NLC’s newest municipal action guide provides an overview of food incubator programs as well as guidance on how local governments can support these emerging strategies to promote local entrepreneurship and strengthen local food systems.
As the American Heart Association kicks off national American Heart Month, we are reminded about the importance of accessing healthy and affordable food. Whether it’s from a local grocer, food truck, or farmer’s market, the freshest and most nutritious meals are most often sourced, prepared, and served locally. In addition to the obvious health benefits, there are also economic gains when cities support access to local food systems and local food entrepreneurs. That is why so many communities are supporting food-based businesses, particularly through the creation of food business incubator programs.
For years, co-working spaces and incubator programs have accelerated the growth of technology-based startups. Now, this concept of providing entrepreneurs with shared working space, mentorship, and education is increasingly being translated into food-based business incubators. The type of assistance provided to food entrepreneurs includes access to a shared workspace, education programs on how to run a business, and mentors who can deliver industry-specific guidance.
Kitchen incubators and farm incubators are two programs for food-based entrepreneurs. These food-centric programs support individuals in their efforts to launch or grow a business in the food industry, which could include opening a restaurant, food truck, or catering service, as well as selling products at grocery stores, farmers’ markets, and online.
A new action guide from the National League of Cities, “Food-Based Business Incubator Programs,” provides an overview of kitchen and farm incubator programs, as well as guidance on how local governments can support these emerging strategies to promote local entrepreneurship and strengthen local food systems.
Below is a Q&A with several of the practitioners and experts who helped inform the guidebook. Read on to learn more about why food-based incubators are so important for their communities.
Why are food incubators important?
Cullen Gilchrist, CEO of Union Kitchen: Food incubators allow startup businesses to gain access to the resources, tools, and connections necessary to launch a successful business. At Union Kitchen, we build successful food businesses. We provide the professionally maintained commercial kitchen space that all food businesses need, but we differentiate ourselves by offering the services that businesses need to grow and accelerate their business. Our distribution company and retail outlets reduce the risk of failure for these businesses and supports them in establishing a strong baseline of success. We define our success by the revenues and profits we create, the businesses we grow, the jobs we create, the economic impact we have, and the employment training we deliver.
Chris Hiryak, Director of Little Rock Urban Farming: Food incubators are where the next generation of agriculturally informed citizens will be inspired, educated and instilled with the principles and values necessary to meet the challenge of creating a just and equitable food system in the 21st century.
New York City Department of Small Business Services (SBS): Food incubators provide food entrepreneurs with critical resources for building their businesses. Securing a private space to produce food commercially is a major financial and logistical barrier for start-ups. Financing the renovation of a production space with specific capabilities is even more costly and more of a risk. Incubators help food entrepreneurs avoid these hurdles by providing access to a licensed and regulated commercial kitchen space. This allows these small businesses to scale up to larger orders, receive assistance from qualified incubator staff, and network with other entrepreneurs utilizing the space.
What was the biggest challenge in launching the program/incubator?
Cullen Gilchrist, CEO of Union Kitchen: The greatest challenge has been to create an effective local food system that promotes supply and demand for local products, but that also delivers on the logistics necessary to be a successful operator in the food industry. We are creating the demand and supply for local products through our Grocery stores, and we need our distribution company’s operations to be strong enough to support this demand.
Chris Hiryak, Director of Little Rock Urban Farming: The biggest challenge in starting our urban farm project was learning to manage a small business.
New York City Department of Small Business Services (SBS): Through community outreach, the New York City Housing Authority (NYCHA) identified a trend of residents having food business backgrounds and interest in jumpstarting food-related businesses. At the same time, NYCHA recognized it would need support in gaining the necessary business education, funding, and accessing a regulated commercial kitchen space. SBS was able to address these challenges by creating the NYCHA Food Business Pathways program, in partnership with other key supporters. NYCHA resident participants in Food Business Pathways receive 8 weeks of training on business practices and food industry specific topics. The program teaches participants about kitchen incubators, provides assistance to participants on applying for space in incubators, and offers grants that allow graduates to rent space at the incubators for no cost. Grant funding also covers the cost of required licenses and permits for the training graduates.
How did your local government support or assist the creation of your program/incubator?
Cullen Gilchrist, CEO of Union Kitchen: The local D.C. government has been essential in supporting us through the permitting and licensing process. They have played an integral role in training D.C. residents to work for us and our Member businesses through subsidized training programs and initiatives.
Chris Hiryak, Director of Little Rock Urban Farming: Mayor Mark Stodola of Little Rock appointed me to the Little Rock Sustainability Commission, where as the Chairman of the Urban Agriculture committee, I have been able to make recommendations to the City of Little Rock Board of Directors related to urban agriculture policy. This has allowed us to have an ongoing dialogue with city staff and officials to ensure that all urban agriculture projects in Little Rock are supported.
New York City Department of Small Business Services (SBS): The Department of Small Business Services (SBS) works to help small businesses, launch, grow and thrive in New York City through various services and initiatives. SBS’ Food Business Pathways program works directly with NYCHA to meet the recognized needs of residents. This collaboration grew to include several other entities; Citi Community Development provided funding for the program, the New York City Economic Development Corporation provided funding and connections to NYC kitchen incubators, and Hot Bread Kitchen provided technical assistance and access to their commercial kitchen incubator.
What are one or two success stories of businesses created in your incubator program?
Cullen Gilchrist, CEO of Union Kitchen: Over the past four years, current and alumni Union Kitchen Members have collectively opened and operated nearly 70 storefronts in the D.C. region and have developed over 400 unique products. Approximately one third of our current Member businesses are distributing their products with Union Kitchen to nearly 200 retail locations in the region, including 25 Whole Foods Stores. We have seen our Members grow their businesses rapidly and successfully and are proud to support their ongoing success as distribution and retail partners. One of Union Kitchen’s first Members, TaKorean now has three storefronts and a fourth one on the way in 2017. What started as a food truck peddling unique Korean-inspired tacos has become one of D.C.’s most popular fast casual concepts.
New York City Department of Small Business Services (SBS): Joann Poe, owner of Joann’s Elegant Cakes, participated in the Food Business Pathways program and won a grant that provided her with free use of the kitchen incubator, Hot Bread Kitchen, in Harlem. Use of the food incubator led to Joan building up the capacity of her business which ultimately catalyzed growth and allowed her to contract with clients such as the City of New York, Citibank, and Kate Spade.
About the Author: Emily Robbins is Principal Associate for Economic Development at NLC. Follow Emily on Twitter @robbins617.