Finding leg room
Aug. 1, 2014
by Charlotte Atchley
When Barry Levin, Snak King chairman and CEO, acquired the company more than three decades ago, he began to inject into it his entrepreneurial soul. Over the years, he created a business with a can-do attitude and a willingness to try just about anything in the realm of snacks.
“Barry grew the company on that entrepreneurial spirit of ‘we’ll get the job done’ and ‘impossible is not an option,’ ” said Mark Schieldge, vice-president of quality and innovation. “Through that entrepreneurial spirit, we’ve continued to grow.”
Snak King, located in City of Industry, CA, just east of Los Angeles, has gradually expanded nationally through co-manufacturing, its own brands and a variety of private label snacks, including tortilla chips, popcorn, nuts, pork rinds and more. Its portfolio includes a wide range of brands: Jensen’s Orchard, El Sabroso, The Whole Earth and Granny Goose.
During the past decade, however, Snak King has been known best for its presence in the alternative snacks category. Veggie chips, multigrain snacks, nut clusters, organic varieties and bold Latino-inspired flavors — these are the value-added products Snak King has staked its growth on. “Traditional snacks are still dominant in the market, but new and innovative, the ‘other snacks’ category, continues to get bigger and bigger,” said Joe Papiri, vice-president, sales and marketing.
The vast opportunity in alternative snacks, paired with the Snak King team’s out-of-the-box mindset, has fueled the company’s growth over time and led to the Los Angeles snack plant bursting at the seams. Needing some room to stretch its manufacturing legs, Mr. Levin and his team began looking for a way to expand production and reduce its distribution costs as business blossomed in the Midwest and further east.
They found the answer in a regional snack company, C.J. Vitner Co. The producer of Chicago-style snacks had been distributing Snak King’s products for years, and its owner Bill Vitner was ready to sell. The deal was struck in 2011.
Now, Snak King boasts two manufacturing facilities, its 180,000-sq-ft site in City of Industry and a 220,000-sq-ft operation in Freeport, IL. The Midwestern plant sits on 50 acres to provide plenty of room for future expansions while easing the distribution burden of shipping product from coast to coast.
An entrepreneurial spirit
At Snak King, no idea is a bad idea, and anyone at the company can contribute. “We operate on a team approach,” Mr. Levin explained. “Everyone has a voice, and everyone is passionate about what they do and the direction of the company.”
To carry out Snak King’s mission of making quality snacks consistently, Mr. Levin assembled a team that is as passionate as he is, including Ron Jones, president and COO, as well as Mr. Papiri and Mr. Schieldge.
“Barry and Joe, they really work through what we need to do to make sure we’re supporting the customer and how we leverage our own opportunities,” Mr. Schieldge explained. “Then Ron and I look at the efficiency side. We ask, ‘How do we do this in an effective, achievable manner?’ ”
The four men complement one other, and Mr. Levin asserted that their roles can be fluid, depending on the product. “We all have the ability to see all different angles of how things affect the company and the direction,” he said. For example, while Mr. Papiri may be handling the marketing and sales angles of the business, he is very knowledgeable about the manufacturing side of things too, and Mr. Schieldge considers anything new in the plant his jurisdiction. “My role and responsibility is both engineering and R&D because anything that’s new is going to fall within my team’s responsibility whether it’s new equipment, process or product,” he said.
The business’ can-do attitude translates into its ability to meet its customers’ needs quickly. “It’s a willingness to try new things that may be a little unproven, a willingness that runs pretty deep in the company,” Mr. Papiri said. “We’ve taken on some incredible projects and gotten them done with tight timelines.”
With innovation a core part of Snak King’s identity, being flexible to handle experimental products is vital to the company’s growth. Because private label and co-packing clients make up much of Snak King’s business, the team has to have the capabilities and the readiness to respond to their customers’ innovative ideas. Snak King’s relatively small size makes it more nimble in handling changeovers and experimenting with new products, but the company has implemented tools by larger companies to keep product quality on par with those snack giants.
“We’re trying to set up very high-quality control systems to produce high-quality products consistently,” Mr. Levin explained. “We spend a lot of time and money training people and setting up our systems for quality control, food safety and training.”
As Snak King’s customer base and capacity has grown, so has its variety of certifications. Both facilities have SQF Level 3, organic ingredient verification from Quality Assurance International, kosher certification, whole grains ingredient verification from the Whole Grains Coucil and partner brands ingredient verification from the Non-GMO Project.
Upgrading Freeport to SQF 3 meant meeting a demanding standard. “We had to do a top-to-bottom look at our quality systems and evaluate where we had opportunities to improve,” said David Bull, vice-president of operations in Freeport. Those improvements included bringing in new analytical equipment and a quality manager.
How Freeport fits
With the capabilities to produce potato chips, popcorn, corn chips, tortilla chips and extruded snacks, the Freeport operation reduced distribution costs as it expanded on a national basis and nicely complemented Snak King’s headquarters facility (see “California roots” on Page 28).
With this perfect match, Snak King also acquired the venerable Vitner’s brand that had become synonymous with snacking in Chicago over the years. The Vitner’s deal brought with it a direct-store-delivery operation with 65 routes. “Vitner’s has a pretty old brand, an 80-plus year history that we were intrigued with,” Mr. Levin said. “We thought it would be a better business move to buy an existing business and grow it than try to start from scratch with a new facility.”
During the past two years, Snak King incorporated its corporate culture into Illinois as the two companies became one. “When you have two companies, you have two different cultures, so we spent a lot of time in Freeport helping them understand our culture,” Mr. Levin said. “We want to make sure everyone who works here knows that we care about them and we’re all on the same team.”
Snak King upgraded Freeport’s quality control systems as a part of more than $20 million in new equipment, expansion and upgrading of the operation. For instance, the company recently added an ingredient warehouse rack system to streamline production and organize operations using 5S (sort, streamline, shine standardize, sustain) where every piece of equipment and every ingredient has its proper place.
“They had a lot of really good people there when we took it over,” Mr. Papiri said. “We’ve just helped them bring a lot of the systems that we were further along in and given them more support.” During the two years following the acquisition, Snak King showed that support by investing time and money in upgrading the equipment, streamlining production and training employees to make the Freeport facility a mirror image of its California sister plant. The Freeport plant currently houses seven processing lines and single and twin tube packaging lines to support it.
Taking on tortilla chips
Under Snak King’s leadership, the Freeport facility has more than tripled its output, according to Mr. Levin.
Sales and volume for Vitner’s brand potato chips have doubled in the past year thanks to improvements in product quality, packaging design, family-sized bags and increased distribution. “Now, we’re running 24/7 with three shifts operating, and we have 390 employees,” explained Jorge Nava, the Freeport plant manager. “We’re one of the top employers in Freeport.”
However, the bulk of this growth can be attributed to the influx of Snak King products being made by the Freeport facility. Before Snak King could relieve some of the pressure on the City of Industry plant, the Freeport operation needed some upgrades to handle the extra capacity as well as the growth Snak King had in store for the Vitner’s brand.
Previously, C.J. Vitner’s relied mostly on its potato chip and extruded snacks business with little attention paid to an existing tortilla chip line on the production floor, according to Mr. Bull.
The Midwestern facility gave Snak King the ability to produce cooked corn tortilla chips, where in California it had previously been able to only produce from masa flour. Snak King updated Freeport’s corn processing system with a new PLC-based control system for the kettles and by replacing the majority of the steam system.
To handle the incoming capacity of tortilla chips, Snak King installed a shiny new tortilla chip line in early 2013, a TC3. “It is a large scale, state-of-the-art tortilla chip line, and it gives us the ability to really dial-in with great precision the attributes customers are looking for,” Mr. Bull said. “We can run masa flour products or cooked corn products and do so with the ability to changeover quickly between those different products and run a whole variety of different types of tortilla chips.”
On the new line, tortilla chip dough is mixed from bagged masa flour or the cooked corn system in a Shaffer mixer turning out 800-lb batches every 8 minutes. A bucket conveyor carries the mixed dough to a sheeter and cutting system where rotating rollers sheet it to a specific thickness before cutting the chip shapes. A three-pass oven bakes the chips to the consistency of a soft tortilla. They are then conveyed on a conditioning belt to let the moisture equilibrate and set the chips’ texture before entering a Heat and Control fryer.
For the finishing touches, the chips are seasoned in, as Mr. Nava described, one of the largest seasoning tumblers he had ever seen. In addition to quick changeovers and high-speed capacity, the line’s computer controls allow Mr. Nava to access detailed information on the equipment’s operation, temperature and capacity by simply touching a screen.
With the new TC3 line and the existing line operating with rebuilt ovens and fryers, tortilla chips now dominate Freeport’s output.
Investing in Vitner’s
While tortilla chips may be running the show in Freeport nowadays, potato chips and extruded snacks have not been forgotten. “We still have a very large potato chip business, and we’ve added pounds of extruded products,” Mr. Bull said.
Freeport houses two continuous potato chip lines. The newer potato chip line includes Urschel centrifugal slicer heads that determine the thickness of the chip. With consistency and quality at the forefront of Snak King’s mission, the blades on these slicers are changed hourly to ensure the consistency of the product.
Fried potato chips then travel in bucket conveyors to the mezzanine level where a Heat and Control Fastback vibratory conveyor gently brings them to an automatic seasoner that disperses seasonings according to the amount of chips coming into the system. After seasoning, the chips drop into Ishida net-weighing scales and down to Heat and Control Atlas form/fill/seal baggers. A BluePrint semi-automatic collator groups the bags before they’re manually case-packed.
Seasoning is a core component of the Snak King and Vitner’s brands, so upgrading the seasoning equipment and the quality management systems was a wise investment.
“Vitner’s itself has really been famous for its level of quality around the seasoning,” Mr. Schieldge explained. “We removed the majority of the seasoning application equipment a little over a year after we acquired the company and installed all new seasoning systems for potato chips and tortilla chips. We now have the ‘latest and greatest’ mechanically. When we linked that with the improvement in quality management, it really helps drive a much higher level of quality and consistency than we had before.”
In the packaging room, new seasoners and scales combined with the implementation of a computerized quality control program, ensures Snak King’s seasonings are dead-on for consumers that are heavily invested in the Vitner’s signature flavor profile.
This quality control program automates data collection and management of all typical quality assurance measurements: oil, seasoning and moisture. The program manages that data and directs operators on how they should adjust the process.
“We’re really able to control around that flavor attribute with seasoning application in a much tighter way than we’ve ever been able to before,” Mr. Schieldge said.
As a part of its plan to expand Vitner’s market penetration in the Midwest, the company added capability for larger bag sizes. According to Mr. Nava, before Snak King’s arrival, Freeport specialized in smaller bags for vending, c-stores and other outlets. Snak King not only wanted to ramp up speeds for smaller bags but also produce 5-oz bags more efficiently.
The packaging room’s new seasoners, packaging machines and collators can produce both private label and branded products at the same time. And the lines are speeding up. Where previously the plant produced 50 bags per minute, now it’s clocking in at 90 to 140 bags per minute on smaller bags and 45 to 75 bags per minute on the larger bags.
“We have much better weight control, and our packaging machines are capable of running at a higher speed, so our overall efficiencies have increased significantly because of that,” Mr. Bull said.
This boom in business has to have somewhere to go after the packaging room, and to handle new national distribution, Snak King needed to take advantage of the extra land surrounding the facility. “A whole variety of new customers is now being serviced out of this facility, and it gives us the ability to distribute the product shorter distances and faster to the customer to make the value equation more attractive to them,” Mr. Bull said.
To handle that distribution, Snak King built a brand new warehouse. Previously, C.J. Vitner’s used off-site warehouses to store its products before shipping, but at the end of 2013, Snak King finished construction on an 80,000-sq-ft warehouse onsite with 22 bays and space for 5,280 pallets. Despite its size, products — including those shipped in from California — typically are shipped out in less than two days.
“It’s nice to have everything all under one roof,” Mr. Bull said. “It gives you much better visibility to see exactly what’s happening with your product, inventory control and freshness management. All these things improve when it’s all in one warehouse, and you can store and ship it efficiently.”
To aid those objectives, Snak King also brought in a warehouse management system. Previously with C.J. Vitner’s, the distribution team was relying on pencil, paper and memory to fill and ship orders, but with the new warehouse came handheld scanners and inventory management. “We now have real-time inventory visibility,” Mr. Bull explained. “We know exactly where everything is and when it was made. When we go to ship a load we know exactly where to pick it from.”
Stretching even more
As far as the future goes, Snak King intends to continue stretching its new legs in Freeport. While grading the land for its new warehouse, Mr. Bull said they had the construction crew grade for another 80,000-sq-ft warehouse to be built in the future. The existing warehouse has 45-ft ceiling clearances, providing ample room to expand vertically before a new warehouse is necessary. But Snak King is ready.
For now, the company intends to fill its Freeport facility with more production lines, matching the capabilities of the California plant.
With the immediate need for additional capacity now answered, Snak King still plans to move some of its rolled tortilla chip products to Freeport as well as a new popped chip product the company recently launched. In fact, Snak King began receiving equipment for the new popped snack line earlier this summer. Eventually, Mr. Papiri expects the Midwestern plant to exceed production in the City of Industry.
To get there, Snak King has the culture, employees, systems and equipment in place to keep taking on the growing national demand for new age snacks.