As a 20-year-old visiting the United States from his native France, Euro Sticks President and owner Frédéric Debacker said it was his encounter with a Kansas farmer that sold him on the idea that America would be a good place to do business.
Debacker said the man taught him, over short period of time one summer, to work heavy harvesting machinery he’d never have the confidence to learn on his own.
“I had never done anything like that before, but he trusted me. He said, ‘yes, you can do it. Just do it,’” Debacker recalls. “After a few months of training on his farm, I came back to Europe and I told everyone these Americans just trust you and they make you better and I think I should do something in the U.S. one day based on that experience.”
Euro Sticks is now one of the world leaders in the production of beechwood ice cream and coffee-stir sticks, producing around 10 billion of them annually. The company is a major supplier in the U.S. for companies like Haagan Daz and Magnum Ice Cream. It announced plans earlier this month to locate a production facility in Corbin that will employ 90 people over a three-year period.
Debacker said he initially began visiting the northeastern part of the U.S. but was dismayed to find there were few beech trees there. The wood is about 25 percent of the cost of the company’s products.
Research eventually led Euro Sticks to focus on southeast Kentucky, which Debacker said has a fairly significant supply of beech trees. The use of beech wood is crucial because it is renowned for being strong, and does not impart any flavor or odor onto the food it comes in contact with.
“We narrowed our focus on Corbin because there were two available buildings here that were suitable for our purposes. That was very important,” Debacker said. “It was also important for us to be along a strong main highway. I also must say that the efforts of the local economic director in Corbin was one of the key reason we felt this was the right place. He really convinced us this would be a good place to do business.”
Debacker said on initial site visits to Corbin he was impressed by things like the strong school system, the local hospital, The Arena, shopping, dining and other things he did not initially expect in a community that officially only has a population of about 7,500 people.
“I just could not believe the kind of investments that had been made in a community of this size. That is impressive,” he said. “There is quite a bit more activity in Corbin than you would think for a community with the population it has.”
Euro Sticks has production facilities in France, the Czech Republic, Turkey and Romania. Debacker said the company’s market share in the U.S. has continued to grow, forcing a decision — continue to produce more of its produce in its current facilities and export, or make them locally for the U.S. market.
“There is some risk, but we have a good feeling about what we are doing,” Debacker said. “We are comfortable doing business in the U.S. because it has a strong, stable political system and the long-term environment looks very good compared to other places.”
Euro Sticks currently needs to supply about 10 percent more sticks each year than the year before. Debacker said the company wants to get production underway as soon as possible in Corbin to fill the demand.
“We are already at our capacity. We need to grow capacity,” he said. “We need an additional billion sticks just to supply the market. Even a month delay means hundreds of millions of sticks are late. So yes, we are in a hurry.”
Corbin Economic Development Director Bruce Carpenter said the company plans to hire workers in the fall and wants to be producing by the beginning of 2017.
Euro Sticks was recently approved for $3 million worth of performance-based tax incentives through the Kentucky Economic Development Finance Authority (KEDFA). Debacker said those tax incentives were important. Without them, the company would likely have gone with a much smaller operation, or instead located in another country, likely Brazil.
Euro Sticks was founded in 1926 and initially started out making wooden inserts for shoes. Debacker said it is now totally focused on its current product and has no plans, at least for the next decade, of deviating from that.
“We want to stay focused and do what we do best. We think that is the way to sustainable growth for the foreseeable future,” Debacker said. “Our clients are very important to make our business grown. They are looking for product that is better and better every year. We still have a lot of room to improve and we are doing that all the time.”
Debacker said the company has many competitors, mainly from China. There are billions of Chinese made sticks on the market today.
“They are sometimes good, sometimes not so good,” he said. “Our target is to replace Chinese sticks in the U.S. market with Kentucky sticks.”
Its plant in Corbin will be the first time Euro Sticks has “started from zero” to get a production facility up and running. Always before, it purchased existing companies or facilities.
Debacker said the company is already at work building and fitting its facility in the Southeast Kentucky Regional Business Park with the unique, proprietary machines needed to produce the sticks.
Carpenter said within the next month the Corbin Office of Economic Development would notify the public about job opportunities at the local Euro Sticks plant.