From Foxconn to sausage makers, Wisconsin companies in expansion mode

Global sales of cheese, sausage, gummy bears, generators and factory equipment are some of the drivers behind the latest Wisconsin business expansions, new data from the state’s economic development agency shows.

Fifty projects eligible for state tax credits in 2017 represent $11.7 billion in investments and thousands of new jobs, according to Wisconsin Economic Development Corp. But one big project — the Foxconn Technology Group factory planned for Mount Pleasant — makes up $10 billion of that amount.

And of the $3 billion in WEDC tax credits the companies could receive, $2.85 billion has been allocated for Foxconn, the Taiwanese electronics giant that says its flat-screen manufacturing plant could employ 13,000 people by the end of 2022.

Foxconn aside, what’s left are $1.7 billion in expansion projects and about $114 million in WEDC tax credits.

Ranked second on the list, convenience-store operator Kwik Trip Inc. plans to spend $309 million to expand and upgrade its operations in La Crosse, an effort expected to create more than 300 jobs. The company will receive up to $21 million in state income tax credits in exchange for the investment and jobs.

No. 3 in the rankings is Haribo of America, the German manufacturer of gummy bear candy that plans to build a factory in Pleasant Prairie — a $220 million investment eligible for up to $21 million in tax credits.

Haribo’s announced plans call for a 500,000-square-foot plant with about 385 jobs. It would be the first North American candy factory for the company based in Bonn, Germany.

In Waukesha, Generac Power Systems is expanding its headquarters and making improvements in its manufacturing plants in an $86.8 million project that’s expected to create about 400 jobs.

The manufacturer of portable and backup power generators could receive up to $10 million in tax credits through 2021.

Generac, with more than 4,500 employees including 2,000 in Wisconsin, says it has outgrown its Waukesha headquarters that was built in the 1960s.

The offices and engineering labs need to be modernized so the company can keep attracting top talent, said Generac President and CEO Aaron Jagdfeld.

“We evaluated, frankly, whether this was the right place for us,” he said. “But when we stripped it all back, a lot of our talent base is in Wisconsin.”

Fourteen of the 50 companies are in the food and beverage industry, making a plethora of products such as cheese, sausage and food ingredients. They’re closely tied to companies that manufacture food processing equipment in the dairy state.

Wisconsin is among the top states in almost every category of food production, industry experts say, partly because of its strong agricultural base.

“We sort of punch above our weight,” said Cate Rahmlow, a WEDC official who assists companies in the food and beverage industry.

Most states lack the support for food production that Wisconsin has, including food ingredient companies and university research.

“We have the ecosystem,” said Brad Rostowfske, director of industry growth for FaB Wisconsin, a trade group that represents the food and beverage industry. 

Much of the growth has come from small and midsize food companies that have popular niche brands. Private-label products, sold under various names, including grocery store brands, also have given food manufacturers a boost.

The industry is nearly recession-proof, Rostowfske said.

“A key driver is going to be international business in the next few years because there’s going to be a billion people coming into the middle class in Asia,” he said, and they are going to demand more types of food associated with a higher living standard.

In Sheboygan Falls, Johnsonville Sausage has just completed an $18 million expansion of its headquarters. The company, founded in 1945 as a small butcher shop, could receive up to $10 million in state tax credits for the project aimed at supporting more than 900 current jobs and creating about 100 more.

Much of the expansion, which included a 15,000-square-foot fitness center, was aimed at creating a better work environment, said Michael Stayer-Suprick, president of the company’s international business division.

Johnsonville has many employee-friendly programs, including bonuses when the company meets certain goals and online courses in subjects such as computer software, English as a second language, weight loss and smoking cessation.

The fitness center helps attract and retain talent, Stayer-Suprick said, “and it’s the right thing to do.”

Also in Sheboygan County, in Oostburg, Masters Gallery Foods is building a $61 million cheese plant that will create about 150 new jobs and will support more than 500 existing positions. The company will receive up to $2.5 million in tax credits.

Masters Gallery Foods, based in Plymouth, considered out-of-state locations for the expansion but decided staying close to home was the best choice, said Mark Grasse, vice president of operations.

There’s a strong work ethic in the area that’s not easily replicated, Grasse said.

Founded in 1974, the company makes products sold under grocery-store names. It also makes cheese for restaurants and food wholesale companies.

Masters Gallery has done four expansions at its plant in Plymouth, Grasse said, but the company has run out of additional production capacity.

“It’s time to open up a second facility,” he said.

In Appleton, U.S. Venture Inc. is building a new headquarters valued at $58.5 million. The company, currently based in Kimberly, is a distributor of petroleum and renewable energy products, lubricants, and tires and parts for the automotive industry.

The project will support about 350 current jobs in the area and will make room for hundreds more, according to the company. It will be eligible for up to $20 million in state tax credits.

The new headquarters will be in downtown Appleton on W. College Ave., and it’s been heralded by city officials as one of the largest projects ever in that business district.

“We believe it’s going to serve as a springboard for other investments downtown,” said U.S. Venture President and CEO John Schmidt.

“It’s going to turn a blighted property into a bustling campus. … I also believe it will help attract and retain top talent in the future,” Schmidt said.

U.S. Venture hosts one of the largest one-day charitable golf outings in the nation. Last year it raised nearly $4 million for local community foundations.

“We are deeply engaged with our community now, and we want to take that to an even higher level,” Schmidt said, adding that having the headquarters downtown will help.

The number of foreign companies investing in projects in Wisconsin is up from previous years, according to state officials. In addition to Foxconn and Haribo, firms from Canada, Switzerland and Germany have recently announced expansion plans here.

Wisconsin did well with large business expansion projects in 2017, WEDC officials said, and there were also quite a few small and midsize firms on the agency’s list.

“While Foxconn has rightfully received a lot of the attention when it comes to Wisconsin’s economic development successes, it was one of the many companies that decided to relocate or expand here after considering other location options around the country,” Gov. Scott Walker said in a statement to the Milwaukee Journal Sentinel.

Rick Barrett, Journal Sentinel

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