Great Lakes Potato Chip’s double-digit growth sparks $1M expansion
When Great Lakes Potato Chip Co. adds a new building this spring to boost warehouse space, it won’t be the first expansion for the 10-year-old company. And it probably won’t be the last.
The chip manufacturer has been on a growth trajectory through many of its years, expanding geographical reach, sales and operations.
Inspired by CEO Ed Girrbach’s favorite snack, he and son Chris Girrbach, president, launched the business venture in 2009. Their goal: To make a quality product and highlight the Great Lakes region, Ed Girrbach said. “We have always wanted to be a regional chip manufacturer with a national reach,” he said. “And we’re well on our way.”
The upcoming building will probably add about 10,000 square feet of space and is among what could be up to $1 million in new improvements to the company’s site off M-72 outside of Traverse City. It’s the latest in a string of investments over the years that have added trucks, fryers, bagging lines and other items, including a $1.5 million expansion in 2018 that more than doubled production capacity and installed new, more efficient equipment.
What began with two part-time employees and the Girrbachs – who in 2009 pulled their pickup truck in line with semi-tractor trailers waiting to load up potatoes grown in Mecosta, Michigan – has become a potato chip presence in eight states and Canada, employing around 35 to 40 people.
A 2018 Inc. magazine ranking of 5,000 of the nation’s fastest-growing private companies placed Great Lakes Potato Chip about halfway on its list at #2,467, with 2017 revenue of $3.9 million and three-year revenue growth of 175%. Company executives declined to disclose current revenue figures but said the business continues to have year-over-year double-digit sales growth.
And consumers’ appetite for the chips has helped other local businesses. Mike Groothuis, owner of distributor Great House Foods in Williamsburg, said Great Lakes Potato Chips account for “a large percentage” of Great House’s revenue and is among the top four or five product lines that Great House distributes. Seven-year-old Great House Foods focuses on specialty foods made in Michigan, mostly northern Michigan, and distributes to SpartanNash stores and others in northern and west Michigan.
Groothuis said the chips are a “consistent selling” line and “a top-notch, quality product” in a variety of flavors that helps set the chips apart.
The company’s line of kettle-cooked, skin-on chips includes include eight permanent flavors and a few seasonal offerings. They’re made from about seven million pounds of potatoes a year, mostly from central Michigan, cooked at a rate of some 1,200 to 1,700 pounds an hour and hand-seasoned.
In the lineup of flavors, original is the best-seller, with Michigan cherry barbecue recently running in second place. Last year saw debuts of a pickled jalapeno chip and a limited-edition purple potato chip to commemorate the company’s 10-year anniversary. The purple chip, made from a potato variety 20 years in development through Michigan State University’s potato breeding and genetics program, was grown by Iott Seed Farms in Kalkaska.
The 6,000 pounds of Blackberry potatoes used in November’s production run became chips that sold out fast on store shelves and Great Lakes’ website. A second limited production run of the purple chips was planned for mid-January.
The company’s chips are sold through nearly two dozen distributors servicing mostly the Great Lakes region, with some sales in Texas and Florida, the latter a market the company may penetrate more.
“We both realize terrific opportunity for the brand down there because of the snowbirds,” Ed Girrbach said.
Chris Girrbach said the company is also looking to build distribution further in the Great Lakes states and “fill out our footprint. We have tons of opportunity in our … region.”
Still, the company steps judiciously. Chris Girrbach said the company never takes on a new distributor unless it is sure it can service the added business.
“We’ve had to say no to distributors because we can’t service it,” he said. “That’s the good and bad part about this business. The good part is that there’s a ton of opportunity, the bad part is that there’s a ton of opportunity.
“The worst thing would be to grow too fast and disappoint our customers.”
Jim Sommerville, director of operations at Oleson’s Food Stores, said Oleson’s store on North Long Lake Road was Great Lakes’ first customer and the chips have done well “right from the start. It’s grown immensely from there, the popularity of that product is amazing.”
He said the product line is competitive with other chips on store shelves and the company supports the line with promotional activities throughout the year. And he and others said the aspect of the chips being locally produced, with “made in Traverse City Michigan” stamped prominently on every bag, has been instrumental in growth.
Jeff DeRushia, corporate director of operations for Tom’s Food Markets, said with Great Lakes Potato chips, “you put a display out there, and it sells. It’s a great product. The quality is good, price is reasonable, and (it’s) made in Traverse City.”
He said Ed Girrbach initially called on him to get chips into Tom’s and Chris Girrbach is frequently in stores, helping to create merchandising strategies and promote the products. In markets and at food shows, “Chris is very much the face of Great Lakes chips,” DeRushia said. And if product is running short, he said, Chris will do what he can to get more chips to refill shelves.
“They really take good care of us, and that’s helped our growth. Our business with them has grown tremendously. We sell more Great Lakes chips every year,” DeRushia said.
As for the company’s future, DeRushia says it’s bright.
“I think their future is very bright,” he said. “They’re one of the strongest local brands we have, and they work hard to take good care of their customers. And that’s what’s going to keep them strong well into the future.”
Beyond its own brand of chips, Great Lakes also does private label production, a niche market that Chris Girrbach said is about 6% of the company’s business. The private label production includes restaurants and Zingerman’s of Ann Arbor. Chip varieties bearing the Zingerman’s name and listing Great Lakes Potato Chip Co. as a partner are sold through Zingerman’s locations, Zingerman’s mail order, and select Michigan markets and grocery stores.
At the company co-owned by Ed and Chris, Ed says he has semi-retired, with COO Shawn Burks taking on some of his responsibilities and production manager Kevin Paveglio stepping into some of Chris’s areas of focus. Still, Chris said, roles “haven’t changed a lot. My dad has always handled the financial end of the business” and he “still oversees to see that our margins are where they should be, and I oversee sales, like I did before.”
The Girrbachs credit their team of employees in helping the company grow. There’s also synergy between father and son, Ed Girrbach said, “and we had a good idea at the right time.”
“We just took the risk,” said Chris Girrbach. “You jump in. We like to start things. And this was a ton of fun to start.”
Amy Lane is a freelance journalist and former reporter for Crain’s Detroit Business, where she covered business, state government, energy and utilities for nearly 25 years.