May 2020 – Page 11 – Bart Taylor

Manufacturing a gem of Utah’s economy, and here’s the best of 2016

May 21, 2020/in General/by Bart Taylor

Utah’s powerful economy is no longer a national secret. Workforce advantages and an embarrassment of R&D riches driven by world-class universities is translating into, among other things, high-tech success. See the Silicon Slopes.

But Utah’s manufacturing ecosystem is emerging into a national model for growth and innovation. Magnificent legacy operators provide a foundation for modern machiners who’ve followed, all of whom may contribute to a sector poised to put the state on the national map — outdoor industry manufacturers.

It’s a cross-industry mix that’s also a blueprint for U.S. manufacturing. In addition, here’s the companies you favored, the most-read list; and Alicia Cunningham’s personal favorites.

Here’s my best of Utah manufacturing list from 2016:

Hammerton — Bill Shott, co-owner and president of Hammerton, said it all, “The majority of the lighting industry manufactures offshore in Asia. And of the few domestic players that exist, most of them source their glass offshore.” Modernizing the industry at the same time it sets an example for what can be made in the U.S. ‘Nuff said.

Robinson Fans — Cutters, benders, welders, craftspeople. I can’t get enough. That the Robinson family has done it for over 125 years in the region is testament to the enduring power of manufacturing and its profound impact on our socio-economic standing.

JD Machine — Speaking of an embarrassment of riches, Utah’s boasts a machining ecosystem worthy of national repute. Progress Manufacturing and Advanced Manufacturing Technology were also standouts.

Artisan Hardware — As with my Colorado list, I favor craftspeople in the building environment, and it’s impossible to not shine a light on the makers in Chase Norton’s operation. Artisans, indeed.

Kodiak Cakes — It’s impossible to leave Joel Clark’s company off my list. I use their product, they’re a leader that’s willing to stand out in front to lead a transformation of Utah’s natural and organic product sector, and their legion of followers pushed the feature to the lofty status of most-read of any profile in CompanyWeek in 2016. Utah, Colorado, wherever.

Best of 2016 a mash-up of manufacturing excellence

May 21, 2020/in General/by Bart Taylor

If there’s a better job in business media than reviewing the stories and photography filed every week by our network of contributors, I’ll have to be reminded what it is. Business is about people and companies, and every week, I’m left shaking my head by the work, the passion, the outcomes, of those we write about.

In addition to the stories you favored most, here’s my list of gems from the past year, manufacturing stories that speak to why we do what we do.

1. Raw Urth Designs — The company’s tagline says it all for me — ‘A boutique metal shop creating custom designs.’ We need more ’boutique metal shops’ in our economy, companies that cut, bend, and weld; that celebrate entrepreneurship; and a passion for making things.

2. Naked Edge Snacks — I love Jonathan Castner’s photographs of John and Lisa McHugh, not to mention that they’re poster children for Colorado’s nation-leading natural and organic food sector that’s transformed the regional economy. We wrote about a couple dozen similar businesses in 2016 — coverage we’ll continue in 2017.

3. Swiss-O-Matic — Take your pick of companies from the machining ecosystem we profiled in ’16, they’re all favorites. But Claude Rocchia’s outpost in Montrose connects past and present, using magnificent machines from the 20th century to fabricate intricate parts for today’s OEMs.

4. Agri-Inject — Can manufacturing transform rural economies? Ag-tech certainly will, and Erik Tribelhorn’s company and others on Colorado’s eastern plains like Graham Electric Planter are helping farmers reinvent the sector while creating high-value jobs. Why are we so slow in rallying support for more early-stage, rural manufacturers? Their payback is colossal.

5. Industry Report: Cannabis R&D in Colorado — CompanyWeek Editor Eric Peterson’s exhaustive look at cannabis and hemp-related science underway in Colorado exposes our collective failure to educate the public on the different outcomes of cannabis legalization, some that have nothing to do with recreational use. The chilling effect of misguided federal policy on legitimate science can be breathtaking. Take note. Now.

6. Fly Pedals — On a lighter note, is there a better business story than two aspiring entrepreneurs reshoring the manufacture of a consumer product to the U.S. from China? Especially one that involves a foundry and machining? Simple answer. No.

7. Wynkoop Brewing Company — Take your pick of the dozens of craft brewers we profiled in 2017, but former Wynkoop brewer Bess Dougherty’s big personality stole the show for me. I also enjoyed Jonathan Castner’s photo expose from his epic summer cycling sojourn through Wyoming, Idaho, and Montana, which brought us Black Tooth Brewing Company and Grand Teton Brewing, among others.

8. The Whole Works — If I were to guess, Colorado’s apparel and outdoor industry sector will transform into a modern, tech-driven manufacturing ecosystem, with brands locating here to develop, prototype, and test. Those who make here in volume will utilize cut-and-sew operations that are able to scale and modernize, and recruit and train qualified sewers. Certainly one of those will be The Whole Works in Rifle, Colorado.

9. Watson Mills — Builders and craftspeople share an important space in our economy with benders and fabricators, and Todd Palmer’s artisans stood out for me. We profiled them in January of last year and I never lost sight of their skill set. None of us should.

10. Housefish — See above. And buy locally made stuff!

Forecast: Colorado manufacturing will prosper in ‘17, despite setbacks

May 21, 2020/in General/by Bart Taylor

Celebrating the best of 2016 manufacturing, as we did last month, was easy. So many companies and success stories, so little space.

CU’s Leeds School of Business Colorado Business Economic Outlook 2017 provides great context for a forecast for the year ahead. The highpoints of the Leeds report:

Manufacturing employment will grow 1.6 percent, adding 2,300 new jobs, about the same as 2016’s year-over-year growth. It would be the seventh straight year of employment growth in manufacturing.
Employment in food manufacturing will reach “22,600 workers or over 42 percent of the nondurable goods subsector employees forecast for 2017,” making it the largest subsector in the manufacturing ecosystem. (“Other durables” is actually larger, comprised though of several subsectors.) Food surpassed Computers and Electronics in 2016 as the largest subsector.

We continue to document the surge in food brands and manufacturers in Colorado. That more growth is forecast isn’t a surprise. But it’s noteworthy that Colorado manufacturing continues to buck the national trend, enjoying productivity and employment growth (U.S. manufacturing has shed 5 million jobs in manufacturing since 2000.)

A lowlight: Total manufacturing employment in Colorado will increase from about 144,00 jobs to 146,000. Government employment will grow from 424,000 jobs to 428,000, second only to Trade, Transportation and Utilities. Has launching and incubating new manufacturing companies ever been more important?

Here’s my forecast for 2017, and a wish list for developments that would bolster the state’s sector:

Forecast: Food and beverage will continue to be the fastest growing manufacturing industry sector, but the story shifts to manufacturing infrastructure in 2017 — as in, can we keep growth brands here? Wish: Two things: that Pueblo and Colorado Springs develop strategies to tap the food boom; and that all eyes turn to the industry supply chain. Food and beverage companies need money, technology and automation, raw materials, and immigrant labor.

Forecast: Dow 20,000 is a high point. Stocks will fall as interest rates rise — and manufacturing stands to gain. It’s counterintuitive, but a normalizing financial sector will hopefully encourage more risk-taking. Investors are cherry-picking deals in the current environment, leaving investment-worthy companies in limbo. Let large caps correct and instead fund and incubate 1,000 companies in the next five years. Wish: Development of a manufacturing accelerator to match new ideas with money — a Techstars for manufacturing.

Forecast: In ’17, we’ll determine whether investments in technology centers and so-called ‘makerspaces’ are bearing fruit. Millions are being spent to establish centers of advanced manufacturing in Colorado. Everyone’s in the game, including the Colorado Advanced Manufacturing Alliance, Manufacturers Edge, state and local government, higher education, and industry. In ’17, we should get a better feel for what models work best, how many companies are benefitting, and when public funding is involved, the return on taxpayer investment. Wish: An accounting of public investments to date.

Forecast: ’17 is also a pivotal year for cut-and-sew centers on the eastern plains — the Rural Colorado Apparel Manufacturing network, or RCAM. Can a nonprofit compete in the highly specialized, competitive, transformative U.S. apparel sector? We’ll know soon. Wish: A concerted effort to recruit national brands to manufacture here, but importantly, more public-private collaboration on a workforce model designed for apparel and outdoor industry. Rally support for Colorado lifestyle industry and not just lifestyle.

Forecast: More high-profile craft breweries will sell controlling interests to strategic or equity investors, but the bigger story is 2017 will be the industry-wide shift in how breweries operate. Expect less new packaged beer on the shelf and more neighborhood taprooms. To what end the industry? Wish: A beverage-industry conference to focus efforts on supply-chain needs for brewers, cider and wine makers, and distillers.

Forecast: Reshoring is evolving. Companies may bring jobs back to the U.S., but more will add new jobs here. Wish: Let’s bury the notion that penalizing companies to move offshore, or negotiating one-off deals, is a strategy to grow manufacturing. Instead, invest in developing a world-class domestic supply chain. That’s a strategy.

Forecast: Investments in workforce development will begin to pay tangible dividends, justifying the enormous investment to alleviate the so-called ‘skills gap.’ Wish: Certainty that the growing number of qualified employees have job opportunities. (See “we must launch and incubate 1,000 new companies in the next five years,” above.)

We’ll reset and correct in 2017. We’ll take one step back and two forward. Only change is certain. See you in ’17.

Bart Taylor is publisher of CompanyWeek. Reach him at btaylor@companyweek.com

Limon bets on foreign trade—and manufacturing

May 21, 2020/in General/by Bart Taylor

Rural America’s decisive role November 8 gives way today to the tough reality that economic prosperity is as elusive after the election as before. Small towns and communities face an uncertain future. Colorado’s rural outposts must also stand by and watch urban counterparts make national headlines for job growth, rising property values, and increasingly diversified economies. It can be a tough pill.

But for others it’s inspiration, and, increasingly, small towns are taking action. On Colorado’s eastern plains, in Wray and Julesburg, Rural Colorado Apparel Manufacturing cut-and-sew centers have opened to pursue business from new domestic apparel and outdoor gear companies. Trinidad and others are reimagining city centers. Farming communities, hardest hit, eye ag-tech manufacturing and new crops to feed a growing appetite for craft food, beer and yes, hemp and cannabis.

Limon, Colorado, is taking a different approach. Seventy-five miles southeast of Denver on I-70, population 1800, Limon is betting on foreign trade. Last year the U.S. Department of Commerce awarded Limon the state’s third foreign-trade zone (FTZ), #293, a development the city hopes will translate into new primary jobs, including manufacturing jobs, that will put this town on more sound economic footing. FTZ’s provide duty relief for companies importing manufactured goods for distribution and sale throughout the U.S., or for parts and components incorporated into products manufactured on U.S. soil. Commercial merchandise can be brought in and held without being subject to the tariffs and taxes imposed by U.S. Customs and Border Protection.

At first blush, the town and trade seem strange bedfellows. What you see is what you get here, an economy based on the service businesses visible from Interstate 70; business that translates into 80,000 room nights a year and $85 per capita in retail sales from domestic traffic passing through this high plains community.

But Joe Kiely, Limon’s assistant city manager and director of the new FTZ, isn’t satisfied. “Those jobs are good for government,” he says, citing tax receipts, “but not good for the citizens of Limon. They’re low-wage jobs, for one. We need to attract new primary jobs to Limon.”

Like much of rural Colorado, government is now the top employer here and in surrounding Lincoln County. It’s also the fastest growing sector, a tide of taxpayer-supported spending Kiely and other development professionals in surrounding counties would agree is unsustainable. Still, the gambit to begin providing services to companies that stand to benefit from FTZ’s – ‘the best kept secret in the business ecosystem’ as described to me – and attract foreign-direct investment to the region, is an eye-opener.

Two things work in Limon’s favor. Colorado has two other established FTZ’s, neither of which are serving a large number of companies or taking steps to expand or promote benefits. As result, there’s no real competition. Chalk it up to Colorado’s ambivalence about manufacturing, a theme I heard not only in Limon but from others. Michael W. O’Beirne, a national foreign trade consultant based in Washington D.C., with deep roots in Colorado, tells me it’s costing the region jobs. “After more than a decade trying to use Colorado FTZs, in my opinion a vacuum still exists that’s pushing companies into states like Texas and South Carolina, states proclaiming they’re ‘open for business'”, he says. O’Beirne was an advocate for Limon’s FTZ but also sees a need for others. “A new west-Denver FTZ extending from Castle Rock to Windsor might help provide options for companies. The benefits are real.”

Kiely see opportunity. “We’re a motivated partner for companies”, he says.

That may be. It also seems a prerequisite if Kiely or his counterparts in Denver and Colorado Springs are to be successful recruiting a new cadre of businesses into this opaque, often confusing program. Economic development officials may be less than enthusiastic, but clearly the manufacturing and supply-chain companies that stand to benefit most from an active FTZ network don’t understand the program, either. It’s a point not lost on Karen Gerwitz, president of World Trade Center Denver. “We’re supportive and would be more than happy to do more to educate the business community”, she offered, “but we just don’t see the interest or demand for information.”

Understanding the scope of Limon’s opportunity is itself a challenge. Limon’s FTZ actually extends east, into metro-Denver. But as O’Beirne notes, having worked with the city, “additionally, Limon could designate FTZ subzone sites anywhere within Colorado where U.S. Customs and Border Protection will also support FTZ usage. Subzones are single-user FTZ sites like Vestas, under the FTZ authority of Denver but with manufacturing in Pueblo.”

It turns out to be a huge geo-footprint that’s home to hundreds of potential manufacturers who might source materials arriving in the FTZ via rail or highway. Limon’s transportation infrastructure turns out to be its greatest asset for goods sourced from the coasts.

In the end, it may be Colorado’s improving international reputation as a regional growth economy that feeds Limon’s aspirations, along with more foreign-direct investment, or FDI, that comes with it. Today less than 100 Colorado companies are members of the Organization for International Investment, with 35% of those in manufacturing. In 2015 roughly 4% of the state’s private sector workforce was employed by foreign-direct investment. Those numbers are sure to improve.

Regardless, Joe Kiely and Limon’s brain trust aren’t looking back, they’re gazing forward, to a day when the city’s FTZ is a gateway for products and components, imported by companies region-wide or utilized by a growing cadre of manufacturers across multiple industry sectors. It’s ambitious, out-of-the-box thinking, equal to the opportunity also available to manufacturing companies operating in one of America’s fastest growing regional economies.

Bart Taylor is publisher of CompanyWeek. Reach him at btaylor@companyweek.com. Contact Joe Kiely at joe.kiely@portstoplains.com.

A cluster to envy: Ross Reels and Montrose rally outdoor industry to growth

May 21, 2020/in General/by Bart Taylor

Ross Reels had been in Montrose, Colorado, since 1983, a leader in precision machining in the fly fishing industry. But David Dragoo, president of Mayfly Outdoors, had already made a fateful decision after acquiring Ross and taking over operations in early 2014. “Essentially, we’d decided then that we were going to move the company,” he says. “And that was a big deal. Ross had been a primary employer here for a long time.”

How things changed. “We stayed, and the reason was simple,” he reflects. “The city has been a huge supporter of our company, along with Montrose County and the Montrose Economic Development Corporation. They have championed the cause to grow U.S.-based manufacturing.”

Today Dragoo is paying it forward in Montrose. In October, Mayfly Outdoors (Ross Reels’ parent company) announced plans to develop a world-class center for outdoor industry and enthusiasts along the famed Uncompaghre River, a development that may thrust Montrose to the front of a national wave of industry-cluster projects transforming American business.

Dragoo’s vision for the Colorado Outdoors project, to be developed on 150 acres around the river, expands on a trend we’ve written about often, of like-minded manufacturing and supply-chain businesses clustering to tap growing demand for domestic-made craft and consumer products; and of the opportunity for new manufacturing companies to again be woven tightly into the broad economic fabric as a result.

“I think the project encompasses three things,” Dragoo says. “It’s a revitalization of a beautiful part of the north side of town, when so much growth has been south. It’s a preservation of the river. We’re a manufacturing company that makes outdoor products for fisherman, hikers, and bikers, so the river is a key resource, an untapped resource in many ways. One outcome will be protecting and preserving the Uncompaghre. And the third thing is obviously the economic driver — bringing jobs, affordable housing, and the like. It’s a powerful combination.”

For those of us who’ve been rooting for these types of projects, it’s the makeup of the industry-cluster concept that’s also exciting.

“This community of outdoor manufacturing businesses we can bring together, the synergies of being together, is very compelling. Imagine small to medium size companies combined with larger enterprises — two-man crews to 250 employees, working and operating in close proximity. Or growing companies like Wagner Skis in Placerville [now in Mountain Village], maybe five or six people in a flex space, with an apartment above, warehouse in the back, retail in the front.”

Dragoo continues to gaze forward. “Then you have big companies, say Yeti Cycles, and they have 200 people in their end of the project — operating in a mix of industries and company sizes with a focus on designing and manufacturing outdoor gear and outdoor products.”

I mention the regional conversation taking place, from Grand Junction to Durango to Steamboat Springs, and the “lift” the collective dialogue about promoting outdoor industry would provide Dragoo and Montrose. He jumps to a tactical benefit: “This cluster of outdoor companies should begin to collectively develop some clout that individually we don’t have. Healthcare’s really tough on small companies, but if we can get 40 companies, for example, from across the region to speak with a single voice, maybe we can develop some negotiating power,” he says.

But for Dragoo it comes back to Montrose, and how the project can benefit the community he’s now committed to support.

“Regional pull for this project means several things for Montrose. We want folks to come stay, live and work here in the city and in the county. One of the challenges we have is that our nightly stay in the hotel is 1.5 nights. Go down to Ouray it’s 3.5 nights. We want to give folks a reason to stay here — to come and do factory tours, walk along the river, to enjoy some nice restaurants as well.”

It’s easy to envision. It’s also a model to emulate, not Dragoo’s vision necessarily, but the process of reimaging economic development that combines resurgence craft or light manufacturing with local attributes that provide for the ‘authentic’ experience consumers crave and new brands build around. Both will travel to embrace the experience.

And the region will benefit as a result.

Bart Taylor is publisher of CompanyWeek. Contact him at btaylor@companyweek.com.

Phylloxera comes to Colorado, and the wine industry holds its breath

May 21, 2020/in General/by Bart Taylor

The wine sector is the crazy old uncle of Colorado’s prolific beverage industry. A wealthy uncle to be sure, with fertile bottomland, magnificent crops and impressive factories. Eccentric to the point of being a bit standoffish, miffed by the sudden success of brewing and distilling nephews, his mood’s improved lately. A burst of creativity — ciders and canned wines — has captured the public’s imagination.

But a new development threatens the good vibe. Phylloxera, killer of grape vines and destroyer of industries, has been found in Mesa County, center of Colorado’s wine kingdom. Suddenly the industry is holding its breath.

Phylloxera’s an aphid-like insect, a pest, native to North America but most famous for decimating French vineyards in the mid-nineteenth century and laying waste to Europe’s wine industry as a result. No one’s sure how it got to Europe, but it’s certainly made its presence felt in America as well. In 1992, phylloxera ravaged 50,000 acres in Napa Valley, half the total vines in the region. As the New York Times described:

In 1992, the scene across the Napa Valley was desolate. In what had been some of the most beautiful vineyards in the world, piles of dead vines pulled from the soil were being burned. The pall of black smoke mirrored the mood of winemakers, who watched grimly as their lifeworks went up in flames.

Is it possible Colorado vineyards might suffer the same fate? I had a lengthy conversation with Dr. Horst Caspari, CSU State Viticulturist, about the discovery of phylloxera and its possible impact on the sector. Caspari and I have spoken before. When I reached him on the phone, he chuckled. “I guess I know why you’re calling.” A scientist, Caspari measured his assessment.

“It could be very very serious, or not, depending on what we find in the coming days and weeks. Is it a single incident, involving one or two vineyards that we can quarantine, or, do we find as we look at other vineyards that it’s widespread? We simply don’t know.” Regarding the offending vine, he was quick to note, “Of course, it’s been pulled and burned.” Visions of Napa.

Or not. “Phylloxera has been found in the wild grapes of Colorado’s canyons — it’s native to North America,” said Caspari, but the recent development is jarring. “It’s the first time it’s been found inside a viticultural area, within a commercial vineyard in our main production area.” Caspari speculated it might have been introduced from vines coming from out-of-state nurseries, from new plantings of “cold-hardy” varieties growers and winemakers here favor for their resistance to Colorado’s intense weather. But it’s impossible to be sure, at least today.

The million-dollar question is what impact a widespread outbreak would have on grape production. Caspari is confident that even in a worst case scenario, where the aphid has spread to vineyards outside the current location, the damage can be limited. “There may be only a small reduction in overall output, if any,” he says. Lessons from past outbreaks help. Rootstocks today are generally more disease resistant, as are younger vines, and this spring new plantings from recent years will be coming online.

Growers are also better equipped to deal with an outbreak today than in years past. “We simply have much better chemistry,” said Caspari. “We’ll be able to get insecticides into the root systems next spring, and if there’s more infestation than we know of now, and again we don’t know, we can also set traps that will catch the insects as they emerge in the spring to let us know where those infestations are.”

But even though the probability of an industry-wide calamity is “very, very low”, vineyard owners and wine brands that grow grapes stand to be affected — if the phylloxera outbreak is more widespread than currently known. For an industry comprised of lot’s of small operators, even a 15 to 20 percent hit to production for vineyards and brands across the valley could be devastating. Today any financial liability would be “on the grower’s backs,” suggested Caspari, “even though they didn’t do anything wrong.”

We’ll know more soon. Caspari’s team is gathering more samples this week in an effort to assess the problem before ground freezes. Vineyard owners are wary. “They’re understandably nervous about bringing contaminated objects into their vineyards from our shoes, or whatever, but we’re obviously taking every precaution,” he emphasizes. “Plus there’s no reason to go into a vineyard that’s thriving.”

If there’s a silver lining, even from a small outbreak, it’s that Colorado’s industry may benefit long-term, from best-practices and new vines. In California, wineries “benefited from the disaster by rectifying errors they had made and by taking advantage of the latest research on new grape clones, planting density and the compatibility between rootstocks and the vines grafted to them,” the New York Times reported. “They learned about new kinds of vine trellises and how to orient the vines to get the best combinations of sun and irrigation.”

Asking wineries to consider the upside of an industry-changing event, is too much, today. Isolating the pest and the problem and limiting the financial hit to Colorado operators is the outcome Caspari and industry allies are working toward this winter.

Bart Taylor is publisher of CompanyWeek. Contact him at btaylor@companyweek.com.

Boulder’s U.S.-leading food scene again on display at 12th annual Pitch Slam & Awards

May 21, 2020/in General/by Bart Taylor

“We should expect more from an ice-cream sandwich.” — Pete Bredemann, founder, PeteyBird Ice Cream Sandwiches

America’s food revolution rolls on in Boulder, Colorado, where natural products enthusiasts convened last to week to parse, among other things, the metaphysical state of ice cream snacks.

Of course, there were more tangible outcomes for the 25 natural food and product innovators competing at Naturally Boulder’s 12th annual Pitch Slam & Autumn Awards, such as coveted booth space at Expo West, business consulting and a higher profile that boosts the early-stage companies pitching to judges and enthusiastic supporters. As I wrote last year, the event has become a spectacular showcase of innovation and entrepreneurship — a window into a movement and industry that’s profoundly changed Colorado’s economy and for consumers nationwide, the way we develop product and food concepts and make and distribute what we eat.

As impressed as I was last year, the crop of companies pitching this year was even stronger in my view, with great products but equally, very capable entrepreneurs. The business acumen of this group was off the charts.

Naturally Boulder again demonstrated why it’s among the most influential and productive trade organizations in America. I hooked up after the event with Bill Capsalis, past board president and early mover in standing up NB, to assess what we witnessed at the 12th annual Pitch Slam.

The cross-section of companies was again eye-opening: desserts, pizza doughs, beverages, snacks, soups and broths, dips, and the winner, tooth powder! Capsalis: Innovation is alive and well in the natural products industry in Boulder. Where else could you see vegan sauces and soups being pitched along with toothpaste? The idea that Boulder is the epicenter of the natural products industry, or at least at the center of the food revolution, is turning out to be a self-fulfilling prophecy. Along with this comes a much more sophisticated entrepreneur; they’re more prepared and savvy than ever.
Gluten-free is now a staple, and grain-free is a new trend, but soy-free arrives this year in a big-way. ‘Gluten-, grain-, and, soy-free’ was the common refrain. Soy’s out because of new health concerns, especially for women. The billion-dollar sale of WhiteWave, with the Silk brand at center, came to mind all afternoon. Capsalis: It was almost $1.5 billion! It’s not so much that soy is out, it’s that other products are hotter. Plant-based milks are surging — almond, cashew, and even flax are gaining in popularity. I think the reason the WhiteWave deal is so important is because it shows how multinational corporations are focused on the innovation in the industry now. That’s a big deal and it gives a lot of entrepreneurs encouragement to keep innovating in the food space.
Paleo’s refinement represents huge opportunity. I’ve been paleo-plus-beer (who can live without beer?) for about six months and it’s hard to replace dietary staples like bread and muffins. But relief for grain-free products has arrived in a big way with the growing popularity of alternative flours made with almonds, chickpeas, and the like. Innovation in non-dairy dips and spreads was also on display. Flavorful, cheesy-tasting, vegan-based spreads from The Honest Stand and Let Thy Food were a hit. Fats are also back — FatWorks — in keeping with the paleo push. Capsalis: My favorite part of the Paleo movement is how so many things fit under the category! As long as you leave out the grains, sugars, and dairy, it’s Paleo! Beyond Paleo what we see happening now is a return to healthy fats like ghee and tallow. The Fatworks people are onto a culinary trend I think. I’m vegan so it doesn’t interest me, but I’m all for using every part of the animal, so bring on the fat.

“Boy, am I tired of energy bars,” opined Matt Oscamou, co-founder of Frontier Snacks. I was surprised his company didn’t make the finals. Energy bars seem in a down cycle, the exception this year being Evo, makers of a hemp bar and a business that’s already booming (profiled in CompanyWeek). Capsalis: It’s true there are a lot of bars out there. I think consumers respond well to high-protein, low-calorie items they can grab and eat on the go. Now they’re demanding actual real food in those bars. The challenge seems to be at the retail level: What does the store do with all of them?
I’ve the made the case for three years that manufacturing innovation has been a critical ingredient to industry growth in Colorado, and the impact of Colorado’s network of co-packers was an understated theme. Manufacturing challenges were less a topic this year than last, testament to expanding infrastructure including a growing network of available commercial kitchens along the Front Range. Brands and products may have been the highlight, but manufacturing assets are the ingredient that truly sets this region apart. Capsalis: This is right on, Bart! Every food brand I know has to start making their products somewhere and they all need to scale. Excellent manufacturing facilities make this a reality in our state. Without these facilities and expertise, we would not have the innovation that we do. A while back, you profiled the company that connects open kitchens with food makers [Food Corridor], a fabulous concept that pushes Colorado even further. We have some of the finest co-packers in the country located in Colorado.
A powerful social mission continues to inform many of the contestants here — it’s in the DNA of this sector — manifest this year in Good Spread, a natural peanut butter made with honey. With so many natural peanut butters on the market today that require a mix with every serving, this product aims squarely at kid’s preference for a creamy, no-stir texture. The corporate mission is to alleviate child mortality with an “every jar feeds a child” credo. It’s a commendable effort to turn a passive consumer to an awake, involved consumer. Capsalis: While mission-based food brands are not new or unique, Good Spread has raised the bar by highlighting malnourished children — a commendable act. Lots of companies want to do good while doing well; we see a lot of examples of this. Evo has re-focused their company around saving family farms by encouraging the growth of organic hemp. It’s brilliant really and not a marketing gimmick — they have locked up 20 percent of the organic hemp production and are creating more products to sell more hemp. Sometimes things just come together in a magical way. These are two great examples of entrepreneurs following their hearts.

Finally, the winner was the entertaining Perry Louis Fowler, eponymous owner of Frau Fowler’s Tooth Powder, part of the Tough Love Organics basket of products. Debilitated by a massive infection from having her wisdom teeth removed, Fowler developed a compelling, all-natural powder that, along with Fowler’s eccentric personality, won over the judges and audience alike. Cool stuff. Capsalis: Boy, was I surprised by her win. Personal care products — along with health and beauty products — are going through a lot of transformation these days and it is about time. It’s like the last frontier for innovation. The NB pitch slam exemplifies the awesome desire for entrepreneurs of all types to just go for it. And I love that about the event.

Our coverage of Pitch Slam finalists also includes this week’s profile of LoveTheWild. Stay tuned as we work our way through this incredible list of innovators and entrepreneurs.

Bart Taylor is publisher of CompanyWeek. Reach him at btaylor@companyweek.com.

A Trump presidency unnerves cannabis manufacturers. Is it time to change tactics?

May 21, 2020/in General/by Bart Taylor

Speculation about the impact of a Trump presidency on U.S. manufacturing has developed along familiar lines, much in keeping with America’s split-personality on the sector. Last week, media surmised that robots will thwart Trumps effort to reshore jobs at the same time his election may discourage the migration of businesses offshore. Midwest manufacturers are “wary of Trump’s free-trade stance” even as the Wall Street Journal reports that manufacturers are mixed on the prospect of a Donald Trump presidency in part because of his ‘protectionist’ rhetoric. So it goes.

Uncertainty and Trump also seem to go together. But here’s what we know: Candidate Trump ran on restoring U.S. manufacturing. And won. The prospects for American manufacturing appear bright.

Colorado’s cannabis manufacturers are probably less assured. Uncertainty has been a constant companion and today, the industry faces the prospect of a Rudy Giuliani or Ted Cruz-led Department of Justice, both of whom have been outspoken in opposing legalization.

I reached out to several of Colorado’s leading cannabis manufacturers to assess what steps industry and elected officials might take to insulate business here from a change-of-opinion at DOJ. The popular sentiment is to continue a ‘wait-and-see’ approach, that with all that’s happening within a new administration, the difficulties involved with unwinding the current hands-off approach and the vote to legalize in four additional states, the rules of engagement shouldn’t change.

Leaving the prospects of a billion-dollar Colorado industry to chance may be the right approach. It’s reasonable to let things play out. But should cannabis leaders and officials elected by the same voters who legalized pot also set in motion a full-throated defense of the industry?

Advocates would do well to publicize the positive impact of legal marijuana on conventional business in the state. They could start with manufacturing.

As President-elect Trump probably understands, creating new manufacturing jobs will pivot on the development of a new domestic supply chain more than legislation that will penalize companies who locate elsewhere, favored Trump campaign rhetoric.

It’s no different here and in Colorado, cannabis farming and production is supporting a wave of new supply-chain companies whose products and services bleed into conventional economy: production supplies including organic soils, lighting hardware, and systems automation; packaging, labeling, and printing including plastic products and fabrication services. Architects and builders are contemplating new facilities. A transportation and logistics network today supports increasingly advanced solutions to bring the industry’s products to market. It’s a long list and getting longer.

Also important is the growing number of capital providers migrating to Colorado and other states with legal marijuana to fund the cannabis industry. Small business requires capital and business services that incubate early-stage companies. Cannabis manufacturing is driving money and expertise into the early-stage ecosystem here and alongside the influx of dollars funding Boulder’s surge in natural food and statewide momentum in craft beverages and other specialized early-stage manufacturing, it’s easy to envision Colorado becoming a financing hub for light manufacturing. Cannabis is a catalyst.

The impact on the labor supply is more mixed. Cannabis complicates efforts of conventional manufacturers in what is already a difficult labor market.

But the jobs paradox that afflicts manufacturing nationally is also at work here: Companies lament a lack of qualified workers, yet point to the loss of manufacturing jobs offshore, or to robots, as the real challenge. Colorado’s manufacturing leaders seem hard at work fixing the workforce challenge. The ‘cannabis contribution’ to new job creation shouldn’t be overlooked.

It still may be a bridge to far for some, but business and policy leaders looking closely will determine that Colorado’s cannabis experiment is today an engine of conventional economic growth.

A rationale to which President-elect Trump can relate.

Bart Taylor is publisher of CompanyWeek. Contact him at btaylor@companyweek.com.

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Cannabis profiles and features in CompanyWeek:

CBDRx

Blue Kudu

Industry Report: Cannabis R&D in Colorado

Dixie Elixirs & Edibles

Workforce paradox: Automation key to manufacturing job growth

May 21, 2020/in General/by Bart Taylor

Even as manufacturing’s percent of U.S. employment lingers around 10 to 12 percent of total employment (and about 9 percent in Utah and Colorado), U.S. manufacturing is alive and well. American industrial output is at an all time high. We’re simply making more, with less. From Vox.com:

Since 1987, US manufacturers have increased their output by 80 percent at the same time as they have reduced their workforce by about 17 percent. In other words, American factories are about twice as efficient today as they were three decades ago. So we’re producing more and more stuff, even as we use fewer and fewer people to do it.

It’s a testament to America’s incredible R&D engine — and entrepreneurial ecosystem that commercializes innovation and technology.

But in the new manufacturing economy, where we make more with fewer employees, we still struggle to develop the right workforce. Today’s manufacturing employees are challenged to learn the skills that match our 21st century industrial makeup: technology-informed and in many cases, skill-sets we stopped teaching decades ago.

This was demonstrated again at last last month’s third annual Apparel + Lifestyle Manufacturing Summit. New cut-and-sew centers are launching in Colorado to meet growing consumer demand for apparel, backpacks, shoes, and other sewn products. Utah’s lifestyle industry boom is also fueling the development of more production businesses. But since we’ve not trained successive generations of pattern-makers, sewers, and finishers, there’s a workforce shortage and no real manual today for workforce development. Who’s an ideal candidate? What’s an appropriate curriculum, and for what equipment?

Even as we find and train workers, one reality is that technology will change everything. As Utah and Colorado look for footing in new (but old) industry sectors like garment manufacturing, technology will shape anew how industry redevelops here. Will the region be home to thousands of new sewers? More likely, based on themes that emerged from the Summit, new production epicenters may look different, featuring more automized systems working in support of smaller, smarter teams — prototyping hubs that enables brands to develop new products and manufacture to test in the field and with new consumers. Volume manufacturing may happen here, or elsewhere.

Consider how this model might proliferate across industries for communities that get it: diversified economies featuring dynamic craft food and beverage sectors that also sustain high-tech agriculture; advanced, agile middle-market manufacturers fabricating refined parts and assemblies; and lifestyle companies prototyping new products here in response to consumer’s preference for all things local. Automated, small-batch manufacturing everywhere.

Here’s a path ahead: Follow the lead of industry and higher-education advocating for fundamental change in how we train a next generation manufacturing workforce — but expand the dialogue into industries not yet party to the conversation. Maker industries that stand to gain from technology and innovation. And feed and incubate early-stage manufacturing companies in these same industries.

We’re destined to make things with fewer employees. But if we expand the breadth of what we make, across industries we’ve forgotten or ignored, we’ll add jobs by breaking down barriers erected in the past couple decades.

With the hammer of American R&D.

Bart Taylor is publisher of CompanyWeek. Reach him at baylor@companyweek.com.

More on CompanyWeek’s most-read content from 2016

May 21, 2020/in General/by Bart Taylor

We’ll devote time and energy this fall doing what many of you do — assessing the popularity of our products (in our case, content), determining what’s working and what isn’t, and developing new content that do what most good products do: meet a demand in the marketplace or solve a problem.

Here’s a list of what you liked, the most-visited content pages at www.companyweek.com, January through September this year:

Column: Walmart says no, but rural Colorado’s apparel manufacturing initiative storms ahead
Industry-report: Colorado’s bike manufacturers
Company profile: Kodiak Cakes
Industry category: Food & Beverage
Column: Middle-market companies steal the show at the inaugural Colorado Manufacturing Awards
Industry category: Industrial & Contract Manufacturing
Industry category: Brewing & Beverage
Industry category: Lifestyle
Industry category: Aerospace & Electronics
Industry category: Built Environment

And here’s a couple takeaways:

Manufacturing companies are interested in each other. We organize and archive company profiles by industry type at CompanyWeek, and this list reflects the popularity of those archives. It’s no surprise, really. It’s the only resource of its kind. But the practical takeaway is that many of the early-stage and middle market companies we profile are interested in how others are managing the challenges, needs, and opportunities outlined each week. Plus there’s business to be had in company-to-company connections.

There’s growing interest in a manufacturing resurgence in lifestyle industries. There was obviously the most interest in a good old-fashioned David-and-Goliath story when brawny Walmart tapped Rural Colorado Apparel Manufacturing a finalist for it’s Manufacturing Innovation Fund then rejected it in favor of more academic exercises, like The Science of Making Old Clothes New Again.

RCAM has since been told no again by Walmart, but here’s guessing that it’s only a matter of time before an authentic manufacturer taps the upstart apparel cut-and-sew resource to make garments — utilizing labor sourced from rural America. RCAM is a sleeping giant, either as an entity or as a concept.

The #2 ranked content on the list was first published over a year-and-a-half ago, in June 2015. Our report on Colorado’s bike manufacturer continues to do well in web searches. Interest is high in U.S.-made gear.

Witness the Food & Beverage juggernaut. We’ve documented Colorado’s food and beverage surge — it’s the fastest growing manufacturing sector in the state. Utah’s Kodiak Cakes is the no. 1 read-profile this year, a result in no small part to its legion of fans active on social media.

But F&B has also been the no. 1 category archive destination this year, a trend that should continue as we shine a light on more regional companies driving a revolution in what we eat and how we distribute it.

Industrial manufacturers continue to be the under-publicized bedrock of sector. If others forget about cutters, benders, machinists, and welders, we won’t, and neither will readers or visitors landing at CompanyWeek.com from web searches.

Finally, on the other end of the spectrum, here’s the best column I wrote this year that nobody read. Can’t win ’em all.

Bart Taylor is publisher of CompanyWeek. Reach him at btaylor@companyweek.com.