Korean food specialist CJ Foods Inc. sees Fullerton as a key to its plans to boost business throughout the U.S.
The Commerce-based company, part of conglomerate CJ Group in South Korea, started work on a manufacturing plant on South State College Boulevard last week. It will renovate the 68,000-square-foot building, which is expected to double the company’s production of dumplings, its signature item.
The goal is to produce 9,000 tons of dumplings a year, according to Senior Vice President Randy Bartter.
The company also opened a warehouse in Fullerton earlier this month and will consolidate three distribution centers in California there.
“CJ Foods made a decision last year to integrate these three warehouses into one location in Fullerton,” Bartter said. “[We] will finish moving all inventory from the other warehouses by June [and] will see efficiency regarding warehouse and logistics.”
The company paid $8.2 million for the manufacturer plant in Fullerton, which is expected to employ about 50 workers initially and grow to more than 200 in five years, according to Jae Han, business analyst at Los Angeles-based CJ America Inc., which counts CJ Foods as a subsidiary.
CJ America is the U.S. arm of CJ Cheiljedang, the largest food company in South Korea, with $6.41 billion in 2012 revenue.
The various CJ units operate as part of a corporate structure that is typical of a Korean “chaebol,” a term used to describe large conglomerates there, which are often controlled by wealthy families. Top chaebols include the Samsung Group, LG Group and Hyundai Kia Automotive Group.
CJ Cheiljedang—which means “top sugar”—got its start within Samsung in 1953. Samsung founder Byung-Chull Lee launched it as a sugar-refiner.
CJ Cheiljedang spun out of Samsung in the 1990s and ultimately became part of CJ Group, a Seoul-based holding company whose business segments include food, entertainment and media, pharmaceuticals and logistics.
CJ Group remains under the Samsung umbrella, even with those moves. It reported about $12 billion in revenue for 2011, the latest year available, and is run by siblings Miky and Jay Lee—the grandchildren of the Samsung founder.
CJ America’s Han said the Korean parent is closely involved in the operations of the U.S. division and “highly interested in business expansion here.”
Support from city officials in Fullerton was part of the draw in establishing two new facilities there, according to Bartter.
“The building size, location—near the 91 and 57 freeways—and purchase price [also] were considerations,” he said. “CJ will invest more in the U.S. when there is a good opportunity to develop and expand the business.”
CJ Foods currently operates a manufacturing plant in Paramount and makes a host of ethnic food products, including instant rice and marinade sauces. CJ Foods’ various brands are sold to a number of grocers, including big chains such as Costco Wholesale Corp., Trader Joe’s and Safeway Inc.
Operations at the new dumpling manufacturing plant will begin in January 2014.
Financial information about CJ Foods as a stand-alone entity was not available, but a five-year plan calls for the Fullerton dumpling factory to account for about $96 million in revenue, according to Han.
