At a time when the total number of Maine businesses is declining, one segment of the economy is rising like a well-proofed loaf of bread – specialty food and beverage businesses.
The number of food and beverage manufacturing companies in Maine grew 35 percent from 2007 to 2017, according to federal census data gathered by James C. McConnon Jr., a Cooperative Extension business and economics specialist and economics professor at the University of Maine. Over that same 10-year period, the number of all Maine businesses, of all kinds, dropped 2 percent, he said.
It should come as no surprise, in a state that launched a thousand blueberry jams, that entrepreneurs still dream of making a living selling food made according to an old family recipe, or brewing beer in their own industrial space instead of at home in the garage. What is surprising, perhaps, is that this trend has legs – long ones – fueled in part by Portland’s reputation as a food town, concerted efforts to grow Maine’s food economy, and the hunger for fresh Maine ingredients harvested from both land and sea.
The average annual growth of the food-and-beverage business sector – which includes startups, value-added products from farms, and craft breweries, wineries and distilleries – has been 3.5 percent per year, McConnon said. “I would say that’s good growth,” he said, adding that Maine is keeping pace with national growth figures for specialty food businesses. The Maine growth rate, he said, is “significantly higher than the average growth rate of all small businesses in Maine over that time period.”
Although the statistics include larger employers, the majority of these businesses in 2017 – the most recent year for which he had data – had no employees at all. The rest typically had fewer than 10 employees. “It kind of fits the model of Maine, being very small businesses,” McConnon said.
And while the data for 2018 and 2019 are not yet available, McConnon said, “given the robustness of the economy in Maine, I would say we’re on the same path.”
Areas that saw the most growth from 2010 to 2018 include retail and commercial bakeries, whose numbers statewide grew from 73 to 109, or 49 percent, according to data from the Maine Department of Labor. Dairy product manufacturers producing milk, butter, cheese, ice cream and frozen desserts were up 73 percent.
CASE STUDIES
Amolitta Pasta is selling several varieties of dried, packaged pasta. Owner Andrew Steinberg started out making wood-fired pizza for events but now offers a pasta line. Ben McCanna/Staff Photographer Buy this Photo
Among those who started new food businesses last year was Andrew Steinberg, a self-described “crazy avid bread baker” who launched his culinary career in 2011 by making wood-fired pizza in a mobile oven for weddings and other events. He’s still selling lots of pizza, but these days you’re just as likely to find him at his Italian pasta-making machine, watching the squeaky blade go round in circles as the machine extrudes and cuts torchietti, fusilli and maccheroni rigati.
This salesman-turned-food entrepreneur has been selling his pasta since July; his company – Amolitta Pasta – has 50 retail customers so far and has started soliciting restaurant business. By March, he hopes to have the sales numbers to justify doubling production. “What I’m seeing is yes, there is a very big natural demand” for specialty foods that are produced locally, Steinberg said.
Like Steinberg, Ravi Koil of South Portland has also recently started a food business, in his case importing cinnamon, turmeric, cardamom, cloves, nutmeg, star anise and other spices from his native Sri Lanka to sell to specialty markets, local wholesale clients, and restaurants in Maine. The spices are grown in multigenerational family spice gardens in the southern hill country of Sri Lanka. “I want to be known as the spice guy,” Koil said.
Koil, an international business consultant, launched his spice business as a sideline six months ago and says he’s not making much profit yet – maybe enough to fund a few nice dinners out at Portland’s finer restaurants every month – but that’s OK. He says he’s doing it to help the Sri Lankan farmers, and to introduce Mainers to the medicinal benefits of spices and to unfamiliar tastes. He’d like to see Mainers eating lobster with coconut curry sauce, for example, instead of drawn butter.
Then there is Heather Rose of Portland, who plans to launch Local Babe in March, a business selling baby purées, as well as snacks for toddlers and adults, all made with ingredients from Maine farms and wrapped in reusable packaging. A wedding officiant and former farm worker, Rose was was inspired to start the business after having her own baby, Camden, who is now 9 months old.
Rose has been developing her business at Fork Food Lab in Portland, a commercial kitchen where food entrepreneurs pay a fee to test their grandmother’s cookie recipe or to decide if they really do want to try selling their killer salsa that family and friends have urged them to market. When the lab opened in 2016, membership hovered at 20 to 25; in the last nine months, it jumped to 40-45, according to general manager Jenn Stein. The lab almost closed in 2018, but has since more than bounced back.
HELP IS AT HAND
In the past 15 years, McConnon and his colleague, Beth Calder, an associate professor of food science and food science specialist at UMaine Cooperative Extension service, have seen increasing numbers of people like Koil, Rose and Steinberg. In 2007, they and their colleagues developed a Recipe to Market workshop to help budding food entrepreneurs get started, answering questions like what kind of licenses are required? How is testing done? What information has to go on the food label?
In the subsequent years, the extension service has offered 25 of the programs, attended by more than 350 people in total. The number of inquiries about how to start a food business hasn’t slowed, Calder said. The most popular recent business ideas have been fermented foods, hot sauces and dressings.
“We’re starting to see plant-based foods,” McConnon added. “Nationally, there’s been a consumer-driven trend looking at plant-based products …We’ve seen a little of that, but I expect we’ll see a lot more of it.”
Other local economic development organizations offer their own programs to teach business skills and, in some cases, to provide financial assistance to food-and-beverage entrepreneurs, including SCORE, the Maine Center for Entrepreneurial Development in Portland, and Coastal Enterprises in Brunswick. More services are needed, though, to help nascent businesses scale up, McConnon said. Maine needs more commercial kitchens, for example, and more co-packers to help with manufacturing and distribution, he said.
The Maine Center for Entrepreneurial Development, in partnership with Focus Maine, now offers a program for food businesses at every stage of their life cycle: Top Gun, a 15-week program for startups (in any field) that culminates in a pitch contest and the chance to win money; Cultivator, a 12-month program designed for established food, beverage and agriculture companies looking to scale up; and MarketShare Accel, a new annual membership program that helps mature food-and-beverage companies expand regionally and nationally.
In the past three years, in response to rising interest in food businesses, Top Gun has held several food-focused programs. A 2018 program in Brunswick centered on aquaculture. A 2019 contest in Waterville tackled food generally. This year, two more food-themed programs are scheduled in Brunswick: one on craft beverages, the second another aquaculture class.
The Cultivator program begins with an in-depth examination of a company’s sales and marketing, operations, finance and management team. “We do a deep-dive assessment of where they are and where they want to be,” said Sue Hanson, Cultivator program manager. “They’re running these companies by themselves, and some of them are one-person owners, so they need coaching and mentoring from people with experience.”
Bangs Island Mussels, Black Dinah Chocolatiers and Vena’s Fizz House are among the graduates of the Cultivator program. Current “students” include Foulmouthed Brewing, New England Distilling and Pemberton Gourmet Foods. Companies that go to the next level – the MarketShare Accel program – get a tailored marketing and sales assessment, more coaching, and access to market and consumer data, Hanson said.
If a new entrepreneur has time for just a one-day commitment, she can find programs, too. This March, for instance, the Maine Center for Entrepreneurs, Focus Maine, and Maine Food Strategy are co-sponsoring Selling More Maine Foods, a daylong conference in Portland aimed at value-added food and beverage producers.
Some people, like Steinberg, go it alone. So far, he has built his fledgling pasta business with his own money and know-how, but his ears perked up when he heard about the spring conference, and he’d like to learn more about programs that could help him scale up. Steinberg loves the challenges that come with the business side of pasta making – cold calls to potential customers get him “jazzed,” he says – and he views Amolitta as a “nice and steady” career path that will give him a good life.
“It’s not going to be this mega-million payday down the road, but it’s going to be a very satisfying career,” he predicted. “You’re engaging people with food, which is a pretty amazing thing to do.”
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