Incubating Good-Food Businesses in Detroit

13 Jun 2014 | America's Tomorrow
Incubating Good-Food Businesses in Detroit
Above: April Anderson (photo by Franise Hearn)
April Anderson starts baking at three o'clock in the morning, 5 days a week — and at one o'clock on Saturdays. At seven o'clock, she loads breakfast loaves, organic cookies, and vegan cupcakes into her van and delivers them to her new shop, Good Cakes and Bakes, in the historic Detroit business district. Just one year after completing a community college program in pastry arts, she has revenues of $6,700 a month, she has hired an assistant baker at nearly double current minimum wage, and she plans to open two more shops, employing 25 to 30 people.
 
What made it all possible is Detroit Kitchen Connect (DKC). The initiative helps local residents — most of them women of color— transform their ideas and passions into scalable businesses by providing commercial kitchen rentals at sliding-scale rates, and guidance in the nuts and bolts of launching and growing a company.
 
"No way I would have been able to do this without Detroit Kitchen Connect," Anderson said. "It's definitely been a lifesaver and such an opportunity."
 
By tapping into local licensed kitchens that are largely unused, DKC is creating pathways to business ownership for entrepreneurs with little wealth or access to capital — people likely to hire other Detroiters and buy supplies from small local firms. It's an example of how to repurpose neighborhood assets to spur small business development, job creation, community renewal, and equitable growth.
 
"We're helping Detroit re-image what should be done with underutilized kitchen spaces and finding new ways to connect low-income people to economic opportunities wherever they exist," said Devita Davison, a Detroit native and the driving force behind DKC. "While our entrepreneurs are hard at work bringing Detroiters delicious and diverse food and beverage options, our relevancy goes beyond just food. It has to do with building a more inclusive food economy."
 
Nourishing the city and regional economy
 
Buying more local foods would bring huge economic benefits to the city and region. Shifting just 20 percent of food spending in Detroit to local producers would create more than 4,700 jobs, raise earnings by $125 million, and bring the city nearly $20 million more in business taxes, according to a recent analysis. Expand this spending shift to the five counties surrounding Detroit, and those numbers soar: nearly 36,000 jobs, $900 million more in earnings, and $155 million in additional business taxes.
 
That's good news in a city with a vibrant emerging culinary scene and a groundswell of interest in healthier, locally produced, and ethically sourced food. Over the past five years, pop-up cafes, small restaurants, and bake shops like Anderson's have sprouted in previously vacant spaces, increasing foot traffic, improving quality of life, and raising hopes for more homegrown economic development.
 
But niche food businesses also raise concerns. All too often they turn out to be an early sign of gentrification in a vulnerable neighborhood, the first wave of investment that benefits privileged newcomers and displaces long-time residents. DKC is part of a broader effort to rewrite that story.
 
Jobs, health, sustainability for all
 
DKC was created through a partnership between two key players in the Detroit good-food movement that together represent the city's prosperous past and an optimistic vision for its future. One partner is Detroit Eastern Market, a historic public market. The other is FoodLab Detroit, a young, rapidly growing community of food entrepreneurs who have come together around a vision of a food system that delivers triple bottom-line benefits — prosperity for all, equitable healthy food access, and environmental sustainability.
 
One strategy to achieve that is Operation Above Ground, which works to get the city's many underground food businesses licensed by helping owners navigate the formidable regulatory maze and advocating for a transparent, streamlined, and affordable process that facilitates, rather than thwarts, the community entrepreneurship that the city economy sorely needs.
 
Another strategy is DKC, launched a year ago. It has lined up two kitchens, in a church and a community services agency, where 11 bakers, gourmet candy makers, and beverage makers rent space for $15 to $30 an hour. The arrangement eliminates one of the greatest barriers to entering the food business: the high cost of building, licensing, and insuring a commercial kitchen. Participants receive technical assistance to get licensed and training in operations, marketing, and sales.
 
All this enabled April Anderson to achieve her goal of opening a bakery within a year of graduating from a program in pastry arts.
 
She has baked since childhood, and ran a small pastry business from her home for several years. She longed to branch into retailing, but did not have $65,000 to $70,000 to invest in a suitable kitchen. When DKC invited applications, she jumped at the opportunity. The first time she baked in the unfamiliar ovens in a church, she charred her brownies. Now she turns out 16 products a day.
 
Drawing on family savings and a grant from Revolve Detroit — a collaborative program that's reinvigorating Detroit by supporting art installations and emerging businesses in vacant storefronts — Anderson opened her shop last September. She recently entered talks with a 16-store grocery chain to sell her products.
 
Her five-year business plan calls for opening two more stores and employing a staff of up to 30. She's committed to hiring people who face employment barriers, particularly the formerly incarcerated. "And we definitely want to pay a living wage," she said.
 
People like Anderson, creating jobs like this, are key to Detroit's recovery. Gone is the era when a manufacturing giant would boost the city's fortunes by opening a big plant and creating thousands of jobs, Davison noted. "I believe that if Detroit is ever going to renew itself, it will be because of hardworking entrepreneurs and small business owners."
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