Recipe for Success
Walking through Portland’s annual American Food Fight competition is like taking a turn down the aisle of a futuristic grocery store. Hopeful entrepreneurs present their creations, from Esspressicles to Tribal Moose High Bush Cranberry BarBQue Sauce, on everything from paper plates to silver platters. Each has a dream of creating the next food fad. Although only one product will win the competition and the prize, all will find that the recipe for success includes a healthy dash of food industry know-how.
Before they bite off more than they can chew, potential entrepreneurs can get help from experts at Oregon State University. A new series of courses at the Food Innovation Center, in Portland’s waterfront district, is designed to dish out the details on creating a successful food enterprise. One of only a handful of such offerings nationwide, the Northwest Food Business Startup program is divided into two courses. The first course reviews the food industry and answers basic questions about product development. The second course, called Food Business Creation, seasons the hopeful entrepreneur into an effective manager.
Coming up with an original idea may be the easiest part of the process. But, beyond the idea lies a litany of logistic, marketing, and business decisions that can spoil even the most promising enterprise. When trying to sell your grandmother’s recipe for home-cooked muffins, you need to consider suppliers, packaging, and markets. Unfortunately, inadequate financial management and insufficient marketing expertise are two common reasons for business failure.
Aaron Johnson, an OSU food marketing specialist at the Food Innovation Center, spent the last several years watching a number of promising ideas fail to become products. “People would come to us to get technical issues resolved, but they’d have to go elsewhere for business or marketing advice,” he said. To provide the whole enchilada, Johnson and his Food Innovation Center colleagues created a systematic introduction to the world beyond the grocer shelves.
Johnson can spot the most promising ideas right away. “There have been half a dozen products to come through the Food Innovation Center where I’ve said ‘why hasn’t anybody thought of this before?’” Potenza—a caffeinated water drink developed by Jeff Epstein—is one. Offering a healthier alternative to colas and diet drinks, Epstein capitalized on the current interest in energy drinks and bottled spring water to create a sugar-free, color-free drink with the caffeine equivalent of one cup of coffee, perfect for a health-conscious public unwilling to part with their daily buzz. Even better, says Johnson, Epstein hit the mark with branding. One look at his bottle, with its striking black-and-white script across the tall, narrow container, ensures a second look. “With simplicity you wind up with a phenomenal opportunity,” Johnson said.
Epstein’s background in business management was a foundation for his success. “But, there’s a big gap between having an idea and seeing it through to a product,” he said. “That’s where the Food Innovation Center can help.” The center’s experts connected Epstein with suppliers, people who helped him create the label, the bottle, the boxes, and the means of distributing Potenza after he developed the product.
The FoodBiz courses provide insider knowledge and a reality check to people with good ideas but little or no formal business training. Johnson has helped people from all walks of life, from a cardiac surgeon to a high school dropout to a soccer mom, and from as far away as Texas. Unfortunately, most new entrepreneurs do have one thing in common. People get the cart before the horse, says Johnson. They get into product development without considering who is going to buy their product and why.
Bob Schwartz found out about the Food Innovation Center and the FoodBiz series when he entered this year’s American Food Fight with his Zuppa Cones, French-bread cones that make it possible to eat soup or stew on the go. Despite 16 years in restaurant management and food sales, Schwartz was unsure how to take his idea to the next level. His original goal was to sell his product at small local stands, but with the information gained through the FoodBiz course, his plan now is significantly grander. His goal is not only to develop and patent the equipment to make his product, but to sell them wholesale, Schwartz says.
Unfortunately, most people run out of energy or money before they get their idea off the ground, according to Johnson. With the FoodBiz courses, Johnson hopes to tip the balance in favor of success. “My goal is not just about getting people engaged, but getting them engaged with more than gut-reaction decisions,” he said. The greatest benefit of the introduction course is a sort of 3,000-foot overview of how the different parts of the food industry all fit together.
One part of a successful enterprise is keeping track of the product goal. Katie McNamara, this year’s American Food Fight winner and FoodBiz participant, has two goals for Nice Cubes, her frozen organic baby food. Her first goal is to reeducate people that baby food doesn’t have to be gross, she says. Her second goal is to get Nice Cubes established in the Pacific Northwest. Beyond that, if the company continues to grow, she thinks she would sell the business at a profit.
Learning how to make such long-range, strategic business decisions is the focus of the second Northwest Food Business Startup course. Johnson and colleagues hope to hone the recipe for success by providing in-depth information about how business decisions affect product development. For example, there is always the unexpected crisis, and some crises are caused by success. Creating a market for 800 muffins a day can grow into a demand for 80,000 muffins a day and a quantum leap in production capacity. Increased demand for a successful product can tax the available space and supplies to create and deliver the product while maintaining the original homemade quality. From market research and product development to regulatory compliance, the second course helps the entrepreneur navigate success through a maze of technical and regulatory know-how. FoodBiz participants can expect to receive advice on everything from the legality of health claims on product labels to the intricacies of the Food and Drug Administration.
“If people only learn that there is always more to learn in creating a food business, we’ve accomplished our goal with the class,” said John Henry Wells, superintendent of the Food Innovation Center and one of the course instructors. In total, both courses cost just over $1000—a small price to pay for success.