Dietz & Watson: Why we're giving away sandwiches

I stopped up at Dietz & Watson's cold-cuts manufacturing plant on Tacony St. yesterday and asked immigrant sausage-maker Gottlieb Dietz's grandchildren, who run the $300 million yearly-sales company, a real soft question: Why are they giving away sandwiches at City Hall's Dilworth Plaza, tomorrow, 11 a.m. - 2 p.m.?

"We had one in Charlotte," N.C., at the Epicenter mall, "and we had a great response," chief executive Louis Eni told me. "We figured it was about time to do it here," to show appreciation for Philadelphians who've bought Dietz & Watson meats for 70 years.

Eni walked me around the chilly factory, through high block rooms fragrant with cloves, cinnamon and pepper, noisy with compressed-air and conveyor-belt machinery, busy with dozens of union crews in hard hats and white coats, hair nets and boots, cutting, stuffing, packing, loading, cleaning. D&W buys meat and spices, and builds them into hundreds of lines of roast beefs, hams, chickens, sausages, and hot dogs by the three-pound box.

The company targeted Charlotte because it says its Florida-based rival, Boars Head, had been pressing for an exclusive cold-cut deal at a North Carolina supermarket chain that would freeze out Dietz. Boars Head tried that at SuperFresh stores two years ago, said Chris Eni, Lou's brother, who runs operations at the plant. In the SuperFresh case, "they lasted less than six months, then they asked us to come back in," Louis said. Boars Head wouldn't call me back.

Dietz includes, besides the Philadelphia plant, a 150-person Baltimore, Md. poultry cold cuts plant purchased from Parks Sausage Co. (the brand is still owned by Steelers veteran Franco Harris) in 2000; the 100-worker Black Bear frozen-products distribution center in Delanco; the cheese prep factory in Corfu, NY, which employs 75; and distribution centers in South Carolina and Florida, said sister Cindy Eni Yingling, the company CFO.

Why is Dietz still here when most old Philadelphia cold-cut makers are gone? Besides the rare unity and continuity of the founding family? Because they compete on quality, the only way to respond to relentless low-price producers. For example, "no carageenan," says Louis, meaning the water-loving seaweed that many food processors use to hold water. "No MSG. No soy fillers. Not all the water. High-quality meat and spices. It costs more. But it's the only way to get the right taste."

How's business different today from 1975, when the plant moved to the Northeast from Front and Vine? "Everybody used to buy baloney loaves, franks and sausages," said Lou. "The fastest-growing (line) today is chicken breast," with a variety of spices. "It's perceived as being low in fat. And it's got a better flavor" than turkey or other newly-popular meats.

Dietz sells mostly to distributors and store chains. ShopRite and Acme are "huge," though no market or distributor is more than 8% of total sales. Wawa "is not a customer." Dietz distributes in Korea, and to military bases in the Middle East. But exports are hard, even to Canada, because of protectionist rules.

Half of sales are within 100 miles of Philadelphia. "This is a sandwich city," said marketing chief Ken Hoffman, a 30-year veteran. "People came here from those parts of the world that eat deli."