Oct. 23, 2023

An executive connected to CJ Foods USA Inc. is reiterating the company’s commitment to building a large Asian food production facility in Sioux Falls.

Scott Peterson, executive vice president and chief human resources officer for Schwan’s Co., spoke about the project at an event this month for the South Dakota Chamber of Commerce & Industry.

“Building a plant in Sioux Falls, South Dakota, is critical to our long-term growth strategy. It’s central to who we are,” he said. “We’re still figuring out the timing, but we’re excited about the prospect of being here.”

The Asian food production facility on 140 acres at Foundation Park was announced in early 2021. At the time, it was valued at up to $500 million and estimated at 700,000 square feet, employing more than 600 people.

It will join Asian food facilities for CJ Foods on the East and West coasts, Peterson said.

“This plant will serve not only the center of the U.S., but we think because of the central location, which was another criteria, we’ll be able to serve the country,” he said.

When it was announced, company leaders said the plant, expected to be the largest Asian food facility in North America, would include automated state-of-the-art food production lines, a warehouse and distribution center, shipping and receiving docks and office space.

All foods made at the production facility will be sold and distributed by CJ Foods and Schwan’s Co., a fellow U.S.-based affiliate of CJ Foods.

CJ CheilJedang acquired Minnesota-based Schwan’s in 2019 — its subsidiaries that focus on foods sold in retail and grocery channels as well as food-service venues and Schwan’s manufacturing and logistics operations and various professional and administrative services.

The Schwan family has retained minority ownership in the businesses acquired by CJ Foods. It continues to be the sole owner of the legacy home-delivery business launched by Marvin Schwan in 1952.

For CJ Foods, “the Asian business is very important,” Peterson said. “The trend in food consumption in Asian is really fast. When you look at one of the CJ brands we have, Bibigo, it’s the fastest-selling frozen Asian food brand in the Upper Midwest, including South Dakota, so we’re onto something that’s very popular, that’s on trend.”

Forecasting consumer demand is part of the decision-making process as the company plans its new facility, he said. So is ensuring the supply chain is dependable enough.

“Whether it’s parts, other things you need to manufacture, especially when you source it globally, has been a challenge,” Peterson said. “I think making sure we have what we need to do the design we need is important.”

Technology is continuing to evolve too. CJ Foods, which “makes more pizzas than anybody in the world,” including under the Red Baron, Freschetta and Tony’s names, recently opened a state-of-the-art plant in Kansas, and “we’re still learning how to best take advantage of that technology,” Peterson said.

Still, for the Sioux Falls project, “it’s not a matter of if, it’s a matter of when, and we’re doing serious planning right now,” he continued.

“The reason we came here was you’ve got a very supporting business climate, very pro-business; the government starting from the governor on down has been very good to work with. Even though there are workforce challenges, we think we’re going to be able to get the talented workforce to work in this state-of-the-art food plant.”

While a groundbreaking hasn’t been set, the company already is considering how to meet its workforce needs. Peterson’s experience includes serving as board chair of RealTime Talent, a business-led workforce development private/public collaborative using data analytics to improve the competitiveness of the state of Minnesota’s workforce.

In South Dakota, the rate of need for employees is outpacing population growth, he said.

“It’s a matter of keeping the people you have in the state to work and then attracting, whether it’s from other states or frankly from other countries, to come to South Dakota to meet the needs, so there’s a fundamental supply opportunity,” he said. “Assuming you get the number, then it’s a matter of do they have the skills to meet the needs. It’s going to take a different set of skills for the next five to 10 years than it did for the last five to 10 years.”

His company plans to work with tech schools and universities, and already has met with key leaders to begin mapping out a strategy, Peterson said.

“They weren’t competing with each other to try and corner the market,” he observed. “There’s a recognition people need to be their lane. Everyone’s going to get a piece of the business, a piece of the work, a piece of the partnership with Schwan’s, and we have to be specific about what skills are needed. If you train the students in those skills, we will be there. We will guarantee a certain number of hires.”

The hope is that the business community collectively looks at the labor supply in the same way as it does the supply chain for materials, he added.

“We’ve got to find a way to collaborate to make the pool of talent bigger than it is to meet our needs,” he said. “And that takes paradigm shifts. It takes revisiting what we normally think our role is.”