©THE FOOD ENTREPRENEUR’S JOURNEY FE RUARY 2018

?THE FOOD ENTREPRENEUR'S JOURNEY FEBRUARY 2018

Prepared by the Agri-food Management Institute, Guelph ON

THE FOOD ENTREPRENEUR'S JOURNEY INTRODUCTION

"This is not a linear model ? at least not in my experience. The process continues to be very organic, multidirectional, and in some cases, it's one step forward and two steps to one side, three to the other side, one back and a leap forward... I guess you could call it a dance!"

Fran Kruz CEO and Founder of Not Yer Granny's Granola, Barrie

This is the process food entrepreneurs and small food business start-ups undertake from idea generation and concept development through to commercialization and/or scale up. It looks at the typical pathway for a food entrepreneur and where resources exist to assist them. It also identifies challenges that affect start-ups and hinder their progression.

The Food Entrepreneur's Journey is written from the perspective of the food entrepreneur. The term food entrepreneur is referred to throughout and is defined as an early stage food and beverage processing start-up business. This viewpoint does not include food retailers or food service businesses including restaurants, food trucks, and catering companies.

The Food Entrepreneur's Journey was produced by the Agri-Food Management Institute with funding from Growing Forward 2 (GF2), a federal-provincial-territorial initiative. The Agri-food Management Institute (AMI) promotes new ways of thinking about agribusiness management and aims to increase awareness, understanding and adoption of beneficial business management practices by Ontario agri-food and agribased producers and processors.

This guide is intended to be used by prospective food business owners, as well as newly established ones. It is not a comprehensive all-inclusive document, but rather, an easily read guide that combines the experience of new entrepreneurs with industry experts. It will enable entrepreneurs to see what is required at the various stages, add context to what they will be experiencing, and prompt them to seek further information and resources. This guide is an excerpt based on the full report: Food Processing Startups and Small Businesses in Ontario: Barriers to Scaling Up White Paper, Barb Shopland, June 2017, with contributions from Al Brezina, Feb 2018.

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FROM CONCEPT TO COMMERCIALIZATION/SCALE UP

This model was created and developed with input from twelve food entrepreneurs, small food business owners and several seasoned professionals working in the areas of product development, education and training, distribution and economic development. The model depicted is linear in nature to illustrate the general phases of a food business start-up. However, it should be noted that the entrepreneurs interviewed stress that the process is very organic. Fran Kruz, CEO and Founder of Not Yer Granny's Granola, in Barrie, described the process she continues to go through: "This is not a linear model ? at least not in my experience. The process continues to be very organic, multi-directional, and in some cases, it's one step forward and two steps to one side, three to the other side, one back and a leap forward... I guess you could call it a dance!" CONCEPT TO COMMERCIALIZATION There are five distinct phases or stages within the process, each defined by a number of activities and milestones. The two major outcomes of the process include: 1) a business plan and 2) a product. The success of these two outcomes is dependent upon catalysts or facilitators and several technical requirements. The concept to commercialization model is intended to help a food entrepreneur engage in business development and visualize the process in its entirety. Food entrepreneurs tend to be activity-focused in their approach to business. They want to know what to do and how and when to do it. They also want to understand why such a model will help them navigate the journey from concept to commercialization. The next section describes each phase of the model in order to provide that guidance.

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"You need more than an idea to start a business. You need to be able to create a product or deliver a service that people want and will pay for. You also need to be able to market it and know how to run a business. In short, you need far more than a good idea, but it is the idea that will propel the business. Unless you have identified a solid customer base, know how to access it, and have a business plan you can take to the bank, as well as a viable business model, then all you have is a great idea."

John Pickard Executive Director of the Henry Bernick Entrepreneurship Centre at Georgian College, Barrie

1) PHASE ONE: THE IDEA AND CONCEPT

This phase is all about research, fact-finding, investigation, and asking many questions.

Many people have great ideas throughout their life, but few take the great idea and translate it into a business. Doing so requires an enormous amount of effort and research. There is no assumed timeframe for this phase; some entrepreneurs can take months, even years to complete their research, while others with access to resources such as experts, money and information, may take less time.

PHASE 1 ACTIVITIES: ? Opportunity Identification: Understanding how the business concept and the selling of the product fulfills a market need;

? Consumer Research: Defining who will buy the product and the demographics/profile of the consumer;

? Industry Research: Understanding where the business and product fit in the food industry sector;

? Competitive Analysis: Finding out who, why, where, and how a similar product is being sold;

? Business Planning: Finding a business plan template that can be populated with specific product and business information;

? Available Resources: Looking for people, tools, and information that will help.

This can be a very exhilarating phase for food entrepreneurs as they contemplate their new food products. Questions abound. Is there a demand? Is the product competitive? Is it unique?

At this stage, many food entrepreneurs get caught up with the excitement of their idea. Often they do not know how to analyze their idea objectively and/or understand just how complex running a food or beverage business can be.

Successful food entrepreneurs know the danger and vulnerabilities of being stuck on their idea rather than the process of turning the idea into a business. John Pickard, Executive Director of the Henry Bernick Entrepreneurship Centre at Georgian College, has worked with entrepreneurs for many years after launching his own successful business. Pickard spoke about ideas and business:

"You need more than an idea to start a business. You need to be able to create a product or deliver a service that people want and will pay for. You also need to be able to market it and know how to run a business. In short, you need far more than a good idea, but it is the idea that will propel the business. Unless you have identified a solid customer base, know how to access it, and have a business plan you can take to the bank, as well as a viable business model, then all you have is a great idea."

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"In my case, I already ran a business but was seeking new and healthier foods for my expanding family. I had limited knowledge of any sort of cooking or food preparation so had to do a lot of research. It started with a few simple questions: how could I make pasta healthier, would it sell, was anyone else doing it or should I just feed my son good pasta? I attended as many entrepreneurship seminars I could find and spent months on my research looking for anyone who knew about pasta and more importantly, knew how to become a successful food business owner. The hardest part was finding the food experts."

Shelby Taylor CEO, and Founder of Chickapea Pasta, Collingwood

Shelby Taylor, CEO, and Founder of Chickapea Pasta in Collingwood, stresses that one should really have a passion for research.

"In my case, I already ran a business but was seeking new and healthier foods for my expanding family. I had limited knowledge of any sort of cooking or food preparation so had to do a lot of research. It started with a few simple questions: how could I make pasta healthier, would it sell, was anyone else doing it or should I just feed my son good pasta? I attended as many entrepreneurship seminars I could find and spent months on my research looking for anyone who knew about pasta and more importantly, knew how to become a successful food business owner. The hardest part was finding the food experts."

RESOURCES AVAILABLE One of the best ways to capture the idea, process it, and `propel the idea to a business' is to start with a business plan. There are many business plan templates available online and some software packages are available for purchase. The key for many food entrepreneurs is finding a templated plan that resonates with their own style and purpose.

Most communities have small business enterprise centres and/or entrepreneurship organizations that offer business consulting services, mentorship and coaching, networking, and business planning resources. There are many websites available providing business start-up tool kits, including business plan templates, checklists, and tests to measure whether one has the capabilities and characteristics to become a successful entrepreneur.

Resources for food-specific support are very limited. Food incubators offer programs for food business start-ups. There are also some food-specific seminars for food entrepreneurs offered by municipalities and community colleges.

CHALLENGES Although there are a growing number of beginner seminars and workshops tailored to the food industry sprouting up across the province, they are by no means accessible to everyone interested in developing a food business.

Food entrepreneurs struggle with the complexity of the information available online. Many websites are either confusing, too general, or written in technical language they find difficult to understand. This frustration was particularly amplified by food entrepreneurs who do not speak English as a first language.

At this very early stage, food entrepreneurs want to be guided, not overwhelmed with too much information. They need a personal contact to speak with and pose questions to, and their desire is to talk to someone who knows the food sector or has gone through the start-up process.

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