Michigan colleges are leaders in the number of Pell Grants received for inmate job training, Page 3 AUGUST 8 - 14, 2016

Garden City Hospital builds its footprint, reputation

By Jay Greene [email protected] The fastest-growing hospital company in the country is doubling down on its investments and part- nerships in Michigan. Garden City Hospital will begin its planned $35 million renovation project this fall that will further add to its local community hospital rep- utation, said Saju George, CEO of Garden City. As part of California-based Prime for Healthcare’s Midwest region of eight Menu hospitals, Garden City is one of two Prime hospitals in Michigan. The second is the former Novi-based Trinity Health hospital in Port Huron, the newly named Lake Huron Medical change Center. Prime is eyeing acquisitions of other hospitals in Michigan, said George, and talking with hospitals in Southeast Michigan about inno- Special 14-page report starts on Page 11 • Details about the Aug. 22 Crain’s Food Summit, Page 22 vative clinical partnerships. He de- clined to name the hospitals or Michigan’s food economy is changing. health care systems involved in State, farming industry leaders hunger talks. The local-food movement is “We have spent $15 million on sprouting new opportunities for immediate effi ciency and care coor- for more food processors to invest dination improvements the last two entrepreneurs, whether they’re By Sherri Welch Michigan’s peninsula footprint can make years” since Prime acquired the [email protected] shipping products costly, and suffi cient elec- 67-year-old hospital founded by farmers, manufacturers, retailers or Michigan is a leader in producing many trical, gas and water infrastructure isn't al- several osteopathic doctors, said restaurateurs . New distribution foods, from blueberries to bell peppers, but ways available in the rural areas closest to George, the former Ascension Health an important strategy in growing the state’s crops. And, in general, the state’s signifi cant Michigan executive who became models are creating opportunities for food economy is gaining market share with food industry is frequently overshadowed by CEO last year. Garden City was for- food processing opportunities. manufacturing companies when it comes to merly a nonprofi t independent hos- state farmers. E orts are underway Among them: processing some of the incentives. pital. to attract more manufacturing and state’s superfl uous milk supply now shipped But those working to expand food pro- “We got a lot of input from the to other markets into new dairy products, cessing in Michigan say it’s important to community, employees and medi- processing plants that make the food turning soybeans into meal — to help meet stay, well, hungry for processing deals as part cal staff before we did anything,” he that feeds millions. And an expected increase in demand tied to the of a broader push to promote more jobs up said. “We made immediate im- state’s growing livestock herds — and trans- and down the food supply chain. provements in information tech- bootstrapped success stories like forming corn crops into animal feed and “Food processing is the best way to deliv- nology and invested a lot of money ethanol. Also brewing: strong demand for er additional value to the farmers and to the in bedside computers for charting.” Ferndale’s Garden Fresh are inspiring Michigan hops for craft beer. communities that are home to the food pro- Garden City’s three-year, $35 mil- startups all over the state. As with many food business opportuni- cessors,” said Mike DiBernardo, who joined lion renovation program will re- ties, there are hurdles. SEE FOOD, PAGE 32 place all semi-private patient rooms with private rooms, double the size SEE HOSPITAL, PAGE 29 PHOTO BY JACOB LEWKOW; PIE, ELLEN’S BAKERY AND CAFE

© Entire contents copyright 2016 by Crain Communications Inc. All rights reserved Second Stage: Choosing inside jobs or outside work crainsdetroit.com Vol. 32 No 32 $2 a copy. $59 a year. When a company must decide between doling out work internally or outsourcing a job, there are many factors to consider, among them NEWSPAPER budget and culture, Page 25 2 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016

ported. A Worker Adjustment and reported. The Board of State Can- MICHIGAN Retraining Notification Act notice vassers approved proposed ballot INSIDE filed in late July said Dow Corning wording submitted by Raise Michi- THIS ISSUE CALENDAR ...... 28 will restructure operations at its cor- gan to create the “Earned Sick Time CLASSIFIED ADS ...... 29 porate center in Bay County’s Wil- Act.” The group must collect more DEALS & DETAILS ...... 28 liams Township and its Bay City site. than 250,000 valid signatures to KEITH CRAIN...... 8 The layoffs are expected to be per- send the proposed legislation to the MARY KRAMER ...... 8 manent. On June 1, Midland-based Legislature. If lawmakers reject the OPINION ...... 8 BRIEFS Dow Chemical Co. assumed full con- legislation or don’t act, the question PEOPLE ...... 28 Obama nds inspiration projects during the Obama admin- trol of its 73-year joint venture with will go on the November 2018 bal- RUMBLINGS ...... 34 in Grand Rapids-made rug istration. Corning Inc., becoming the full own- lot. Under the plan, employees WEEK ON THE WEB ...... 34 “Anytime you can be mentioned er of Dow Corning’s silicones busi- would earn one hour of sick time for A Grand Rapids rug business re- positively, that is great,” said Mike ness. Dow is merging with chemical every 30 hours worked. Employees cently got an unexpected plug — di- Ruggeri, Scott Group’s co-owner giant DuPont. of larger businesses would be able COMPANY INDEX: rect from the Oval Office. and president. “And when the presi- n More than 8 percent of entre- to use up to 72 hours each year, and SEE PAGE 30 During a recent interview with dent of the United States mentions preneurs in Michigan were born in employees of small businesses CBS’ “Face the Nation” about his leg- you, that is really great.” another country, and their compa- would normally be restricted to up acy, President Barack Obama was If the next administration redec- nies accounted for more than to 40 hours. ing next year after 10 years in the asked what art in that office he orates the office, which is tradition, $600 million in business income in n Progressive AE, the Grand Rap- job. Dunn announced last week he would reflect upon on his last day in Obama’s rug will go into the ar- 2014, a new report shows. “The ids architectural firm that designed will serve through June 2017 and power, MLive.com reported. His re- chives of the National Park Service, Contributions of New Americans in Frederik Meijer Gardens & Sculp- then become president emeritus for sponse was the carpet beneath his Ruggeri said. But, he added, there is Michigan” was authored by the ture Park and other high-profile a year, AP reported. feet, a handmade wool rug crafted a possibility it would become avail- Partnership for a New American Econ- West Michigan destinations, is n The U.S. Department of Home- in the Furniture City by designers able for a future Obama presidential omy, a group of more than 500 merging with ai Design Group, a de- land Security has identified a differ- and artisans of Scott Group Studio. library or museum. American mayors and business sign firm based in Charlotte, N.C., ent kind of threat in West Michigan, The 23- by 30-foot oval rug features leaders and highlights the econom- that is known for its work on race MiBiz reported. The federal agency five quotes around the perimeter by MICH-CELLANEOUS ic contributions of immigrants in tracks, MLive.com reported. They filed an opposition to an applica- former presidents and Martin Lu- n Battle Creek-based food maker Michigan, including entrepreneur- will have a combined workforce of tion by Grand Haven-based Grand ther King Jr. Kellogg Co. said it has decided to ship, income, tax revenue and em- 200 people doing work across 48 Armory Brewing Co. to trademark the “I will tell you that I’ll probably close an Indiana snack plant next ployment. states. phrase “Coast Guard City,” which it look at the carpet because ... I still year in a move to reduce production n More than $1.2 million from n Lansing-area-based Auto-Own- used in the name of a signature beer remember thinking about those capacity, AP reported. The company the Flint-based Ruth Mott Founda- ers Insurance is boosting IT opera- brewed for the Grand Haven Coast quotes from Teddy Roosevelt, JFK said the plant in Seelyville, about 75 tion will help fund a mobile health tions with the opening of a West Guard Festival. The label for the and Martin Luther King and I’ll miles west of Indianapolis, is ex- clinic amid that city’s crisis with Michigan technology office in Coast Guard City Pale Ale features wonder if I did everything I could to pected to finish closing by Septem- lead-tainted water, a job training Grand Rapids, MLive.com report- the likeness of a U.S. Coast Guard stay true to those quotes,” Obama ber 2017, and that about 150 jobs program for at-risk youth and ed. The Delta Township insurer ex- vessel set amid waves, barley spikes said. “And hopefully I did.” will be affected. neighborhood improvement proj- pects to hire 35 people, mainly soft- and a sunset. Homeland Security The rug was developed in con- n Dow Corning Corp. officials have ects, AP reported. ware developers, for the new said the application infringes on ex- junction with Los Angeles designer formally notified the state of plans n A group has launched a new branch office. isting marks and that the use of the Michael S. Smith, who has led to lay off 348 employees from two attempt to require Michigan em- n John Dunn, the president of Coast Guard name is restricted un- many of the White House design mid-Michigan sites, MLive.com re- ployers to provide paid sick time, AP Western Michigan University, is retir- der federal law.

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PNC and PNC Bank are registered marks of The PNC Financial Services Group, Inc. (“PNC”). Banking and lending products and services, bank deposit products, and treasury management products and services are provided by PNC Bank, National Association, a wholly-owned subsidiary of PNC and Member FDIC. Certain banking and lending products and services may require credit approval. ©2016 The PNC Financial Services Group, Inc. All rights reserved. CIB ENT PDF 0716-0141-342702 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 3 Michigan colleges leaders in oering Pell Grants to prisoners By Lindsay VanHulle eled their expectations. ated students. Michigan, and more than 60 across Crain’s Detroit Business/Bridge Magazine That inaugural class in 2012 “It’s that moment when we begin the country, to be chosen to partici- LANSING — Several years ago, as eventually grew to about 400 pris- to pull (back) that curtain of our pate in a U.S. Department of Educa- administrators at Jackson College oners today, partly due to additional own imagination,” Butler said, “and tion pilot program that will waive prepared to offer courses to inmates grants. Those students would not say, ‘I didn’t realize that this level of restrictions on federal Pell Grants at a state prison, they weren’t opti- only raise the bar, but shatter it, said potential existed.’” for prisoners in order to find out mistic about success. Todd Butler, the college’s dean of Jackson College has been a leader whether more prisoners will pursue The community college in Jack- arts and sciences. Inmates make up among higher education institu- education if they have financial as- son County had educated inmates about 3 percent of Jackson College’s tions in Michigan in teaching pris- sistance. Jackson College was slot- for decades, but stopped in the mid- part-time student population, But- oners while they’re behind bars. Of- ted for 1,305 Pell Grants, more than 1990s when a federal law change ler said, but 46 percent of the part- fering college classes in prison is SEE GRANT, PAGE 31 prohibited incarcerated students time dean’s list. Their success rate one piece of a broader approach from receiving Pell Grants. This time on their first attempt at completing within state corrections depart- Gary McKissack, an inmate at the around, administrators thought the a developmental math class is near ments nationally — and particularly Richard A. Handlon Correctional first class of 18 prisoners paying 100 percent, compared to 54 per- in Michigan — to try to increase in- Facility in Ionia, participates in a their own way would be the most cent of on-campus students. mates’ employment opportunities welding training program as part academically disadvantaged stu- Butler said instructors attribute post-release and lessen the chances of the Michigan Department of dents they’d ever taught. They the difference in part to a noticeably they’ll get locked up again. Corrections’ new Vocational planned remedial courses and lev- strong work ethic among incarcer- The college is one of three in Village program. LINDSAY VANHULLE WSU sees Dual view of auto horizon nancial concerns lightening Ocials: Enrollment, med school xes keys to turnaround

By Chad Halcom [email protected] Wayne State University officials think the clouds that bond rating agencies see looming over their fi- nances will soon lift, as deficit spending to subsidize construction and its School of Medicine winds down. S&P Global Ratings earlier this Plymouth-based Varroc Lighting’s new system uses a cluster of nearly 40 LED lights. A number of them turn oƒ summer downgraded Wayne State automatically to avoid blinding other drivers by creating a black box eƒect around the approaching or followed vehicle. from an AA- to an A+ rating, while Moody's Investors Service Inc. main- VARROC LIGHTING tained an Aa3 but lowered its out- look from stable to negative, on Fear of recession clouds technology excitement at industry conference $101 million of bonds refinanced in June and more than $400 million in By Dustin Walsh the 2019 time frame,” Jeff Schuster, senior vice global production will hit 91 million units this total debt the university carries. [email protected] president of forecasting for Troy-based LMC Au- year and exceed 100 million units by 2019. Although the refinancing gave The mood at last week’s annual automotive tomotive US Inc., told attendees. “We see a flat “We see both (gross domestic product) and WSU lower interest rates and freed business conference, called Management market this year and next year, and very, very light-vehicle sales growth averaging right up funds to retire debt principal, Briefing Seminars, ranged from energetic on low levels of (production) growth going for- around the 2.7 percent level,” for at least the both agencies warned that the uni- new technology to somber over looming con- ward.” next five to seven years, Schuster said. versity has depleted some cash re- cerns about North American auto sales. Schuster said there are growing risks from This bodes well for the suppliers and auto- serves on construction projects and The conference, held at the Grand Traverse rising incentives, longer-term loans, growing makers whose advanced products are set to hit subsidies to offset budget deficits in Resort in Acme and organized by the Center for reliance on fleet sales and leasing. So far, those the market in the next few years. the medical school. Automotive Research, provided ample oppor- risks remain on the horizon, but they aren’t For example, Praveen Singh, vice president “Despite receipt of flat state oper- tunity for industry executives to highlight new likely to stay there, he said. of Southfield-based Lear Corp.’s new connec- ating appropriations and bet- advancements in auto tech, while forecasters While the forecasts are gloomy for North tivity business, said the supplier is only a ter-than-projected tuition revenues, and economists warned of an impending America, the rest of the world may pick up the few years away from offering to customers a the university’s financial operations slump. sales slack. are expected to be negative in fiscal “We’re still looking for the risk of recession in Schuster said he still believes worldwide SEE AUTO, PAGE 30 SEE WSU, PAGE 33

MUST READS OF THE WEEK Separate courses Sharing rides Ready to pay Diversied to spin o its Bagger Splt-Lyƒ pact to aid Beaumont MLS expansion fee boost won’t Dave’s business, Page 6 Health patients, Page 4 faze Gilbert-Gores bid, Page 4 4 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 MLS expansion fee increase won’t faze Gores-Gilbert bid By Bill Shea pansion club, and we continue to New York and Orlando began Wayne County Executive Warren re-confirmed last week the plans for [email protected] have productive discussions with a play last year, and future teams in Evans has said he intends to work an RFQ. Major League Soccer’s disclosure number of prospective ownership addition to Minnesota and Los An- with the Gores-Gilbert group, but An MLS club, even at $200 mil- last week that it could nearly double groups,” Abbott said in a league geles include Atlanta in 2017 and his priority is getting a justice com- lion, is less expensive than the bil- its expansion fee to around $200 statement. “Following the board of Miami once a stadium deal is for- plex built. lionaires’ other pro sports ventures: million hasn’t dampened Tom governors meeting, the league is malized. The Gores-Gilbert group still is Gores bought the National Basket- Gores and Dan Gilbert’s interest in continuing to work on the timeta- Gores and Gilbert — estimated to focused on the jail site for a stadium, ball Association’s Detroit Pistons for owning a team in Detroit. ble and the details, including pric- be worth $3.3 billion and $5.1 bil- but is believed to be considering al- $325 million in 2011, and Gilbert Gores’ point man on the MLS bid, ing, for future expansion, and no lion, respectively, by Forbes — an- ternative locations. purchased the Cleveland Cavaliers Palace Sports & Entertainment Vice decisions have been made. Based nounced their interest in owning an “We believe the right develop- for $375 million in 2005. The aver- Chairman Arn Tellem, noted in a on the increasing value of MLS MLS team in Detroit in April at a ment for that site is something that age MLS club is worth $157 million, statement to Crain’s on Friday that clubs, expansion fees could be as news conference attended by MLS enhances the city and fuels the con- according to the most recent valua- the league hasn’t formalized its pro- high as $200 million.” Commissioner Don Garber, who tinued revitalization of Detroit,” tions from Forbes.com, and the cess for when it will expand, how the MLS has 20 clubs and four in the spoke glowingly about a team in this Matt Cullen, one of Gilbert’s long- most valuable club was Seattle at process will work — or how much expansion process that will begin market. time top lieutenants and principal $245 million. new owners will pay. play over the next few years: Atlan- The Gores-Gilbert group, which with his Rock Ventures LLC, said in a The soccer league has a far lower “Our enthusiasm for bringing ta, Los Angeles, Minnesota and Mi- could eventually include other in- statement. “We remain committed barrier to entry than its U.S. major MLS soccer to Detroit has not ami. Along with Detroit, Sacramen- vestors, said it wants to build a to exploring an exciting and distinct league counterparts. National Foot- changed, and we look forward to to and St. Louis have been reported 500,000-square-foot soccer-specific large-scale development that will ball League expansion is pegged at working closely with MLS on the bid as likely expansion cities. stadium, which likely will seat bring jobs, an increased tax base $1 billion, and the fee to relocate the process once it begins,” he said. Owners of the Los Angeles FC report- around 24,000 and would cost $225 and substantial economic activity St. Louis Rams to Los Angeles was MLS Deputy Commissioner edly paid a $110 million expansion fee million to $250 million, on the 15 to our burgeoning urban core. And $550 million this year. Mark Abbott in a statement last for their club, which begins play in acres underneath the unfinished as such, we will continue working MLS is a single-entity business, week signaled that the expansion 2018. Minnesota United FC, which be- Wayne County jail project site — side by side with Wayne County meaning all teams are owned by the fee could increase to as much as gins play in 2017 or 2018, reportedly prime downtown real estate on Gra- throughout this process to ensure league and all players are its em- $200 million. paid $100 million. New York City FC’s tiot Avenue at I-375. maximum positive benefit for the ployees rather than employed by “There has been incredible inter- ownership reportedly paid a $100 mil- The $1 billion plan, designed by community.” the club. MLS pays the players. est from cities across the country in lion expansion fee, while Orlando City Detroit-based Rossetti Associates Evans previously has said the two Team “owners” pay an investment acquiring a Major League Soccer ex- FC’s paid $70 million. Inc., includes three 18- to 28-story requirements for having the Gil- fee to MLS for the right to operate a glass towers along with retail, bars bert-Gores project move forward team in a geographic area. They be- and restaurants. are that Wayne County gets a new come league shareholders rather The aim is to have a stadium open jail without additional cost to coun- than franchise owners. Teams keep by 2020, but a major roadblock is ty taxpayers and that a reasonable their own books and budgets. that Wayne County owns the jail site offer for the site be received by the MLS has publicly said it contin- and said last month it intends to late summer or early fall, which is ues to lose money — as much as complete the project. Work on the when he said the county expects to $100 million annually. jail was halted because of a $100 mil- issue a request for qualifications to Bill Shea: (313) 446-1626 lion cost overrun in July 2013. finish the project. The county Twitter: @Bill_Shea19 Beaumont Health patients to benet from Splt ride-share pact with Ly By Tom Henderson Babbitt said prise health care partnerships at [email protected] the partnership Lyft, in a news release. Local patients of Beaumont with Lyft won’t “We look forward to working Health will be part of the first wave require seniors with Splt with our non-emergency of a service contract reached be- to use smart- medical transportation companies tween ride-sharing companies Splt phones. She in Michigan and beyond,” said Dr. and Ly†. said Splt has de- Paul LaCasse, vice president of the Splt, a graduate of last summer’s veloped a sys- post-acute care division and diver- Techstars Mobility incubator pro- tem that will al- sified business operations at Beau- gram at Ford Field in Detroit, is ex- Anya Babbitt: low patients to mont Health. pected to announce Monday that it Wants to roll out schedule rides Babbitt said she is hiring four has signed a contract with Lyft, the service with health through a web- software developers and two op- '((35(6285&(6 San Francisco-based ride-share care systems. site, by text mes- erations and business develop- '((35(/$7,216+,36 company, to provide transporta- saging or by ment employees to manage the tion for senior citizens to their phone calls. increase in business, which she Developing customized investment strategies is a non-emergency medical appoint- “More seniors are using smart- expects to mean an increase in continuum. We are honored to serve our clients. ments. phones, but they won’t need to have revenue of $20 million over the The service is scheduled to begin one,” Babbitt told Crain’s last week next year. She declined to reveal Relationships. Rigor. Results.  this fall with patients of Beaumont while in Palo Alto, Calif., at a pitch current revenue. Health. event to would-be investors. She In April, Splt won the $100,000 Splt founder and CEO Anya Bab- said Splt is raising a funding round Pritzker Foundation Award at the bitt said she wants to roll out the of $500,000 to $1 million, which she sixth annual Clean Energy Trust service with health care systems hopes to close in the next three Challenge in Chicago. In May, Splt throughout the Midwest this year months. pitched to venture capitalists at the and next and then go nationwide. “This deal lets Lyft focus on its annual Google Demo Day in She said Lyft will provide the core business, and it lets Splt focus Mountain Valley, Calif., having drivers. Splt will do the scheduling on our core business, which is help- won the Detroit Demo Day contest and handle insurance reimburse- ing people connect to share rides,” at Grand Circus in March. ment, Medicare qualifications and said Babbitt. As part of her participation in reporting to health care systems. “It’s our mission to connect peo- last summer's Techstars program, Splt was founded as an app- ple and communities through ef- Splt got $120,000 in funding from Member FINRA/SIPC based way for companies to launch fective, affordable, safe and acces- Detroit-based Fontinalis Partners ride-share programs for employees. sible transportation, and Splt’s LLC and Basking Ridge, N.J.-based Investment Advisors s (866) 644-2701 s www.GJSCO.com Current customers include DTE Ener- concept is a great way to deliver Verizon Ventures. gy, Honda Manufacturing of Ohio and our services to the underserved,” Tom Henderson: (313) 446-0337 Magna International of America Inc. said Gyre Renwick, head of enter- Twitter: @tomhenderson2 PN Full pg_DBpageAD.qxd 7/7/2016 11:01 AM Page 1

Keeper of the flame

Gertrude Ramsay Crain viewed herself as “the keeper of the flame” after she succeeded her husband, G.D. Crain Jr., as chairman of Crain Communications.

But she was so much more. Gertrude Crain led the company, founded by Mr. Crain 100 years ago, during some of its most exciting and productive years.

During her tenure, Crain bought Modern Healthcare and Rubber & Plastics News, started such publications as Crain’s Chicago Business (and similar papers in Detroit, Cleveland and New York) and Investment News, and expanded internationally.

Crain’s revenues during that period increased tenfold, and the company’s titles went from a handful to over two dozen.

Above all, Gertrude Crain was the one who made the Crain family company a real family. She laughed with Crain employees, she cried with them, and she celebrated the milestones of their lives with them.

When Gertrude Crain passed away in 1996 at the age of 85, Advertising Age said, “her smile warmed hearts, lit up rooms, lifted spirits.”

Gertrude Crain - a big reason why the people who count, count on Crain.

GERTRUDE CRAIN

CRAIN.COM 6 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016

LENDING | TREASURY MANAGEMENT | BANKING | BUSINESS SERVICES Diversied to spin o Bagger Dave’s By Sherri Welch [email protected] Southfield-based Diversied Restaurant Holdings Inc. plans to split into two separate, publicly traded Best bank...6 years running. companies through the tax-free spinoff of its Bagger Dave’s business to its stockholders. Diversified (NASDAQ: SAUC) Best-in-class products. plans to continue operating as the largest franchisee of Bu alo Wild Wings. “Over the last year, we invested Best of all… considerable resources and time to improve the Bagger Dave’s concept, which included rationalizing un- derperforming locations, making local decision making. changes in management and im- provements in operations while en- hancing our customer touch points,” Chairman, President and CEO Michael Ansley said. “The greater focus on our BWW As a Michigan-based bank, we’ve been getting to work helping businesses since 1917. By providing area expertise and loan business and its significantly larger decisions that come out of our local offi ce and not out-of-state, our services are enhanced to optimize cash fl ow and fi nance size limits the attention and re- growth to help businesses move forward, even faster. And with best-in-class banking resources like Positive Pay, Business sources we can apply to Bagger Express Deposit and SBA loans, you’re always banking big…even when you’re banking local. Dave’s, which ultimately restricts our ability to build on the recent success of its redefined concept. As Learn more about how big doesn’t always mean best. an independent company, we be- Give us a call today. lieve Bagger Dave’s will be in a www.thefsb.com/business | 866-372-1275 much better position to leverage its redefined concept to drive growth.” *Voted “Best Bank” by 4HJVTI+HPS`readers The two businesses are distinct in (2011: 3rd; 2012: 1st; 2013: 1st; 2014: 1st; 2015: 2nd; 2016: 1st) many respects, he said, including: n BWW is a franchise brand, and Diversified owns the Bagger Dave’s brand. n BWW is a mature brand, while Bagger Dave’s is still in its early stages. n Bagger Dave’s has a more com- plex menu and complex food prepa- ration processes and requires differ- ent management and personnel. The company to be formed with the proposed spinoff of the Bagger Dave’s business will own and oper- ate 19 Bagger Dave’s restaurants, which had revenue of $10.7 million YOU FLY PRIVATE in the first half of 2016. It will trade BECAUSE YOU DON’T LIKE RULES. in the over-the-counter market. Diversified said it plans to con- Why do you accept paying for taxi time, minimum flight tinue to own and operate its 64 time, trip changes or cancellations, and adjust your franchised BWW restaurants and schedule around blackout dates and restrictive service be listed on the NASDAQ exchange. areas? With Corporate Eagle you won’t. The spinoff plan will be subject to its board’s approval and custom- ary regulatory requirements, it said, with completion of the spinoff ex- pected during the fourth quarter. In its results for the second quar- ter ended June 26, released last week, Diversified reported $46.39 million in revenue, up nearly 26 percent from the same quarter of 2015. Its total operating expenses rose 7 percent to $45.4 million. It narrowed its net loss during the quarter to $182,000 compared to a net loss of $3.3 million during the year-earlier quarter. Revenue grew, Diversified said, with the addition of 15 new restau- rants and increased menu pricing. The company had 83 total restau- rants at the end of the quarter. Its Buffalo Wild Wings business corporateeagle.com | 248.461.9001 accounted for 88 percent of sales during the quarter; Bagger Dave’s contributed nearly 12 percent. DBpageAD_DBpageAD.qxd 7/28/2016 10:48 AM Page 1

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OPINION Keep state’s food economy growing ime was, big food companies kept the sources of their farm in- gredients secret. Michigan corn or Iowa? Or even Mexican? You wouldn't really know. That was before consumers got very inter- Tested in where their food was coming from. Consider some facts in this week’s Food Economy report: A poultry farm near Saranac supplies nearly 100 million dozen eggs to McDonald’s, enough for a billion Egg McMuffins. Yoplait has been making yogurt in Reed City since 1975. Sugar beets from the Bay City-based, grower-owned Michigan Sugar Co. produce about 1 billion pounds of the sweet stuff every year under the Pioneer Sugar and Big Chief Sugar brands. Yes, Michigan is a manufacturing pow- More erhouse, but the food economy is alive and Award marks 35 years of honoring women attention is well — and growing. The same farm-to-table movement that n 1981, Martha Mertz, a success- tisha and anti-sexual assault activ- needed by is propelling an explosion in foodie-fa- Iful real estate developer in Oke- ists Annie Clark and Andrea Pino. economic vored restaurants in Detroit is evident mos, was invited to join the all-male Ashley Judd, actress and activist, is across the state. And to make it even stron- board of the Lansing Regional the keynote speaker. developers at ger, the state should welcome more pro- Chamber of Commerce. “After Meanwhile, in Grand Rapids, the state and cessinging and distribution deals between about a year, I decided to nominate public broadcaster Shelley Irwin, Michigan-made companies. This is a new several women from our communi- an alumna of WJR-AM in Detroit, local levels. form of manufacturing, and builds on a ty to join me, so I wouldn’t be a sin- MARY KRAMER will be the 2016 ATHENA honoree strong Michigan heritage. gular voice,” Mertz said last week. Publisher at the Sept. 15 luncheon sponsored Take the vision for Detroit’s Eastern “My male colleagues told me: ‘Mar- by the Grand Rapids Area Chamber Market, chronicled on Page 13. Plans call for expanding the boundaries tha, women aren’t leaders.’ And the Mary Kramer is publisher of Crain’s of Commerce. In Detroit, Heather of the district by up to five times, eventually to include many more food funny thing is, we didn’t think we Detroit Business. Catch her take on Paquette recently concluded an processors and distributors. The plans will kick off with the redevelop- were, either.” business news at 6:10 a.m. Mondays on eight-year stint on ATHENA’s inter- ment of a large building just east of Roma Café. The old building could Only once in 75 years of the cham- the Paul W. Smith show on WJR AM 760 national board, serving as board be multi-tenant, with space for food processing or distribution, retail ber’s history had a woman received and in her blog at chair for two years. and restaurants. an award or recognition, Mertz www.crainsdetroit.com. Paquette is Michigan managing Around the state, a lot of work is underway to match growers to dis- learned. So she decided to create an partner for the audit, tax and fi- tributors and processors and create linkages, and to give budding food award specifically for high-achieving the initiative through chambers of nance consulting firm KPMG. She entrepreneurs help navigating state and federal red tape. women. “I didn’t want to wait anoth- commerce across the country. and her mother received interna- But more attention is needed by economic developers at the state er 75,” she says today. Next month, the now-interna- tional ATHENA awards 20 years and local levels, with clear paths to find the licensing, financing and oth- Thus, the ATHENA award was tional ATHENA organization will apart, making them the awards’ er must-haves for new food enterprise. born, honoring women based on return to Lansing for its 35th leader- only mother-daughter honorees. Some of the major grocery chains, like Meijer, have demonstrated the three criteria: achieving excellence ship conference. Attendees of the “As I noted in my acceptance ability to shepherd Michigan-made food products, helping small com- in a profession; giving back to com- Sept. 25-27 event will draw from the speech, ATHENA leaders raise ATH- panies grow to scale. Other chains could take note. Investors should give munity with time or talent; and United States, Canada and even ENA leaders,” Paquette says. food opportunities a closer look. Food processing businesses, in partic- opening leadership opportunities China. And those two women Mertz ular, can create new manufacturing jobs to replace some that have fad- for others, especially women. More Metro Detroit’s own Florine nominated at that first ATHENA ed away in automotive downsizing. A plant is a plant, whether it’s for than 1,000 people attended that Mark, who owns the largest fran- event 35 years ago? One became camshafts or for pickles. first awards luncheon honoring two chise in Weight Watchers Interna- Michigan’s first female U.S. senator, The annual aggregate value of agricultural production in Michigan is outstanding women in the Lansing tional Inc., will receive ATHENA’s Debbie Stabenow; the other, Dawn already more than $8.5 billion. Imagine the possibilities of Michigan’s area; Oldsmobile sponsored that top award. Other honorees include Springer, became chief of staff at food economy with more effort given to “home-cooked” deals. first event and helped Mertz grow Flint pediatrician Mona Hanna-At- Lansing’s Sparrow Hospital. A great celebration — for 100 years Just about a month ago, the 100th this exciting but dangerous event. with quieter and more powerful jet published Automotive News during Indianapolis 500 was celebrated at Many great names have graced engines, the excitement has, if any- the war. the Brickyard. It was a historic event these waters, names like Guy Lom- thing, increased. And there are now It told its readers exactly where with a huge crowd. bardo or Gar Wood, and boat own- three unique classes with nonstop those engines were built — engines Now it is Detroit’s turn. ers from decades ago, in addition to action all day long. that were destined to power those This year from Aug. 26-28, De- all the drivers and famous boats I am excited and pleased that the Gold Cup boats years later. troit will celebrate the 100th anni- from yesteryear. organizers asked me to be the grand Watching the races is an exciting versary of racing in the Gold Cup on Once again, with the generosity marshal, because our company, time. Whether you bought a front- the Detroit River. There are few, if KEITH CRAIN of GM and the UAW, we will be able Crain Communications, is celebrat- row seat or simply enjoy watching any, races that have as much history Editor in chief to watch some of the most thrilling ing our 100th anniversary as well. from the shore, it’s another “must” as the Gold Cup and the city of De- boat races in the nation. And fol- Any way you look at it, 100 years event in the summer in Detroit. I troit. A century of Gold Cup racing years, and you quickly understand lowing the lead of the Belle Isle is quite an accomplishment, can’t wait. on the Detroit River is certainly the impact of this racing series and Grand Prix, admission on Friday whether it is Gold Cup racing or I sure wouldn't miss it. Celebrat- worth a huge celebration. All you Detroit’s contribution. will be free for all. publishing. ing the 100th anniversary of the have to do is take a look at the color- It would be equally important to Although some of us might miss We haven’t had the roar or the ex- Gold Cup and our company is go- ful history of the boats and the driv- pay tribute to all the brave souls the roar of World War II 16-cylinder citement that the races have, but I ing to be very exciting. ers who have participated over the who lost their lives participating in engines that have been replaced couldn’t help but notice that we I’ll see you there. CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 9 Evangelical Homes gets new name, property, foundation By Jay Greene Evangelical Homes earlier this the Daughters of Charity of St. Vin- tive building in which the children corporation. Articles of incorpora- [email protected] year acquired the 31-acre former cent de Paul, which founded the and families came to meet with the tion papers are expected to be filed After 137 years, Evangelical Homes site of the St. Vincent and Sarah center, $1 million for the property sister running the community.” shortly. By 2021, the foundation of Michigan has a new name, EHM Se- Fisher Center, at the northwest corner and has invested several hundred EHM plans to offer services in- aims to raise $12.5 million. nior Solutions, along with a signifi- of 12 Mile and Inkster roads, from St. thousand dollars to maintain it. cluding adult day programs; 354 in- Said Rabidoux: “We had charita- cant new building project in the John Providence Health System. The new Rabidoux said Evangelical dependent living, assisted living ble gifts coming in to the endow- works: the redevelopment of the St. St. Vincent and Sarah Fisher Center Homes had sought property in Oak- and memory loss clinic units; resi- ment fund, under $1,000, and most Vincent and Sarah Fisher Center site moved to Detroit in 2006. land County to expand services dential and family support services; were about $100. Some donors who in Farmington Hills. While the purchase price of the during the past eight years. Earlier and brownstone condominiums. believe in our mission feel more CEO and President Denise Rabi- property was not disclosed, Rabi- this year, it acquired the St. Joseph Royal Oak-based Fusco, Shaer & comfortable donating into a foun- doux said the Saline-based organi- doux said once the newly named Mercy Saline health building from St. Pappas Inc. is serving as the consult- dation.” zation wants it known that it offers a Sarah Fisher Senior Living Community Joseph Mercy Ann Arbor and now op- ing architects, with the senior living She said it is possible EHM will range of services to seniors and their is open sometime in 2020, pending erates a large senior center. campus market feasibility study add another 10 staffers to the four families, whether in their homes or city zoning and land use approvals, “There are 17 buildings on the completed by Plante Moran. employees already engaged in man- in facilities. new construction costs for the proj- historical site,” Rabidoux said. “We EHM also plans to create the aging the endowment fund. “In the 1970s, the only answer for ect could run about $40 million. are going to preserve three of them: Evangelical Homes of Michigan Foun- Jay Greene: (313) 446-0325 older adults was to stay at home un- In 2011, St. John Providence paid the gym, chapel and the administra- dation, a new Michigan nonprofit Twitter: @jaybgreene til you couldn’t manage anymore and then look at long-term care placement,” said Rabidoux. As part of the renaming, EHM is launching a two-year, $500,000 re- branding campaign. “We have an array of services no matter what your income is, rich or poor, or whether you are gay, lesbi- an or transvestite, whether it is mom “HOW DOES DTE ENERGY in a skilled nursing home or rehabil- itation facility, or dad or grandpa in home health, or your aunt with a KEEP NATURAL GAS SAFE?” telemonitoring provider, we are serving the entire family unit,” Rabi- doux said. “We are not really just nursing homes anymore.” Customer safety is our highest priority. That is why we take many precautions when Rabidoux also said EHM Senior Services will unveil an interactive delivering natural gas to over 1.2 million homes and businesses across the state. We inspect website in the next three months nearly 10,000 miles of pipeline each year using advanced technologies, and modernize about and has opened a toll-free line, which is (866) 734-1566. 100 miles of pipeline annually. We also add an ingredient that makes natural gas smell like “We hope to serve 10,000 older rotten eggs, making it easily identifiable in the case of a leak. adults in the near future.” If you smell natural gas or suspect a leak, do not use electronic devices or open flames, CultureSource, Crain’s leave the area immediately, and call DTE Energy at 800.947.5000 24 hours a day. to team for arts, cultural listings, preview section Crain’s Detroit Business and Cul- tureSource, the nonprofit member- ship organization for arts and cul- tural groups, have a new partnership. Crain’s will add CultureSource’s listings of arts and cultural events to crainsdetroit.com and will feature CultureSource listings on its “10 Things to Do” feature. And on Sept. 12, Crain’s will pub- lish a special section, a fall/winter “arts and culture preview.” Crain’s is offering nonprofit advertising rates exclusively to CultureSource mem- bers in that section and throughout the year. “This makes perfect sense to col- laborate,” said Crain’s Publisher Mary Kramer. Pam Iacobelli, president and CEO of CultureSource, said Culture- Source is “excited and proud to part- ner with Crain’s in this unique way and to help build awareness of the arts, culture and creative communi- ty for millions of readers.” For information, visit www.cul- turesource.org. For information about advertising opportunities in the Sept. 12 guide, contact Crain’s Advertising Director Matt Langan at [email protected]. For informa- tion about editorial coverage in the section, contact Editor Jennette Smith, at [email protected]. DBpageAD_DBpageAD.qxd 8/1/2016 11:58 AM Page 1

ADVERTISEMENT Bodega Bootcamp teaches business skills to Michigan’s startup grocers Michigan Good Food Fund grows healthy food access across the state. By Amy Haimerl

nside a small brick building in the to help these entrepreneurs build they were not alone. “Something ICorktown neighborhood of Detroit, their business acumen so they can that came out of the Bootcamp was a plan is hatching that will bring translate their ideas into success in the fact that there was a need for the building full circle and turn the the marketplace.” [this training] to exist,” says Foulkes. former Bagley Trumbull Market, The Bootcamp takes entrepreneurs www.MIGoodFoodFund.org which was more liquor store than through the nitty gritty of running market, into the Farmer’s Hand—a a store—from reading income year-round farmers market and café statements to predicting expenses offering fresh, healthy, and locally to properly pricing and determining grown food. profit margins. Co-founders Kiki Louya and Rohani “When I talk to nascent-stage Foulkes met earlier this year and entrepreneurs, they have this grand decided to team up. While they vision of what they want to do,” both had food industry experience, says Johnson-Piett. “The question is they lacked retail savvy, so it was whether or not your vision has been fortuitous when they heard about defined by the marketplace.” Bodega Bootcamp, a one-day crash course provided by the Michigan Malik Yakini is taking this question Good Food Fund. seriously. As the executive director of the Detroit Black Community The Fund had heard from a number Food Security Network, he is of startup grocers and wanted to working with the community help them accelerate their business to open the Detroit People’s planning because such enterprises Food Co-op in Detroit’s North fit with the Fund’s work providing End neighborhood to provide financing and business assistance a community-owned outpost of to good food enterprises in healthy food plus a gathering space Michigan. in an otherwise underserved area of The Fund brought in James the city. Johnson-Piett of Urbane Such expansive thinking tied with Development to host a Bodega alternative funding and ownership Bootcamp for five startups: The models makes Detroit unique. Farmer’s Hand, Chene Street Grocers, and Detroit People’s “Detroit has one of the best Food Co-op in Detroit, The Local infrastructures for support in this Grocer in Flint, and a new store in space,” says Johnson-Piett. Jackson supported by Bridgepoint Foulkes and Louya are counting Development. on that. The Bootcamp helped “Since the Fund launched, we’ve them develop their benchmarks for received a number of inquiries financial success, see where they from startup grocery projects will be able to connect with other committed to putting healthy food resources, and really understand at the center of their stores,” said their value proposition to the Oran Hesterman, CEO of Fair Food consumer. Network, a core Michigan Good But most importantly, they liked Food Fund partner. “Through the being in a room with other Bodega Bootcamp, we were able entrepreneurs and understanding CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 11

CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY

PHOTO BY JACOB LEWKOW / STYLING BY STEVE D’AGOSTINO OF TINO FRIENDLY FOODS AND GAYLE HALEBIAN LEWKOW / PIE BAKED BY ELLEN’S BAKERY AND CAFE From state to plate Michigan-grown fare  lls appetites of national food companies

By Sherri Welch Local growers “are typically real proud plies Meijer, Kroger and other major retailers [email protected] that they’ve been chosen to put a sign in with private-label and Eggland’s Best eggs, If you’ve ever driven on the back roads their fi eld ... that their wheat is destined for in both raw and hard-boiled form, said Greg near Frankenmuth, it’s no secret that wheat the Kellogg Co.,” he said. Herbruck, corporate vice president. farmers in the area are growing for Battle Traditionally, many national food com- It connected with McDonald’s through Creek-based Kellogg Co. panies haven’t disclosed where their prod- Minneapolis-based Cargill Inc., a global pro- It’s right there on signs posted among the ucts come from for competitive reasons, vider of food, agricultural, fi nancial and in- rows of grain. said Jim Byrum, president of the East Lan- dustrial products and services and one of Frankenmuth-based Star of the West Mill- sing-based Michigan Agri-Business Associa- the largest grain brokers in the world, he Coming Aug. 22 ing Co., which purchases wheat from farm- tion. “But we are now fi nding some of the said. At the Crain’s Food Summit, key players from ers and processes it into whole-grain and big companies want to identify, especially if As Cargill put together a deal to supply local companies will gather at Eastern fl our products for companies like Kellogg, they’re sourcing products locally.” eggs to McDonald’s about 20 years ago, Her- Market to discuss the state’s food puts up to 150 of the signs in the fi elds. Herbruck’s Poultry Ranch Inc., a 58-year- bruck’s sold it an egg processing plant in ecosystem. For more information, see Farmers in the state’s Saginaw Valley and old, family-owned and -operated farm in Lake Odessa to make egg products. And Page Thumb regions grow a soft white winter Saranac near Grand Rapids, is one of Herbruck’s remains one of the main suppli- 22. wheat that’s different from most other McDonald’s largest egg suppliers in the ers of eggs to that plant, Herbruck said. Inside this section wheats, said Michael Fassezke, vice presi- country. It supplies 94.2 million dozen eggs Eggs aren’t the only Michigan-grown  Garden Fresh Gourmet’s new owner dent of Star of the West’s fl our milling divi- to the chain each year, according to the products you’ll fi nd when you walk into launches expansion in Ferndale, Page 16 sion. “It is the wheat of choice for the cereal Michigan Department of Agriculture. McDonald’s. industry,” he said, with color and fl avor “Michigan eggs wind up in virtually every Peterson Farms Inc. in the village of Shelby  Detroit plots course on land use as leader more suited for whole-grain use. McMuffi n east of the Mississippi River and on the state’s far west side, was one of the in urban farming, Page 19 And Michigan is the only place growing it some beyond that,” Byrum said. pioneers of supplying apple slices to Mc-  10 steps to grow a food business, outside of Washington, Oregon and Idaho, Herbruck’s, the state’s largest egg produc- Donald’s, Byrum said, and a lot of its baked Page 23 Fassezke said. er and 12th-largest in the country, also sup- SEE GROWERS, PAGE 12 12 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016

CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY GROWERS FROM PAGE 11

goods are made with Michigan wheat flour. And Butterball Farms Inc. in Grand Rapids supplies the butter pats for your pancakes and biscuits at the chain’s restaurants. There’s a long list of additional commodities McDonald’s is sourc- ing from Michigan each year, ac- cording to the Department of Agri- culture: n 43.9 million pounds of soy- beans. n 42.2 million pounds of cucum- bers. n 25.9 million pounds of corn. n 19.2 million pounds of apples. n 8.4 million gallons of milk. n 4.5 million pounds of beef. n 2.8 million pounds of blueber- ries. n 2.4 million pounds of oats. Also in the mix are canola, cheese, JACOB LEWKOW cherries, chicken and onions. Pickling is big business in Michigan: In fact, virtually all of the fast-food chain sandwich pickles east of the Mississippi are made And that’s just McDonald’s. in the state. “If you look at all fast-food retail- ers, Michigan has a big piece in tries, are among the brands using those, certainly in the region and potatoes from the Great Lakes State. from here to the south and east,” Farmers in a number of areas — Byrum said. including the Thumb, the state’s If you buy a sandwich with pick- west side, south near Three Rivers les in virtually any fast-food chain and in the western Upper Peninsula east of the Mississippi — as well as — grow potatoes, said Jamie Zmit- some nationwide — those pickles ko-Somers, international marketing came from Michigan, he said. program manager for the Depart- The state’s pickling companies, ment of Agriculture. which can be found across the Low- Yogurt fans may be surprised to er Peninsula, include: Vlasic Pickles know Yoplait has been made in Co. in Imlay City, McClure’s Pickles in Reed City since 1975 after Otsego- Detroit, Mr. Chips Inc. in Pinconning, based Michigan Cottage Cheese Co. Swanson Pickle Co. in Ravenna near acquired the U.S. licensing rights to Muskegon and Hausbeck Pickle Co. make and market the French brand in Saginaw. in the U.S. STAR OF THE WEST MILLING CO. On the sweeter side of things, After two years of negotiations, A private farm along one of the back roads near Frankenmuth is among the Michigan Sugar Co., a grower-owned Minneapolis-based General Mills Inc. Michigan suppliers of wheat to Kellogg Co. sugar cooperative in Bay City, is the acquired the exclusive rights to third-largest beet sugar processor in market the brand in the U.S. in Oc- vate label ... for companies like Mei- them are processed in the state into the U.S., producing more than 1 bil- tober 1977 when it signed a fran- jer or Spartan,” she said. dried fruit or canned pie filling lion pounds of sugar, on average, chise agreement with Sociéte de Dif- Indian Summer Premium Apple made by Honee Bear Canning in Law- each year. Sold into both the whole- fusion de Marque, also known as Juice is also grown, harvested, pro- ton and Elk Rapids-based Burnette sale and retail markets under the Sodima, a cooperative of six dairy duced and packed in Ludington, Foods Inc. for sale under brands like Pioneer Sugar and Big Chief Sugar farmers in France. It also acquired and Chelsea Milling Co. in Chelsea Duncan Hines’ Comstock label. brands, its product is sourced by the Reed City yogurt plant from uses Michigan wheat to make its Jif- Burnette also processes mara- food companies around the coun- Michigan Cottage Cheese and con- fy Mix products, Zmitko-Somers schino cherries, applesauce and try, Byrum said, for use in every- tinues to make Yoplait there, as well said. juice, fruit cups, green beans, fresh thing from ice cream and dough- as at other U.S. plants. Gerber, which began making pumpkin, dry pack beans, potatoes, nuts to cereal and pies. Cooperative Elevator Co., a large baby food in Fremont in 1927 and asparagus, cherries and fried apples “There are a couple of other cooperative owned by farmers han- today operates as a division of Nes- for sale under various labels. northern sugar providers, but Mich- dling grains and beans in Pigeon, tle, sources a lot of Michigan-grown Last year, Seneca Foods Corp. igan is one of the largest,” he said. sells wheat to Mondelez Global LLC in products, she said. (NASDAQ: SENEA, SENEB) ac- Michigan is known as a potato Toledo, which makes Triscuits and There’s also FlatOut bread, pro- quired Gray & Co., the world’s lead- production state primarily for pota- other Nabisco products, Byrum said. duced in Saline and acquired by Co- ing provider of maraschino cherries to chips but also the bags of pota- On the dried bean front, Michi- lumbus, Ohio-based Lancaster Colo- and one of the largest providers of toes you can buy in grocery stores, gan supplies a lot of beans to Knox- ny Corp. last year, and Garden Fresh candied fruit from its plant in Hart. Byrum said. Frito-Lay North America ville-based Bush Brothers & Co. for Gourmet salsa, hummus, dips and “The major corporations and Inc. in Plano, Texas; Bay City-based its well-known Bush’s Best beans, chips, produced in Ferndale and ac- brands don’t necessarily want you Made Rite Potato Chip Co.; Better Zmitko-Somers said. quired last year by Campbell Soup to know that someone else makes Made Potato Chips Inc. and Uncle And much of the applesauce for Co. (NYSE: CPB), that are sold the product, but it’s Michigan prod- Ray’s Potato Chips in Detroit; and sale in stores is made from Michi- around the world. uct in a lot of the products (sold) na- Traverse City-based Great Lakes Po- gan apples, she said. “A lot of our Michigan produces about 75 per- tionally,” Zmitko-Somers said. tato Chip Co., which sells into both companies produce stuff here, like cent of the country’s tart cherries, Sherri Welch: (313) 446-1694 the retail and food services indus- apple sauce, that is sold under pri Zmitko-Somers said. Nearly all of Twitter: @sherriwelch

“It’s Michigan product in a “If you look at all fast-food lot of the products (sold) retailers, Michigan has a big nationally.” piece in those.”

Jamie Zmitko-Somers, Jim Byrum, Department of Agriculture Michigan Agri-Business Association CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 13 CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY Eastern Market looks to be 5 times bigger by ’25

By Sherri Welch ing on a $5.5 million budget for fis- purchase and redevelop the vacant [email protected] cal 2017, is investing just over building. Eastern Market, already the larg- $150,000 in the various studies, with Under the terms of the purchase est historic public market district in support from the state of Michigan, order, the developer buying the the country, is looking to expand its the New Economy Initiative and the building would earmark 15,000 footprint to more than five times its Fred A. and Barbara M. Erb Family square feet of space that Eastern current size, roughly 250 acres, by Foundation. The John S. and James L. Market can turn into an accelerator 2025. Knight Foundation and Kresge Foun- for second-stage food processors. The growth is needed, Eastern dation are also providing support for Eastern Market will also work Market believes, to give food distrib- the larger plan. with the developer to identify busi- utors and processors a place to As the studies are completed, the nesses that could work in the move into modern facilities as new market is in the process of creating a 100,000-square-foot, high-ceiling federal safe food handling require- nonprofit development entity with building. ments are phased in. its own board comprised of proper- The old building could be multi- Eastern Market Corp., the non- ty developers and community resi- tenant, with space for food process- profit overseeing the Detroit market dents. That entity will seek a ing and/or food distribution, retail JACOB LEWKOW district, envisions shared infrastruc- for-profit developer to team up with and one or more restaurants, DiBer- Eastern Market wants to expand to meet the rising demand from retailers, ture that could help draw new restaurants and others interested in moving into the market. the market on the innovation zone. nardo said, given its proximity to the companies and re-purpose the old The redevelopment of the old Dequindre Cut and the central area buildings that food companies va- east side of I-75 in Eastern Market at ings that food processors and distrib- Detroit Water Board building in of Eastern Market. cate to help meet rising demand a site fronting Russell Street and in utors currently occupy in Eastern Eastern Market just east of Roma “Once you start something like from retailers, restaurants, enter- Shed 4 where upper lofts are envi- Market could turn to new uses such Cafe at Erskine and Orleans streets this, (the larger plan) is then believ- tainment venues and others looking sioned. as retail, restaurants and entertain- is the first step in Eastern Market’s able and real,” DiBernardo said. to come into the market. The Choice Neighborhoods proj- ment venues such as wineries and 2025 strategy, DiBernardo said. “This building becomes a viable “If we don’t take advantage of this ect doesn’t overlap any of the 200 or breweries, DiBernardo said. The city and Eastern Market are part of the Eastern Market district, opportunity, how many more times so acres of land Eastern Market Moving the truck traffic inherent talking with two developers who and then we start moving on to the in our lifetime will we have the abil- hopes to acquire or jointly develop to a working food district to the pe- went through the bidding process to next steps.” ity to take advantage of the vacant in its bid to expand the district, rimeter of the district could help alle- land?” said Mike DiBernardo, East- DiBernardo said. viate concerns about the mixture of ern Market’s director of food inno- The current 43-acre Eastern Mar- foot traffic and truck traffic, he said. vation programs. ket district is bounded roughly by The area targeted for what East- The food industry wasn’t really on Mack Avenue to the north, I-75 to ern Market has dubbed its food in- the city’s radar initially, he said. But the west, St. Aubin Street to the east novation zone is a mix of property Eastern Market’s 2025 strategic plan and Gratiot Avenue to the south. owned by the city, the Detroit Land formally released in April “helped Eastern Market hopes to expand Bank and private owners. The market bring the food industry to the fore- north of its current boundaries. estimates roughly a third of it is held A Fee-Only Wealth Management Group front, showing there is opportunity.” The market’s expansion vision is by private interests, DiBernardo said. As the market awaits completion the centerpiece of its 2025 strategic Eight produce companies run the of studies it commissioned to look at plan. New federal food require- 300,000-square-foot Detroit Produce land acquisition and use and con- ments being phased in as part of the Terminal, located on 26 acres on structing a new wholesale produce 2011 Food Safety Modernization Act West Fort Street, roughly eight miles Michigan’s #1 Financial Advisor terminal, the city has begun its own require temperature controls for from Eastern Market. study on the prospects for food as an produce. Food handlers in the mar- The terminal would need to economic development strategy, es- ket will either need to do costly up- spend $15 million just to meet the pecially around Eastern Market, dates or move to modern sites, new federal requirements, and in DiBernardo said. DiBernardo said. the end would still have a “1925 fa- The Boston Consulting Group in About 30 food companies are in- cility that isn’t energy efficient and is &KDUOHV&=KDQJ Troy is working with the city of De- terested in locating in the new food terrible with regard to material lo- &)3Š0%$06)6&K)&&/8 troit, pro bono, to help develop a innovation zone, he said. gistics,” Eastern Market President 0DQDJLQJ3DUWQHU cluster-based approach to econom- A second driver of the market’s ex- Dan Carmody said in December ic development in the city, with food pansion plans is demand from a when Crain’s first reported on the 2QHRIWKH1DWLRQ熎V7RS1$3)$5HJLVWHUHG development a key piece of that number of businesses looking to market’s expansion plans. )HH2QO\)LQDQFLDO$GYLVRUV strategy, he said. move into the market. The old build- Eastern Market, which is operat- “Working with BCG ensures that we are all on the same page about how to best achieve our goals,” Jed Howbert, executive director, jobs &DUHHU2SSRUWXQLW\ and economic development for the city, said in an email. Eastern Market is developing the We Uphold a Fiduciary Standard plan to expand the district as retail %XVLQHVV&RDFK and residential redevelopment on 6XFFHVVIXO0DUNHWLQJ6WUDWHJLVWORRNLQJWRIRUPD 犇犆犇:HVW%LJ%HDYHU5RDG the west side of I-75, and to a lesser SDUWQHUVKLSZLWKDVPDOOEXVLQHVVFRDFKFRQVXOWDQW degree within the market itself, 犇犊WK)ORRU draws nearer. ,¶YHGHYHORSHGDSURFHVVZKHUH,FDQILQGPRUHWKDQ The city in June applied for up to IRU$1<VPDOOEXVLQHVVRZQHU«DQGGRVRLQOHVVWKDQPLQXWHV 7UR\0,犊犎犆犎犊 $30 million in federal financing , YHEHHQRIIHULQJWKLVVHUYLFHWRVPDOOEXVLQHVVRZQHUVDQGLW V 犈犊犎 犌犎犍犇犈犋犎RU 犎犎犎 犍犍犍犆犇犈犌 through the U.S. Department of UHVXOWLQJLQPRUHEXVLQHVVWKDQ,FDQSRVVLEO\KDQGOH Housing and Urban Development’s Choice Neighborhoods Program to ,I\RX¶UHDQH[SHULHQFHGEXVLQHVVFRDFK put toward an approximately RU\RX¶UHLQWHUHVWHGLQEHFRPLQJRQHDQG $300 million project expected to \RXKDYHDVROLGEXVLQHVVEDFNJURXQG, www.zhang nancial.com bring more than 1,000 new housing ZRXOGOLNHWRVSHDNZLWK\RX units and tens of thousands of :LOOLQJWRWUDLQWKH³5LJKW&DQGLGDWH´LI $VVHWVXQGHUFXVWRG\RI/3/)LQDQFLDODQG7'$PHULWUDGH square feet of retail space to Brush Park and Eastern Market. \RXKDYHZKDWLWWDNHV $VUHSRUWHGLQ%DUURQ犑V0DUFK犋犈犆犇犌5DQNLQJVEDVHGRQDVVHWVXQGHUPDQDJHPHQWUHYHQXH JHQHUDWHGIRUWKHDGYLVRUV犑ILUPVTXDOLW\RISUDFWLFHVDQGRWKHUIDFWRUV $VUHSRUWHGLQ New mixed-income housing %DUURQ犑V$XJXVW犈犊犈犆犇犋7KHUDQNLQJUHIOHFWVWKHYROXPHRIDVVHWVRYHUVHHQE\WKHDGYLVRUV would be focused on about 25 acres )RUPRUHLQIRUPDWLRQ DQGWKHLUWHDPVUHYHQXHVJHQHUDWHGIRUWKHILUPVDQGWKHTXDOLW\RIWKHDGYLVRUV犑SUDFWLFHV 1$3)$5HJLVWHUHGVWDWXVUHSRUWHGDVRI6HSWHPEHU犇犎犈犆犇犋RQZZZQDSIDRUJ on the site of the former Brew- HPDLOFKXFN#.H\V%XVLQHVVFRP ster-Douglass projects on the west 0LQLPXPLQYHVWPHQWUHTXLUHPHQW犇犆犆犆犆犆犆  side of I-75 in Brush Park and on the RUFDOO 14 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY their customers,” she said. Brown recently was in her SUV Food hubs create buzz in state’s distribution system driving to meet with farmer part- ners in Imlay City to pick up spinach By Marti Benedetti Michigan-based food, said Rich Pi- and green tomatoes requested by a [email protected] rog, director of Michigan State Univer- Detroit chef. Having face-to-face Ever wonder how those plump, sity Center for Regional Food Systems contact is how she develops rela- sweet Michigan blueberries or per- in East Lansing. On average, a food tionships with Michigan farmers. fect heads of lettuce get to the pro- hub employs about 20 people, six full Some chefs and entrepreneurs duce department of your neighbor- time and 14 part time. There are oth- show up at Eastern Market between hood grocery store? There’s a good er distributors that carry local and midnight and 4 a.m. to get the pro- chance food hub employees picked Michigan foods, but they also source duce they need so distribution can up the berries from a local farmer and globally. Food hubs focus on food go either way. distributed them to your market. from local and regional sources. She said customers also include Food hubs are a fairly new cre- Hubs tend to be an even mix of grocery stores, school systems and ation, and no two are alike. But they for profit or nonprofit. Seventy-five colleges such as Schoolcra„ College are catching on, and new ones are percent of the hubs are breaking in Livonia for their culinary classes. cropping up throughout the state. even or better. In 2015, 113 food “The average food travels 1,500 The hubs — businesses that hubs in the United States reported miles to its destination,” Brown manage the gathering and distribu- gross revenue more than $370 mil- said. “Our goal is to change that to tion of food products whose origins lion, according to the 2015 National 50 to 100 miles.” are clear — are receiving increased Food Hub Survey, a collaboration of Besides Eastern Market’s Grow attention from diverse stakeholders MSU’s Center for Regional Food Eastern Market, the largest food hub who see them as the road to eco- Systems and The Wallace Center at in the state is Cherry Capital Foods in nomic growth and social and envi- Winrock International. Traverse City. Evan Smith, executive ronmental change. The benefits of hubs include director of policy and outreach at They do that by connecting the fresher food for consumers and an Cherry Capital, said the structure distribution dots between farmers, avenue for farmers to grow their and organization of food hubs vary. often small operations that big dis- businesses and keep future genera- For-profit Cherry Capital operates tributors wouldn’t do business with, tions of farmers employed. The av- JACOB LEWKOW primarily as a distribution market and the wholesale and retail cus- erage age of farmers in the state and Food hubs connect the dots between farmers and the wholesale and retail customers looking for locally grown food. with 16 refrigeration vehicles that tomers looking for locally grown nationally is 58, said Lynne Brown, transport food from Michigan farm- food. In the process, they often em- program launch specialist and gen- Brown said the for-profit food months to launch and derives its farms and fostering relationships. ers to customers such as Kroger, brace a social mission to bring fresh eral manager of food hub Grow East- hub that is part of nonprofit Eastern products from 30 farms within 125 She also is in touch with local restau- Whole Foods, Tom’s, restaurants, hos- food to underserved areas. ern Market in Detroit. So there’s a Market started in May. It was set up miles of Eastern Market. rant chefs, who make specific re- pitals, colleges and other institu- The early hubs started in 2008, but potential crisis if these farmers for profit so when it starts making “We have a lot of meetings quests for items she delivers. tions. the movement really took off in 2011. reach a certain age and close their money in two to three years it can throughout the year to get farmers “About 50 percent of farmers While its primary locale in Tra- Now there are eight that focus on farms. “We want to grow a stable give dividends back to farms. and buyers together,” said Brown, bring their goods to Eastern Market, verse City is in a former hockey are- gathering and distributing local and food system.” Grow Eastern Market took 14-16 whose job involves going to the and the other half take produce for na, it shares warehouse space in

Alzheimer’s is an epidemic devastating our families, our THE END OF finances and our future. The disease is all around us — but the power to stop it is within us. Join us for the ALZHEIMER’S Alzheimer’s Association Walk to End Alzheimer’s® and be inspired by all the footsteps that fall into place behind STARTS WITH yours. Together, we can end Alzheimer’s. YOU START A TEAM. alz.org/walk 800.272.3900 This ad brought to you by: HEALTHY FOOD OCTOBER 9 | ANN ARBOR FOR ALL ONE OF 23 WALKS IN MICHIGAN. OTHER NEARBY WALKS: Detroit’s food ecosystem is a model for communities The W.K. Kellogg Foundation supports a food BRIGHTON AND DETROIT | OCTOBER 1 across Michigan to strengthen their “value chain” of system that provides better access to healthy foods, local food systems: addresses the impact of poverty and inequity on + From seed to table; health, education and the economy for all children, + Through sustainable production, farmers markets, families and communities. institutional procurement and cooperatives; + Fair treatment of farmers; and + Investment in local economies. CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 15 CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY their customers,” she said. Okemos, which delivers food south cery chains. “And we’re working hard fessionally by programs such as the Brown recently was in her SUV of Lansing. It controls Earthy De- to develop our own brand,” she said. one at the University of Vermont. So far, Food hubs create buzz in state’s distribution system driving to meet with farmer part- lights, an import/export business, Harvest Michigan operates with those who attended said they ners in Imlay City to pick up spinach there as well. five to seven employees and a few learned a lot. Food hub employees and green tomatoes requested by a The Traverse City warehouse is volunteers. are working in a relatively new pro- Detroit chef. Having face-to-face vast — 60,000 square feet, Smith fession, which requires a unique set contact is how she develops rela- said. Cherry Capital took the old Food hub challenges of skills. Those include professional tionships with Michigan farmers. arena locker rooms and re-pur- Food hubs have their challenges. logistics and distribution, warehous- Some chefs and entrepreneurs posed them into rentable food units Smith said he worries about the en- ing acumen, food marketing and Vicki and Tom Zilke: Pleased with show up at Eastern Market between with refrigeration. Fledgling busi- forcement of food safety regulations, sales, food processing, food retail, what hubs provide to their farm. midnight and 4 a.m. to get the pro- nesses can set up shop there to getting people to think about what management, and strategic plan- duce they need so distribution can launch new products. they eat, investing in state roads to ning. Food hub managers also need hubs work to improve human go either way. Smith said the trucks, which improve transportation for food-de- to learn the ropes of safety certifica- health in their communities or re- She said customers also include Cherry Capital routes around the livery vehicles, and dealing with tion, auditing procedures, personnel gion as part of daily operations and grocery stores, school systems and state, pick up produce from farms, growth issues. management and post-harvest han- programs, according to the 2015 colleges such as Schoolcra College meat from food processors and “We would like to see more meat dling of fresh produce. National Food Hub Survey. in Livonia for their culinary classes. jams and salsas from producers and processing in the state,” Smith said. “There’s a fine balance in making Vicki and her husband have “The average food travels 1,500 bring them to its two facilities, “We produced a million hogs in ends meet,” Gerencer said. “We are made farming a second career. She miles to its destination,” Brown where it distributes the products all Michigan, and they went to Iowa for asking our food hubs to do a lot. We was a nurse practitioner; he was a said. “Our goal is to change that to over the state. processing.” help them to meet the need of food landscaper. “I’m certainly a farmer, 50 to 100 miles.” Cherry Capital has 65 employees Clemens Food Group in Pennsylva- access to low income communities but also an advocate of healthy food Besides Eastern Market’s Grow in both facilities. Impressive, Smith nia is building a pork processing — it’s a different model.” for all,” she said. On 27 acres near Eastern Market, the largest food hub said, because it had five employees plant in Coldwater Township. The 2015 National Food Survey where Washtenaw and Monroe in the state is Cherry Capital Foods in eight years ago. Sales have grown 45 According to Marty Gerencer, reported that “food hubs have addi- counties meet, the couple grow Traverse City. Evan Smith, executive percent in five to six years, and he principal of Morse Marketing Connec- tional financial challenges that come sweet corn, tomatoes, kale, lettuce, director of policy and outreach at projected $7 million in sales this year. tions LLC, a Norton Shores-based from embracing environmental and and other vegetables. They also op- Cherry Capital, said the structure Yvette Berman, CEO of for-profit food systems consulting business, social missions...managing grant erate a farm stand. and organization of food hubs vary. Harvest Michigan in Pontiac, is one of the challenge is how long it takes to and donation revenue, and ensuring Zilke Vegetable Farm has 15 to 18 For-profit Cherry Capital operates the smaller hubs but also one of the connect small growers to new mar- that people, animals and the envi- full- and part-time employees. Vicki JACOB LEWKOW primarily as a distribution market oldest. It started in 2008 as a busi- kets. “How do we help food deserts?” ronment are not exploited in the favors giving jobs to local teens who, Food hubs connect the dots between farmers and the wholesale and retail customers looking for locally grown food. with 16 refrigeration vehicles that ness-to-business hub, but since 2014 MSU’s Pirog said the interest in lo- business process.” in turn, learn about healthy food. She transport food from Michigan farm- has been a hybrid hub serving both cal food has sharply increased in the relies on food hubs such as Grow Farmers mesh with hubs farms and fostering relationships. ers to customers such as Kroger, business-to-business and business- last 20 years. “Food hubs that Eastern Market to assist them in She also is in touch with local restau- Whole Foods, Tom’s, restaurants, hos- to-end users. emerged out of the local food move- Vicki and Tom Zilke, owners of Zil- growing their business. rant chefs, who make specific re- pitals, colleges and other institu- Its plan is to develop a product ment are gaining in popularity,” he ke Vegetable Farm in Milan, are pleased “Food hubs solve (the concern) quests for items she delivers. tions. package containing staples such as said. Simultaneously, he sees a de- with what the hubs provide. The mis- that you will have enough purchas- “About 50 percent of farmers While its primary locale in Tra- cucumbers, green beans and carrots cline in CSAsand farmers markets. sion of food hubs meshes with Vicki’s ers even if you have 500 pounds of bring their goods to Eastern Market, verse City is in a former hockey are- for sale through Community Sup- Pirog said food hub managers are philosophy of food justice. food,” thereby eliminating food and the other half take produce for na, it shares warehouse space in ported Agriculture (CSA) sites or gro- now being certified and trained pro- More than 95 percent of food waste, Tom Zilke said.

Alzheimer’s is an epidemic devastating our families, our THE END OF finances and our future. The disease is all around us — but the power to stop it is within us. Join us for the ALZHEIMER’S Alzheimer’s Association Walk to End Alzheimer’s® and be inspired by all the footsteps that fall into place behind STARTS WITH yours. Together, we can end Alzheimer’s. YOU START A TEAM. alz.org/walk 800.272.3900 This ad brought to you by: HEALTHY FOOD OCTOBER 9 | ANN ARBOR FOR ALL ONE OF 23 WALKS IN MICHIGAN. OTHER NEARBY WALKS: Detroit’s food ecosystem is a model for communities The W.K. Kellogg Foundation supports a food BRIGHTON AND DETROIT | OCTOBER 1 across Michigan to strengthen their “value chain” of system that provides better access to healthy foods, local food systems: addresses the impact of poverty and inequity on + From seed to table; health, education and the economy for all children, + Through sustainable production, farmers markets, families and communities. institutional procurement and cooperatives; + Fair treatment of farmers; and + Investment in local economies. 16 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY Campbell launches expansion, new products at Garden Fresh

By Sherri Welch But to ensure Garden Fresh Salsa going to be big.’ And it looks like he [email protected] is made the same way 20 years from was right again.” Just over a year after acquiring now, Campbell videotaped Garden Aronson also wanted to intro- Garden Fresh Gourmet in Ferndale, Fresh co-founder Jack Aronson duce a green salsa with avocado, Campbell Soup Co. (NYSE: CPB) is making it, Putman said. Putman said, adding that keeping launching the first phase of invest- Operating as part of the C-Fresh avocado from browning over time is ment on the Garden Fresh campus platform has enabled Garden Fresh hard. But the Garden Fresh team with a $7 million expansion. to launch a number of new prod- figured it out and introduced that Construction of a 20,000-square- ucts. A year ago, Garden Fresh had version in May in Michigan and in foot addition to what was originally just three organic products, said Wal-Mart on the West Coast. So far, the hummus plant could begin as Regan Phillips, head of communi- it’s selling better than red medium early as this week, according to cations and public relations for the and mild of Jack’s Special. Ferndale officials. C-Fresh division. “Whenever we do research on the To make room for the addition, Since then, it’s launched 15 new brand, we do a wave in Detroit/Fern- Campbell demolished the former organic Garden Fresh products, dale and a wave in Chicago, Kansas Detroit Gear & Spline Co. building at along with 12 new conventional City or the West Coast,” Putman 1515 Bonner St. in early July. It had hummus and salsa products. At said. “That enables us to see what been using the building as a mainte- the same time, its increasing its our heartland market is saying and nance site, said Todd Putman, gen- market penetration by leveraging what our new markets are saying.” eral manager of Garden Fresh, the C-Fresh division’s reach, sup- To build on the support Garden which operates as part of Camp- LARRY PEPLIN ply and distribution network, Phil- Fresh Gourmet founders Jack and bell’s C-Fresh division. Garden Fresh co-founder Jack Aronson has agreed to stay on as consultant to the lips said. Annette Aronson have been given in He expects the addition, which operations for another year. “Jack really wanted us to push Ferndale and other parts of metro will bring the building to nearly stronger into organic salsa and Detroit, the company’s new owner 72,000 square feet, to take six to nine crease quality and inventory man- capacity to be able to grow the hummus,” Putman said, and the in April launched Campbell’s months to complete. It will provide agement capabilities. brand out of Ferndale,” Putman company has done that by intro- Healthy Communities Metro De- space for expanded storage and, The project is the first phase of a said. ducing new snack packs of hum- troit, a program that focuses on with the addition of new equip- $20 million investment in the Fern- Even so, Garden Fresh is not mus as well as larger size organic public-private collaboration to im- ment, increased capacity to pro- dale operation, something Garden about efficiencies, he said. “It’s salsa and hummus, such as an or- prove the health of young people in duce Garden Fresh salsa, hummus Fresh pledged as part of its $231 mil- about an artisanal product that will ganic version of Jack’s Special salsa its home communities. and dips. lion purchase of the company and always be made in small batches.” as well as the conventional version. Led by the Aronsons’ daughter As part of the initial investment, its commitment to keeping its oper- There are other ways to gain effi- “We took conventional salsa, Melanie Mena as director of com- Campbell has upgraded the Wi-Fi ations in Michigan. ciencies, like putting salsa on the back hummus flavors and created organ- munity engagement for C-Fresh, in the Garden Fresh buildings, Put- “We very much intend to live and of a truck with carrots and bringing ic sisters or brothers. It’s very much the program is focused on increas- man said. And it’s in the process of thrive in Ferndale. We’re making in- Campbell’s buying power to bear for on trend,” he said. ing access to affordable, healthy adopting a new IT system to in- vestments ... in our capability and things like computers, he said. “Jack said, ‘I think organics are food; increasing nutrition and health education; and engaging the public to help create and sustain a healthy community. The couple’s son, Trevor Aronson, also remains director of operations for Garden Fresh. And Jack Aronson himself has 105 agreed to stay on for another year as a consultant. “We find that as we expand ... to the West Coast and Texas ... the story and product of Jack and Annette 145 and what they created is resonating with new customers,” Putman said. E N G I Garden Fresh Gourmet’s founders S N E E R 60 E R S will always be on the packaging, and

N  they and the small Ferndale restau- I G S E rant where it all began will always be

D part of the back story, he said.

 The new products launched un- 

 der Campbell’s ownership “were an  

 extension of what we were working 

 INSPIRING  on,” Aronson said.





 “Their team has brought those to   RESULTS  the market. And they include me on a    lot of these products, which has been    fun. ... I’m extremely satisfied with what they’ve done in the last year.” S C Campbell promised a lot when it I E N bought Garden Fresh, he said. T I S “Denise Morrison (president and T S CEO of Campbell) told me they’d keep the plant in Ferndale ... retain the workforce. You don’t put some- thing like that in writing. We trusted her.” Since then, Campbell has given Garden Fresh workers two raises, bet- ter insurance and an extra 15-minute break every day, Aronson said. “They have done so much since ),6+%(&.7+203621&$55 +8%(5,1& they bought the place. ... They HQJLQHHUV_VFLHQWLVWV_DUFKLWHFWV_FRQVWUXFWRUV promised a lot, and they’ve over-de- 1RYL_0DFRPE__IWFKFRP livered.” Sherri Welch: (313) 446-1694 Twitter: @sherriwelch DBpageAD_DBpageAD.qxd 8/2/2016 3:47 PM Page 1

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Find us at: nationalfoodgroup.com 800-866-6866 18 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY MSU’s new food processing center to aid second-stage biz

By Sherri Welch them, “you don’t control the process and packaged, with sophisticated [email protected] … because you’re not allowed on temperature controls to keep the The Michigan State University the floor,” Birbeck said. room clean of pathogens and al- Product Center hopes to break By leasing space at the food prod- lergens, Birbeck said. ground this fall on a new processing uct innovation center, food compa- “We’ve catered the center to 80 center that will allow second-stage nies basically own the facility for the percent of the needs of the food pro- food companies to test new prod- time they have leased it. cessing industry ... within Michigan, ucts and markets before making siz- “The idea is that once you’ve the Great Lakes region and beyond,” able investments. proved your (product) is success- he said. As planned, the $8 million Food ful in the marketplace, you go Leasing costs for the center are Processing and Innovation Center back to your facility with all the projected to be $3,000-$6,000 per will meet all state and federal knowledge and a list of the equip- day, depending on which equip- food-processing requirements and MICHIGAN STATE UNIVERSITY PRODUCT CENTER ment you’ll need” to move for- ment is being used, Birbeck said. licensing to let companies lease ca- Michigan State University Product Center plans to convert an existing building on ward, Birbeck said. Launched 13 years ago, the MSU pacity and sell products made at the the university’s campus into a food processing center. The MSU Product Center had Product Center has traditionally fo- center. letters of intent from 10 Michigan cused on assisting food entrepre- The center is destined for an condundrum often facing food Rapids-based architectural and en- companies as of late July, with neurs, providing them with consul- MSU-owned companies that want to grow, Bir- gineering firm, was the designer of commitments to lease the facility tation on everything from supply building in a beck said. “Do you expand your ex- the new center. Birbeck said the for a collective minimum of 221 chain to label design and helping business park isting line or open a new store or contractor chosen for the project days over the first two years, Bir- connect them with distributors and south of the uni- take a risk and move to a new prod- won’t be announced publicly until beck said. retailers. versity’s East uct? You really have to think careful- the final funding is approved. The center will include two large Its efforts have always been Lansing cam- ly about how you’re going to spend MSU believes the center will be pieces of equipment: a spiral freezer around stage-one food companies, pus, pending fi- your money.” the only fully licensed, food-pro- to cool food quickly at very low tem- defined by Birbeck as “a client flying nal approvals for The new processing center will cessing facility of its kind tied to a peratures, and a retort, which cooks by the seat of their pants ... someone an additional be available for a company to use U.S. university, Birbeck said. The prepackaged products in jars or who is just getting up and running, $1.6 million for three or seven days or however MSU Product Center team worked pouches at precise temperatures. in proof of concept, the smallest needed for the Matthew long it needs, he said. with MSU food scientists and pack- It will also include multiple echelon of business doing farmers project from Birbeck: Center Renovations to turn an existing aging experts and regulatory repre- standard pieces of equipment to markets and things like that.” university trust- will help food building into a state-of-the-art food sentatives from the Michigan Depart- process everything from meat to When the recession hit, the MSU ees at their Sep- companies grow. processing center can start as soon ment of Agriculture and Rural seafood to bakery items, along Product Center found that sec- tember meet- as the funding is approved, Birbeck Development and the U.S. Department with packaging lines and a state- ond-stage businesses with five to 50 ing, said Matthew Birbeck, senior said, with an expected opening in of Agriculture to ensure the facility of-the-art ready-to-eat room, a employees and $5 million to $50 project director of the food process- the late spring or early summer next will meet all standards and compli- chilled, designated clean area million in business were hurting ing center. year. ance for a modern facility. where foods that are ready-to-eat just as much as the startups, Birbeck The center is intended to solve a Dan Vos Construction, a Grand There are co-packers, but with (like sandwiches) can be made said. The product center launched its Advanced Growth Services work four years ago to assist second-stage food companies. Feedback from those companies “helped us to understand these new businesses had nowhere to go in or- der to mitigate risk while accelerat- ing expansion, Birbeck said. Among them was Honor-based Food for Thought Inc., which makes Real Estate Litigation Experience shelf-stable organic and conven- tional products such as preserves, ® salsas, dressings and mustards un- der the Food for Thought and Esch In Your Corner. Road brands. The 21-year-old com- pany is located not far from Sleep- Ŷ Real estate litigation in state and federal ing Bear Dunes National Lakeshore, courts, landlord-tenant and lease disputes employs about 20 and has $1 mil- lion to $3 million in annual revenue, Ŷ Construction lien and quiet title matters. said Gregory Young, partner and CEO. MSU’s new Food Processing In- novation Center will enable Food for Thought to test new products with new technology before it in- vests in either. “This proof of con- cept capability is something that we continue to struggle with. (It) inhib- its our speed and ability to grow into additional products and technolo- gies,” Young said. It will also enable the company to define standardized processes, quality verification standards, work- flow and final layouts before it makes investments, while benefit- ing from the expertise of the MSU Product Center, Young said. “In addition, the early product we get from running at the FPIC gives us a chance to further test the mar- First Tier Ranking ket farther upstream in the develop- Real Estate Law ment process than we might nor- mally be able to do.” Contact Brad Defoe at [email protected] Ŷ Detroit Ŷ Novi Ŷ Grand Rapids Ŷ Kalamazoo Ŷ Grand Haven Ŷ Lansing Ŷ Ann Arbor Ŷ Hastings Sherri Welch: (313) 446-1694 Twitter: @sherriwelch CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 19 CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY

mined whether a percentage of land side plans to turn 22 blocks, or a will be dedicated to agriculture. 105-acre footprint, into a center for “The city is looking at proposals urban agriculture with employment Growing pains on a case-by-case basis and within for ex-offenders, recovering addicts the context of the area in which the and others with barriers to employ- Detroit plots course on land use project is proposed. Local advocates ment. Forty of the acres are city- of urban farming and urban farmers owned, said Gary Wozniak, presi- as leader in urban farming have identified 3 to 5 acres as opti- dent and CEO of RecoveryPark, a mal size for a larger-scale urban nonprofit that owns RecoveryPark By Marti Benedetti Planning and Development, said in an farm,” Cox said. Farms. Construction of the project [email protected] email that currently there is not a is expected to start this summer. “Here, try this,” said Detroit farm- map specifying where farms should RecoveryPark Farms Of the 105 acres, 20 percent is in- er Greg Willerer, plucking a sprig of be. “The ag ordinance does not des- For-profit RecoveryPark Farms is frastructure such as roads, side- Osaka purple mustard from the acre ignate a specific zoning category for an example of how to turn a former- walks and parking areas; 40 percent of land he farms in the city’s north indoor and outdoor agriculture, but ly urban area over to farming, Fahle is city land; and 40 percent is private Corktown neighborhood. allows some form in most zoning said. land that the project hopes to ac- MARTI BENEDETTI Willerer, owner of Brother Nature districts,” he said. The $30 million capital invest- quire over the next five years. Wendy Casey is internship coordinator Produce, is one of dozens of Detroit He said the city has not yet deter- ment project on Detroit’s lower east SEE URBAN, PAGE 20 of D-Town Farm in Detroit. farmers trying to carve a living. Greens like this, and other boutique produce such as tangy sorrel and baby Chinese cabbage, are cropping up in gardens and farms all around Detroit. City farmers are growing more exotic greens and herbs to meet the demands of residents and the city’s trendy restaurants. Willerer sells his produce at the Eastern Market on Saturday mornings and by filling orders for customers such as Brooklyn Street Local, C ra  Work and St. CeCe’s. He relies on cof- fee grounds and other biodegrad- able waste from local restaurants to add to the compost piles that are scattered around the land where he owns two houses and their side lots. He is farming on additional lots on the block and would like to buy them, but, he said, the Detroit Land Bank Authority won’t return his calls. Willerer and other farmers are ea- ger to expand land ownership in a city that is a national leader in urban farming. But city planners don’t have green thumbs when it comes to figuring out how much of the va- cant land should be farmed and how much preserved for other uses. Tyson Gersh, co-founder of the Michigan Urban Farming Initiative in the city’s north end, is another frus- trated farmer. “I’ve had quite a few dealings with the land bank, and none of them are positive.” When your business grows, Gersh said his farm is made up of 30 parcels, or about 1.5 acres. He has acquired half of it. The Detroit Land your expectations should, too. Bank Authority won’t sell him the other parcels. “We’ve invested (thousands of) volunteer hours here,” he said. Experience a higher level of cash management Craig Fahle, spokesperson for the city’s land bank, said it is aware that with the leading bank for business.* people in the city are farming on Your business is growing, but so is the complexity. At your stage of growth, you need a land that is not theirs. financial partner who can help you streamline your systems and maximize your opportunities. “The land bank is happy to help people rejuvenate their neighbor- Comerica Bank’s dedicated Business Advisors and comprehensive cash management tools hoods,” as long as they work with go beyond payables and receivables to help you manage and grow your business. the city, he said. It sells land through its side-lot program, its nonprofit For more info, visit Comerica.com/cash today or call 888.341.6490, and Community Partner Program and Raise Your Expectations of what business banking can be. to faith-based organizations. Among the projects it has partnered with are Eden Gardens’ community garden and education project, Ma- trix Human Services’ outdoor learning center, Wolverine Human Services’ or- chard and garden project, and Young Nation’s urban art project. ® If someone wants to buy 10 or MEMBER FDIC. EQUAL OPPORTUNITY LENDER. RAISE YOUR EXPECTATIONS. more lots of city land, the Detroit *Comerica ranks first nationally among the top 25 U.S. financial holding companies, based on commercial and City Council needs to approve it, Fah- industrial loans outstanding as a percentage of assets, as of December 31, 2015. Data provided by SNL Financial. CBP-6105-04 06/16 le added. Maurice Cox, director of Detroit 20 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016

CRAIN’S MICHIGAN BUSINESS: RETAIL REPORT

contracted to transport the pro- LARRY PEPLIN URBAN Greg Willerer, owner of Brother FROM PAGE 19 duce. The goal will be to get food delivered in 24 to 48 hours, when it Nature Produce, harvests some Scattered throughout on the park is freshest. leafy greens for a local restaurant. site are fewer than 30 houses and “Detroit needs an economic He farms in the city’s north commercial buildings. Wozniak said base. Farming, in general, adds to Corktown neighborhood and is the site used to contain 851 struc- the economic profile,” Wozniak one of dozens of Detroit farmers tures. said. “Residents need access to good trying to carve out a living. Unoccupied houses will most jobs, and this area has good public likely be torn down by Reclaim De- transportation.” troit. “We don’t want anyone who is Malik Yakini, founder and execu- here to leave. Instead, we want to tive director of the Detroit Black strengthen the fabric of the build- Community Food Security Network, Detroit urban ings already here,” Wozniak said. which operates the 7-acre nonprofit farming leader RecoveryPark Farms has hired an D-Town Farm in Detroit, started it in organic farmer and a hydroponic 2008 with 2 acres in the 200-acre All the activity around Detroit’s grower. Produce will be grown via Meyers Tree Nursery, part of Rouge farm industry has picked up in re- hydroponics in greenhouses cover- Park. The city used to plant trees cent years. Michigan State University ing 15 acres of the property. Wozniak there to transplant in Detroit neigh- agriculture Professor Bill Knudson said the benefits of growing pro- borhoods. That job has been inher- said urban farming is taking off duce through hydroponics is higher ited by the Greening of Detroit. around the country, yet Detroit quality and more plentiful crops. D-Town’s customers are those seems to be the leader. Yet the eco- Hoop houses and high tunnels, who shop at the farm on Saturdays nomics of farming are challenging, which are highly sturdy growing and Sundays and those who buy he said. structures, are planned for 9 acres. from them at the Wayne State Uni- “The reality is after several years The 1920s Chene-Ferry Market, versity farmers market on Wednes- of good commodity prices for farm- which will be restored, will be a cen- days. The farm has five staff and five ers, commodity prices are going tral part of the project. interns. Yakini said D-Town, the down while their costs for fertilizer, RecoveryPark’s East Grand Bou- largest farm in the city, is a produc- seeds and land are falling at a much levard pilot program’s customers tion farm and an education facility. slower rate,” which is squeezing currently are local restaurants. Spe- “We are focusing on getting more their profits, he said. Only part of cialty produce such as albino beets, African-Americans involved in this what shoppers pay for produce goes Asian green mixes and striped car- industry so they have greater self-re- to the farmer. rots are being sold to 15 Detroit-area liance,” he said. “African-Americans U.S. Sen. Debbie Stabenow, a restaurants. Over the next five years, often associate farming with slavery, proponent of growing Michigan’s RecoveryPark Farms has a distribu- and an important part of our work is food economy, said Detroit leads tion agreement to sell to more than to (change) that thinking. We teach D-Town has four hoop houses of its power, a rainwater retention the country in urban farming. 400 businesses statewide. that farming was part of our culture and four large quadrants of farm- pond and an off-the-grid energy “When I took over as a (ranking Detroit-based Del Bene has been 7,000 years ago.” land. By using solar panels for some station, the farm is self-sufficient. member of the U.S. Senate Com- mittee on Agriculture, Nutrition and Forestry), I started talking about urban farms to people in oth- er states,” she said. “They asked, ‘Why are you talking to us? You have the urban farming leaders in De- troit.’” Stabenow has heard concerns from city farmers who have not been able to buy more land for farming. “It is part of what I consid- er a natural tension as the city grap- ples with redevelopment,” she said. “There should be good planning, not hit and miss.” Dan Carmody, Eastern Market president, said Detroit is a national leader in urban farming because of “the sheer number of people partic- ipating in it.” He said there are 20,000 people working on 1,400 gardens or grow- ing sites in the city. The way urban farmers should acquire land has been “an issue per- colating for a while,” he said, adding that the city is in the midst of creat- ing another ordinance around chickens, goats and other animals. Detroit changed its zoning ordi- nance in March 2013 to expand farming. “The city land bank has the her- culean task of repurposing 96,000 vacant lots,” Carmody said. “Urban agriculture is part of the answer, but not the whole answer.” He said several of the farms and organizations are doing a good job. The Leader in Among those are Greening of De- troit, Brother Nature Produce, Capu- Shareholder Rights chin Soup Kitchen’s Earthworks Urban Farm, and Rising Pheasant Farms. “At the market, we see our role as working with all these farms to cre- ate products,” he said. DBpageAD_DBpageAD.qxd 8/4/2016 2:37 PM Page 1

JOIN US MONDAY AT THE INAUGURAL AUG. 22 2-7 P.M. • Eastern Market Shed 3

Key players from local food companies will gather to focus on building Michigan’s supply chain and pairing ideas with the visions from major national food companies. 352*5$0+,*+/,*+76 3/86 Discount BREAKOUT SESSIONS Combo Tickets Consumers are demanding local food. Hear how the trend is disrupting business as usual. Three discussions will focus on agriculture, food product entrepreneurs and the world of with Live Love Local! retailers and restaurants. At The Greening of Detroit’s 6th annual Live Love Local event, patrons get to SELECTED SPEAKERS: sample local food highlighted in original Erika Block Jim Byrum Dan recipes from 25 of the area's hottest Founder and CEO, President, Carmondy chefs while having their own “farm Local Orbit Michigan President, to fork” discussions with Greening of Agri-Business Eastern Detroit farmers. The event includes Association Market two drink tickets and coincides with Corp. Eastern Market's Sunday Street Market, which showcases local home goods, art, Mary Donnell Lydia Guttierez Jim Hiller jewelry, clothing, antiques, and furniture. Program Manager, Co-founder Former Michigan Good and President, Owner, Combination Ticket includes entry to Food Fund Hacienda Hiller’s Crain’s Food Summit + Live Love Local. Mexican Foods Markets Live Love Local 12-3 p.m. Kirsten Ussery Malik Yakini Sunday, Aug.21 Co-Owner and Founder and Executive Director, Detroit Eastern Market Shed 5 General Manager, Black Community Food Security Network, Discount Combo Ticket Detroit Vegan Soul which operates the D-Town Farm with Live Love Local: $100

Summit Only Individual Ticket: $80 FOOD TRUCK RALLY – Dinner with a variety of eclectic fl avors at Bert’s Warehouse Groups of 10+: $75 each

Showcase your products or services with a sponsorship at the Food Summit. Contact: Matt Langan, [email protected], (313) 446-6032

INVESTOR FORUM TITLE SPONSORS MAJOR SPONSORS

SNACK SPONSOR PARTNERS 22 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016

CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY Crain’s forum Homegrown businesses expand state’s food market From toee to popcorn to (yes) crickets, Michigan’s food businesses are growing. A dozen of them will pitch their businesses at Crain’s Food Summit Aug. 22 examines food at Eastern Market. From more than 50 applications, we and a team of food industry experts picked a selection in three categories: social impact, startups and growth companies. Here’s a closer look at some businesses that oer a cross-section of what Michigan’s food entrepreneurs are up to.

economy SOCIAL IMPACT STARTUPS GROWTH COMPANIES By Daniel Duggan [email protected] Eden Urban Farms LLC Detroit Bold Co†ee Co. The consumers have spoken, and they Detroit Highland Park are looking for local food. With that disrup- Owners: Kimberly Bu†ngton, CEO; Ocie Irons, Owner: A.J. O’Neil tion, new business models are evolving COO; Brian Surowiec, CFO What they do: Coee brand that pitches itself and existing business models are adapting. What they do: Startup that aims to grow as a “working-class” cup of coee. Founder A.J. To bring this topic to life, Crain’s is produce in an indoor hydroponic farm in Detroit’s O’Neil, former owner of Ferndale’s AJ’s Cafe, launching the Crain’s Food Summit on Corktown neighborhood. Plans to distribute food started the brand three years ago. Roasted by Aug. 22 to focus on the ways the food econ- through nonproŒt partners such as MercyWorks, Highland Park’s Becharas Brothers Inc., the omy is changing and adapting. MACC Development and Forgotten Harvest, Pop Daddy Popcorn Inc. brand has grown into distribution at Meijer, Participants can hear from large nation- with the aim of starting more farms through Green Oak Township Kroger, Westborn Market and other retailers. al companies such as Campbell Soup Co. as Detroit’s underserved neighborhoods. well as local businesses such as the popular Owner: Mark Sarafa Website: www.detroitboldcoee.com Website: www.edenurbanfarms.com restaurant Detroit Vegan Soul. What they do: Locally grown and As part of the event, the first Crain’s In- manufactured bagged popcorn. In fewer than vestor Forum will be a chance for potential Zilke Vegetable Farm LLC three years, Pop Daddy has landed distribution investors to hear from local companies in in Meijer, Kroger and Wal-Mart stores, among the food sector. (See story, this page.) Milan others. Sources its popcorn from an Ann Arbor Speakers will weigh in on a range of food Owners: Vicki and Tom Zilke farm and pops it in olive oil, aiming to lure issues in panel discussions moderated by customers looking for healthy snacks. The Vegetable farm that started by reporters and editors from Crain’s. What they do: company is now test-marketing seasoned selling produce at a farm stand and through The keynote panel will bring three na- pretzels as well. tional brands together on stage to focus on community-supported agriculture subscriptions, the ways that global food brands are con- and now through institutional sales to University Website: www.popdaddypopcorn.com necting with local communities. Speaking of Michigan Dining Services, Eastern will be Jeˆrey Dunn, president of the Camp- Michigan Dining, local restaurants and grocers, Great Lakes Potato Chip Co. bell Fresh division of Camden, N.J.-based and the new Grow Eastern Market food hub. Grand Traverse Pasta Co. LLC Traverse City Campbell Soup Co.; Kirk Sabiston, senior Also distributes fresh food through twice-weekly Traverse City Owner: Edward Girrbach manager of mergers and acquisitions for MHealthy produce markets at the University of Owner: Bill Koucky Minneapolis-based General Mills Inc.; and Michigan. What they do: Maker of locally sourced What they do: Has its kettle-style skin-on potato chips. Founded six Rick Wion, senior director of corporate en- Website: www.zilkevegetablefarm.com gagement for Battle Creek-based Kellogg Co. roots in Grand Traverse years ago, the company has surpassed $3 million Three panels will dive into the topic of Culinary Oils, which in revenue with distribution at Kroger and consumer demand in three niches: agri- The Local Grocer processes sunžower and Spartan stores and Tom’s and many other culture, food product entrepreneurs and canola seeds into culinary chains. Is aiming to move into a larger facility with the world of retailers and restaurants. Flint oils. Two years ago, it began upgraded equipment. processing locally grown It's crucial to bring those groups togeth- Owners: Erin Caudell and Franklin Pleasant Website: greatlakespotatochips.com er when possible, said Erika Block, founder (pictured) wheat into stone-ground žour, and earlier this year and CEO of Ann Arbor-based Local Orbit, Grocery What they do: started making pasta from one of the speakers. store featuring Michigan that žour. Is aiming to open Edibles Rex Buyers, she said, often say that suppliers products and produce that a pasta-making operation in Detroit don’t offer enough local food. But suppliers had its roots in a front-yard the Eastern Market area of say the orders are too small. garden that grew into a small Owner: Tammy Tedesco Detroit. “The key is communication,” she said. farm and stand at the Flint What they do: Catering company that has “If we are working on the communication Farmers’ Market. Has Website: www.gtculinaryoils.com grown over 23 years into providing food service to problem, we can be working on the supply expanded to sell products Detroit schools. This year, it was awarded the and demand problem." from eight small farmers and contract for the summer “Eat Up and Meet Up” Dan Carmody, president of Eastern Mar- more than 30 small Old World Gluten-Free LLC school food program. Sources its fruits and ket Corp., which has worked with Crain's to companies that produce all-natural food, body care St. Clair Shores vegetables from Eastern Market, and all dairy create the event, said the food sysem is a and home products. Planning to launch a nonproŒt and groceries from Michigan companies. In 2014, Owner: Alicia Bemiss path to jobs and wealth for the region. partnership for a mobile vegetable van. received a $250,000 grant from Chase Bank, “Intense connectivity between local What they do: Makes and sells pierogis made partly to build out its Good Food Village, an Website: www.thelocalgrocer.com producers, processors, distributors, retail- from a mix of žours that contain no wheat or Eastern Market location intended to serve as a ers and consumers foster food system in- gluten. Bemiss was inspired by a desire to share hub for food businesses. novation,” he said. her family’s Polish heritage among family Website: www.ediblesrex.com The speaker lineup includes: Detroit Food Academy members, including her child who has celiac n Erika Block, founder/ CEO, Local Orbit Detroit disease, which makes the body unable to tolerate n Malik Yakini, executive director, De- Executive director: Jen Rusciano gluten. The pierogi are sold at about 40 stores in troit Black Community Food Security Net- metro Detroit, and the company has received its Dave’s Sweet Tooth What they do: NonproŒt work and the D-Town urban farm Œrst orders from Whole Foods Market. Harrison Township n Jim Byrum, president, Michigan whose program works with Owner: Andrew Chmielewski Agri-Business Association young people to create their Website: www.oldworldglutenfree.com n Lydia Gutierrez, co-founder/ presi- own food business projects. What they do: Michigan-made almond toee dent, Hacienda Mexican Foods Has grown since its 2011 sold in pouches. Andrew n Brenda Reau, senior associate direc- founding to encompass 10 Detroit Ento Chmielewski started the tor, MSU Product Center high schools with more than Detroit company and named it for 200 participants. DFA his father, who was known n Dan Fone, Global Business Develop- Owners: Anthony Hatinger, Theodore Kozerski ment – Food, NSF International students created and for his homemade toee n Jim Hiller, former owner, Hiller’s Mar- launched Mitten Bites, a What they do: Startup that aims to create and recipe. Over Œve years, the kets granola bar featuring Michigan fruits and local sell sustainable protein sourced from crickets and company has grown to 12 n Kirsten Ussery, owner, Detroit Vegan ingredients now sold in more than 50 retail other insects. The company is working to create a employees and received a Soul locations, including every Whole Foods Market facility to grow crickets and process them into a big boost when featured on n Dan Carmody, president, Eastern in the state. protein powder for human food, livestock and “Good Morning America” pharmaceuticals. The use of Insects as a food earlier this year. Market Corp. Website: detroitfoodacademy.com source is slowly gaining acceptance in the U.S., but n Mary Donnell, program manager, Website: www.davessweettooth.com Michigan Good Food Fund and Capital the company notes that there are few suppliers. Impact Partners Website: www.facebook.com/detroitento CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 23

CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY REPORT Advice for would-be food entrepreneurs 10 steps on how to grow a business

By Rachelle Damico money to pay yourself as well — 90 percent ment, start with what you need fi rst, rather shelves.“I went in, talked to the manger, Special to Crain's Detroit Business of entrepreneurs I know do not.” than purchasing what you think you’ll need brought samples, and once they tasted it, Now may be the time for Michigan in the future. they liked it,” Owens said. entrepreneurs interested in entering the 2. Learn who regulates your “It’s tragic to me when I see entrepre- Last year, the company sold 83,000 food business to tap their potential. product. neurs who will spend a bunch of money on bottles of sauce, and expects an increase of “Over the past six (or) seven years, there Food companies face regulations and equipment that are way beyond where they 240,000 bottles sold with the addition of has been a tremendous increase in locally licensing requirements specifi c to the need to be,” said Jess Sanchez-McClary, Kroger Co. and Meijer Inc. shelves. grown and processed products in Michi- nature of the food business. founder and CEO of McClary Bros., which gan,” said Brenda Reau, senior associate Building relationships with local makes drinking vinegars served in more 8. Network. director for Michigan State University’s food-regulation representatives can ensure 1,000 locations and in 27 states. Product Center, which has helped hun- paperwork is done in a timely and legal Bommarito of Ethel’s Edibles said to be One of the biggest challenges for food dreds of entrepreneurs develop and manner. A baked goods company, for profi table, entrepreneurs should never be startups is food sourcing. New companies commercialize products. example, can contact a local representative paying retail for raw materials. Seek tend to have less buying power, making it Local brands on supermarket shelves from the Michigan Department of Agriculture wholesale or direct sources. harder to contract the amount of materials such as Hamtramck-based McClure’s and Rural Development for help answering “If you’re going to Kroger to buy your needed. Building contacts with local Pickles are thriving, but building a success- legal questions and navigating licensing. chocolate chips, you’re in trouble,” she farmers can help you leverage. ful business does not happen overnight. Resources like MSU’s Product Center said. Trade shows and industry events are also “It tends to have a lower profi t margin, can also help navigate the regulatory maze a way to network with other entrepreneurs so if you want to make any signifi cant and offer consulting services at no cost. 5. Pay attention to and be in front of buyers. amount of money, you’re going to have to packaging. scale up,” Reau said. 3. Find a licensed food space. A food product should be marketable For advice and tips on how to establish Many food entrepreneurs begin making both on and off the shelf. Working with a 9. Go at your own pace. and grow a successful food business, their products at home. Michigan’s Cottage graphic designer will help create unique Common issues many food companies Crain’s talked to local food companies and Food Law allows food entrepreneurs to packaging that can make your product face include cash fl ow, and growing too experts. produce certain types of foods at home stand out. fast. without being licensed by the Department Sanchez-McClary worked with a graphic Food entrepreneurs should focus on 1. Ensure there’s a market of Agriculture and Rural Development, but designer to create the current McClary Bros. growing at a sensible pace and establishing for your product. there are limitations. label, which evokes a 19th century vibe. solid footing before considering leasing You need more than a great recipe — a Only certain types of products apply Clark, who self-funded Bon Bon Bon, space or buying more equipment. lot more. — such as jams, baked goods and teas — uses recyclable cardboard because it keeps “I’ve seen a lot of people outgrow their Andrew Chmielewski, founder and CEO and the law prohibits annual sales the chocolate fresh, is environmentally initial production facility and aren’t sure of Harrison Township-based toffee exceeding $20,000 for home-produced friendly and is cost-effective. where to go, or don’t have the resources to company Dave’s Sweet Tooth LLC, has sales foods. Food entrepreneurs looking to expand to a larger facility,” said Michael in more than 2,000 stores in 14 states expand should search for a licensed Geiger, business adviser for 6. Market test your product Goldman Sachs including Whole Foods Market and Fresh commercial food space — such as a baking Group Inc.’s 10,000 Small Businesses Thyme Market. The business employs 12 facility, church or hall that can be rented. Consumers are more likely to buy a program at Wayne State University, which and is projected to surpass $500,000 in Incubator kitchens can also be a product if they have an opportunity to taste has helped about a dozen food entrepre- sales this year. cost-effective option that allows entrepre- it. Bring samples to the farmers market, do neurs navigate their growth plan. He said many food entrepreneurs have a neurs to rent space, and often include product demonstrations at stores and take good recipe, but don’t have business equipment. , in advantage of craft shows, festivals and local Detroit Kitchen Connect 10. Consider paying someone acumen on how to gauge a possibly partnership with Eastern Market Corp., holiday events. saturated market. There are already a helps connect food entrepreneurs with Joseph McClure, co-founder of Mc- else to distribute your number of granola and hot sauce compa- incubator kitchens. Eastern Market’s Clure’s Pickles, said most food entrepre- product. nies, for example, competing for the same Shed 5 provides a community kitchen for neurs gain initial exposure and sales from In startup mode, most food entrepre- shelf space. food entrepreneurs as well. farmers markets. Online marketing, such neurs distribute and package their A written business plan is necessary for Location should also be considered, as as social media work, is another way to products themselves because they do not both strategic planning and sharing with well as competitors in the area. reach customers and gain direct sales. have the margin to hire an outside lenders in the event a business wants to Alexandra Clark, founder of Ham- company, but growing companies may borrow money and should include a tramck-based Bon Bon Bon LLC, grew up in 7. Build relationships with fi nd hiring a distributor is more effi cient. company’s target market, fi nancial Plymouth, but chose Hamtramck for her retailers. Bommarito discovered that hiring a projections and product pricing detail. location. distributor saved her about a 4 percent Jill Bommarito, CEO and founder of St. “At the time I opened my chocolate Visit local stores, build contacts with margin increase. Clair Shores-based Ethel’s Edibles Gluten shop, there were fi ve in Plymouth, so it managers and allow them to taste test your “It’s a much better use of your time, the Free Baking Co. LLC, said many startup food wasn’t an option,” said Clark, who employs product. Bring a sales sheet that outlines company’s time and putting people to entrepreneurs charge twice the amount of nine and sold about 100,000 bonbons this product attributes, packaging and how it’s work at what they’re best at,” she said. raw materials, but should be charging year. distributed. more. That’s how Scott Owens of Dear- 4. Source ingredients and “If you’re going to succeed, employ born-based Owens Family Foods LLC, which  For more tips for food entrepreneurs, people and grow, you have to be profi t- equipment. makes Scotty O’Hotty brand hot sauces, visit crainsdetroit.com/foodeconomy. able,” she said. “You have to set aside When it comes to purchasing equip- fi rst landed on Westborn Market Group’s

PHOTO BY JACOB LEWKOW 24 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 CRAIN’S MICHIGAN BUSINESS: FOOD ECONOMY How entrepreneurs compete for grocer shelf space

By Marti Benedetti tise as local. we can,” Heinz said. “Buyers love One thing companies do wrong is [email protected] Picking winning products is the looking at these products and, if the underestimate the amount of prod- Mark Tomas compares growing a job of the major grocery chain’s buy- businessperson is passionate, we uct required for entry into even a successful food product to “running ers, said Pete Heinz, director of gro- will give them a try. But sometimes limited number of our locations, a marathon at sprinter speed.” cery merchandising for Meijer. “We they just aren’t ready. Then we send McClure said. “We commonly start The founder and owner of have 20 buyers in grocery.” them to (MSU) for help.” new products out in 10 to 40 of our Bloomfield Township-based Rib A major local venue for buyers is Matthew Birbeck, senior project stores, depending on the product Rack Distributing LLC, a manufactur- the Making It in Michigan Market- director for the Food Processing and and region, and require that some er of barbecue sauces, marinades, place Trade Show at the Michigan Innovation Center at the MSU Prod- form of distribution system is in spice rubs and tenderizers, would State University Product Center in uct Center, said consumers are place. Many small companies may know. He has been “running” since November. Organizers are expect- looking for products that “have not have the production ability to his product was chosen for the ing more than 200 vendors this year. unique attributes, anything made meet the demand necessary for that shelves of Grand Rapids-based Mei- Meijer will be using the show to es- with Michigan-grown products.” commitment.” jer stores five years ago. tablish its 2017 selection of Michi- The most popular items chosen by While there are opportunities at “We started one small batch at a gan-made products for more than grocers are “shelf stable or have an trade shows and with buyers, not ev- time, and built our company store 100 stores across the state. extended shelf life,” such as jams, eryone has an easy time of getting by store starting with small, local Kroger spokesman Ken McClure jellies, syrups and mustards and their product on the grocery shelves. grocers,” he said. “Getting your first said in an email that the retailer also popcorn and tortilla chips. RIB RACK DISTRIBUTING LLC Motor City Popcorn owner Ronier large retailer is very important — if starts many of its local relationships Product trends continue to Rib Rack shares Meijer shelf space with Golightly founded his business four you do well there, the other chains at the event. evolve. Last year, products created its BBQ sauce competitors. years ago, and his popcorn has land- will start calling.” The two biggest national trade around chiles were the rage. This ed in some stores. It can be found at Rib Rack now is in Kroger, Publix, shows for food entrepreneurs trying year, he is seeing that “soups are in look at the new products. Detroit Metropolitan Airport, Holly- Albertsons, Whole Foods and Sprouts, to sell their wares is Expo West in vogue as is drinking vinegar and fer- “Pete (Heinz) is now making this wood Market in Royal Oak, several in 50 states and is the fastest-grow- Anaheim, Calif., which specializes mented foods such as kimchi, pick- the designated show for Meijer to Detroit-area gas stations, and Red ing BBQ brand in the country. in natural and organic products, les and pickled (vegetables). There's find its products,” Birbeck said. “So Truck Fresh Produce in Eastern Mar- Breaking into the big leagues is and the Fancy Food Show in New often a probiotic or health attribute if chosen, an entrepreneur gets their ket. But he can't crack the majors. more difficult now than when To- York and San Francisco. involved.” product on the shelf at a Meijer, Kro- “My experience is those stores mas started in 2011. Competition is Heinz said that when Meijer buy- MSU's trade show at the Product ger, Westborn Market or Hollywood don't want to work with individual stiffer because of the sheer number ers go to a show, they are looking for Center can help young businesses Market. They all attend, which companies,” he said. “Imagine if ev- of food entrepreneurs vying to get local products that are following get their products to the market- makes it Michigan's largest special- ery brand brought their product to their products from a private kitch- trends, such as products that give place, he said. The show allows them ty food show. My job is to help them (the big stores) and they had to cut a en to the shelves of a major grocer, back to the community — especial- to sell their products to the public or with due diligence.” check for each brand. So the big gro- according to those in the grocery ly popular with millennials — or grocery buyers. The first show was Birbeck said getting a product in cers want me to get a distributor, but business. But there is a silver lining: anything related to craft brewing or eight years ago and featured 30 ven- a regional market such as Westborn when I approach a distributor, they increasing demand among big artisanship. dors; this year it will have 200 ven- is an excellent and manageable way want to know who else is selling with chains for products they can adver- “We try to give them a chance if dors. Roughly 150 buyers come to to start. me. Everyone wants to wait for someone else to make the first move.” Golightly said his strategy now is to improve marketing his popcorn and to have his own kitchen space, which will give the brand greater profes- sionalism. “I have a couple distribu- tors who have shown some interest, but they think I should have my own building,” he said. He now uses the Have you kitchen in a Royal Oak church. Birbeck said popcorn and chips are saturated categories, making it harder for them to get shelf space. outgrown “The big players tend to get the shelf space. That is such a competitive your investment market,” he said. Davita Davison, director of mar- advisor? keting and communications for Food Lab Detroit, said food business people need to understand it can As you grow your wealth and your portfolio take years to land real estate on gro- cery store shelves. "They start out becomes more complex, the impact of taxes selling their products at farmers on investment returns becomes a critical issue. markets," she said. Food Lab Detroit plays the role of concierge by guiding food produc- Come learn about several steps we take ers to where they need to go and to increase the tax e ciency of your portfolio. who they need to meet to reach their goals, she said. Food Lab has 202 Detroit-area businesses. Davison said small food businesses need to realize that giant companies such as Campbell Soup Co.’s multiple brands get the prime space at the grocery stores. “The big brands have a strangle- hold on the stores,” she said. But grocers such as Meijer and Whole Foods make an effort to carve out sections of their stores for local 248.731.9500 | WWW.S CHECHTERWEALTH.COM brands.” “Meijer has been terrific,” Tomas said. “They like the fact that we are Investment Advisory Services oered through Schechter Investment Advisors, LLC. local, have great products and a loy- al customer base.” CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 25

SPECIAL REPORT: SECOND STAGE

Inside jobs or outside work?

By Rachelle Damico Special to Crain’s Detroit Business How do you know whether to dole out work internally, or hire an outside compa- ny? Jane Owen, president of Vistage Michi- gan, a peer-to-peer business coaching or- ganization in St. Clair Shores, says there are many factors to consider. A business should first recognize if it has the budget and capability to understand the process in-house, Owen said. “Outsourcing of a subject-matter expert can be much more efficient,” she said. “It reduces overhead costs internally and al- lows you to have flexibility in your staffing — you’re not paying for any kind of bene- fits or all the back end in costs when you have an employee.” These are factors Tim Smith, owner and CEO of Skidmore Stu- dio, considered when it came to outsourcing Options for his Detroit-based n Skidmore goes design firm, which outside, Page 26 specializes in brand- ing for millennials. n Hohauser brings “The hard costs are task inside, Page 27 only the tip of the ice- n Sigma picks both berg,” Smith said. “It’s options, Page 27 about expertise and the quality of work.” Owen said companies should consider insourcing when they have grown enough to afford the overhead costs, or when it’s important that the business process is closely connected to the culture of the company. “You have a lot more control in terms of quality,” she said. “When you outsource, you lose the ability to connect the culture you’re creating internally, and it’s harder to ensure that you’re always delivering the same kind of quality you would want to have connected to your company.” Culture played a major factor in the de- cision by Troy-based executive recruiting firm Harvey Hohauser & Associates LLC to bring in employees to do a service that was previously outsourced. “It solidifies more when they’re here ev- ery day and I’m telling them about interac- tions I have with the client,” CEO Todd Ho- hauser said. In this month’s Second Stage, Crain’s JACOB LEWKOW talked to three companies to find out how Tim Smith, CEO of Skidmore Studio, decided to outsource the code-intensive they made decisions when it came to in- side of the company’s website. “We only do what we’re experts at. ... If we can sourcing versus outsourcing. focus all our energy on the creative, we can do better work.” 26 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016

SPECIAL REPORT: SECOND STAGE How Are You Enhancing People & Improving Business Results? Skidmore Studio outsources coding, PR Ulliance is celebrating 25 years of delivering comprehensive services that keep your employees By Rachelle Damico emotionally and physically healthy. Special to Crain’s Detroit Business Advertising and design firm Skid- more Studio sticks solely to the cre- Complete Workforce Services ative side of things. that o er: The Detroit-based company, which specializes in branding for • Life Advisor EAPs that are cost millennials, keeps all design-related e ective and promote emotional business functions in-house — in- wellness cluding branding ideas, strategizing and the creative execution for de- • Customizable Life Advisor sign. Wellness Programs “We only do what we’re experts at,” said Tim Smith, owner and CEO. • Human E ectiveness Trainings “There’s a philosophy internally that • Organizational and Leadership if we can focus all of our energy on the creative, we can do better work.” Development Skidmore outsources everything • Career Transition Services else — which can include photogra- phers, website developers and even • Voice Your Concern Report Line public relations work. The company • Incident & Crisis Management has 19 employees and reached about $7 million in revenue last Services year. “A lot of these decisions go to a respect for the kind of work that goes into it,” Smith said. “That’s what they do every day and they’re Contact Ulliance at 866-648-8326 or www.ulliance.com great at it, and I want that to come in return — I don’t think a PR firm is the best place to go for your design JACOB LEWKOW work.” Tim Smith is owner and CEO of He said Skidmore always focused advertising and design rm Skidmore on design internally, but it took a Studio. few years for the company to define what constitutes creative work. when you’re making certain assur- Previously, Skidmore outsourced ances to your clients because you’re website developers to create the accountable to those,” Smith said. company’s website, but realized the “When you outsource, you need to front-end design — how the user in- make sure those people are ac- teracts with the website — was more countable to you.” on the creative side and in the com- pany’s area of expertise. Lessons learned Rather than hire a vendor to do a Smith now vets vendors by inter- complete website build, Skidmore viewing employers and asking spe- now outsources back-end develop- cific questions about their work ers only — the more code-intensive processes. side of website building required to “If I would have focused more on make the website work. This would how different perspective vendors Complimentary give Skidmore more control over got to that end product, I would how the users interact with the have saved a lot of heartache and Webinar company’s website. learning along the way,” he said. Presented by “Front-end designers sometimes Smith said he saves hundreds of misinterpret the original intent in thousands of dollars a year by out- Comerica Business the navigation or the user experi- sourcing web development alone, Owner Advisory Services ence, and we had to go back three or because it would take a staff of six or four times to get that intent right,” seven people to do the work effec- Smith said. “We decided it’s more tively. That means getting staffers Experience a Higher Level efficient to have that in our own up to speed on programming lan- of Business and shop, so when the user gets to it, guage, mobile versus desktop, and Wealth Planning they have that experience that was more. imagined.” “Think about the gain of working There were challenges along the with an expert you can outsource way. Smith said he has hired ven- and trust, and they’ll actually save dors that showed a good product money along the way that are going but weren’t able to go back and re- to come in a lot of intangible gray create it when needed. areas that are difficult to measure Tuesday, Sept. 13, 2016 In the past, Skidmore’s client but very accretive to the bottom Business Succession wanted to add a new field to Skid- line,” Smith said. 12 p.m. – 1 p.m. ET more’s website database after it was “Many times, business owners Planning - completed. When an outsourced will look at a hard-line cost of — if I web developer went back to make pay (a staff member) a salary of X Expect the Unexpected and plan for it To Register: changes, it couldn’t replicate the da- amount of dollars a year, that’s go- CrainsDetroit.com/webinars tabase programming language, ing to save me money — but the end leaving Skidmore to rebuild the cost of that decision is that they’re Powered by: code onto the existing database. hiring somebody that’s either new “That becomes the studio’s ex- or not as good, and they lose the ex- Comerica Bank. Member FDIC. pense, so you have to be careful pertise.” CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 27

SPECIAL REPORT: SECOND STAGE “I wanted to bring it in-house so it was more e ective and I Decision time: Make or buy could have control Sigma International goes outside for soware engineering, other services over it.” Todd Hohauser, CEO, By Rachelle Damico tract from their cause we know logistically we will Harvey Hohauser & Associates LLC Special to Crain’s Detroit Business area of exper- be at a better position to ship it to Christopher Naidoo, founder tise. our customers,” Naidoo said. and CEO of Livonia-based automo- “Stick with Sigma outsources engineering tive manufacturer Sigma Interna- your core service providers that provide soft- tional Inc., credited the tier-one sup- strength and ware specific to an automotive Executive recruiting plier’s growth to a combination of continue to company’s needs. Since different insourcing and outsourcing. broaden and automotive companies require dif- “Anything we undertake is always strengthen ferent engineering design work, it a make-versus-buy decision,” that,” Naidoo would be too costly for the compa- Christopher rm brings search Naidoo said. “Is it cheaper for us to said. “For items ny to invest in it on its own. Naidoo: Stick with make it in-house, or is it cheaper for core strength. that are not “If we had to invest our own capi- us to source it?” called to you, tal into it, we may not see a return in Sigma’s core technologies are in- look to the out- our investment,” Naidoo said. “We’d process in-house jection molding, decorative plating, side for companies that are experts also have to train someone to teach LED lighting and painting. The in that field.” them new technology versus going By Rachelle Damico now,” he said. “We can focus our company and its strategic alliances Sigma ships its own products to out and buying it from somebody Special to Crain’s Detroit Business efforts more on client services.” have an employee count of more its customers regionally and inter- else.” Todd Hohauser, CEO of Troy- Hohauser said outsourcing ini- than 400, and international loca- nationally, giving the company a Naidoo said that when it comes based executive recruiting firm tially helped the company expand, tions in South Africa, Mexico, China competitive edge. to insourcing versus outsourcing, Harvey Hohauser & Associates LLC, but having employees internally al- and South Korea and soon will ex- That includes items many auto- companies should keep in mind saw an opportunity to expand his lows the company to bring more pand to India. Its customers include motive manufacturing companies their reputations are on the line ei- father’s business after the company accurate candidates to clients. FCA US LLC, General Motors Co. and don’t want to deal with, such as an ther way. had been outsourcing an integral “Doing outsourcing in the begin- Ford Motor Co. auto interior console part that may “At the end of the day, you have part of its business process. ning helped us gather momentum Naidoo said Sigma has seen a 40 stack awkwardly due to its complex the ultimate responsibility when The second-generation family and set us up to then hire our own percent to 50 percent growth in- shape. Because of the unique ship- you’re providing this component business recruits executives and internal people,” Hohauser said. crease in the past six years, in- ping specifications, Sigma can only to somebody else,” he said. “If business leaders. These are for po- “Insourcing really helps when you’re sourcing anything connected to its fit about 10 or 15 items in a ship- somebody doesn’t perform, you’re sitions with starting salaries at trying to keep propriety knowledge core technologies and outsourcing ment at a time. ultimately responsible. It’s your $200,000 per year or more. The inside of your company, or to con- business functions that don’t pro- “In those cases, we’d make the name on it — your financial risk— company has 11 employees and trol a certain process.” vide a capital investment or dis- decision to do that ourselves, be- and you take on the liability.” works with businesses mainly be- tween $30 million and $500 million in revenue. For more than 15 years, the company outsourced external name generators — researchers that find potential candidates that match a company’s needs and cul- ture by using job-searching tools such as LinkedIn, Hoover’s and Ref- erenceUSA. Once the candidates are located, they provide their in- formation to executive recruiters at Harvey Hohauser & Associates, who connect with the candidates. “Finding the right person that not only matches the knowledge, skills and abilities your client needs, but also matches their cul- ture, is very tough,” Hohauser said. The company had been using third-party name generation ser- vices in places such as New York or Texas, which Hohauser said made it more difficult for researchers to understand the culture of the com- pany’s clients. “It doesn’t click as well as when I have people here with me every day to talk about the culture of our clients,” he said. “We were still do- ing our job and delivering candi- dates, but it was taking longer.” Hohauser hired two external name generators he found by tap- ping networking connections and using his own outsourced recruiter. “I wanted to bring it in-house so it was more effective and I could have control over it,” he said. Hohauser figures the company has saved millions of dollars by in- sourcing because the business is fill- ing searches quicker and more effec- tively; turnaround time is about 100 hours per executive search. “We have more repeat business 28 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016

DESïN LLC, Bloomfi eld Hills, a robot- MedNetOne Health Solutions, CALENDAR ic products fi rm, launched Obi, a Rochester Hills, a physician PEOPLE: DEALS & robotic device to give individuals organization, announced its SPOTLIGHT WEDNESDAY with physical challenges the ability diabetes prevention program, a AUG. 10 DETAILS to take control of their meals. lifestyle and diabetes intervention St. Vincent de Paul Geo-Targeting Your Audience. 11:30 CONTRACTS Website: meetobi.com. plan aimed at preventing Type II a.m.-1 p.m. Troy Chamber of Simons Michelson Zieve Inc., Troy, an diabetes. Website: mednetone.net. names executive director Commerce. Brian Blau, Quell advertising agency, has added 88 Health Products, Ann Arbor, a The Society of St. Vincent de Communications Group, will walk General RV Center, Wixom, to its list nutraceuticals and topical solutions Advanced Manufacturing Media, Paul of the Archdiocese of Detroit attendees through a digital of clients. Websites: smz.com, company, has announced Dearborn, a manufacturing news has named Kelly Services Inc. marketing program to target generalrv.com. FrutosAid brand xylose isomerase and technology information source executive specifi c audiences. Troy School supplement to address that is a division of SME, has Christopher District Services Center. $28; $18 Truven Health Analytics, Ann Arbor, fructose malabsorption, a dietary launched a new website, Stark as Troy Chamber members. Add $5 for an IBM company, has partnered fructose intolerance. Website: advancedmanufacturing.org. It executive registering on day of event. Contact: with Allen Technologies Inc., Austin, 88healthproducts.com. encompasses original and live director, Jaimi Brook, phone: (248) 641-8151; Texas, to integrate Truven’s reports about manufacturing, effective Sept. email: [email protected]. medication essential fact sheets NEW SERVICES including content from magazines 1. into Allen’s E3 patient engagement Haley Mechanical, Dexter, a plumb- Manufacturing Engineering and Stark, 51, THURSDAY products to give patients access to ing, HVAC and electrical services Smart Manufacturing, the podcast succeeds Bill AUG. 11 information about their prescribed provider, announced the addition Advanced Manufacturing Now, Brazier, 65,

ASE Talent Symposium. 7:15 a.m.- medications. Websites: of Air Scrubber Plus, a home SME’s industry yearbook series, Christopher Stark who is retiring 4:15 p.m. American Society of truvenhealth.com, purifi cation system, to its services. and highlights from SME’s scholarly after leading Employers. Talent acquisition, engagewithallen.com. Website: haleymechanical.com. journals. Website: sme.org. the nonprofi t for more than 12 management and development years. Brazier previously told practices will be topics. Aaron Olson, MOVES SME, Dearborn, an organization STARTUPS Crain’s he plans to remain in the Northwestern University instructor, Tanoury, Nauts, McKinney & Garbari- (formerly the Society of Manufac- A World of Relaxation, Southfi eld, a area and volunteer for the charity. chief talent offi cer and author of no PLLC has moved its law offi ce turing Engineers) that trains and therapeutic massage clinic, has Stark, who joined Kelly Leading With Strategic Thinking, from 333 W. Fort St., Suite 1800, develops manufacturing workforce, opened at 24901 Northwestern Services in 1999 as a branch will speak on “Developing Strategic Detroit, to 38777 Six Mile Road, has launched a high school Highway, Suite 315, Southfi eld. manager, most recently served as Leadership: The Key to Compet- Suite 101, Livonia. Phone (313) membership program to educate Phone: (947) 282-8872. Website: global practice consultant for the ing.” Starr Shafer, president of 964-4500. Website: tnmglaw.com. the next generation on the value of aworldofrelaxation.com. Troy-based company. He is an StarResults and senior consultant manufacturing and encourage ordained permanent deacon in with Career Systems International, NEW PRODUCTS careers in the fi eld. Website: the archdiocese and serves in Deals & Details guidelines. Email will speak on “Develop Your ., Detroit, and sme.org. that role at Ally Financial Inc [email protected]. Use St. Thomas More Employees or Someone Else Will.” , Detroit, in Troy. Detroit Water Ice Factory any Deals & Details item as a model Catholic Church Management Education Center, announced a new water ice fl avor , Grand Rapids, added St. Vincent de Paul provides Meijer Inc. for your release, and look for the Troy. $219 ASE members; $259 called Ally Caring Coconut, with curbside service to its Rochester food, shelter, medical and dental appropriate category. Without nonmembers. Contact: Dan Van proceeds going to benefi t the Hills location. Customers can shop care, utility assistance, disaster complete information, your item will Slambrook, phone: (248) 223-8008, or Detroit community as part of its online and pick up their groceries relief and emergency support to not run. Photos are welcome, but we Ed Holinski, phone: (248) 223-8017. 313 pledge. Websites: ally.com, curbside without leaving their nearly 300,000 households each cannot guarantee they will be used. Website: aseonline.org. detroitwaterice.com. vehicles. Website: Meijer.com. year. It operates 11 thrift stores and donation centers to produce revenue to support its mission. ADVERTISEMENT SECTION Ex-Rock Ventures exec named foundation VP FINANCE INSURANCE Lisa Dancsok, formerly a vice president at Rock Ventures LLC, will join the Detroit-based Christopher Soupal Richard McGregor Community Senior Vice President, President Foundation for National Sales Director, Guy Hurley Southeast SBA Division as Richard McGregor has been Michigan vice president Crestmark Bank elevated to president of of marketing Crestmark promoted Guy Hurley’s Troy o­ ce and commu- Christopher Soupal to senior vice president, a™ er serving as vice president since 2009. nications, HEALTH CARE national sales director of its SBA Division. He With 23 years of insurance industry effective Aug. joined Crestmark in 2014 to help launch the management experience, he will assist CEO 15. SBA Division, and his e‘ orts have been Paul Hurley in leading the insurance and Lisa Dancsok Dancsok, integral in its growth from de novo to the rank surety ’ rm, building innovative risk 55, was vice of the 72nd largest SBA lender in the U.S. management solutions. McGregor will president of corporate philan- Soupal has more than 20 years’ experience in continue to manage the ’ rm’s insurance thropy, marketing and commu- ’ nance, and is a graduate of Ferris State and service o‘ erings, which include property/ nications at Detroit-based Rock the executive management program at the casualty, professional liability, cyber and Ventures. She also has served as College of Business at University of Notre captive, in addition to surety and claims senior vice president of market- Dame. advocacy. ing and legislative affairs at the Michigan Economic Development Corp. and as managing partner of D&D Advisors and held se- Michael Jasperson nior-level positions at Blue Cross Vice President, Eastern Region CONSTRUCTION MANUFACTURING Blue Shield of Michigan. Priority Health Logicalis Group names Jasperson will oversee business Rod Elgie Adam J. Wilson development, sales and product growth in Chief Operating O cer Director of Brand Brandtneris U.S. CFO southeast Michigan. Jasperson was the White Construction Experience The Logicalis Group, an vice president business development, chief international IT and man- White Construction is Carhartt, Inc. marketing o­ cer for Hospice of Michigan aged-services provider, has pleased to welcome back Carhartt has hired Adam J. leading sales and marketing strategies for appointed Sally Brandtneris as Rod Elgie as Chief Wilson as its new director the state-wide organization. Prior to that, CFO in the United States. She will Operating O­ cer. Rod was formerly Vice of brand experience. Wilson is responsible for Jasperson was regional sales manager for continue to work out of Logicalis' President of Construction Operations for all Carhartt-branded experiences, content, Blue Cross Blue Shield of Michigan where Bloomfi eld Hills offi ce. White from 2001 to 2007. Rod’s return to and marketing campaigns, with PR, he led a team charged with establishing Brandtneris, most recently vice White signals a renewed commitment to entertainment marketing, brand advertising & and maintaining relationships with president and CFO for Stefanini IT providing the highest caliber of operational media reporting to him. hospitals, the Michigan Health & Hospital , was a fi nalist in the 2015 excellence, innovation and investment in Solutions Association. Crain’s CFO of the Year Awards. talent. CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 29 August 8, 2016 CRAIN’S DETROIT BUSINESS Page 29

man. Prime now is confident that it will prevail and As part of the turnaround, George said. HOSPITAL is the fast- be found to have completely com- is discussing clinical collaborations Yusuf Hai, managing director of FROM PAGE 1 est-growing plied with all federal regulations re- with hospitals and health care sys- business advisory services with health care garding Medicare inpatient admis- tems in Southeast Michigan. Southfield-based CIG Capital Advi- of its pharmacy and radiology de- company in the sions.” “We are surrounded by big sys- sors, said Garden City needs addi- partments, expand ancillary ser- U.S. with 43 hos- But from a financial standpoint, tems and want to work collabora- tional business relationships with vices and create a new intensive pitals in 14 Prime and George have turned tively with them. We have (clinical nearby hospitals to generate suffi- care unit. states. around Garden City in revenue, services) that don’t belong here and cient revenue for long-term growth. The hospital also will add a sec- George spent profitability and patient volume, we won’t do ... pediatrics and neu- “They are doing better internally, ond state-of-the-art cardiac cather- five years with George said. rology. We are a teaching hospital, cutting the (financial) bleeding and ization laboratory, expand the entry Saju George: Saginaw-based “We have taken 11 percent of but we need to partner with other have stabilized operations,” Hai Wants to work lobby and cafeteria on the first floor St. Mary’s of costs of the hospital,” he said. “2014 hospitals on clinical care.” said. “I am not sure Prime can make collaboratively with and renovate the emergency de- Michigan Health was a positive year and 2015 was a The closest other hospitals to too much money off that location other hospitals. partment. System, serving good year” financially. Garden City are St. Mary Mercy Livo- because they are a lone hospital” in “We had high length of stay in the as administra- Financial reports for 2015 and nia, which is part of St. Joseph Mercy a market dominated by regional ER. It was eight hours; now it is three tive director, after starting his health 2016 were not yet available. During Health System; Beaumont Hospital system-owned hospitals. hours on average,” George said. care career as a physical therapist in the 15-month period from Sept. 30, Wayne (formerly Oakwood Wayne “One or another of the other “Our goal is to improve time and 1996. He recently hired former As- 2013, to Dec. 31, 2014, Garden City Hospital); Beaumont Hospital Farm- players in the market will probably outcomes.” cension Health executive Gina earned net income of $17.9 million ington Hills (formerly Botsford Hos- make a play for them,” Hai said. So far under Prime management, Butcher as CFO. on net patient revenue of $175.8 mil- pital); and Henry Ford Wyandotte “There are multiple conversations George said, Garden City has been While Prime hospitals have won lion, Garden City officials confirmed. Hospital. going on. Garden City has improved recognized by national quality orga- numerous national awards and This contrasts with $8 million in op- Beaumont Hospital Dearborn has to the point where they might be ap- nizations like Leapfrog Group, quality recognitions, the U.S. Depart- erating losses in 2012 and 2013, ac- an agreement with Garden City for pealing to a larger system.” Healthgrades and the state's largest ment of Justice in late June agreed to cording to Cost Report Data, a Louis- neonatal support, neonatal inten- Hai said Beaumont Health makes health insurer, Blue Cross Blue Shield take up a false claims act whis- ville, Ky.-based consulting firm. sive care unit services and neuro- the most sense to acquire Garden of Michigan, which awarded the hos- tleblower lawsuit filed by a former “We have had patient volume in- surgery residents who rotate at the City. Beaumont officials said there pital with a distinction award for case manager. The allegations in- creases every year from 2013 to 2016 hospital. Henry Ford and St. Joseph are no current talks with Garden maternity care and hip and knee re- clude that Prime hospitals in Cali- and also improvements in efficien- officials said there are no talks with City. placement program. fornia pressured ER doctors to ad- cies because of better care coordi- Garden City. But on Prime adding other Mich- “This shows the staff’s commit- mit patients without sufficient nation,” George said. George declined to offer more igan hospitals, George said the com- ment to the deal. We are finally get- medical necessity instead of hold- For example, inpatient length of specifics, citing ongoing talks. But pany is interested in expanding in ting recognized for our hard work,” ing them in the ER for observation. stay was cut to 3.4 days this year he suggested that Garden City doc- Michigan. There are no talks in he said. George deferred comment to compared with six days in 2013, he tors could refer certain patients to Southeast Michigan, he said. George said that when he was Prime corporate, which released the said. more advanced hospitals with high “Prime has 43 hospitals now,” hired by Prime as chief administra- following statement to Crain’s: “We have had good positive im- technology and specialized services George said. “We were the 30th two tive officer in November 2014, he “Prime Healthcare denies the alle- pact from Healthy Michigan (Med- for treatment and be seen at Garden years ago. We have the fastest growth had never heard of the for-profit gations and remains committed to icaid expansion in 2014),” George City for follow-up care. in the U.S.” company founded in 2001 by Prem providing quality care that patients said. “Charity care has become “Patients don’t like to travel. They Jay Greene: (313) 446-0325 Reddy, an internist turned business- need and deserve. Prime Healthcare Medicaid.” like to stay local when they can,” he Twitter: @jaybgreene

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Systems Inc. last year, is the primary the $92 million acquisition of Vis- AUTO component in the 125-mile test-bed teon Corp.’s lighting division in 2012, FROM PAGE 3 of installations from I-96 near Gener- discussed its new adaptive drive al Motors’ Milford Proving Grounds, beam headlamp system. completely integrated modular unit I-94 from Ann Arbor to metro De- The new lighting system, called that connects vehicles to infrastruc- troit, U.S. 23 from Ann Arbor to ADB, adapts to the environment. ture, other vehicles and the cloud. The Brighton, and elsewhere. Its systems Specifically, the cluster of LED lights unit will upgrade the hardware easily, also are used in downtown Detroit. turn on and off individual lights to focused on security and software ca- “Detroit is the only downtown in avoid blinding other drivers. Scott pable of over-the-air updates. the country with a network deploy- Montessi, director of product devel- The city of Detroit will play a ma- ment,” Singh said. “We’re currently opment for Varroc Lighting, said six jor role in Lear’s success, or failure, looking to work with the city on cre- or seven of the nearly 40 LED-lights in the connectivity space. ating connected buses, etc.” system are switched off to create a Lear’s infrastructure technology, Plymouth-based Varroc Lighting black-box effect around vehicles in which it gained in the acquisition of Systems Inc., the U.S. unit of India’s the beam of light. (Photo, Page 3) former Silicon Valley startup Arada Varroc Group that was formed from “We’re in the middle of a renais- sance for (automotive) lighting,” Montessi said. “Lamps have been INDEX TO COMPANIES the same for nearly 60 years, but Crain’s Detroit Business These companies have signicant mention in this week’s : LEDs and new technologies are Brother Nature Produce ...... 19 Harvey Hohauser & Associates ...... 25, 27 changing the landscape.” Cascade Engineering ...... 31 Herbruck’s Poultry Ranch ...... 11 The ADB system uses cameras Cherry Capital Foods ...... 15 Jackson College ...... 3 equipped on vehicles with advanced CultureSource ...... 9 Lear ...... 3 safety functions — such as lane-de- Dave’s Sweet Tooth ...... 22 LMC Automotive US ...... 3 parture warning and emergen- Detroit Bold Co
ee ...... 22 The Local Grocer ...... 22 cy-braking systems — that can detect Detroit Ento ...... 22 Michigan Agri-Business Association ...... 11, 32 light coming from other vehicles. Detroit Food Academy...... 22 Michigan Department of Agriculture ...... 11, 32 The technology will be on Euro- Diversied Restaurant Holdings ...... 6 Michigan Department of Corrections ...... 31 pean models next year. D-Town Farm ...... 20 Michigan State University ...... 14, 18, 22 Meanwhile, the supplier has Eastern Market Corp...... 13 Michigan Urban Farming Initative ...... 19 joined a push to get U.S. regulators Eden Urban Farms LLC ...... 22 Motor City Popcorn ...... 24 to adopt European standards for a Edibles Rex ...... 22 Old World Gluten-Free LLC ...... 22 new lighting technology. EHM Senior Solutions ...... 9 Pop Daddy Popcorn ...... 22 Audi AG and Toyota Motor Corp. Evangelical Homes of Michigan ...... 9 RecoveryPark Farms ...... 19 have been proponents of the tech- Food for Thought ...... 18 Rib Rack Distributing LLC ...... 24 nology. Toyota even petitioned the Food Lab Detroit ...... 24 Sigma International ...... 27 National Highway Trac Safety Ad- Garden City Hospital ...... 1 Skidmore Studio ...... 25, 26 ministration to mandate, or allow, Garden Fresh Gourmet ...... 16 Splt ...... 4 ADB systems in the U.S. Grand Traverse Pasta LLC ...... 22 Star of the West Milling ...... 11 Montessi said he expects U.S. Great Lakes Potato Chip ...... 22 Varroc Lighting Systems ...... 30 regulators to draft rules allowing Grow Eastern Market ...... 14 Wayne State University ...... 3 ADB systems in the next 12-18 Harvest Michigan ...... 15 Zilke Vegetable Farm LLC ...... 15, 22 months. To battle any oncoming recession in North America, Michigan went on the offensive by signing a memo- randum of understanding with On- tario to increase the region’s com- petitiveness in the automotive industry. Cyber threats The agreement is designed to create best practices, cohesive pub- lic policy, increased supply chain are constant integration and technology transfer agreements, the state said last week. Gov. Rick Snyder and Ontario … and so are our attempts Premier Kathleen Wynne signed the agreement on Aug. 3. to thwart them. Ontario and Michigan account for more than 26 percent of vehicle In 60 percent of cases, attackers are able to compromise production in the Great Lakes re- gion. Trade between the two re- an organization within minutes. Rely on Rehmann’s cyber gions in 2015 totaled $74 billion, the security consultants to help fend o
digital assaults that state said. “Collaborating to improve the disrupt your business and hurt your bottom line. auto sector is a great use of resourc- es that will lead to continued growth Visit rehmann.com/bwd-cyber to watch our exclusive and job creation in both econo- video series on ways to bolster your cyber defense. mies,” Snyder said in a statement. “Sharing best practices and inte- grating our supply chains will ad- SOURCE: Verizon 2015 Data Breach Investigations Report vance Michigan’s and Ontario’s po- sitions as leaders in the auto industry.” The announcement comes amid labor talks between Canada’s largest private union, Unifor, and the De- troit 3. The result could ultimately define how much auto production remains in Ontario. The current la- bor agreement expires Sept. 19. Wynne said Ontario and Michi- gan must find a niche in the market- place to attract new auto investment rehmann.com/bwd-cyberrehmann.com | 866.799.9580 in the region, pointing to an “educat- ed workforce” as an example. Automotive News contributed to this report. CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 31

inmates at the Thumb Correctional oversees a $400 million group of 10 GRANT Facility in Lapeer, while Delta Col- companies and 1,700 employees. FROM PAGE 3 lege won 15 slots to teach general Cascade has hired “hundreds” of management and small-business ex-offenders, some of whom work any other selected college or univer- programs at Saginaw Correctional Fa- in leadership and executive posi- sity in the nation, according to the cility, administrators at both schools tions, Miller testified before the Sen- department. Mott Community Col- testified. ate committee last week. lege in Flint and Delta College near “We’re confronted with a bubble, Bay City also were chosen to partici- Taking a chance and that bubble is moving through pate. The ultimate goal of all of the ed- the system right now. And we need Michigan is second only to Texas ucation and training efforts, propo- to replace the bubble with compe- in the total number of Pell Grants nents say, is for ex-offenders to land tent technical skills and capable in- received. The three schools will jobs that in turn can help them sup- dividuals,” Miller said, adding that teach students at a number of state port their families and communities the company sees an untapped la- prisons, including the Detroit Re-en- and lower the risk of committing bor pool in ex-offenders and sup- try Center on Ryan Road and Ma- another crime. ports the Pell Grant pilot. comb Correctional Facility in New Some companies have taken “For us, this is very simple: Going Haven, according to the federal gov- chances on job candidates with fel- back to the battle for talent, I would ernment. ony records; Sakthi Automotive argue that this is mission critical for State corrections officials and Group USA Inc., a subsidiary of In- the state of Michigan.” college administrators hope the dia-based supplier Sakthi Group, has Washington said the Corrections program will be a catalyst for re- hired dozens of ex-offenders as the Department is making a deliberate duced recidivism, as they work to company expands in southwest De- effort to reach out to employers by send paroled ex-offenders back into MICHIGAN DEPARTMENT OF CORRECTIONS troit. CEO Lalit Verma has said he inviting them to tour the Vocational their communities with education, Jackson College held a ceremony for graduates at the Parnall Correctional Facility in finds paroled prisoners to be among Village and by taking inmates’ re- skills training — and job opportuni- in May. The college has been a leader in Michigan in teaching prisoners. his most dedicated workers. sumes to manufacturing expos. ties. In Grand Rapids, Cascade Engi- “There’s always been a stigma. The last remains challenging. on job applications that requires fender success. And I believe that neering Inc. has opted to wait to ask That’s always been one of the big- Many employers still hesitate to hire candidates to disclose their criminal the key to that is education and em- about an applicant’s criminal record gest challenges for anybody coming candidates with felony convictions, records up front — which often pre- ployment,” said Heidi Washington, until the company is ready to ex- out of prison,” she said. “We’re not though proponents say there are vents a paroled prisoner from land- director of the Michigan Department tend a job offer. And even then, the waiting for employers to come to us. signs that more are becoming recep- ing an interview — is gaining trac- of Corrections. “How could we ex- information is shared only with cor- We’re out seeking employers.” tive to the idea. For instance, a tion. pect people who, by and large, come porate executives, said Mark Miller, Lindsay VanHulle: (517) 657-2204 movement to remove the check box “Prior to this, I just never dreamed from environments which are not Cascade’s president and CEO, who Twitter: @LindsayVanHulle — I never knew — what capable comparable to the environment people were waiting behind those that many of us came from ... to get At a glance bars for an opportunity,” Butler said. out of prison and be successful The U.S. Department of “If I didn’t know that, how can I without these tools?” Education has awarded more than blame any employer out there for In 2013, Santa Monica, Ca- 60 U.S. colleges and universities the thinking the same thing?” lif.-based research organization released a study financed ability to oer Pell Grants to A way out Rand Corp. inmates in state and federal prisons by the U.S. Department of Justice that in order to study whether In 1994, Congress passed a provi- analyzed existing research on the participation in higher education sion in a federal crime bill that pro- relationship between higher educa- while in prison increases with hibited inmates from receiving Pell tion and recidivism. Its authors con- nancial aid. Here’s how many Grants while in prison. The Obama cluded that inmates who received grants states won: administration last year announced career or college education while the new pilot program, called Sec- incarcerated had up to a 43 percent Texas: 2,544 ond Chance Pell, that will waive the lower chance of another offense Michigan: 1,475 restrictions on incarcerated stu- than their counterparts did. New York: 1,110 dents in an effort to determine the Michigan’s Corrections Depart- link between access to financial aid ment this spring launched a resi- Ohio: 1,040 and participation in higher educa- dential vocational training program Connecticut: 801 tion. The selected colleges were at a state prison in Ionia that simu- New Jersey: 598 named in June. lates a workday while offering in- To qualify, prisoners must be mates the chance to learn skilled California: 582 within five years of release. Federal trades in carpentry, plumbing and Alabama: 556 Pell Grants are worth up to $5,815 electrical work, automotive tech- Arkansas: 400 per student this year, based in part nology, CNC machining and weld- on financial need, the cost to attend ing. A second location will open at Iowa: 314 classes and a student’s full- or part- Parnall Correctional Facility near Oklahoma: 279 time status. Jackson. A few years ago, Michigan was All participants in Vocational Vil- Wisconsin: 250 one of three states, including New lage, as it’s called, live together in the West Virginia: 215 Jersey and North Carolina, chosen to same housing unit designed to cre- Maryland: 209 participate in a five-year effort called ate a supportive learning environ- Pathways from Prison to Postsec- ment. Washington said her depart- Virginia: 187 ondary Education. Sponsored by the ment hopes to replicate the idea Oregon: 186 New York-based nonprofit Vera Insti- with the Pell Grant students. South Carolina: 180 tute of Justice and funded by several The model makes Michigan a Progress. foundations — including the Battle “national leader” in prisoner educa- At the heart of West Michigan’s economic development, Washington: 135 Creek-based tion and rehabilitation, she testified W.K. Kellogg Foundation Lakers are a vital force. Throughout the region and state, Pennsylvania: 115 and the Ford Foundation, based in last week before a state Senate com- Lakers live, work, and lead, helping create solutions that Minnesota: 100 New York City — the Pathways pilot mittee. drive growth forward. As a major university, Grand Valley’s offered inmates within two years of Jackson College will offer an asso- economic impact is substantial. As a talent resource, Lakers Indiana: 100 their release date in Pontiac and Ka- ciate of arts degree, an associate in are uniquely prepared to meet the challenges of a changing Illinois: 86 lamazoo the chance to take college applied science degree in business world. That’s the Laker Eect. classes and receive other support administration and an associate de- Massachusetts: 72 services. Researchers will follow the gree in general studies, along with a Vermont: 56 inmates for two years once they’re certificate in business, Butler said. Florida: 50 paroled. Jackson will hire instructors to teach Jackson College also participated inside a number of state prisons, in- Nebraska: 30 in the Pathways project; some of cluding the Women’s Huron Valley Maine: 25 those students not yet released are Correctional Facility in Washtenaw Total Pell Grants: 11,695 expected to transition into the Pell County. gvsu.edu Source: U.S. Department of Education program, Butler said. Mott Community College re- “It’s all about breaking the cycle ceived 155 grants and will offer two of incarceration and (creating) of- certificate programs in business to 32 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016

U.S. and Canadian population,” he it ranked sixth in the country last state’s dairy industry. The launch came two years after Brauer said. They, too, present pro- FOOD said. Coupled with the number-one year for the farm-level value of pro- Dairy farmers from drought-rav- Continental began producing Core cessing opportunities, especially giv- FROM PAGE 1 border crossing in North America duce sold into the processed market, aged California, the Netherlands Power, a high protein milk shake en that Michigan is home to families between Detroit and Windsor, those with $360 million in total revenue. and Belgium are increasingly locat- aimed at fitness enthusiasts, from that have done that work, processing Eastern Market Corp. in Detroit as di- are strong selling points for Michi- Michigan is second only to Cali- ing their herds here, Byrum said. its Coopersville plant on the state’s pickles, asparagus and potatoes. rector of food innovation programs gan, Vernaci said. fornia in the diversity of fruits, vege- “Cows like Michigan better. … They west side, for Coca-Cola. after 15 years with the At its core, food processing takes tables and other agricultural prod- produce more milk because it’s Bean counters Michigan De- Michigan soy sauce? partment of Agriculture and Rural De- a product like an apple from its nat- ucts it grows or harvests, from cooler and more moderate in tem- Michigan, meanwhile, produces velopment as an economic develop- ural state into something more. It cherries to potatoes to pumpkins, peratures,” he said. In the corn field, there’s a resur- more dried beans than what is being ment specialist. could be apple slices sold as part of a honey and maple syrup, according Large retailers have begun oper- gence of companies looking at etha- consumed domestically in the U.S., “It enables a farmer to sell more Happy Meal at McDonald’s, apple- to the USDA. ating dairies here to capitalize on nol in fuel, Brauer said. And when it said Jamie Zmitko-Somers, interna- of his crop,” he said, creating de- sauce, apple cider vinegar or And Michigan’s food processing the milk supply. The Kroger Co. of comes to soybeans, most of the 100 tional marketing program manager mand not just for the product in its chopped apple bits to flavor a gra- roots run nearly as deep, bringing Michigan operates Michigan Dairy LLC million bushels or so grown in for the state Department of Agricul- own right, but also as an ingredient nola bar. increased economic activity for in Livonia, a milk processing and Michigan each year are sent to other ture. To sell more of their crops, in other products. According to U.S. census data for farmers, cities and the state as a bottling plant. And four years ago, states to be processed. Some comes growers are exporting them to Mexi- With rising transportation costs 2010, Michigan ranked No. 19 for whole, through household names Meijer Inc. acquired a share of Bare- back into the state to feed animals. co, Central America, the Caribbean, and the Food Safety Modernization agri-food processing with $14.13 like Better Made Potato Chips, Mc- man’s Dairy and launched the Purple As a new Clemens Food Group pork Italy and the United Kingdom. Act ramping up responsibilities for billion in food shipments that year. Clure’s and Vlasic pickles, Kellogg, Cow Creamery, investing $8 million processing plant ramps up in Cold- “Our Michigan processors have a growers, processors and distribu- In 2014, the most recent year Seneca juices and Yoplait. to expand the family-owned dairy in water Township, demand is expect- great relationship with Busch’s and tors, “it’s becoming much more im- available, the total value of cash re- “Michigan has … had to work Holland to process white and choc- ed to surge for animal feed made others, but ... there’s a lot of produc- portant to monitor more fully ceipts for all agricultural production harder than other states because of olate milk for Meijer stores across from corn and soybeans to feed the tion here. We certainly would look through the food chain, from grow- in Michigan, from livestock to milk, limitations,” including a shorter the state. growing number of hogs raised in for opportunities for companies to er to table,” said Kurt Brauer, part- produce and tulip bulbs, was $8.54 growing season and different soil With the increased dairy farmer the state. Processing soybeans into come and use and process dried ner and chairman of the agribusi- billion, according to the U.S. Depart- types that can help or hurt produc- presence and milk production meal in Michigan could also offer beans here in Michigan,” Zmit- ness and food industry group at ment of Agriculture. tion, said Jim Byrum, president of comes opportunity for processing opportunities to begin making ko-Somers said. Warner Norcross & Judd LLP in South- Michigan ranked No. 19 in the the East Lansing-based Michigan ancillary products as well, Brauer products new to the state, such as Using surplus beans to produce field. farm-level value of all agricultural Agri-Business Association. said. “There are several yogurt and soy sauce, DiBernardo said. new products, such as bean flour, is That may be spurring food pro- commodities produced that year At the same time, microclimates cheese makers looking to locate or Zeeland Farm Services near Grand already being looked at, she said. cessors to look at their footprint and based on data collected by the like those in the northwest and expand in Michigan,” he said. Rapids contracts with soybean “Millennials are not eating consider expansions and reloca- USDA, said Marty Saffell, statisti- western portions of the state help There’s also a growing market for growers and grows its own crop to canned cherry pie filing any more,” tions, and Michigan is in the mix. cian specialist for the state Depart- moderate temperatures on the high new dairy-based products. Conti- make soybean meal. It then ships she said. “And a lot of them aren’t In the Michigan Economic Develop- ment of Agriculture. and low extremes, providing the op- nental Dairy Facilities LLC last year that to Asia for use in soy sauce and necessarily eating canned beans ment Corp.’s view, the state’s location Federal numbers don’t break out portunity for fruit production, began producing FairLife for Co- tofu and uses a portion of it to make anymore. They’re looking for ways makes it a prime candidate for new rankings for broad commodity “There’s always opportunity; ca-Cola Co. Distributed through animal feed, DiBernardo said. to eat these foods in a more whole- processing, said Tony Vernaci, vice groups, but based on 2015 data, Saf- that’s part of the entrepreneurial Coke’s Minute Maid division, which “That’s an example of an export- some way, like using dried bean president of global business devel- fell said, Michigan ranked seventh spirit here,” Byrum said. has a plant in Paw Paw, the reconsti- ed product that presents an oppor- flour in a meat substitute or using opment. in the country for the farm-level val- tuted milk product boasts higher tunity to make a value-added prod- tart cherry juice concentrate with “If you draw a circle around ue of fruits and vegetables sold into Pure dairy? protein, less fat and more calcium uct like soy sauce here,” he said. health benefits for muscle recovery Michigan, within a 500-mile radius the fresh market for consumption, One area presenting opportuni- than regular milk, appealing to con- Crops like tomatoes and peppers in (other products).” you hit more than 50 percent of the with total sales of $514 million. And ties for increased processing is the sumers on high-protein diets. are also processed in other states, The MEDC sees opportunities in attracting juice processors to Michi- gan, given the yields of apples and cherries the state produces, Vernaci said. And there are opportunities for both growing hops and processing them as the craft beer industry grows. Michigan may be fertile ground for crops, but the same can be said WSU FROM PAGE 3

2016...,” the S&P report states. “(T)he university intends to subsidize antic- ipated losses at its School of Medicine and an affiliated entity related to a major ongoing restructuring at these Thank You! entities, which includes several gov- ernance changes and elimination of tenured faculty positions.” For moving regional transit forward. The student enrollment figure for fall 2015, the latest WSU said was available, shows 27,200, a drop of about 400 from the total enrollment — undergraduate, graduate and professional students enrolled in fall 2014. In fall 2011, the Michigan Higher Education Institutional Data Inventory logged WSU at 29,786. The S&P report also notes WSU could “potentially” issue bonds in late 2017 or early 2018 to support the Mike Ilitch School of Business construction project in District De- Chair, Washtenaw Executive, Executive, Mayor, Executive, troit, something it has hoped to County Board of Wayne County Macomb County City of Detroit Oakland County tackle largely with donor gifts, or to- Commissioners ward part of a science and engineer- Warren Evans Mark Hackel Mike Duggan L. Brooks Patterson ing building renovation. Susan Felicia Brabec Burns, vice president of develop- ment an alumni affairs at WSU, said the school could bond up to $14 million toward a total $59 million Il- Your leadership is building a brighter, collective future for Southeast Michigan. itch project cost — or less, if dona- tions cover more. The university reported just over CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 33

The launch came two years after Brauer said. They, too, present pro- for its challenges. “have to be sensitive to and mindful gram, it’s connecting food growers Continental began producing Core cessing opportunities, especially giv- Food processors and farmers are that if they expect companies to pay and buyers. And it’s assisting local Power, a high protein milk shake en that Michigan is home to families increasingly sensitive to the rising for public infrastructure, that’s a companies with exporting their www.crainsdetroit.com aimed at fitness enthusiasts, from that have done that work, processing costs of transporting produce from competitive disadvantage over ... products to other countries. Editor-in-Chief Keith E. Crain its Coopersville plant on the state’s pickles, asparagus and potatoes. the field to the factory, Brauer said. other states,” DiBernardo said. In the case of Clemens Food Group Publisher Mary Kramer, (313) 446-0399 or [email protected] west side, for Coca-Cola. As a result, they are increasingly Companies “understand the Group and its plan for a new pork Bean counters Editor Jennette Smith, (313) 446-1622 looking to locate their facilities clos- things they have to do inside of their processing plant, company, local or [email protected] Michigan soy sauce? Michigan, meanwhile, produces er to growers. ‘box,’but paying for infrastructure and state officials had “thoughtful Director, Digital Strategy, Audience Development Nancy Hanus, (313) 446-1621 or [email protected] In the corn field, there’s a resur- more dried beans than what is being Most other states have continu- that comes to their property line is a conversation about what they need- Managing Editor Michael Lee, (313) 446-1630 gence of companies looking at etha- consumed domestically in the U.S., ous rail from east to west, he said. disadvantage” for Michigan, he said. ed to deal with water and wastewa- or [email protected] nol in fuel, Brauer said. And when it said Jamie Zmitko-Somers, interna- “In Michigan, you’ve got a lot of “Other states are willing to make ter for the plant,” said DiBernardo, Managing Editor/Custom and Special Projects Daniel Duggan, (313) 446-0414 or [email protected] comes to soybeans, most of the 100 tional marketing program manager north-to-south traffic before you that investment.” who, while at the Department of Assistant Managing Editor Kristin Bull, million bushels or so grown in for the state Department of Agricul- can go east or west.” The Department of Agriculture is Agriculture, was a part of piecing to- (313) 446-1608 or [email protected] Michigan each year are sent to other ture. To sell more of their crops, And it’s the same thing with funding research to look at anaero- gether $12.5 million in community News Editor Beth Reeber Valone, (313) 446-5875 or [email protected] states to be processed. Some comes growers are exporting them to Mexi- Michigan’s interstate highways, bic digesters and other ways to more block development grant funds to Senior Editor Gary Piatek, (313) 446-0357 back into the state to feed animals. co, Central America, the Caribbean, making the logistics of shipping cost-effectively treat water at compa- bring the Pennsylvania-based pork or [email protected] As a new Clemens Food Group pork Italy and the United Kingdom. food products tougher and more ny facilities, Zmitko-Somers said. processor to Southwest Michigan. Research and Data Editor Sonya Hill, (313) 446-0402 or [email protected] processing plant ramps up in Cold- “Our Michigan processors have a costly, Brauer said. Economic incentives available to The funds helped to support in- Newsroom (313) 446-0329, FAX (313) 446-1687, water Township, demand is expect- great relationship with and food processors range from block frastructure, land acquisition, work- TIP LINE (313) 446-6766 Busch’s Power issues ed to surge for animal feed made others, but ... there’s a lot of produc- grant funding to business develop- force development and on-the-job REPORTERS from corn and soybeans to feed the tion here. We certainly would look Other challenges in locating clos- ment grants and loans to renais- training for the 550,000-square-foot Marti Benedetti General assignment. (313) 446-0416 or growing number of hogs raised in er to crops in the state’s rural areas [email protected] for opportunities for companies to sance-zone designations that ex- Clemens pork processing site now Jay Greene, senior reporter Covers health care, insurance, the state. Processing soybeans into come and use and process dried are energy and water infrastructure. empt companies from property tax under construction. Clemens’ in- energy, utilities and the environment. meal in Michigan could also offer beans here in Michigan,” Zmit- Food processing plants are high for up to 15 years. There are, howev- vestment in the project is expected (313) 446-0325 or [email protected] Chad Halcom Covers litigation, the defense industry, opportunities to begin making ko-Somers said. utility consumers, Brauer said, and er, only a couple of those left, Brauer to total up to $255.7 million. education, Macomb and Oakland counties. (313) 446-6796 products new to the state, such as Using surplus beans to produce there are sometimes challenges of said. Clemens is working with Kellogg or [email protected] soy sauce, DiBernardo said. new products, such as bean flour, is getting adequate natural gas and But on a positive note, the state’s Community College and the Branch Tom Henderson Covers banking, šnance, technology and biotechnology. (313) 446-0337 or Zeeland Farm Services near Grand already being looked at, she said. electricity. In 2014, grain farmers in personal property tax phase-out for Area Career Center to develop cours- [email protected] Rapids contracts with soybean “Millennials are not eating the thumb area, dependent on heat most businesses in 2014 means the es to train an estimated 810 employ- Kirk Pinho Covers real estate, city of Detroit. (313) growers and grows its own crop to canned cherry pie filing any more,” and fans to dry their grain in the si- expensive food processing equip- ees on the equipment and expertise 446-0412 or [email protected] Adrienne Roberts General assignment, retail. (313) make soybean meal. It then ships she said. “And a lot of them aren’t los, faced natural gas shortages as ment and machinery companies needed to be eligible for skilled 446-1612 that to Asia for use in soy sauce and necessarily eating canned beans homeowners turned their dials up house in their facilities here won’t be trades careers with the company. Bill Shea, enterprise editor Covers media, advertising and tofu and uses a portion of it to make anymore. They’re looking for ways amid uncharacteristically frigid taxed. That — along with Michigan’s Attracting a large processing marketing, the business of sports, and transportation. (313) 446-1626 or [email protected] animal feed, DiBernardo said. to eat these foods in a more whole- temperatures that winter. stance as a right-to-work state — plant like the one Clemens is build- Lindsay VanHulle, Lansing reporter. (517) 657-2204 “That’s an example of an export- some way, like using dried bean While abundant, our water is not has helped the state become more ing is rare, Byrum said. “Very few or [email protected] ed product that presents an oppor- flour in a meat substitute or using equally distributed across the state, competitive, Brauer said. companies are going to come out Dustin Walsh, senior reporter Covers the business of law, auto suppliers and manufacturing. tunity to make a value-added prod- tart cherry juice concentrate with so getting it to where it’s needed can Because manufacturing in areas and build a brand new green field (313) 446-6042 or [email protected] uct like soy sauce here,” he said. health benefits for muscle recovery be a challenge, Brauer said. such as automotive and aviation is plant in an area where they aren’t fa- Sherri Welch, senior reporter Covers nonprošts, services, Crops like tomatoes and peppers in (other products).” But the bigger issue is on the sew- Michigan’s greatest strength, there miliar,” he said. food and hospitality. (313) 446-1694 or [email protected] are also processed in other states, The MEDC sees opportunities in er side of the water lines, industry are more incentives put behind Much of the growth in processing ADVERTISING Sales Inquiries (313) 446-6032; FAX (313) 393-0997 attracting juice processors to Michi- experts said. Fats, greases and oil that those types of projects, Vernaci said. in Michigan will be organic, he said, Advertising Director Matthew Langan gan, given the yields of apples and are byproducts of food processing Still, the state does see the potential noting that those just starting out in Senior Account Manager Katie Sullivan cherries the state produces, Vernaci need to be removed before the water for increased food processing. the food industry tend to launch Advertising Sales Christine Galasso, Gerry Golinske, Diane Owen, Sarah Stachowicz said. And there are opportunities for is returned to the general water sup- The MEDC is working to under- companies in their own backyard. ClassiŠed Sales Manager Angela Schutte, both growing hops and processing ply, and often, municipalities do not stand supply chain gaps, and, in the “That’s why we need to do more (313) 446-6051 them as the craft beer industry have the capacity or system in place meantime, is focusing on helping economic gardening for folks al- ClassiŠed Sales Lynn Calcaterra, (313) 446-6086 Marketing and Event Director Kim Winkler grows. to clean that water. It can be expen- grow the food processing opera- ready in Michigan,” Byrum said. Events Manager Kacey Anderson Michigan may be fertile ground sive to put those sewer lines in. tions already here. Through the Pure Sherri Welch: (313) 446-1694 Senior Art Director Sylvia Kolaski for crops, but the same can be said Local and state governments Michigan Business Connect pro- Twitter: @sherriwelch Marketing Manager Marilyn Banes Special Projects Coordinator Keenan Covington Sales Support Suzanne Janik $124 million in unrestricted net as- first year of a three-year turnaround and some out-of-state student re- Production Manager Wendy Kobylarz sets at the end of fiscal 2015, down plan for those three units, and Hefner cruitment, which helps stabilize en- Production Supervisor Andrew Spanos WSU CUSTOMER SERVICE FROM PAGE 3 $31 million from the previous year, said some segments could cross the rollment and revenue — a practical Main Number: Call (877) 824-9374 and over two years it had made cap- net-zero mark next year to become necessity, since all Michigan col- or [email protected] 2016...,” the S&P report states. “(T)he ital expenditures of $69.3 million for cash-flow positive in fiscal 2018. leges are facing a dwindling crop of Subscriptions $59 one year, $98 two years. Out of state, university intends to subsidize antic- a new Integrative Biosciences Cen- But he declined to elaborate, par- local high school graduates. $79 one year, $138 for two years. Outside U.S.A., add $48 per year to out-of-state rate for surface mail. Call (313) ipated losses at its School of Medicine ter building, plus $30.8 million for ticularly about the dozens of report- John Axe, a Detroit-based attor- 446-0450 or (877) 824-9374. and an affiliated entity related to a renovations to its student center edly unproductive faculty members ney at Clark Hill PLC who specializes Single Copies (877) 824-9374 major ongoing restructuring at these building. The ratings services had that Hefner and medical school in bond financesaid bond debt like Reprints (212) 210-0750; or Krista Bora at [email protected] Thank You! entities, which includes several gov- expressed some concern about the dean Jack Sobel addressed in a the kind WSU carries is sometimes To Šnd a date a story was published (313) 446-0406 or ernance changes and elimination of university’s “spend down of finan- March letter to the faculty, other an easier proposition for larger uni- e-mail [email protected] tenured faculty positions.” cial reserves” and overall weaker than to say there is “lots of progress” versities with national attraction, Crain’s Detroit Business is published by For moving regional transit forward. The student enrollment figure for credit position. on that issue in recent weeks. like the University of Michigan, versus Crain Communications Inc. Chairman Keith E. Crain fall 2015, the latest WSU said was William Decatur, WSU vice presi- He and Decatur also said the uni- regional colleges. President Rance Crain available, shows 27,200, a drop of dent for business operations and versity is implementing new man- “Generally speaking, in order to Treasurer Mary Kay Crain about 400 from the total enrollment CFO-treasurer, said the university agement and accountability mea- borrow, you should have some reve- Executive Vice President/Operations William A. Morrow — undergraduate, graduate and found some new stability in enroll- sures within the administration that nue coming from the specific build- Executive Vice President/Director of Strategic professional students enrolled in ment and expects an increase in are expected to help. Decatur called ing, depending on what you’re put- Operations Chris Crain fall 2014. In fall 2011, the Michigan student retention this coming fall, it a “responsibility-centered man- ting up for debt service. And Executive Vice President/Director of Corporate Operations KC Crain Higher Education Institutional Data bolstering tuition revenue. But he agement model” that Ohio University ordinarily what universities bond Vice President/Production & Manufacturing Inventory logged WSU at 29,786. also predicts some of the medical adopted during his tenure as senior are dormitories, sports stadiums Dave Kamis The S&P report also notes WSU school-related budgets could be vice president of finance and ad- with a ticket gate, and other facilities Chief Financial O”cer Bob Recchia Chief Information O”cer Anthony DiPonio could “potentially” issue bonds in balanced during the fiscal year that ministration there, and that Virginia that generate a revenue stream,” he G.D. Crain Jr. Founder (1885-1973) late 2017 or early 2018 to support begins Oct. 1. Commonwealth University was also said. “And in that sense a (University Mrs. G.D. Crain Jr. Chairman (1911-1996) the Mike Ilitch School of Business David Hefner, vice president of developing when he left that school of Michigan) will have less trouble Editorial & Business O”ces 1155 Gratiot Ave., Detroit MI 48207-2732; construction project in District De- health affairs at WSU, said a com- last year to assume his WSU post. than Michigan State, and they’ll both (313) 446-6000 Chair, Washtenaw Executive, Executive, Mayor, Executive, troit, something it has hoped to bined $32 million budget deficit in Also, Wayne State’s six-year grad- have less trouble than other schools, Cable address: TWX 248-221-5122 AUTNEW DET tackle largely with donor gifts, or to- fiscal 2015 across the School of uation rate was 35 percent last year because of the options you have.” CRAIN’S DETROIT BUSINESS ISSN # 0882-1992 is published County Board of Wayne County Macomb County City of Detroit Oakland County weekly, except for a special issue the third week of Commissioners ward part of a science and engineer- Medicine, the University Physician for students who enrolled in 2009, a Moody’s also noted that “the uni- November, and no issue the third week of December by Warren Evans Mark Hackel Mike Duggan L. Brooks Patterson ing building renovation. Susan Group and the Fund for Medical Re- 9 percentage-point increase since versity’s ambitious strategic plan Crain Communications Inc. at 1155 Gratiot Ave., Detroit MI Burns, vice president of develop- search and Education could narrow 2011, and Monica Brockmeyer, as- will place additional pressure on 48207-2732. Periodicals postage paid at Detroit, MI and Felicia Brabec additional mailing o¦ces. POSTMASTER: Send address ment an alumni affairs at WSU, said to as little as $16 million combined sociate provost for student success, operations and financial reserves,” changes to CRAIN’S DETROIT BUSINESS, Circulation the school could bond up to $14 for the fiscal year ending next said it expects to hit its 38 percent but that stabilizing enrollment and Department, P.O. Box 07925, Detroit, MI 48207-9732. GST # 136760444. Printed in U.S.A. million toward a total $59 million Il- month. But that is subject to a fiscal goal next month when the next set more geographic diversity among Contents copyright 2016 by Crain Communications Inc. All Your leadership is building a brighter, collective future for Southeast Michigan. itch project cost — or less, if dona- 2016 audit to be completed at the of graduation figures is complete. the students it attracts could even- rights reserved. Reproduction or use of editorial content in tions cover more. end of the calendar year. Decatur said the school is doing tually generate a credit rating up- any manner without permission is prohibited. The university reported just over The university is wrapping up the better in recent years at regional grade. 34 CRAIN’S DETROIT BUSINESS // AUGUST 8, 2016 ON THE WEB RUMBLINGS WEEK JULY 30-AUG. 5 ranking of national primary Bloom eld Park site has Ford uses Olympics Detroit Digits mortgage servicing providers. n Calexico, the New York to drive Snapchat A numbers-driven look at last City-based restaurant chain known week's headlines: for its California-Mexican style food new name, new plan presence and cocktails, is to open inside the he long-anticipated build-out grocery store — along with 300 to One Campus Martius building in Tof the former Bloomfield Park 350 residential units. ord Motor Co. is about to make $107,000 downtown Detroit on Aug. 11. site at Telegraph and Square Lake Redico and California-based Fits most aggressive play yet on The amount of revenue sharing n A groundbreaking was held in roads is finally on the docket. Paci‘c Coast Capital Partners LLC Snapchat, and the automaker is money to be split among the Ypsilanti for a $17.2 million, 86-unit Demolition is expected to begin purchased the site last year after the using the Olympics to launch the nearly 500 investors in Detroit affordable-housing community within 90 days at the Village at previous owner waived redemption campaign. Although not an official City Football Club’s project to called New Parkridge, developed by Bloom‘eld site in Bloomfield rights to the property. sponsor for the current summer renovate Keyworth Stadium in the Ypsilanti Housing Commission Township and Pontiac, according to The Village at Bloomfield, the games, the Dearborn-based Hamtramck. The semipro soccer and Chesapeake Community the project’s developer, Redico LLC. architect of which is Detroit-based automaker has come up with a club had launched a grass-roots Advisors. UnitedHealthcare is Redico President, CEO and COO SmithGroup JJR Inc., is expected to creative workaround for the campaign that raised $725,500. investing $8 million in the project, Dale Watchowski said last week that cost approximately $180 million. campaign, which spotlights the set for completion in fall 2017. construction at the Village at Construction was halted at the 2017 Ford Escape SUV, Advertising n A $2.5 million gift to United Bloomfield, which is the new name half-completed, 18-building Age reports. Ford has created more $4.4 million Methodist Retirement Communities of the half-built development, will Bloomfield Park complex in than 30 Snap ads — the 10-second The planned cost of the renovation by Ann Arbor philanthropists Tom begin this year as well. The project November 2008 after the project ads that appear within Snapchat by Bloomeld Hills-based MJR and Debby McMullen will fund is expected to include up to 300,000 faced financial and legal stories — that make veiled but Theatres Inc. to the Cinemark construction of a wellness and square feet of new retail space — challenges under previous recognizable Olympic references. Movies 16 theater in Warren, which aquatic center on its main campus including a movie theater and ownership. will reopen under the MJR Digital in Chelsea. COMPANY NEWS Cinema banner in February. n The Detroit Tigers’ spring n Beaumont Health plans to training home in Florida is getting a Mudgie’s sells 3,500 lobster redevelop its 183,000-square-foot longer name: Publix Field at Joker rolls during its big week Northwood Shopping Center in Royal $173.8 million Marchant Stadium. The name Oak into a commercial retail The estimated maximum value of change comes after Lakeland- Those tapped into Detroit’s development, pending city approval. based chain dining scene — or those who the University of Michigan’s Publix Super Markets n Birmingham-based Conway athletics deal with Oregon-based Inc. agreed to pay $3 million over 15 appreciate fresh seafood — were is expanding with the years for naming rights. well aware of the hype surrounding MacKenzie Inc. Nike Inc. UM’s new football n addition of a Dallas-based valuation uniforms — the rst to sport Nike’s Jimmy Walker’s victory at the Corktown sandwich shop Mudgie’s and opinion services practice. Michael Jordan “Jumpman” logo PGA Championship was a market- “Lobstah Roll Week” July 25-31. n The Battle Creek-based W.K. — were unveiled during a media ing win for Farmington Hills-based Mudgie’s had lines around the Kellogg Foundation awarded a event in Detroit last week. wholesale insurance broker and building of more than 100 people, three-year, $2.5 million grant to City underwriting manager Burns & averaged sales of 80 lobster rolls an Connect Detroit to help sustain Wilcox, whose logo was embla- hour and introduced “shifts” that

Detroit’s youth employment holding company, acquired Royal zoned on the golfer’s shirt due to a broke up the day into two parts as a MUDGIE’S system. City Connect is among the Oak-based Berg Steel Corp. Finan- sponsorship deal signed last year. way to ensure there were lobster in Corktown sold about 80 participating agencies in the Grow cials were not disclosed. rolls available for people who came Mudgie’s lobster rolls an hour during its “Lobstah Detroit’s Young Talent program. n Of the 38 branches scheduled OTHER NEWS at dinnertime and that the staff Roll Week” last month. n Ontario-based Martinrea to be closed in Michigan following n Creation of a committee with could get a rest, said Greg Mudge, International Inc. will close its the $3.4 billion acquisition by veto power over funding allocations owner of Mudgie’s. advance, anticipating a 20 percent Detroit-based Martinrea Hot Columbus-Ohio-based Huntington for metro Detroit’s transportation Over the week, the restaurant increase over last year, but instead Stampings Inc. plant. The first stage Bancshares Inc. of Akron, Ohio- systems was the compromise that sold 3,500 lobster rolls and reached reached a 40 percent spike in sales. of layoffs was already announced to based FirstMerit Corp., six are in broke a deadlock for a regional sales of $20,000 a day, compared to Mudge said the restaurant had to begin Aug. 31; the next stage begins Oakland County (Commerce transit tax to go on the November $4,000-$5,000 on an average day for stop taking carryout orders for Sept. 26. Up to 122 jobs will be lost. Township, Farmington Hills, ballot. The Regional Transit Authority the restaurant. lobster rolls early in the week n Northville-based auto parts Rochester, Troy and two in Novi); of Southeast Michigan’s board voted Mudge said after introducing because people would order 20 supplier ZF North America Inc. is three in Macomb County (Romeo, for a bylaw change that allowed it to “Lobstah Roll Week” four to five rolls at a time. He said customers recalling 505,000 control sensors in Clinton Township and Shelby unanimously agree to send the years ago, sales of the rolls have were bribing staff with $100 in cash the U.S. because they can make Township); and one each in Wayne ballot language for a 1.2-mill, increased 20 percent year over year. for a lobster roll, and customers some nine-speed transmissions County (Canton Township) and 20-year transit tax to the state board He ordered 850 pounds of Maine who weren’t able to get a lobster roll shift into neutral without warning. Washtenaw County (Manchester). of canvassers for approval ahead of lobster — which was shipped in before Mudgie’s ran out would n Union Partners I LLC, an Oak n Detroit-based Quicken Loans the Aug. 16 deadline to get issues daily — for this year’s event. Mudge attempt to buy lobster rolls from Brook, Ill.-based investment Inc. topped the J.D. Power 2016 on the Nov. 8 ballot. ordered the lobster weeks in other diners. n Jim Wright, a Detroit Building Authority deputy director, resigned and was replaced by Timothy 1,500 tickets sold to hear Trump at Detroit Economic Club Palazzolo, a demolition operations manager. The city’s demolition The Detroit Economic Club sold nominee Hillary Clinton also has program has been under federal roughly 1,500 tickets to hear been invited to speak. and local investigation for several Republican presidential nominee The controversial New York months amid cost concerns. Donald Trump speak about the businessman has rankled many in n A $75.5 million plan by economy on Monday. the GOP with recent comments Vancouver real estate investor Ron That was the tally after ticket about veterans and his decision not Lanthier to purchase and renovate sales closed midday Friday, said to endorse some top Republican the historic Buhl Building in Matt Friedman, a spokesman for the lawmakers in primary races. downtown Detroit has collapsed. economic club. The venue, the The economic club has hosted Sources told Crain’s that financial Detroit Marriott Renaissance Center, previous presidential candidates, snags torpedoed the deal. has capacity for 2,000. including U.S. Sen. Marco Rubio of n Voters in Wayne, Oakland and Trump’s campaign told the Florida, former Florida Gov. Jeb Macomb counties approved a tax economic club only that it planned Bush, Ohio Gov. John Kasich and

CHRIS EHRMANN/CRAIN’S DETROIT BUSINESS renewal for the Detroit Zoo, and U.S. a “major” speech focused on the then-U.S. Sen. Barack Obama from The nal structural steel beam is raised to be placed on top of the Little Caesars Rep. John Conyers, the longest-serv- economy, Friedman said. The event Illinois in 2007. Arena in downtown Detroit last week. More than 7,500 pieces of steel have been ing member of the U.S. House, is open to Detroit Economic Club The Detroit Economic Club does placed on the 819,000-square-foot structure since October by Detroit-based defeated Detroit City Clerk Janice members and their guests. not take a position on candidates, Midwest Steel and Iron Workers Local 25, with more than 540 construction workers Winfrey in the heavily Democratic The club’s invitation to Trump Friedman said, adding: “It’s about helping to build the $627.5 million, 20,000-seat future home of the Detroit Red 13th District primary. No incum- was among several extended to providing members with direct Wings. What’s next? Building the elevators and escalators, parking structure and bent Michigan House candidates presidential candidates during the access to newsmakers to discuss pedestrian bridge linking parking to the arena. lost in the state primary election. primary season. Democratic important issues.” DBpageAD_DBpageAD.qxd 8/3/2016 9:47 AM Page 1

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