Better Made Snack Foods, Inc.

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Better Made Snack Foods, Inc.

10148 Gratiot Avenue
Detroit, Michigan 48213
U.S.A.
Telephone: (313) 925-4774
Toll Free: (800) 332-2394
Web site: http://bettermadepotatochips.com

Private Company
Incorporated: 1934 as Cross & Peters Company
Employees: 300
Sales: $50 million (2006 est.)
NAIC: 311919 Other Snack Food Manufacturing

Better Made Snack Foods, Inc., is a Detroit-based maker of potato chips and popcorn that also sells pretzels, tortilla chips, pork rinds, and beef jerky under its brand name. The company distributes its products throughout Michigan, to Canada and Ohio, and as far west as Chicago. Better Made is owned and run by the heirs of cofounder Peter Cipriano.

BEGINNINGS

The origins of Better Made Snack Foods date to 1930, when a Detroit potato chip salesman named Cross Moceri decided to go into business for himself after being denied a commission by a chip producer. The young Italian immigrant partnered with boyhood friend Peter Cipriano to found a small chip-making operation in a garage on Detroit's east side, which began selling its output at a next-door bar, local movie theaters, and the city's Belle Isle park. The business grew, and in 1934 it was incorporated as Cross & Peters Co., using the founders' first names. Chips would be sold under the brand name Better Made, because Moceri and Cipriano sought to use only the highest-quality ingredients. A logo that featured a smiling "maid" in a sunbonnet was later adopted.

In 1937 the firm's employees joined the Teamsters Union, which helped boost their pay to 40 cents an hour. Two years later the company moved to a new location, which had a fryer that could cook 100 pounds of chips per hour. To help boost sales, the fryer was positioned behind a large window so that passers-by could watch, with many sales being made onsite as well as through delivery routes.

After several subsequent moves Cross & Peters bought a storefront space on Gratiot Avenue in 1949, which was expanded in 1955. During the 1950s the firm also purchased more sophisticated production equipment including a continuous fryer, and began to make the wavy, dip-friendly Ridges chip. In 1960 the plant was expanded again, and in 1965 production of popcorn was added. The 1960s saw the introduction of several varieties of flavored chips as well.

Over the years Cross & Peters had purchased several adjoining properties, and in 1972 its plant was again expanded to accommodate growth. Better Made chips were being distributed in much of Southeast Michigan, as well as in other parts of the state and as far south as Toledo, Ohio.

For most of the year the firm's potatoes were sourced from Michigan farmers, supplemented if necessary by potatoes from North Dakota and Minnesota. During the spring and early summer they were trucked from Southern states like Florida, North Carolina, and Alabama. To produce chips the potatoes were cleaned, skinned, and inspected. The potatoes were then sliced, after which they traveled down a conveyor where cool water jets sprayed away excess starch. The slices were air-dried, and then they were fried for three minutes at 325 degrees in pure cottonseed oil. Salting was next, followed by another inspection, and then flavorings such as barbecue or sour cream and onion were sprayed on before the chips were packed into heat-sealed bags. Because potatoes were 80 percent water, 100 pounds of raw potatoes yielded only about 20 pounds of chips. To reduce waste, the peelings were sold to hog farmers for use as feed.

SECOND GENERATION TAKES CONTROL IN 1984

In 1981 cofounder Peter Cipriano died, and three years later Cross Moceri passed away at the age of 86. Both men had worked almost until the end, overseeing the chip-making operation they had founded a half-century before. Control of the firm subsequently passed to their families, who continued to split ownership equally. Robert Marracino would serve as the company's president, with the founders' children holding other key positions. At that time, the company employed 120.

Cross & Peters was the lone survivor among some 20 chipmakers that had operated in Detroit in the late 1940s. The others had fallen prey to the efforts of nationally advertised competitors and an influx of other snack food products despite the fact that Detroiters were the country's top potato chip consumers, eating an average of seven pounds per year (well above the U.S. average of 4.3 pounds), according to the Snack Food Association. The company was the second biggest chip seller in the Detroit area after Frito-Lay, which had bought out former local leader New Era. In addition to six different varieties of potato chips, Cross & Peters produced four types of popcorn and cheese puffs, and distributed other snacks like pretzels made for it under contract.

A six-week Teamsters strike against Frito-Lay in late 1985 helped boost Better Made sales by up to 20 percent, but bad potato crops in Michigan and in the South in 1986 and 1987 caused the price of potatoes nearly to double. The firm scrambled to find enough potatoes to keep up with demand, though it held prices in check. Despite such challenges, the company expanded its plant twice during the 1980s.

With competition continuing to impact sales, in 1994 Cross & Peters merged with Made-Rite Chip Company of Bay City, Michigan. Chips would continue to be produced under both brand names.

In the mid-1990s the firm began receiving employment tax credits after a Federal Empowerment Zone (created to encourage employment in America's troubled inner cities) was declared in the area where the plant was located. Though originally in an enclave of hardworking Italian immigrants, the firm's Gratiot Avenue location had come to be surrounded with abandoned buildings and other signs of blight, though it continued to offer employment to residents of the area.

In 2001 Cross & Peters celebrated its 70th year in business (though uncertain about the exact date it had begun operations), and packed its chips in special commemorative bags. It was processing 200,000 pounds of potatoes per day, with 75 percent of sales continuing to come from Southeast Michigan.

CHANGES IN OWNERSHIP AND NAME

In 2003 the heirs of Peter Cipriano bought out the Moceri family's interest in the firm they had jointly owned for nearly 70 years. Salvatore "Sam" Cipriano, the 62-year-old son of the company's cofounder, was designated president and CEO, with chip-making veteran Mike Schena hired to serve as general manager of the 250,000-square-foot plant and 180,000-square-foot storage facilities. After the ownership change the company's name was changed from Cross & Peters Company to Better Made Snack Foods, Inc. For 2003 the firm had sales of $36 million and recorded a profit.

COMPANY PERSPECTIVES

Better Made Potato Chips use all natural resources and are untouched by human hands from the time the potatoes leave the farm until you bring the crunchy chips to your mouth. When you add Better Made's line of best selling seasoned potato chips such as Bar-B-Q, Red Hot, Sour Cream and Onion, Salt and Vinegar, and the brand new Sweet Bar-B-Q, you have the best snacks for any occasion.

Under its new management team Better Made soon began improving production, packaging, and shipping operations to boost quality. New supervisors were hired for its delivery staff, which included 25 company employees and 150 independent drivers. Six new flavors were also created including Creamy BBQ; Ketchup, Curry & Garlic; and Sicilian Style, which debuted in 2005. They were a response to industry trends as well as the success of smaller local competitor Uncle Ray's, which offered a number of offbeat chip flavors. Despite an increase in sales to $37 million in 2004, the cost of reorganization caused the company to record a loss for the year.

By 2005 Better Made was producing 22 flavors of potato chips and five flavors of popcorn, as well as shoestring potato chips. It also offered seven pretzel varieties, six of tortilla chips, three corn chips, four each of pork rinds and beef jerky, two party mixes, and six dips and salsas, which were produced for it by outside firms. The company had a 15 percent share of the Southeast Michigan grocery store chip market, with even stronger sales in convenience, drug, and party stores.

In October 2006 the firm's factory outlet store was reopened after an expansion and upgrade. It was double in size and featured marble counters, a tile floor, and historic photos of the company on the walls. Its product lineup was broadened as well to include logo-imprinted hats, T-shirts, and other souvenir items, which the firm also sold online, largely to nostalgic ex-Detroiters.

In 2007 Better Made Salt & Vinegar flavored chips were named the best of their type in tastings in Every Day with Rachael Ray magazine and the Detroit News, while the firm was named "Snack Manufacturer of the Year" by Snack Food & Wholesale Bakery. The company's chips, which still bore a decades-old logo featuring a smiling, sunbonnet-clad woman at the top, were distributed throughout Michigan, in North and Central Ohio, in the southern Chicago metropolitan area, and in parts of Canada.

KEY DATES

1930:: Cross Moceri and Peter Cipriano begin making potato chips in Detroit.
1934:: Firm is incorporated as Cross & Peters Co.
1949:: Company moves to new quarters on Gratiot Avenue.
1965:: Production of popcorn begins.
1984:: Control of company passes to heirs of Moceri and Cipriano.
1994:: Firm merges with Made-Rite Chip Co. of Bay City, Michigan.
2003:: Cipriano family buys out Moceris; Salvatore "Sam" Cipriano becomes CEO; firm renamed Better Made Snack Foods, Inc.
2004:: Company restructures operations, begins developing new chip flavors.
2006:: Better Made outlet store expanded, upgraded.

More than 75 years after Cross Moceri and Peter Cipriano founded a small potato chip company in Detroit, the Cipriano family continued to own and manage Better Made Snack Foods, Inc. The firm had established itself as the leading locally owned Detroit chip producer, and was expanding its territory beyond Southeast Michigan. With a host of new flavors and a renewed emphasis on quality, the company appeared to be on solid footing for continued success.

Frank Uhle

PRINCIPAL COMPETITORS

Frito-Lay, Inc.; The Procter & Gamble Company; Lance, Inc.; Jays Foods, Inc.; Jenkins Foods LLC; Kettle Foods, Inc.; Shearer's Foods, Inc.; Snyder's of Hanover, Inc.; Wise Foods, Inc.; Mike-Sell's Potato Chip Co., Inc.; Detroit Popcorn Company.