I have a customer using No. 2 potatoes for fresh cut fries, by I’m thinking that No. 1 potatoes have a better yield, right? With less nicks, bruising, pointed tips, etc., wouldn't the No. 1 yield less shorts (equals longer fries) that cover more of the plate? This would then mean more portions per case, correct?

You are on the right track. Operators, especially these days with rising labor costs, should consider the total cost of the potato and especially the labor and the most expensive part of the equation, the uptake of oil, and find a solution that works for them.

Most years, the No. 2 potatoes are less expensive to purchase than say an 80 count, so operators choose to have a little more labor or waste than buying a No. 1. Also, several of the chains look to get a balance of large and medium sizes without paying the premium for say a 40 or 50 count. So they will request a 6 ounce and above or a 10 ounce and above No. 2 potato to get the extra length.

Given a crop with a large size profile, it can pay to order a No. 1 carton. If there are few large sizes in the crop, the operator using the same scenario might actually double their costs to buy a No. 1 grade large size. The following chart can held an operator decide on using a No. 1 for their fresh cut fries: https://idahopotato.com/foodservice/cost-and-size