Originally created 07/09/01

Makers of multi-flavored kettle-cooked potato chips making market inroads



PHOENIX -- Jay Poore and his older brother, Don, got into the potato chip business at the ground level, installing and servicing bagging machines at snack food plants across the country.

After several years of back-breaking work, the Poores had a revolutionary idea: Why not make their own brand?

They developed a kettle-cooked chip cut thicker than conventional varieties that has evolved into Poore Brothers Inc., a multimillion-dollar business based in suburban Goodyear.

"I never anticipated the company would get this size," said Jay Poore. "Back when we started, we just saw a void in the market."

Poore Brothers now boasts 10 different seasoned chips, ranging from dill pickle to jalapeno, and markets them in 30 states and over the Internet. It is a publicly traded company with first-quarter sales of $14.2 million and a revenue growth goal of 30 to 40 percent in fiscal 2001.

"Last year, we had $41.7 million in revenue. Our goal is to build a $100 million a year business," said Eric Kufel, president and chief executive.

Fifty-four-year-old Jay Poore has been the company's vice president since June 1995 and still works at the Goodyear plant, overseeing the quality of the chips which are cooked one batch at a time. Don Poore, seven years older, is semiretired but helps out in the engineering department.

The brothers grew up in Arkansas and first started a small chip manufacturing company in Brookshire, Texas, in 1983. Within three years, Bob's Texas Style Potato Chips were selling well enough that the brothers sold their interest in the business and moved to Arizona to launch their namesake brand.

"In 1986, we started with one kettle and one delivery truck," Jay Poore recalled. "We didn't have a marketing budget so we relied on sampling and word of mouth."

Grocery stores and supermarkets around Arizona soon were stocking their shelves with Poore Brothers' distinctive colored bags that sport a cactus logo and a roadrunner and coyote scampering across a desert under a full moon.

And the different flavors kept coming: unsalted, bar-b-que, steak-and-onion, salt-and-vinegar, parmesan-and-garlic.

By May 1995, the chip company was getting too large for the brothers to handle and they sold the business for roughly $4.5 million to a private investment group that Jay Poore said "saw bigger and better things for us."

That group took the company public in December 1996 and the added revenue helped build a 60,000-square-foot manufacturing plant in Goodyear.

Poore Brothers also has a 140,000-square-foot plant in Bluffton, Ind., that was part of its May 1999 acquisition of some Keebler Co. snack brands for about $12 million.

Besides making, marketing and distributing the Poore Brothers' line of chips, the company also manufactures several other products including T.G.I. Friday's brand of salted snacks under a marketing agreement with the restaurant chain.

"The company has done great under Eric's leadership," Jay Poore said.

But even if it reaches the $100 million-a-year level, Poore Brothers still would lag far behind Plano, Texas-based Frito-Lay, which is an $11 billion snack food division of PepsiCo Inc., and has nearly a 68 percent share of the salty-snacks market.

"For potato chips, there's Frito-Lay and everybody else. They're the gold standard of the industry," said Dan Malovany, editor of Snack Food & Wholesale Bakery, a trade magazine based in Deerfield, Ill.

"But consumers want choice. They want new products," he added. "Poore Brothers has developed into a strong regional brand. This is a perfect opportunity for them to grow."

On the Net:

http://poorebrothers.com