Getting Saucy In The Great Lakes

he next time you go out for sushi, you may want to thank a Japanese company that had the foresight to establish a food manufacturing plant in Wisconsin a half century ago.

Kikkoman Foods Inc., the Noda, Japan-based company that has been selling soy sauce in the U.S. since it opened its first overseas sales office in San Francisco in 1957, helped Americans develop a taste for Japanese cuisine and condiments when it launched its first production line in 1973 in Walworth, Wisconsin, on the southwestern tip of Geneva Lake near the Illinois state line. Though the company was formed in 1917, its roots date to the 1600s.

Today, Kikkoman is doubling down on its investment in Wisconsin by expanding at two sites in the Badger State — one in Walworth and one in Jefferson, located about halfway between Milwaukee and Madison.

Source: Kikkoman Corp.

Wisconsin Gov. Tony Evers announced April 23 that the Wisconsin Economic Development Corp. (WEDC) had approved a $15.5 million performance-based tax credit to help Kikkoman expand. The company plans to invest $800 million to expand its soy sauce brewery operation in Walworth and build a new plant in Jefferson. The firm said it will add 83 new high-wage jobs over the next 12 years in Wisconsin.

Kikkoman, which leads the world in soy sauce sales with revenues of $4.55 billion in 2023, has seen that first Wisconsin plant that opened 51 years ago in Walworth become the highest-producing soy sauce facility in the world. Coming less than three decades after the end of World War II, the plant was one of the very first production facilities built in the U.S. by a Japanese company.

That plant was so successful that Kikkoman opened a second U.S. production facility in 1998 in Folsom, California. As demand worldwide for Kikkoman Soy Sauce increased, the firm spent the last several years scouring the country to find the right place for a third U.S. factory. The company, which has a market capitalization of $11.39 billion, found that spot on a 100-acre site in Jefferson County.

“Fifty years ago, Kikkoman made history by choosing Walworth, Wisconsin, for its first international brewing plant,” said WEDC Secretary and CEO Missy Hughes. “Now Kikkoman is opening a new chapter in that history by expanding its presence in Walworth and Jefferson.”

Yuzaburo Mogi, honorary CEO and chairman of the board of Kikkoman Corp., said, “We have always valued Walworth for its great market access, outstanding workforce, central location for raw materials, pure water and the open-hearted spirit of partnership of the local community. We chose Jefferson for those same reasons, and we look forward to expanding our footprint in Wisconsin and establishing a supply chain with increased stability in North America, Kikkoman’s largest overseas market.”

Wisconsin Wins Kikkoman with the Basics
Deb Reinbold, president and executive director of Thrive Economic Development, the Jefferson County Economic Development Consortium, says that “timing was important to Kikkoman. It came down to how quickly we could put all the infrastructure together to meet their needs. It was in the City of Jefferson, and all utilities ran to the site. They have 40 megawatts of power available here at a lower rate because it is a local utility. WPPI is the local electric company, which means they can trade between utilities. And we are able to meet all of their wastewater needs.”

Kikkoman broke ground on the $560 million, 240,000-sq.-ft. facility in Jefferson in June and plans to begin shipping soy sauce from that location in fall 2026. WEDC added a new Enterprise Zone designation for the Kikkoman plant, bringing to 20 the number of such zones around the state.

Adding F-Series Super Duty pickup assembly in Canada means Ford Motor Co. is also growing at U.S. component plants that support Super Duty production, including $24 million in Sharonville, Ohio; $1 million and 20 jobs in Rawsonville, Michigan; and 50 new jobs at its Sterling Axle Plant in Michigan.
Photo courtesy of Ford Motor Co.

In an exclusive interview with Site Selection, Osamu Mogi, representative director and senior executive corporate officer for the International Operations Division of Kikkoman Corp., spoke with me by Zoom from his office in metropolitan Tokyo. He said that the three most important site selection factors for Kikkoman are logistics, environment and workforce.

“Soy sauce is a heavy and expensive product, so we look for logistics advantages when we are locating a plant,” he says. “We need a safe and clean environment. We don’t want to have to worry about contamination. As a food manufacturing company, we require good natural surroundings. We do not want to be in a heavy industrial park. The Jefferson site is dedicated to food research and manufacturing. We feel very safe there. The site meets all criteria. It is large and flat with water and gas, and it is close to Interstate 94.”

Quality workers and a helpful government sealed the deal, he notes. “We need a quality workforce, and Wisconsin is known for its high-quality workers,” says Mogi. “The local government was very helpful.”

Mogi says the incentives were helpful too but not the main reason for the site choice. “We are fortunate to have incentives from the state and local communities, but they were not the deciding factors. We might have chosen this site anyway. Incentives help to start up a new facility, but logistics is the most important factor.”

Mogi adds that the new plant needed to be “close enough to achieve good alignment with our existing Wisconsin plant. We hired a site selection agent who contacted states to make a long list of locations. We had 64 possible locations on our list and half were in Wisconsin. We appreciate our relationship with Wisconsin for over 51 years, so we worked with the state to find the land that met our requirements. I would like to thank Missy Hughes and all the other officials at WEDC. We know we can count on the workforce of Wisconsin.”

Mogi says his firm is not done growing in the U.S.

“The U.S. market is 25 times larger than Japan,” he notes. “That is why, from the beginning, logistics was the most important factor. There were discussions about building our new plant on the West Coast, but instead, management chose Wisconsin because it is right in the center of the U.S. If we were to choose just one location, we would choose Wisconsin. We are enjoying a 5% increase in demand in the U.S. every year. We will continue to invest in our manufacturing operations as we expand our space, but we also plan to expand in Europe and Asia.”

A Sign of the Changing Times
At $800 million, the Kikkoman expansion in Wisconsin ranks as one of the five largest capital investment deals in food manufacturing in America over the past five years, per the Conway Projects Database, a corporate facility tracking tool of Site Selection and its parent Conway Data Inc. in Atlanta. The Kikkoman project is also one of 20 corporate facility deals announced by Japanese companies in the Upper Midwest region of Wisconsin, Michigan, Minnesota, Illinois, Indiana and Iowa since 2019.

Quentin Messer, the president, CEO and chair of the Michigan Economic Development Corp. (MEDC), says it is no secreat why Japanese CEOs love the Upper Midwest.

“Toyota has been here for 50-plus years. They want to be in a place where culturally they are comfortable,” he says. “We have a vibrant Japanese community in Novi. They know that when they come to Michigan, we are focused on building a relationship with them. It is not just transactional. We make it easy to say yes.”

Case in point is FANUC America, a Japanese-owned company that on July 10 officially opened its new $110 million West Campus facility in Auburn Hills, Michigan. The 650,000-sq.-ft. complex will be used for robotics manufacturing.

“This major expansion represents our growth strategy in the U.S. and our steadfast commitment to the future of the automation and robotics industry,” said Mike Cicco, president and CEO of FANUC America.

According to MEDC, more than 5,300 jobs and $1.8 billion in private investment have come to Michigan from Japanese companies in the last 10 years. There are currently 456 Japanese facilities in Michigan supporting nearly 40,000 jobs statewide, per the Japanese Consulate in Detroit.

“We are fortunate to have incentives from the state and local communities, but they were not the deciding factors. Logistics is the most important factor.”
— Osamu Mogi, Senior Executive Corporate Officer, International Operations Division, Kikkoman Corp.

Messer says corporate facility investments like this happen because state leaders prioritize high-value deals from other parts of the globe.

“We opened a trade office in Taiwan. Gov. Gretchen Whitmer has been to Japan, South Korea and Taiwan,” he says. “This effort to attract FDI comes from the highest office in our state. About a year ago, the governor and MEDC announced a new economic development strategy called ‘Make It in Michigan.’ At some point, you have to go out and compete.

“We aim to compete for the newest technology and make sure those industries see the value in locating in Michigan,” he says. “This is a great time to be in the Midwest.”