Everyone knows the story of the secret family recipe that started out being prepared in small batches in a home kitchen and went on to find national or even global popularity while generating millions of dollars in sales. Mrs. Fields, Dr. Pepper and Campbell’s Soup all have humble roots, but today they are instantly recognizable and trusted brands. While the idea of starting out small and making it big is the quintessential success story for just about any food-based enterprise, the reality can be a daunting proposition for upstart food producers who are giving everything they have to get their feet off the ground.
Small businesses generally don’t make and sell enough product, and rarely do they have the necessary financial resources, to support the expense of developing a full commercial production facility of their own. Enter the food incubator.
Today many small producers are relying on food incubators – commercial kitchen facilities where space and time can be rented in shifts – to keep production costs down. By eliminating start-up costs, providing access to high-quality kitchen equipment, and allowing vendors to share operating expenses (such as pest management, trash removal, and utilities), business incubators make the dream of having a successful food business a realistic goal. According to the National Business Incubation Association, over 87% of incubator businesses continue to thrive and grow into independent businesses after they “graduate” from the incubator where they initially started.
Incubator kitchens are catching on in New York, with more than 40 registered locations that are potentially available for food artisans to set up shop. Food incubators are so appealing that even large food companies are investing in the concept. In November 2014, Chobani announced that it was opening a food incubator in New York City.
In 2009, Bad Ass Organics started producing raw and lacto-fermented products in a commercial warehouse space in Long Island City. The company produces a line of 20 fermented products that includes raw ketchup, kombucha, barbecue sauce, four flavors of lacto-fermented slaw, four flavors of hot sauce and probiotic energy shots, which are made with the leftover brine from the other fermented products. BAO founder Michael Schwartz got the idea to offset production costs in slow periods by leasing more space in the warehouse which he would, in turn, lease to other food producers. He succeeded in creating a series of kitchen spaces with flexible rent options that attracted a vibrant set of local food producers, and the Organic Food Incubator was born.
“When we started BAO in 2009 the local small food scene was very different than it is now. No one was willing to help us. We had door after door slammed in our faces. After BAO became successful, we wanted to help other small companies avoid some of the same pitfalls, so we started the Organic Food Incubator.” – Mike Schwartz
Upstart food businesses have a variety of different needs, and the Organic Food Incubator has several options to suit different producers. Some of the kitchens have commercial equipment like dough mixers, steam kettles and convection ovens, while others are empty spaces outfitted with nothing more than electricity and plumbing. Producers can pay for daily access to commercially outfitted kitchens or they can rent an empty space on a monthly basis, providing all of their own specialized equipment. The Organic Food Incubator also offers contract manufacturing which allows companies to develop a product and outsource the entire production process – from procurement of ingredients, to preparation, to post-production packaging.
The Organic Food Incubator presently serves as the base of operations for a total of 60 individual companies and 19 kitchens. The roster of Organic Food Incubator producers includes Alchemy Creamery (a vegan ice cream company), Hella Bitter, Simply Gum, BAO Food and Drink, Loliware (producer of edible drink cups), The Jam Stand, The Chili Lab, Farmivore (producer of DIY smoothie kits), and The Splendid Spoon. No fewer than five juice companies, three coffee companies, two olive oil companies, and a gluten-free bakery round out the list.