Canadian sunflower seed factory closing — but Spitz brand still growing
Bittersweet emotions for founder Tom Droog, who built the company 'from nothing' alongside his wife
Spitz sunflower seeds blossomed at its lone processing plant in Bow Island in southern Alberta — but the Canadian factory is now closing down and moving south of the border, a move the company's founder says is hard to watch.
Tom Droog and his wife spent decades growing their sunflower seed farming business in Alberta into a multi-million dollar corporation with sales across North America.
Droog and his wife Emmy, a pair of Dutch immigrants, started the company in 1982.
At first, the idea was to market the seeds as bird feed, until the couple realized they could sell them as a snack in resealable bags. The company expanded, marketing bags of sunflower seeds at baseball games and to people spending a lazy summer day lounging on a deck.
The pair sold the company to American snack giant PepsiCo in 2008, in a private multimillion dollar deal. A decade later, Droog learned the multinational had decided to shut down the brand's only Canadian facility.
Droog began to anticipate such an announcement as the brand continued to grow, but the Spitz founder says that didn't make it any easier to swallow now that it's happened.
PepsiCo had invested a few million dollars recently into the original Spitz plant in recent years, so the decision to close the facility was a shock.
That's the cruelty of business.- Tom Droog , Spitz founder
"Of course I'm sad, it was our baby," said Droog. "But hey, they bought it, they can do with it whatever they want."
Droog tried to sound upbeat during a phone interview Tuesday as he drove to Bow Island to meet with employees and give comforting words to the 50 startled workers, many of whom will be without a job once the doors on the processing plant close in July.
Not only did the company emerge as a major employer in the community, but also a major sponsor and donor in the town of about 2,000 people. The local impact of the closure won't go unnoticed.
"That's the cruelty of business," he said.
At the same time, PepsiCo plans to continue growing the Spitz brand, which gives Droog immense pride. When the company was sold in 2008, it was producing five and a half million kilograms of seeds a year. The Bow Island plant now processes about 14 million kilograms and Droog says the company is aiming to double production in the future.
"They didn't think the Bow Island plant could handle it," says Droog, dismissing any suggestion the decision was prompted by minimum wage increases in Alberta.
"It just becomes a numbers game. The bean counters got a hold of it and say 'What if we do this? How much will we save if we do it somewhere else?' And I think that's the brunt of the story," he said.
PepsiCo said in a statement last week that it made its decision based on the long-term viability of the Alberta facility and "its ability to meet our increasing volume requirements for the brand, which will continue to play an important role in our North American portfolio."
It's not immediately clear exactly where the Spitz manufacturing facility will be located, but PepsiCo has said it will be in the U.S.
While it's the end of an era in Bow Island, Droog says he's proud the Spitz legacy will continue — as long as PepsiCo sticks with the same patented production process and maintains the distinctive flavour.
Droog's wife died in 2010 and wherever Droog travels in Canada and the United States, he's reminded of what they built together as he sees bags of Spitz seeds on store shelves, even in parts of Mexico.