A First Nation in southern Manitoba is weighing its options about what to do with hundreds of thousands of dollars’ worth of potato chip equipment it owns, which is sitting in a factory collecting dust.
Swan Lake First Nation paid $800,000 in 2005 for equipment that would produce potato chips, and another $900,000 on upgrades when it arrived from Egypt, according to a recent Facebook post to band members by Chief Jason Daniels.
Since then, the unassembled equipment has been sitting in a factory — about 124 kilometres away in Rivers, Man. — for which which the band pays a monthly $1,200 storage fee. It still hasn’t produced a single potato chip.
“It’s a liability. It’s costing us money. Something needs to be done about it,” Daniels told CBC News.
Daniels was elected chief in September 2021. He previously served a term as band councillor in the early 2000s and, he says, was aware the leadership was considering the purchase, though he was not in office when the deal closed.
He says he’d like the membership’s input on what to do now.
According to Daniels, the equipment was supposed to create a stacked, “Pringles-style” chip, which is more difficult to produce than regular potato chips, because it requires different ingredients to be compressed into the specific shape.
“Since we bought potato chip equipment, it has depreciated to a point where if we even sold it for $20, we’d walk away with $20,” he said.
“I don’t really like that concept.… But we have to make a decision.”
Daniels wants to explore whether the equipment could be turned on and eventually create revenue for the First Nation, which is 136 kilometres west of Winnipeg.
“There’s a huge market there… So can we harness it? Can we mobilize it? Can we do it? And what’s going to cost more? Because we don’t have the flavours, we don’t have the potatoes, we don’t have the necessary distribution licence. So it may cost a bit more money to even get it operational,” he said.
Daniels says he’s had some preliminary conversations with Alfred Lea, the owner of Riverton-based Tomahawk Chips, an Indigenous-owned and -operated potato chip company.
Daniels says the band will likely pay for a “small feasibility study” to see if there are any potential partnerships that could work between Tomahawk Chips and Swan Lake.
Lea, who has been in the potato chip industry since 2015, has been able to get his products into some big-box stores like Walmart in Winnipeg. He says he’s willing to share information with Daniels and Swan Lake.
Lea says it’s difficult to break into the industry and that it could cost upward of $100,000 just to get a product like potato chips into big-box stores, and that is not counting the production expenses.
“It’s going to take more money to get it working,” Lea said in an interview.
“And then on top of that, now they’re going to have to find a market for it …That’s the biggest challenge, not to get it going.”
Konwatsitsawi Meloche, is Kanien’kéha from Kahnawake in Quebec, and has been involved in sales and distribution for Lea and the Tomahawk Chips brand in that province for about four years.
She says there is a growing market for Indigenous companies like Tomahawk Chips, though she still has had to keep her day job as a public speaker/educator.
“We don’t get the same funding as Pringles or Frito-Lay. We are the hustlers. It’s a lot of work,” said Meloche.
Over the years, she has mainly distributed the chips to First Nations in Quebec, but says it’s still very much a side hustle for her and her husband.
Lea says it can be difficult for First Nations to run bigger businesses because of the leadership changes that take place with elections.
Lea says Swan Lake is facing an uphill battle if it wants to get a chip company off the ground, however, he is willing to share best practices as the First Nation figures out its next steps.