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What's in Store - Locals Seafood: Road warriors no more
North Carolina duo takes baby steps into retail, wholesale seafood
By Christine Blank
April 01, 2014
Their start in retail seafood wasn’t glamorous, but it certainly worked out. Locals Seafood partners Ryan Speckman and Lin Peterson began selling local shrimp on the side of the road in Raleigh, N.C., four years ago.
“It was an experiment. We both had day jobs during the week, and were selling out of the back of the truck on the weekends. As it grew, we saw there was a demand for local seafood and people just weren’t getting it,” Speckman says of the partners’ retail operation.
The following spring, Speckman and Peterson were asked to sell local seafood at two farmers markets. Demand at similar venues around the Raleigh-Durham-Chapel Hill region quickly grew, reaching a total of nine last year. The partners found their niche in the retail seafood arena by building one-on-one relationships with customers at the markets, selling only local seafood, and forming a type of community supported fishery (CSF) program.
“We do a subscription service or share program, which starts in March. Subscribers prepay for 10 weeks of seafood and each week, they get 2 pounds of our choice,” Speckman says. Subscribers pick up the seafood at farmers markets. Because Locals buys in quantity from fish houses, consumers in the share program essentially get a wholesale price. As with CSFs, they get whatever seafood is in season that week: It could be shrimp and tuna or mullet and bluefish, or a number of other combinations.
“It forces them to try things they would not have tried previously,” Speckman says, adding that Locals’ customers have expanded their horizons, and the farmers market setup allows staff to educate them.
“My favorite part is talking to customers about how to prepare seafood like tilefish and dogfish. We like to promote these lesser-used species,” Speckman says.
Fortunately for Locals, a growing number of Americans are interested in learning about the food they buy and want to support local businesses. “There is a big shift. A certain demographic is really interested in learning about the background of the food,” Speckman says. “It is typically people who are into cooking and appreciate high-quality ingredients. They are willing to pay more. Plus, they know that local dollars stay here and benefit the economy,” Speckman says.
Despite Locals’ success at farmers markets, Speckman and Peterson want to focus the company’s growth with the wholesale side of the business. While all of Locals’ revenue came from farmers markets just two years ago, wholesale made up 60 percent of the company’s sales in 2013. To run its wholesale operation, Locals rents around 3,000 square feet of warehouse space that includes a cutting room, cold storage and freezers. “We had a few personal relationships with chefs in the area, and are now supplying 50 different restaurants,” Speckman says. The wholesale business is not nearly as labor-intensive as the various farmers markets — particularly the ones that are open five days a week for most of the year, he explains.
Plus, farmers markets — and retailing fresh seafood in general — come with a high amount of risk.
“You can’t just take all this fresh seafood out to market and expect to sell it. It takes time,” Speckman says. Growing Locals’ business was challenging, and the partners didn’t get a paycheck for the first two and a half years. “We invested all the money back into the business. That’s why we have grown — there is no debt,” Speckman says.
The growth of Locals was made possible by forming relationships with North Carolina’s long-established fish houses. “Many people buy directly from fishermen. It is better for us to go through fish houses: We have built relationships with them and they are the foundation of our business. They look out for us, and make sure we have the product where and when we need it,” Speckman says.
The growth has allowed Locals to employ six full- time employees and seven part-timers.
A traditional retail shop is possible for Locals down the road. “We looked at the costs versus the benefits. It depends how this company evolves over the next couple of years,” Speckman says. However, Locals has become so entrenched in Raleigh-area farmers markets that Speckman considers them to be viable retail outlets. “For example, the Raleigh State Farmers Market is our flagship retail store. We will be there five days a week in the summer,” Speckman says.
And the farmers market-wholesale business mix is clearly paying off for Locals. “Each month we are cash-positive. We haven’t had a bad month yet,” Speckman says.
Contributing Editor Christine Blank lives in Lake Mary, Fla.