The Grand Traverse region is home to scores
of small, successful fruit, coffee, salsa, tea, bread, and other food entrepreneurs. TCBN publisher Luke Haase sat down with four leading foodies on a recent wintery afternoon. Included in the roundtable were:
Melissa Ewing, Undercover Vegetable Company
Jeff Hughes, Brownwood Farms
Bob Sutherland, Cherry Republic
Chris Treter, Higher Grounds Trading Company
TCBN: Tell us a little bit about you and your business.
Treter: We are a 100 percent fair trade organic coffee maker, the only one in Michigan, and we recently opened a coffee bar and roastery at the Grand Traverse Commons. My wife Jody and I founded the company in 2002 after working with Mayan growers living in Chiapas, Mexico. We moved here from there, and found this to be an amazing place to live and do business. We took a $3,500 loan from Jody's life insurance policy, bought a palette of beans, and got started. We are now importing 120,000 pounds of green coffee each year.
Sutherland: I started in 1989 when I was still in college, selling t-shirt designs out of the trunk of my car. It was very successful, and I sold 3,500 shirts at Art's Tavern (in Glen Arbor) and had 13 stores that carried it. So I had this little t-shirt idea, and the next year I did a couple designs, and soon I started selling a cookie, because I realized people buy food year-round but not t-shirts. I was just wholesaling them, but now had a van. I had never taken a business class, but I was having fun. Then I met a farmer who had a new way to dry cherries and was looking for someone to market them. We worked out a good deal where I could use my label on his cherries, and his son helped me deliver. Over eight years we sold tons of his cherries. Eventually I got a retail store, and now we are 90 percent retail. Of that retail business, 50 percent is Internet/mail order. The vision of the company was far different than it is today. We are trying to capture the essence of northern Michigan. We put the best of the area in our products, displays, and buildings. From the moment people step out of their car, they are experiencing northern Michigan and our 175 products. We do our best to support local farmers, and our future is to support local manufacturers, as well, through shirts, pottery done locally. We have 160 employees at Christmas, and an average growth of maybe 15-20 percent.
Hughes: Brownwood was started in 1945 by my partner's grandparents as a roadside stand that sold cherry butter and honey. It expanded to a few gift shops, and grew to a nice and very popular restaurant located on East Torch Lake Road, which was at its peak in the late '50s to early '70s. It just amazes me that we still get phone calls about that place. I entered the business in 2001 when my friend Steve de Tar called and said he was concentrating on nutraceuticals and didn't want to do jam any longer. Five months ago I bought Steve out, so Brownwood Farms I own, Brownwood Acres Steve owns. We make salsas, jams, mustards, and more. Ninety percent of our business is wholesale, and 10 percent is retail. We have 40 products under our brand, 50-some products under other companies' labels. Our products are sold in Michigan, Florida, Wisconsin, Missouri, and lots of other places. Ours are high-end specialty products. And, we make everything here in Williamsburg, and we rely on retailers to move our product.
Ewing: Well, have any of you heard of Yotta Bars?[Group]: Yeah!
Ewing: Our two-year-old son wouldn't eat his veggies. We talked to pediatricians, friends, and everyone said hide the veggies in his food. And we just wondered why wasn't there food with the veggies hidden? So we hired a test kitchen from Minneapolis to help us create a recipe. The idea was to put this product on the market for kids and parents, but adults actually like them better than kids. Eighty-nine percent of adults don't get enough vegetables in their diet. We started in baby steps…two years ago we were selling them in the local market, then we expanded in Michigan, and took a big step this year when we got a deal with QVC on TV. I have a person who I know from high school who works there, and then we have a consultant who got us in the door. Our bars sold really well on QVC, and we've been on twice. And we just got a national distribution deal with Whole Foods. We put the product on the market in fall 2005. Oh, and I should add that my husband, TJ, is my partner.
Sutherland: You'll have great success…
Ewing: You know, even a positive email makes such a huge difference…maybe you all are beyond that, but it's true for me.
Hughes: Oh, you never get beyond that!
TCBN: What about the whole organic issue? Bobby, if you decided to go 100 percent at Cherry Republic, that would cost you what, 15-20 percent more?
Sutherland: Oh, a lot more than that. The organic cherries would probably be 50 percent higher than we're paying.
Treter: Our situation is different. We're in an industry that has a lot of inequalities of wealth and devastating effects on environment. We have a unique company; we started right next to growers in 2002. They're getting paid $.41 per pound, and it takes a grower $1 just to break even…just to feed their families. So we pay an organic premium; we are paying $1.61. It promotes the sustainability of farming and it is a more wholistic approach. We are buying the best coffee available, and our passion is for organic and fair trade. It's a highly competitive market, but we don't put a lot of value in large, multi-national accounts. Our biggest customer is Oryana here in Traverse City, and they represent less than 8 percent of our business.
Sutherland: I give credit to you, Chris. Our customers are now more aware of fair trade and organic. You really paved the way for us…
Ewing: Our next product will be organic. When we started out it wasn't justified, but now it absolutely is…
Hughes: We've thought a lot about it. We're going to look at it again. I don't know how deep we'll dive in, but it's definitely a growing trend.
Hughes: Chris, do you think because of where we live, we tend to be more interested in the organic movement than in, say, St. Louis or Indiana?
Treter: Maybe, but there are niches everywhere. But the important thing is that organic consumers are extremely loyal. Once they make that commitment, those customers don't turn back. It's a huge phenomenon.
TCBN: What about the increasing importance of the Internet to your businesses?
Sutherland: Nine years ago I wanted to get a web site up but I didn't have the confidence to get enough orders to pay for it. So I got a grant for it, and that started us off. It didn't really pay for itself until several years down the road, but it is a major part of our business. Of course, as the Internet grows, catalog sales are leveling off. People's impression is if you get online, you'll sell to people who have never seen your store, but the reality is that people want to see and feel your products. Especially with cherries. Cherry is a subtle flavor; it doesn't pull off the shelves…you have to sample it.
Ewing: In our case, people trust our products because they trust QVC. They trust the hosts on the channel, so they will try it out based on that.
TCBN: Does the food sector have the potential to significantly grow this local economy?
Hughes: I continue to hear of lot of people in northern Michigan who would like to create food and drinks and package and market them. I think it's fantastic.
Treter: We can't rely on industry and the service economy. People are coming up here, and they want a taste of place…they know and love this place, and you can capitalize on that business. I could be naive; I've only been here five years…but I think we should put more government resources into growing small business and value-added agriculture.
Sutherland: I'd say we do have a great opportunity to build our economy around food. We are in a great, growing area, there are proven people like all of us…I actually have seven former employees who now have their own food companies themselves. The key is to make a product with a shelf life so we can all ship to California. We ship product out there, and they send money back to our local economy…bring those millions of dollars back home to our box company, our employees, and everyone involved.
TCBN: It doesn't seem like there's a lot of camaraderie or cooperation though, like in the wine industry.
Ewing: I think you're right. We should spend more time together.
Treter: Yes, that's a great idea. Let's do it.
TCBN: So where will you all be in 10 years?
Ewing: We'll have expanded our product line beyond bars and maybe be manufacturing here.
Hughes: We'll be here, in a bigger facility, with more distribution. We won't necessarily have several new products….we're in the places we need to be, just need to grow what we already have.
Treter: We'll expand our direct relationship with growers and showing that to consumers…showing complexity of coffees like wine…but also using profits of our company to deepen our relationship with community.
SUTHERLAND: We want to help create a different-ness about here, instead of doing the same thing everywhere around the country. We will always be here and about this region. I have a file full of people who want to do Cherry Republic franchises, but I won't do it. I just love that we are a great region to incubate new businesses. People will say, 'Hey, I want to move up to northern Michigan. Find me something to do.' And I say, 'if you want to move up here, then start a business. That's the right way to do it."