BusinessTN

There are times when even the best-laid plans need a revision, and as Sullivan County leaders will attest, that's not always a bad thing. After Leclerc Foods USA finalized its initial agreement to open a state-of-the art automated food-processing facility in Kingsport, a visit to the area prompted a new idea and a revised plan. "Several of us visited in May," says Jean-Marc Lemoine, senior vice president of Leclerc Foods USA. "Mr. Jean-Robert Leclerc, the 'big man' of the company, was really impressed with the area and the people.

He said, 'You should move the headquarters.' When he talks, we say, 'Yes, sir!'"

Jean-Robert Leclerc is the third of four generations of Leclerc family members involved in the company since the opening of Biscuits Leclerc in 1905 in Quebec City, Quebec. Nearly a hundred years later, in 2002, the company had several Canadian facilities and had moved into the United States with a facility in Montgomery, Penn.

In the last year, officials at Leclerc were searching out expansion possibilities in the Southeast to combat rising transportation costs and expand the company's distribution areas. "We looked at Tennessee, North Carolina, South Carolina and Georgia," Lemoine says. "On our visit to East Tennessee, we found a beautiful area--and the people at NETWORKS-Sullivan Partnership were ready to help." As incentives that sealed the deal between Leclerc and Sullivan County, Lemoine lists the 500,000 people in the Metropolitan Statistical Area; the existing building in the Northeast Tennessee Business Park (formerly occupied by Cartamundi); the available workforce; and, of course, the great price.

Richard Venable, CEO of NETWORKS-Sullivan Partnership--a joint economic development alliance between Bluff City, Bristol, Kingsport and Sullivan County--points out a number of other incentives that the Kingsport location offered to Leclerc, including its proximity to highways 81 and 26 and interstates 75 and 40; two nearby railroads; a consistent water supply and power supplied by TVA; an established foreign trade zone; and a U.S. customs station. "East Tennessee is a distribution crossroads. In Kingsport, with a single truck dispatch, a company can reach 70% of the population of the United States," Venable points out. "Leclerc's new location in Kingsport has given them an entrée into the Southeast and much of the rest of the country, too."

Leclerc's property is five minutes from the Tri-Cities airport, five minutes from Northeast State Technical Community College, and close to their necessary supply chain of grains and rice as well. "When they saw the possibilities in the logistics of our location," says Jack Lawson, director of economic development for NETWORKS-Sullivan Partnership, "it was a no-brainer that this was the place to locate their new facilities."

Leclerc had been dealing with a major food company in Atlanta, and this location makes it possible to supply them. The company will also make granola bars for Target Stores. And Food City, a major grocery store chain in East Tennessee and Southwest Virginia--with almost 100 supermarkets in the area and one of the largest employers in East Tennessee--signed a contract with Leclerc to produce a private label brand.

Only top management will be brought in--including Lemoine and Denis Leclerc, president of the company and the fourth generation of Leclercs in the family business. (Both men are moving to Sullivan County.) The workforce will be hired locally through an area HR director, and the state of Tennessee will be providing training for the first group of new hires. "They'll be sending folks to Montgomery and Quebec City to train them on the new machinery. Those people will return to Tennessee to train future workers," Lawson says.

What began as a desire for a warehouse and distribution facility in Kingsport has grown to a plan to build a U.S. headquarters--and a state-of-the-art production facility, too. "They are making a nearly $40 million initial investment in equipment, and they're projecting around 70 to 80 employees," Lawson says. "They were offered a tax abatement on the equipment for a fully automated facility."

"We want people to work smart, not hard," Lemoine says. "Within three years, we'll have three production lines up and running, and we'll be generating approximately $40 million yearly in sales." As of press time, the first line is open, producing granola bars. The second production line will be delivered in approximately eight months--a cracker line. The third production line will be up and running within 18 months. "We also made the decision to install an automated warehouse," Lemoine says. "We already have three, and our fourth will be in Tennessee." Venable confirms that the company has just completed plans to build the 85,000-square-foot distribution center adjacent to the plant on seven acres of land.

Lawson is excited by the possibilities for future economic growth in Sullivan County, referring to a September edition of The Wall Street Journal in which an article on increased exportation mentions Kingsport, Tenn., on the front page. He sees additional trucking in the area, and with the similarities between the drug companies that have been in the region and the incoming food industry, Lawson says the region will start recruiting other companies in the food industry, "not an industry we've traditionally recruited," he adds.

"With Eastman Chemical Co.'s worldwide headquarters here, and King Pharmaceuticals in Bristol--and now Leclerc--we have established a track record that will attract future industries," Lawson says.

Lemoine agrees, but he says it more simply. "Working in an area is one thing, but you need the whole package. The people here are fantastic, and we can see this area offers a very good quality of life."