The Food Factory serves up a recipe for success in the food industry
The Food Factory Charitable Trust has been nurturing culinary dreams since its launch in September 2020, with a vision to bridge the gap for aspiring food innovators. This not-for-profit startup based in Stoke, Nelson, is providing the essential ingredients for success.
“We’re here to help food businesses to get up and running, and to ease their entry to market by making it more achievable in a quicker period of time with less investment from them as individuals,” says general manager Olivia Martyn.
It’s often “a quantum leap” for businesses trying to get their products on the shelves. Going from selling popcorn at the local Saturday morning market to purchasing premises so they can fully scale up is a big deal, says Martyn.
“The Food Factory allows you to scale up a bit more. It allows you to have a food grade facility, and introduces you to a broad range of networks who can help you develop your business without huge capital investment from individuals.”
The idea was founded by Pic Picot, the mastermind behind Pic’s Peanut Butter. Picot had a love for building a collaborative environment after working in the furniture industry in the 1980s in a building leased by other woodworkers. There he learned skills, tapped into networks, and met different people and their ideas.
Picot’s success with Pic’s Peanut butter could have been faster had he had the networks, facility and support he’s now offering with The Food Factory project, says Martyn.
Setting up The Food Factory carried a hefty price tag, as a warehouse was transformed into four fully equipped commercial kitchens and a demonstration kitchen. The funding was provided by a governmental Provincial Growth Fund grant.
Each kitchen is 40 square metres. The Food Factory provides limited shared kitchen equipment, or the tenant can bring their own if they wish.
“At the front we have this beautiful demonstration kitchen. It’s the place where you want to go if you want to show off a wee bit about your product. If you’ve created a chilli sauce and you want to invite a whole lot of people in – they could just be people in the public, they could be potential investors – you could showcase your product,” says Martyn.
The venture costs approximately $200,000 to run each year, around $120,000 of which is covered by revenue from leases by three tenants.
“But this could change tomorrow if one of them becomes ready to set up on their own and ends their tenancy.”
Sponsorships also help with costs.
“We are reliant on relationships with other partners. The Lion Foundation supports us. NBS [Nelson Business Society] supports us. We have some independent funders and individuals that fund us. But it would be great to be more established in that space.”
Other sponsors include Isherwood Le Gros Law Limited, Findex financial advisory and accounting services, and Coman Construction.
More revenue streams come from hiring storage space in the warehouse, launching Martyn’s school holiday programme, and getting more people to use the demonstration kitchen for things like cooking classes. However, there is still a shortfall.
“I’ve got an application into the Rata Foundation for funding at the moment, so we should hear back from them soon. We’re doing the best we can to close the funding gap.
“It would be great if we could find partners who are keen to sponsor us and be part of our networks, because there’s so much that would be in it for them as well.”
Sponsoring a food and product incubation hub can provide tangible value in various ways for sponsors, says Martyn – things like brand visibility and recognition, networking opportunities, and access to innovation.
“Sponsors would help up-and-coming food businesses get into the industry. That’s something that would be great to see. Longer term, these businesses will hopefully be sustainable and successful in their own right, and they need all those types of services and products. It would be great to support them from the beginning, from grassroots up, and get them that leg-up that they need in the industry.”
Three of the four kitchens are tenanted on a permanent basis at present. One tenant is Yum Granola, running their business on-site for the third year in a row. Yum Granola has won the New Zealand Artisan Award and Best of Natural Healthpost Award in recent years.
Another tenant is QB Cheese, who makes crunchy cheese snacks that are gluten free and keto friendly. The owner, Graham Manson, won the New World Food Starter 2022 award. For his win, Graham was awarded $70,000 worth of prizes, mentoring, and product advice from industry professionals. His product is on shelves in 147 New World supermarkets around the country.
“His business is growing quickly, and we are proud to be a part of his journey to build a sustainable business. QB Crunchy Cheese Snacks are made right here at The Food Factory,” says Martyn.
The third set of tenants are Pinu Raja and his wife, Nasrin. Their food cart, FoodD, sells Indian meals, sweets and snacks locally in Nelson. They also own a muesli company named Muesli & Co.
The fourth kitchen is used regularly by different smaller groups. One is Auckland-based Friendly Food Co. They’re known for their low-FODMAP curry powders – designed to help people with irritable bowel syndrome have better control over their symptoms by limiting certain ingredients.
And another tenant is Te Chili Hot Sauces. Founder Patrick Gilgenberg grows organic chillies in Nelson. When they are ready, he picks them and brings them to The Food Factory to ferment. He then gets the hot sauces bottled on-site. In June 2023, Fresh Choice in Richmond, Nelson, began selling Te Chili’s sauces.
“We are so proud of his success and look forward to watching his business grow,” says Martyn.
The facility has a flexible tenancy arrangement where tenants pay $200 per day. However, if they book in for two weeks or more it’s cheaper.
Martyn, who is a seasoned food technologist herself, has had extensive experience working in product development and sales for brands like George Weston Foods, McDonalds, and McCain. She assists food innovators with sales and pricing strategies. Plus, there are a range of people in the Nelson community who can be tapped into, she says.
“It’s actually really cool to be able to help people in that way and give them a bit of advice that can just set them on the right path or help them on their journey in some way.”
Other than the Food Innovation Network, The Food Factory is the only facility of its kind offering a space for food innovators starting their journey.
The Food Factory also aims to strengthen communities by providing a hub where charitable groups connect, learn new skills related to food preparation, develop cross-cultural diversity through cuisine, and create a sense of belonging.
As the Food Factory continues to expand its reach, serving up a recipe for success in the food industry, it’s stirring the pot of innovation, creating a stronger, more connected community, one meal at a time.
Story by Mina Amso in partnership with Nelson Regional Development Agency (NRDA).
Innovation Nation is a series celebrating stories of innovation and diversity in entrepreneurship from around New Zealand.
