Zapp's Potato Chips

by Don Boudreaux on March 11, 2005

in Food and Drink

In the first 1992 presidential debate, then-candidate Ross Perot famously quipped "you make more making computer chips than potato chips." This clever little phrase was part of Perots explanation for why America needed a high-tech-focused industrial policy (my term) to handle the demise of the cold-war defense industries.

I typically respond with two observations to people who insist on the intrinsic merits of computer chips over potato chips.

First, Id rather eat potato chips than eat computer chips but I admit that potato chips dont work as effectively in my laptop computer.  Second, Herman Lay founder of Frito-Lays made a fortune producing potato chips.

Here’s another chip entrepreneur whose story is interesting: Ron Zappe.

Zappe founded Zapps Potato Chip Co. in 1985. It was successful from the start, today employing 100 people at its plant in Gramercy, Louisiana (which is about half-way between New Orleans and Baton Rouge) and producing 150,000 bags of chips per day. Zapps chips are now the number two selling snack food in Texas and Louisana.

I’m pretty sure that Mr. Zappe is a wealthy man.

He once worked for Ingersoll-Rand and then started a few companies selling oil-field equipment. That industry went south in the mid-1980s when oil prices plummeted. His companies followed suit.

What’s a guy in his early 40s to do?

Ron Zappe used his creativity and energy to start a company producing Cajun-spice potato chips – gourmet chips, even, as some (including moi) insist.

Zappe built his Gramercy, LA, plant in 1985 in a building recently vacated by an automobile dealership. Gramercy was then filled with laid-off oil and gas workers.

This is one, relatively modest example of the market’s vibrancy. Had huge subsidies poured in from Washington to keep south Louisianas oil-and-gas firms artificially profitable, Ron Zappe might today still be peddling the pumps he peddled before moving into chips. Would he have been better off? Maybe, but probably not.

But I for one would have been worse off. Being a New Orleans native, I discovered Zapp’s chips just after they first hit the market. I love them. I absolutely adore them. Theyre spectacular. Were it not for the fall in the prices of oil and gas, and the consequent release of resources (including Mr. Zappe) from the energy industry, I and other fans of Zapps chips would be all the poorer.

I thank my long-time friend Kerry Dugas for alerting me to Ron Zappe’s story.

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