NEW YORK — For Utz Brands, Inc., the next leg of the growth story may be how quickly the company can expand west.
In a May 16 presentation at the Goldman Sachs Global Staples Forum in New York, Howard A. Friedman, chief executive officer of Utz, identified westward expansion as key to the Hanover, Pa.-based snack manufacturer’s future growth.
“I think the fact is one point a share is about $200 million in revenue as we think about growth potential moving forward,” he said. “So we’ll want to stay in our core. We’re going to compete there, but our goal would be to expand distribution and capture share as we continue to look westward.”
Mr. Friedman said a quick snapshot of the Utz portfolio would show the company’s products are about 90% distributed. Broken down further, distribution is at about 60% for the Utz and On the Border brands, while Zapp’s is about 40%, he said.
“So we have a lot of not only ability to penetrate some places where we already exist, but a lot of head space really as you sort of start looking westward for us,” Mr. Friedman said.
To take on the western markets, Mr. Friedman said the company plans to adopt a similar approach to what it undertook as it expanded into Florida.
“We look to partner with an anchor customer that has experience with us and understands our business and where we start out slow,” he explained. “So we actually have some consumer and shopper evidence that, in fact, we are accretive to the portfolio, that we are actually accretive to the customer itself. We’re not just moving peas around the plate. … We look to anchor customers and then figure out how to then build our presence there and then surround them within a geography.”
But it’s not just geographies in which Utz is looking to expand. While stating that Utz is happy with most of its power brands, Mr. Friedman said the company does still see opportunities in some snack subcategories.“We’re still underrepresented in popcorn as an example, is a place where we think we can go,” he said. “But generally speaking, we have both brands and items in most of the majority of the other subcategories that we’re really happy with.”