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Jerky and much more -Hi Country Snack Foods

Lincoln’s Hi Country returns focus to its first product, while looking ahead to satisfy consumers and employees.

LINCOLN – Opened in 1977 with two owners and a pair of part-time employees, Hi Country Snack Foods http://shopsite.hicountry.com/index.html today employs around 55, making it easily the largest employer in the Blackfoot Valley and a vital cog in the tourism-driven Lincoln economy.

By John Harrington, IR Business Editor

While employment is down from a peak of around 90 workers several years ago, production is at an all-time high. Between 750,000 and a million pounds of red meat are processed at the plant on Hwy. 200 each year, with 2.5 to 3 pounds of meat needed to produce a pound of Original, Peppered, Honey Kist or Teriyaki jerky.

As with many industries, the meat snack industry has become increasingly consolidated and global in recent years.
"There used to be maybe 50 small and mid-size manufacturers of meat snacks," said owner Jim Johnson, 56. "Several were purchased or went out of business, and today there are three or four representing 80 percent of capacity. All have connections in South America – Brazil, Argentina, Paraguay, Uruguay. One just opened a plant in New Zealand."

Even Hi Country uses some foreign-grown meat in its product. Johnson, who moved to Lincoln in 1976 from Michigan to run a small grocery store before starting Hi Country, estimates that half his beef is domestic and half is imported.

"We’re proud," he said. "All of our processing and production is done here in Lincoln, Montana."

Consolidation has taken place on the wholesale side as well, so that winning or losing one or two major contracts can make or break a year for Hi Country.

"We had four or five very good years," Johnson said. "We just lost a major customer to a national buying program, but we may have that replaced with another club account. We’re close to coming to terms with another company. Let’s face it, we’re in a world market, and it’s all evolved here in the last 10 or 15 years."

Recognizing that shoppers are increasingly turning to the major chains and wholesale clubs to meet all their household needs, Johnson said Hi Country has turned in that direction as well.
"If that’s where the consumer is buying, that’s where we need to be," he said.

As a result of focusing on the major contracts, Hi Country has returned to its roots – focusing on meat snacks. Gone are the monster cookies (sold to a Bozeman outfit) and energy bars (discontinued) that marked attempts to branch out into different snack areas in recent years.

"We realized that if we’re going to compete, we’ve got to simplify our product line and get back to what we do best, which is make jerky," Johnson said. "We want to consolidate into a regional company where we have some of our own distribution and sales force working with different chains.
"We’re going to be a strong regional company. We can handle that, reach capacity and do some expansion. We have good brand recognition within our market, and probably the strongest meat snack market is the Northwest market. It’s more part of the culture out here."

And while product lines are being shaved, the jerky operation continues to grow.
"You’ve got to be working one to three years ahead of yourself," Johnson said. "What it’s like today doesn’t mean anything. In the last 2 1/2 years we’ve spent $750,000 on new smokehouses, equipment and floors to keep our plant up to snuff with the latest technologies. We’re as sophisticated as anybody; it’s just a matter of size."

Upgrading to automated packaging, automated scaling and automated slicing has allowed the company to produce more jerky with better quality and consistency than was possible when the company started.
Johnson maintains that Hi Country’s remote location isn’t a problem as the company struggles to compete in a global environment.

"With UPS and trucking, shipping is not a problem, and receiving is not a problem," he said. "The small niche manufacturer has a darn tough time, it doesn’t matter whether you’re in Montana or anywhere else. We’re going to stay in Montana; you just learn to work around it."

In addition to focusing increasingly on sales in the Rockies and western U.S., Johnson is taking other steps to ensure the success of his company and others like it. Hi Country has retailed its products directly to the public since 1986 and in 1995 built a separate gift store behind the factory. It’s a popular stop for hunters, anglers, snowmobilers and tour buses.
Within the gift shop, Johnson stocks all of Hi Country’s products, and as much other "Made in Montana" merchandise as he can get his hands on.

"We try to carry the biggest selection of jams, jellies, candies. We try to have everybody’s things in there," he said. "We feel we’re doing our part to support the other small manufacturers and processors in the state in our own small way."
The store also includes artifacts from the Upper Blackfoot Historical Society, which leases for a dollar a year four acres from Hi Country to display more of its historical items.
"It’s a drawing card for us, and it gives them a chance to have a museum at no cost," Johnson said.

It was partly with an eye to the future that Johnson arranged several years ago for the company’s employees to buy out his business partner. Using a Community Development Block Grant that was subsequently paid back early, Hi Country workers became one-third owners of the business.
"Those are the people that have been through the ups and downs," Johnson said. "At some point my wife and I will probably sell the business, but at least the employees will benefit if that were to occur."

An added benefit, as Johnson eases toward retirement, is that his employees have a greater interest in keeping the company successful.
"The feeling was and is that people have a vested interest in our success because they are owners," he said. "It makes it easy for me not to have to manage every aspect of the business. I was wanting to start to back out of the day-to-day operations. The last year or 18 months it’s really started to register with them."

Even as he looks toward retirement, Johnson is taking the steps he sees as necessary to keep Hi Country viable – and keep it in Lincoln – long after he stops working. That may mean doing things differently than he did a quarter-century ago, when his first few packs of shrink-wrapped jerky hit the shelves of his Lincoln grocery store.

"The market doesn’t allow you to be head-in-the-sand and do it your way," he said. "You need to look at trends. There are market changes taking place. Some of the customers we would have died for five years ago are not even on our radar now."

John Harrington can be reached at 447-4080, or [email protected].

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