Chip plant expansion will benefit potato farmers

Published October 29, 2015 by Joan Tupponce

Sarah Cohen was thinking about the future when Route 11 Potato Chips built its 23,000-square-foot production facility in Shenandoah County in 2007.

“We built with the thought of putting a second line in,” says Cohen, the founder and president of the company. “In the last couple of years, we have needed a second line. We are very vulnerable with just one production line. It can be precarious at times. People want their orders when they are expecting them.”

Route 11 produces kettle-cooked potato chips in seven flavors as well as sweet potato chips. It will invest more than $1.2 million in an expansion and create 13 jobs — three of which already have been filled — in Mount Jackson. It will make nearly half of its new potato purchases — and all of its sweet potato purchases — from Virginia farmers. That equates to more than 1.5 million pounds of potatoes and sweet potatoes.

“They can expand and get credit for sourcing Virginia products,” says Carrie Chenery, executive director of the Shenandoah Valley Partnership. “The new jobs and capital investment means a lot to our regional economic development efforts for Shenandoah County and Mount Jackson.”

To help with the expansion, the state will provide a $50,000 grant from the Agriculture and Forestry Industries Development Fund that will be matched by Shenandoah County. “The grant requires a local one-to-one match,” says Brandon Davis, the county’s director of community development.

He feels that Route 11 is a company that hits several economic hot buttons — entrepreneurism, manufacturing and tourism. The Mount Jackson facility has a store on site and offers tours of the production process. “It’s a unique business that supports everything Shenandoah County stands for,” says Davis.

The company’s distribution is focused on the on the mid-Atlantic states, but it also sells throughout the U.S. and exports to Indonesia, China and Japan. “I would be happy if we sold every chip we made here in Virginia, but it’s hard to convert people from their chip brands,” Cohen says. “Our niche in the market is specialty food.”

One of the company’s largest customers is members-only warehouse retailer  Costco. “We just sell to them in the mid-Atlantic region,” Cohen says. “We pick and choose who we want to sell to based on keeping a simple business model — the lowest maintenance customer with the highest margins. We are so small we can’t sell to everybody.”

The company, which now has 32 employees, produces potato chips six days a week. It was one of the first two potato chip companies to produce sweet potato chips in the U.S. All of its sweet potatoes come from Quail Cove Farms on the Eastern Shore.

“We are not a 24-hour operation. That sets us apart,” Cohen says. “Our motto is unhurried potatoes. The kettle-style chip is a slower method than industrial-style chip.”

The company is moving forward with its expansion. It plans to install the second production line at the beginning of next year. “We have to keep producing while we are in construction,” Cohen says. “Potato chips move pretty quickly.”