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 Perot’s 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, I’d rather eat potato chips than eat computer chips – but I admit that potato chips don’t work as effectively in my laptop computer. Second, Herman Lay – founder of Frito-Lay’s – made a fortune producing potato chips.
Here’s another chip entrepreneur whose story is interesting: Ron Zappe.
Zappe founded Zapp’s 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. Zapp’s 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 Louisiana’s 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. They’re 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 Zapp’s chips would be all the poorer.
I thank my long-time friend Kerry Dugas for alerting me to Ron Zappe’s story.