Dade City juice plant to stay open

Vitality Beverages sees potential in the former Lykes Bros. facility, a top employer in Pasco County.

By KYLE PARKS

© St. Petersburg Times, published May 12, 2000

TAMPA -- In recent months, Vitality Beverages Inc. seriously considered closing its Dade City juice packaging plant.

The fast-growing, Tampa-based juice company has eight packaging plants across North America, and it faced a big question. Should it try to move more business to the Dade City plant or close it to move the work elsewhere?

The decision: Keep the Dade City plant open, even though it's running at about 50 percent of capacity.

"We'll be moving to bring more production down here," chief executive Bob Peiser said. "We are committed to Dade City."

This is the most definitive statement yet from Vitality, which bought Lykes Bros. Inc.'s juice operations last year. And it's a relief for the 600 employees at the plant, one of the largest employers in Pasco County.

"That's very good news," Scott Black, mayor of Dade City, population 6,000, said Thursday. "We're still very much a company town. We live by that whistle blowing. We set our watch by it."

The plant, about twice the size of the WestShore Plaza shopping mall in Tampa, grew out of an operation that started in 1936 as a packing house on five acres of land.

At one point under Lykes' ownership, it had 1,200 employees processing oranges and putting the juice in containers. Though it now has a smaller work force and no longer does processing, it's still one of only a few manufacturing facilities on the North Suncoast.

But while Vitality knows how important the Dade City plant is to Pasco County, it had to make sure it was making the right decision based on facts.

"We are doing this because the Pasco facility has better capacity than the other plants we have," Peiser said. "We simply couldn't have moved the work from Dade City to the other plants."

Vitality has aggressively become one of the Tampa Bay area's largest companies, growing to $800-million in revenues from about $500-million a year ago. It bought Orange-co Inc.'s processing plant in Bartow, and in its biggest acquisition, it bought the citrus division of Oak Brook, Ill.-based McCain Foods, a company known for its Ore-Ida potato products.

As part of last month's McCain deal, Vitality picked up three more packaging plants; it now has eight packaging plants and two processing plants. And as the company figures out how to streamline operations, it's clear that they won't all stay open.

"We are going to have to consolidate," Peiser said. "But I am prepared to say we are committed to Dade City."

The company's goal is to create a more efficient shipping system. While it's relatively cheap to ship frozen concentrate, one reason Vitality has acquired plants across the country is to shorten the distance it ships its chilled juices.

The Dade City plant, one of the largest facilities of its type in the world, handles both frozen concentrate and chilled juice for Vitality, now the country's largest provider of private-label juices for grocery chains and other users.

But employment there has been cut in half in recent years, as Lykes Bros. Inc. made an ill-fated foray into the branded juice business while watching its private-label market share slip.

The McCain deal helps Vitality regain its private-label stature, and with the backing of its two deep-pocket investment firm owners, it plans to keep growing.

"I could see us being at $1.5-billion in revenues in two or three years," Peiser said. "Whether we stay private or public, I don't know. We'll have to decide by watching the capital markets and seeing what our objectives are."

The operation was bleeding money when Vitality was formed last year, but Peiser said it's now making money. Vitality cut costs by abandoning the Sunkist brand, and it's working to build its food service division, which supplies juice to institutions such as schools and hospitals.

Some plant workers drive as long as 11/2 hours to work. But many of the jobs are low-wage positions, some filled by people who live in a nearby migrant community of ramshackle houses called Tommytown.

The plant's new owners have some work to do in improving employees' standard of living, said Margarita Romo, who runs Farmworkers Self-Help Inc., a Dade City non-profit group that helps migrant families.

"For years, the plant has been very good at paying low wages and making sure it doesn't pay much in benefits," Romo said. "I am hoping the new owners will do more for this community than the Lykeses did. They left after years here, didn't give Tommytown a park, a community center, anything.

"For years, these people have made money off the backs of the working poor. Now, we are supposed to believe things will get better. Well, we'll see."

-- Times staff writer Chase Squires contributed to this report.

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