San Francisco Food & beverage Industry Cluster

1. San Francisco Food & beverage Industry Cluster Planning department oewd SPUR bae urban economics

2. Introduction • Why is this important to San Francisco economy? • Supports Employment and Socio-Economic Diversity • Blue-collar jobs create opportunity for all educational backgrounds • Cluster Effects • Positively reinforcing loops can accelerate growth and innovation • The San Francisco Brand • Unique, creative businesses attract diverse residents and support the tourism, hospitality, and other • What is the Food & Beverage Industry Cluster? • Food Manufacturing • Bakeries, Chocolate & Confections, Seafood Processing, etc • Beverage Manufacturing • Breweries, Wineries, Distilleries • Food & Beverage Wholesalers • Grocery, Alcoholic Beverage, Farm Products & Supplies Wholesalers

3. Regional Trends • …but Food & Beverage jobs make up an important part of those sectors, especially in San Francisco. • Manufacturing and wholesaling make up a small part of the regional and San Francisco economies... Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014

4. Regional Trends 22,930 18,085 23,308 Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014 .*As per QCEW disclosure policy, employment data for Beverage Manufacturing and Alcoholic Beverage Wholesalers in Solano County and for Farm Product Raw Materials Wholesalers in multiple counties are not publicly disclosed. • San Francisco plays a small role in the region’s food and beverage manufacturing. • Alameda, Napa, and Sonoma Counties are major players.

5. Regional trends Alameda Santa Clara Sonoma San Mateo San Francisco Solano Contra Costa Napa Marin • In the Bay Area, San Francisco had the largest loss in food manufacturing jobs Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014.

6. San Francisco Trends • Since 1990, food manufacturing has accounted for most of the loss in cluster jobs • In recent years, however, wholesaling and manufacturing have both grown again Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014.

7. San Francisco Trends • Food and beverage manufacturing jobs have declined in San Francisco since 1990… • … even as jobs in restaurants, bars, grocery stores, and liquor stores grew Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014.

8. San Francisco Today Fruit & Veg. 46 (1,853) Breweries & Distilleries 113 (211) (2,986) Farm Supplies 43 Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014.

9. San Francisco today • Bakeries have highest revenue in total, but also large number of small establishments (not shown) • Coffee & Tea and Candy manufacturing are small subsectors in terms of revenues Sources: Dun & Bradstreet, 2013; BAE, 2014.

10. business surveys: key challenges • Transportation/access and workforce issues are bigger challenges for wholesalers than for manufacturers • Real estate and capital access are the top challenges for manufacturers Sources: SFMade, 2014; SF Planning, 2014; BAE, 2014.

11. business surveys: Location decisions • Top reasons for San Francisco location? • Near customers and “brand” of San Francisco Sources: SFMade, 2014; SF Planning, 2014; BAE, 2014.

12. business surveys: space & expansion • Most manufacturers operate in their own space or a commercial kitchen • More than half of manufacturers will need new or expanded space within one year Sources: SFMade, 2014; SF Planning, 2014; BAE, 2014.

13. Key Findings • San Francisco’s Food and Beverage Cluster: • Has relatively small share of Bay Area Food Cluster employment • Accounts of ¼ of all City’s manufacturing/wholesaling jobs • Has seen a steep decline in employment since 1990, but appears to be leveling off since 2006 • Has more jobs in wholesaling than manufacturing (with grocery wholesalers as largest) • Bakeries is largest type of food manufacturer • Top challenges facing Cluster in San Francisco: • Real Estate (Affordable/Available Space + Build-Out Costs) • Access to Capital • Labor Costs • Regulatory Issues • Skilled workforce • Mobility (Transportation + Distribution Access)

14. Food & beverage Cluster “Map” Sources: BAE, 2014.

15. Key Discussion Questions • Did we “get it right on the challenges facing this cluster? • Affordable space • Access to capital • Transportation issues • Workforce issues • Regulatory issues • How can San Francisco help existing food and beverage manufacturers and wholesalers to stay and grow? • What facilities, infrastructure, or services are missing today that, if located in San Francisco, would help existing businesses and attract new ones?

16. Thank you for your participation! Diana SokoloveFood System Policy ManagerSan Francisco Planning Department(415) 575-9046diana.sokolove@sfgov.org Eli ZigasFood Systems and Urban Agriculture Program ManagerSPUR(415) 644-4881eli.zigas@spur.org Tiffany GarciaBusiness Development ManagerOffice of Economic and Workforce Development(415) 581-2322tiffany.garcia@sfgov.org • Next Steps • Steering Committee Meeting February 26th • Draft Report March 17th • Steering Committee Meeting March 26th • Final Report April 21st • Final Steering Committee Meeting Date TBD Contacts