​The Ins and Outs of Business

Small businesses get help navigating
roadblocks that come their way

 
Brad Niemeier is ready to start bottling his Azzip sauce, thanks to assistance from Purdue Extension’s food science outreach program.
Brad Niemeier is ready to start bottling his Azzip sauce, thanks to assistance from Purdue Extension’s food science outreach program.

As Brad Niemeier was closing out his football career with the Purdue Boilermakers in the 2011 season, competition was just starting up in another arena—the university’s annual Burton D. Morgan Business Plan competition.

Niemeier had always dreamed of playing football for Purdue, but the hotel, restaurant and tourism major was also nurturing another dream—to open his own restaurant. Winning the prestigious business plan competition—with its $20,000 first-place award—would go a long way toward making this goal a reality.

Niemeier’s concept for Azzip Pizza, a fast, casual pizzeria where customers walk down a line and choose ingredients, much the way they do in a sub shop, combined with his business and marketing plan, struck a chord with the judges. He walked away with the top prize and partnered with chef Blake Kollker. While working on the restaurant—projected to open in early 2013 in either Evansville or West Lafayette, Ind.—they decided to bottle and market Azzip Sauce, the spicy pesto sauce they developed for their pizza.

But bottling sauce isn’t the same as serving it fresh. To meet FDA regulations, shelf-stable food products must be below a certain level for pH (acidity) and water activity to prevent growth of microorganisms.

Food science outreach specialist Katie Clayton tests new products to ensure they meet FDA regulations.
Food science outreach specialist Katie Clayton tests new products to ensure they meet FDA regulations.

To test the sauce, the 2012 graduate went back to his alma mater.  A Purdue Department of Food Science outreach program helps fledgling food entrepreneurs like Niemeier, who want to sell at farmers markets and other venues, make products safe from bacteria.

“We test pH and water activity to make sure products meet food safety regulations,” says Katie Clayton, food science Extension outreach specialist, whose recent client list has also included restaurateurs, bakers and home-to-retail vendors with such products as barbeque sauces, wedding cake icing, specialty peanut butters and coated popcorn. 

 “Katie and Steve Smith (director of the food science pilot plant that tests products) walked us through all the steps,” Niemeier says. “Our sauce wasn’t acidic, but it had to be tested for water activity. It was right at the cutoff, so we discussed ways to lower it by changing the proportion of ingredients. After a few trials, we ended up with a product that tasted good, looked good and was at the right activity level,” he says.

“I never knew this help was available for entrepreneurs,” Niemeier says. “It’s awesome to have this resource. I got so much out of my time here as a student. Now, Purdue is still giving back to me.”

The Extension program is among the offerings of the Purdue New Ventures Team, which provides business planning assistance to entrepreneurs and small business owners. Food science also offers workshops, provides technical assistance and connects people with resources on food processing and regulations.

While this outreach effort works to get food enterprises to the marketplace, another Purdue Extension group is focusing on a way to help producers grow more products.

Percentage of Small Farms in Indiana   
Percentage of Small Farms in Indiana











A Hub of Activity

Demand for locally grown foods is on the rise. But many small farmers are unable to take advantage of opportunities, because they can’t readily tap into a variety of buyers and processing systems that would give them better access to markets.

Food hubs are among the fastest-growing models for increasing farm sales, says Roy Ballard, Purdue Extension educator in Hancock County, who leads the Central Indiana Food Hub Feasibility Study Committee​. This committee of local producers, business leaders, Purdue Extension educators and an Indiana State Department of Agriculture representative is laying the groundwork for a food hub initially serviced by seven counties: Hancock, Hamilton, Henry, Madison, Marion, Rush and Shelby.

Food hubs collect produce from area farms at a central location and then deliver it to customers. A food hub may also process, store, market and certify local produce. End customers can be a mix of consumers; restaurants; institutional clients, such as schools and hospitals; wholesale brokers; and even food banks.

The committee received a USDA Specialty Crops Block grant to conduct a feasibility study of such an enterprise in early 2012 and has now entered the business plan and marketing phases.

Ballard says the CIFH may have a virtual hub running by spring 2013 and possibly one with substantially more infrastructure by 2014. “We’re moving forward with cautious optimism,” he says. Sales are conservatively estimated at up to $1 million the first year.

Indiana already ranks in the top 10 nationally for production of some specialty crops, but others are not grown in the state, although they could be.

 “We would need to expand our core of farmers in the loop,” Ballard says. “Some farmers will need to diversify the crops they are growing, and we will likely need to bring new farmers into production,” he says.

More than half the producers surveyed during the feasibility study reported a strong interest in adding value to their operations by diversifying and in opportunities to bring family members into their operations.

“Our goal is to go as close to year-round as possible, with various ways to preserve crops in season for later sales and to produce more customer-ready products,” Ballard says.

“Instead of just having sweet corn in the summer, we can flash freeze it and have it available for schools,” he says. Producers may need to develop season-extending production systems to help them start earlier in the spring and go longer into fall.”

For producers who grow predominately for farmers markets, this could increase their capacity and allow at least one person to stay on the farm full time. They can continue to grow an array of produce for farmers markets but focus on one particular crop for the food hub.

“If they enjoy growing crops, they can hand it off to someone else to market,” Ballard says. “If they like doing farmers markets, they can continue to do that. It comes down to the value they put on an hour of labor and whether they prefer to spend those hours in production or marketing their farm products.”

Goat cheese producer Judy Schad relies on Purdue’s Heeke Animal Disease Diagnostic Laboratory in southern Indiana to identify health problems in her goat herd.
Goat cheese producer Judy Schad relies on Purdue’s Heeke Animal Disease Diagnostic Laboratory in southern Indiana to identify health problems in her goat herd.

To Protect and Serve

When it comes to labor, operating a goat dairy and making artisan cheeses is a labor of love for Judy Schad and her husband Larry, who own Capriole Inc. in Floyd County. Goats not only provide the means for their livelihood but are also part of the family. The milk from the genetically closed herd is used to make a specialty line of cheeses original in appearance and taste.        

So when the herd was threatened by disease, the Schads turned to Purdue’s Heeke Animal Disease Diagnostic Laboratory in Dubois, Ind. Judy Schad recalls a health crisis during a winter outbreak of an infection that “spread like wildfire on the milk line” and killed several goats. She contacted the lab, and the Purdue specialists identified the culprit and recommended elimination procedures.

“We caught it early, before it infected the whole herd,” she says. “It really did save us from what could have been a terrible situation.”

Protecting the unique genetics of the herd is allowing the Schads to move to the next level and grow the cheese part of their business, Judy Schad says. “We’d like to get the genetics into other herds and establish a local milk market.”

The ADDL is the primary animal diagnostic resource for private owners like the Schads as well as for public proprietors and veterinarians. Tests are used to diagnose diseases, establish treatment plans and provide surveillance for select diseases. The Heeke lab was established at the Southern Indiana Purdue Agricultural Center to serve the poultry and livestock industries in this area of the state and coordinates with the main ADDL lab on Purdue’s West Lafayette campus.

The Shads continue to consult the lab as needed to monitor their herd. “The diagnostic lab has been very helpful in identifying causes of health problems in goats. It does keep us in business.”

Purdue Agriculture has many resources to help entrepreneurs navigate the roadblocks—the Shads, whose herd could have been wiped out by disease, and Niemeier, who started with a solid business plan but needed to make sure his product was safe to manufacture.​ 

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