Small Food Startups Face Challenges En Route To Supermarket Shelves

By Joe Ryan

There is perhaps no greater leap for an aspiring chocolatier, craft brewer or organic granola maker than from the farmer’s market to the supermarket.

That potentially lucrative ascent has long bedeviled startup food companies, often separating those that fizzle from the one-in-a-million that booms. But that rise has become increasingly important on Long Island in recent years, as a growing number of local entrepreneurs stake their livelihoods on artisanal pickles, gluten-free cookies and small-batch you-name-it.

“It’s a big jump to land at the grocery store,” said Christine Bellini, a Sag Harbor-based consultant who works with food startups.

The proliferation of tiny food companies on Long Island follows the nationwide farm-to-table movement and is anchored on the East End, where companies buy ingredients direct from farms and have exposure to affluent customers who flock to the region.

In the last year, the number of companies renting industrial kitchen space at Stony Brook University’s 3-year-old business incubator in Calverton has more than doubled, to 50. Officials say those startups have emerged as a crucial part of the region’s entrepreneurial economy.

Indeed, small-batch food companies have become big business across America. Ten years ago, an artisanal ketchup maker’s best chance of landing on a supermarket shelf might have been by selling the recipe to Heinz. Today, stores including Whole Foods, Wild by Nature, Fairway and others aggressively stock products cranked out by tiny companies.

Startups face challenges
Yet that doesn’t mean the food business has become easy.

The margins for selling, say, organic soy-free quinoa-stuffed kale rolls are low. Same for wasabi-flavored aioli, wood-fired pita chips, and faro cookies with sea salt and raw honey — and just about any other niche food. Start-up costs, meanwhile, are high. And competition for almost any edible product is stiff.

Hence, most food startups fold before their stuff lands on a shelf.

“The hardest thing for a small company to recognize is that there are thousands of products on the shelf. So they need to have something unique,” said Elly Truesdell, who works for Whole Foods and scours farmers markets for new artisanal products.

She spoke during a visit last week to the Calverton incubator, where about 25 companies were showcasing products for buyers from grocery stores and local restaurants.

Near the front door, a company offered bites of electric-green pickles, brined in a salty-garlicky-horseradish bath. The buttery smell of lobster bisque wafted from a nearby soup-maker’s kettle. Spring rolls sizzled on an electric grill.

Truesdell — whose official title is “Northeast region local forager” — sources products for 32 Whole Foods stores in New York, New Jersey and Connecticut. She walked slowly from booth to booth. Occasionally she tasted. But mostly she asked questions and scrutinized ingredient lists.

Whole Foods has strict rules barring hydrogenated fats, artificial colors, flavors, sweeteners and preservatives. If a product meets those standards, the next question is whether it could fill a void.

“We can only stock so many types of pasta sauce,” Truesdell said.

A few feet away, Deana Reyburn stood before a display of organic granola, which she makes in small batches with organic rolled oats using her grandmother’s recipe. Reyburn, who lives in Mattituck and is a massage therapist, started NoFo Crunch Granola three years ago as a side project.

She managed to sell her products in a handful of specialty grocers, including Vines & Branches in Greenport, Eric’s Breakfast & Lunch in Southold and Love Lane Sweet Shoppe in Mattituck. But she’s had no luck so far at supermarkets.

“The granola market is pretty saturated,” she said.

In the next booth over, Tink Mortimer found a way to make her cocktail sauce stand apart.

Her secret was replacing the sauce’s traditional backbone — horseradish — with ginger. The result is a bracing and slightly-sweet Asian spin on an American classic. And it worked wonders, Mortimer said, when she offered a taste to a manager last year at the Whole Foods in Jericho.

“I gave him a sample and he said, ‘I’ll take it,’ ” said Mortimer, who also runs a garden design company and lives in Locust Valley. “He liked it because it was unique.”

Reinventing the standards
That push for a new twist on a familiar product was on display at nearly every booth.

The Subtle Tea Company of Centereach offered tea brewed with plum instead of the usual offerings of lemon and peach. Naturelle Foods of Calverton hawked a Provence-style tomato sauce, hoping to stand out from Italian varieties. And Hamptons Brine offered bottled sauerkraut juice, a lusty drink with notes of vinegar, cabbage and Himalayan salt.

“It’s the best hangover cure in the world,” said Nadia Ernestus, the company’s founder.

Standing out from the crowd is hardly the only challenge. It’s not easy to churn out handmade foods cheaply.

Cheryl Platt, the owner of 63 South Chill Street of Calverton, separates organic eggs by hand and scoops the ice cream she makes into containers herself. Hence, it retails at $17 a pint. Tiana Le, who runs Le Fusion spring roll company of Calverton, does the rolling by hand. A box of five retails from $7.50 to $15. And Michael Avari, of Newburgh-based Citrose Enterprises Inc., worked for months to find a way to bring the cost of his family hummus recipe down to $3.99 for a 10-ounce package.

“Everyone likes the taste,” he said. “The challenge is producing it at a cost point that makes us competitive.”

Truesdell, the Whole Food representative, said she found a number of products worth pursuing from companies based at the incubator. They include Tainos Sofritos, which makes a blend of peppers, garlic, onions and other aromatics to add zing to stews and sauces; Backyard Brine, an artisanal pickle company; and Radical Rainbow Cookies, which offers layered gluten-free confections, colored red, yellow and green.

“All of these items were very distinctive in taste, packaging, selection of ingredients and offer something that we know our customers will enjoy,” Truesdell said in an email.

Making their debut
Even after a supermarket accepts a product, there can be a long road to the shelf.

Every item needs a universal product code (Those are the bar codes and 12-digit numbers printed on every label, which are assigned by a nonprofit organization based in Chicago.) Producers must be properly insured. Anything claiming to be organic must be certified by the U.S. Department of Agriculture. And packaging must be just so.

Once the first shipment arrives, companies are expected to send representatives regularly to stores to hand out samples. In many instances, those representatives are the company’s sole employee.

“They need to do a lot of demos,” said Michael Infantolino, a vice president and general manager for Wild By Nature. “You have to put in a lot of time. It’s not easy.”

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