Oregon Resources for Food Entrepreneurs

1. Oregon Resources forFood Entrepreneurs Jim Seufert Seufert Winery Dayton Community Development Association jim@seufertwinery.com

2. Oregon Resources forFood Entrepreneurs Topics: • Setting the Stage • Recent Start Ups and a Success Story • The Big Picture of Food Manufacturing in Oregon • Common Challenges • Oregon Resources • Before You Start • University Programs • Quick Start Programs • Solutions to Specific Questions • Selling Your Product • Economic Development Opportunities

3. What’s New:Sampling of Oregon’s New Food Products Fruit Pate from Oregon Growers and Shippers (Hood River) Preserves from Aloha from Oregon (Eugene) Pretzels and dry dips from Vibrant Flavors (Portland) Toffee from Cary’s of Oregon (Grants Pass) Biscotti from Be-Bop Biscotti (Bend) Chocolates from Lillie Belle Farms (Central Point) Tea from Smith Tea (Portland) Pickles from Unbound Pickling (Portland)

4. Role Model:Pacific Natural Foods • Based in Tualatin, Oregon • Vertically integrated (farm, process, retail) • 24x7 operations, 300+ employees • National distribution • Doing things the right way…

5. Food Manufacturing in Oregon • Employs ~23,000 • Only sector to increase jobs during recession: • 2007-9 overall Oregon employment dropped 6.9% while food processing employment increased 2.6% • Predicting future growth: • By 2018 Oregon manufacturing will shed 5,300 jobs but food processing is expected add 1,700 Source: Oregon Employment Department

6. So You Want to Start a Food Business?Common Challenges • Expect all the challenges faced by every start up business: • Market research, product development, business planning, production, marketing, sales, supply chain, technology, etc. • Add to that: • Frequently processing agricultural crops: • Perishable product • Variability in ingredient quality, yield, timing, etc. • Inventory requirements (seasonal harvest to supply annual sales) • Considerable costs: • Specialized equipment, space, inspections, licensing, etc. • Cost to carry inventory • Food safety: • Processing = preserving = pathogen “kill” step (Listeria and so many others) • External oversight, reporting, inspections (e.g., FDA, USDA)

7. Before You Start • Market Research • Small Business Development Centers

8. Entrepreneur Education:Research Your Idea and the Market • Read!(for example) • Starting a Part Time Food Business (Lewis) • Sell Your Specialty Food (Hall) • Small Scale Food Entrepreneurship: A Technical Guide for Food Ventures (Penn State College of Ag Sciences) • And many more resources… • Research trends and competition • Specialty Food magazine • Fancy Food Show – Jan 15-17, 2012 San Francisco • Production equipment and food industry seminars • NW Food Processors Association Expo – Jan 15-18, 2012 Portland • Most industry segments have their own “association”

9. Entrepreneur Education:Getting Started (and beyond) • Oregon Small Business Development Center Network • www.bizcenter.org • Offers FREE help with: • Financial, marketing, production, organization, international trade and feasibility studies. • Develop a business plan, assess a new market, create cash flow projections, control costs, or break into the global marketplace. • Case Study: Ft. George Brewery (Astoria) • Counseling from Clatsop Economic Development Resources and the CEDR/SBDC Small Business Development Center • Wanted to expand production – SBDC counselor helped: • Know what it cost to make a keg of Vortex (the brewery’s signature beer) to justify expansion • Started quarterly (then monthly) inventory schedule • Work with Pacific Power to reduce the cost of converting the expansion space from single-phase to three-phase power

10. University Programs • Portland State University • Food Industry Leadership Program • Oregon State University • Food Science and Technology

11. Entrepreneur Education:Running a Food Business Portland State University: Food Industry Leadership Center

12. Entrepreneur Education:Science and Technology Oregon State University: Food Science and Technology OSU has undergraduate and graduate programs in these disciplines, as well as periodic seminars: • Food Chemistry and Biochemistry • Food Microbiology and Biotechnology • Flavor Chemistry and Sensory Evaluation • Food Processing and Engineering • Enology (Winemaking) • Brewing Science • Dairy Processing • Seafood Science • Value-Added Foods • Upcoming dairy seminars: • Practical introduction to cheesemaking • Production of French soft cheeses • Production of French hard cheeses • Seminar - to pasteurize or not to pasteurize: the great raw milk cheese debate, a French perspective • Dairy cleaning, sanitizing, and impact on food safety • Milk quality, flavor and introduction to dairy microbiology • Prioritizing safety; GMPs and HACCP

13. Quick Start Programs • Portland Community College • Getting Your Recipe to Market course • Linn-Benton Community College • Food-Biz Bootcamp

14. Entrepreneur Education:How To Start a Food Business Portland Community College: Recipe to Market • PCC: Recipe to Market (Portland) • “Comprehensive program that takes food entrepreneurs from concept to commercial ready” • Food safety and science, recipe formulation, product development, brand development and marketing, basic financial management, product distribution, etc. • New Seasons sponsors event • Participants “pitch” products to New Seasons buyers • Winner gets $2,000 launch funding and retail shelf space • Case Study: The Better Bean Company • Fresh refried beans (versus canned) • PCC Recipe to Market graduate; New Seasons Winner

15. Entrepreneur Education:How To Start a Food Business Portland Community College: Recipe to Market

16. Entrepreneur Education:How To Start a Food Business Portland Community College: Recipe to Market

17. Entrepreneur Education:How To Start a Food Business Linn-Benton Community College: Food Biz Bootcamp LBCC/Oregon Tilth: Food Biz Bootcamp (Albany) • “Help food entrepreneurs network, gain resources and perspectives on what it takes to run a successful food business” • The intent of the workshop is three-fold: • Create a community of practice – a cohort of food business owners throughout the Linn-Benton area who can support one another through the challenge of establishing a local food business • Give participants a sense of what it takes to create a successful food business - challenges, considerations, stories from successful entrepreneurs • Expose participants to available resources - local food networks, farmer’s markets, on-site processing, distributing, business planning, financing, marketing and more • Conducted with Oregon Tilth

18. Solutions to Specific Questions • OSU Food Innovation Center • OSU Seafood Research Lab

19. Entrepreneur Resource:Concept Development • OSU: Food Innovation Center (Portland) • Product and process development • Packaging engineering • Shelf life studies • Consumer sensory testing • Case Study: Chez Gourmet • Veggie burgers – accounts include: • Burgerville, McMenamins, Zupan’s, Fred Meyer, Whole Foods, New Seasons • 2006 launch; 2008 moved to 12,000 sq ft facility • 5+ employees; profitable • OSU FIC: Product development

20. Entrepreneur Resource:Concept Development • OSU: Seafood Research Lab (Astoria) • Research and Development • Value-Added Product Development • Seafood Safety • Seafood Biochemistry and Quality • Surimi and Surimi Seafood • Seafood Byproduct Utilization • Extension Service to the Fishing Industry • Graduate Research, Training and Instruction • Case Study: Annual Surimi School: • Develop knowledge of surimi technology and its utilization in food product development, as well as surimi market trends. The course covers: • Chemistry, microbiology, and rheology of surimi, • Functional applicability of surimi additives like cryoprotectants, enzyme inhibitors, binders, fillers, colorings, flavorings, and production know-how.

21. Food Production • Rental Kitchens • Outsource Operations

22. Entrepreneur Resource:Rental Kitchen - Columbia Gorge • Columbia Gorge Community College: The Dalles, OR • Certified commercial kitchen, rent by the hour • Incubator Services: • Goal is to stimulate small business growth in the Mid-Columbia region • Staff assistance in areas of management, financing, and marketing • Connections to entrepreneurs and regional experts • Equipment • Convection oven; food processor, mixers, etc. • Packaging area includes bottle-filler, weight-pack, labeling machine, package sealers • Demonstration area, meeting, & banquet room

23. Entrepreneur Resource:Rental Kitchen - Southern Oregon • Rogue Valley Kitchen: Central Point, OR • Certified commercial kitchen, rent by the hour • Startup resources including: • Advice on licensing; food label law guidance • Graphic design and packaging; product photography • Connections to suppliers and networks • Referrals to an ever-growing base of local resources. • Equipment • Electric convection oven; range; mixers, etc. • Packaging/labeling clean room • Meeting area/conference room • Case Study: Rokz Cocktail Sugars and Salts • Vivid color, sparkle and flavor; new twist on the usual garnish • Superior flavor, brilliant appearance, excellent shelf-life, and exceptional price point • Started 2006 in Eugene sharing space at Food for Lane County • Profitable since 2009, and a “new surge of interest in our products and private label projects” • Husband/wife share 1FTE, hire PT help, about to hire 1-2 people

24. Entrepreneur Resource:Rental Kitchen - Around the State • Corvallis: Chintimini Senior Center • Bend: Bend Community Center • Newport: Senior Center • Portland: John’s Catering and Food Cart Kitchen • Roseburg: Umpqua Valley Arts Association

25. Entrepreneur Resource:Outsource Production • DePaul Packaging (Portland) • Co-Pack facility: • Package bulk product in retail portions • Club store variety packs (and more) • Richmond Baking (McMinnville) • Contract bakery for crackers, cookies, etc. • Case Study: Tao of Tea at DePaul • Retail packaging of loose leaf tea • Strong sales – can’t meet demand in-house • Oregon Tilth organic certification

26. Selling Your Product

27. The Entrepreneur Rarely Sleeps…Selling Your Product • Direct to consumer • Food and wine festivals • Farmers markets • Product demos inside retailers • Online (social media promotions to webstore sales) • Wholesale • Direct sales to retailers • Trade shows • Fancy Foods Show (San Francisco) • Northwest Foodservice Show (Portland/Seattle) • Wholesale distributors • Provvista (Portland) • Specialty food brokers (contract sales reps) • Murdock and White • Cascade Food Brokers

28. Can’t Find What You Need? • Economic Development Opportunities

29. Economic Development Opportunity:Three West Coast Models Food Technology Center University Of Idaho Caldwell, ID “Multi-purpose food production facility” Blue Mountain Station Dayton, WA “Eco-friendly artisan natural & organic food park” La Cocina San Francisco, CA “Cultivate low-income food entrepreneurs”

30. Economic Development Opportunity:Define Your Local Needs • Leverage existing assets: • Community College • Coaching via SBDC, SCORE, etc. • Create new food business courses • Commercial kitchen space • School, church, restaurant, other local food processors • Case Study: Dayton Artisanal Food Center • An innovative new facility that: • Builds a culture around Good Food • Creates businesses and jobs • Develops a workforce

31. Conclusion Small Business Development Centers Final Questions

32. Jim Seufert • Business Consultant: Strategy definition to plant operational improvement • Owner & Winemaker: Seufert Winery, Dayton Oregon www.SeufertWinery.com • Economic Development: Dayton Community Development Association www.DaytonOregon.org • Jim@SeufertWinery.com