part of its business, Utz maintains a handful of US manufacturing facilities to produce its variety of products.
Mergers and Acquisitions
In the heated and growing snack foods industry, Utz has grown through strategic acquisitions. Buying Zappe Endeavors in 2011 gave Utz a larger distribution footprint. Zapp's chips, which have Cajun seasonings and names like Spicy Cajun Crawtator, are kettle-cooked in peanut oil and sold throughout the South, the Northeast, and the Midwest. Zappe's Dirty and California natural chip brands are more lightly seasoned and are a hit on the East and West coasts. The Zappe purchase gave Utz plants in Louisiana, California, and Pennsylvania. Utz plans to expand Zappe's existing 88,000-sq.-ft. Gramercy, Louisiana, plant by 30,000 sq. ft. by 2016. Utz anticipates that with broader distribution and stronger operations (including more employees), it will be able to boost earnings generated by Zappe's brands. Zappe Endeavors continues to operate as a division of Utz. Its fate was spurred along after the death of founder Ron Zappe; he had intended to sell the company he established in 1985.
In late 2012 Utz also bought certain assets and brands of snack maker Bachman Company, giving Utz the Bachman, Jax, Thin'n Right, and Chipitos brands, as well as a plant in Ephrata and Hyde Park. As part of the agreement, Bachman will change its name to Savor Street Foods.
Sales and Marketing
Utz is the leading regional chip brand in the Boston and Connecticut markets. It also ranks highly among other regions with its Zapp's, Dirty, California, and Bachman brands. The company's products are typically sold through large national chains stores the likes of Wal-Mart, Costco, and BJ's Wholesale.
The snack foods maker regularly pumps out products. Utz has rolled out a new range of pretzels under the Utz Specials name that includes flavor varieties unsalted sourdough, extra dark, sourdough, and multigrain. The company has also extended other lines, such as its dip cups with a new Salsa version.
Looking for some leverage among the growing snack foods market, Utz agreed in late 2009 to be taken over by Snyder's of Hanover. However, the deal was called off less than two weeks after the announcement was made, with both companies stating that since the takeover had not been cleared by the Federal Trade Commission (FTC), they decided to cancel the deal because getting FTC approval would likely have been a protracted approval process. Both companies also said they preferred to get on with their businesses and not partake in time-consuming negotiations with the government, which, they added, would be detrimental to their companies. By late 2010, however, Snyder's of Hanover had merged with Lance to create Snyder's-Lance and a then $1.6 billion company.