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2012 Maine Profile: Farmers Markets, Specialty Stores Lead Industry Trends

Portland Maine

Last updated on August 30th, 2022 at 03:16 pm

[gn_note color=”#b1cbde”]The 2012 Maine Profile originally ran in the January 2012 edition of The Shelby Report of the Northeast. Due to reader requests we will be posting our Profiles from each edition of The Shelby Report. The profile will be published on theshelbyreport.com one month after it has run in print.[/gn_note]

by Ashley Bates/staff writer

The Maine grocery industry and the state economy have seen highs and lows during and after the Great Recession, and the future is ­expected to hold a slow climb back to ­economic growth.

Shelley Doak, president of the Maine Grocers Association for three years, said Maine is dealing with deep, sweeping budget cuts that will be tough for some residents to cope with this year.

“The governor has announced significant cuts to our Medicaid,” she said. “Essentially, as proposed, 65,000 Maine residents would no longer receive any kind of government assistance.”

Doak explained that 65,000 residents is a significant percentage in Maine since the state has only 1.3 million residents.

“For us, for our pharmacy members in particular, that poses significant concern,” she said. Those whose benefits are cut “wouldn’t be visiting doctors, they wouldn’t have ­prescriptions filled or couldn’t afford to fill them.

According to WCSH6.com, Gov. Paul LePage has proposed eliminating Medicaid ­funding for group homes and assisted living centers, referred to as PNMIs—private, non-medical institutions.

“Republicans and Democrats alike have been highly critical of that proposal, saying that elderly people in assisted living programs, including some Alzheimer’s and dementia ­patients, have no other places to go,” the news report said.

“Obviously, our health and human services on the budget lines are the most costly to the state, so if you step back and take a look at those budgetary cuts, it means that we really can’t afford to do other things that would be of value to our industry, which is to make ­improvements to our infrastructure, our highways and byways,” Doak said.

As of October 2011, the unemployment rate in Maine was 7.3 percent, which is lower than the national average, according to the U.S. Bureau of Labor Statistics.

“I think what we are struggling with, like a lot of other states, is the lack of higher paying manufacturing jobs, and I daresay we lack a long-term economic development strategy,” Doak said.

Economists in New England also are predicting a slow economic recovery.

New England will continue to experience a slow economic recovery until well into 2013 in part because of weaknesses in the national and global economies, an economic forecaster said on Nov. 17, The Associated Press reported.

The forecast came a day before the New England Economic Partnership was scheduled to hold its fall conference in Manchester.

Ross Gittell, the partnership’s New England forecast manager, said in a statement that the region is not expected to return to pre-recession employment levels until the second quarter of 2015.

He added that Maine and Connecticut are expected to have the lowest job growth rates, and Rhode Island, which has a 10.5 percent jobless rate, is expected to continue to have the highest unemployment in New England.

The report added that Maine economic forecaster Charles Colgan predicts his state will continue to experience job losses through 2012.

“Although the losses will be small, the trends take the Maine economy closer to the levels at the bottom of the recession rather than to recovery,” he said.

Residents not skimping on food, especially the local kind

Even with the sluggish state economy, there are some big trends taking hold in the grocery industry across the state, Doak said.

“We are seeing in certain sections of Maine…an upsurge in specialty foods, gourmet shops, like higher-end markets. We’ve also seen a huge upswing in farmers markets all across the state, just tremendous. We are also seeing interest in buying clubs.”

Farmers markets and independent grocers have been the cornerstone of local shopping in Maine for many years, but now that the “buy local” phenomenon is a national trend, Doak pointed to a recent speech by Supermarket Guru Phil Lempert.

“To quote Phil Lempert, ‘The Supermarket Guru’…he was here in October and said that trends come and go, but the trend with the longest life is the local movement, and it’s very strong in Maine,” Doak said. “I’ve heard from some of our members across the state. They chuckle sometimes and say ‘I’ve been doing local my whole life.’

“We have farmers markets but we also have 8,000 farms in Maine, and there is an uptick in small farms. And this is an interesting statistic: The average age of a farmer in Maine is going down.”

Organic farming is a stronghold in the state, and the farms have a perfect outlet to sell their produce at independent markets that dot the rural countryside throughout Maine.

“We have a vibrant, crucial number of independent grocery stores, and we are seeing growth in that industry. Those avenues have really mushroomed in the last 10 years,” Doak said. “We have several island and rural communities, and we are holding onto our ­independent grocer. I think it stems from their location (partly) but I really think we continue to see family owned and operated independent grocery stores because they are so much a part of the community. They work so well together; it’s not always about the bottom line, it’s about adding value to the store.”

Some of the state’s independent grocers had to scramble to find an alternate source of supply in April 2011. Associated Grocers of Maine (AGME), based in Gardiner, went out of business after 57 years, putting about 100 people out of work and putting about 250 food stores in need of a new supplier.

Around 100 of the stores were picked up by Associated Grocers of New England in Pembroke, N.H., which already served some stores in Maine.

Mike Bourgoine, president and CEO of Associated Grocers of New England, told

The Shelby Report in May that the addition of that many customers at one time was “a once-in-a-lifetime” opportunity for his company.

AG New England also hired several former AGME employees. But Bourgoine made it clear that AG New England was not in any way associated with AGME.

According to court papers, AGME was about $6 million in debt to Savings Bank of Maine, one of its two secured lenders, and the bank sued AGME a week before the shutdown. After the lawsuit was filed, the Superior Court of Kennebec County appointed Jim Ebbert as the receiver for the assets that had been pledged to the bank as collateral. The company’s assets were to be liquidated to pay back as much as possible to the two creditors.

According to a statement from Ebbert that appeared on the AGME website: “This decision was not made lightly in view of the impact it would have on the company’s employees, vendors, customers and shareholders.”

According to court documents, AGME had been in financial trouble for at least three years. In March 2008, the bank agreed to permanently increase the company’s line of credit to $9.5 million. But a document signed nearly a year later reduced that to $8 million.

“AGME’s failure to pay debts as they became due, as well as the fact that its business operations have deteriorated, indicates that AGME is incapable of operating the business or maintaining collateral in a manner which will maximize value and ensure payment on the note,” Savings Bank of Maine SVP Alvin W. Butler wrote in an affidavit requesting the receiver.

Craig Burgess, who was named president of the company in 2007, ran the company at the time of its closure.

Hannaford to Go launched in Maine

In addition to a strong independent base, Maine’s competitive landscape features chain grocery stores like Trader Joe’s, Whole Foods, Hannaford and Shaw’s.

At Hannaford, a banner of Belgian retailer Delhaize, Hannaford to Go has been offered at a store in Dover, N.H., since March and it has proven popular, company spokesman Eric Blom said, although he declined to provide figures on the number of shoppers who use the online grocery ordering service weekly in Dover, the Portland Press Herald reports.

Now shoppers at the North Windham store are now able to use the service.

The service is free for the first order and for any subsequent orders over $125. Otherwise, there’s a $5 service charge. The items cost the same as the in-store price, including any weekly specials.

Supervalu-owned Shaw’s, Hannaford’s major competitor in Maine, does not offer drive-thru grocery pickup at any of its stores, company spokesman Steve Sylven said, although an arm of the chain’s parent company, Supervalu, does provide it at a group of stores in the Philadelphia area, the report added.

About 20 people a day use the service, John Mullins, manager of the North Windham Hannaford store said, noting that it has been promoted only at the store and Hannaford hasn’t officially announced it yet, so he expects interest to increase.

The program will be considered at other Hannaford locations, depending on interest. The Portland Press Herald added that the Hannaford drive-thru program is the first in the state, although “it harkens back to the days when consumers would give shopping lists to the grocer, who would then gather all the items and deliver them.”

Maine Organic Milk Co. wins Whole Foods Market loan

Whole Foods Market Inc. said it awarded its latest low-interest loan out of its North Atlantic region to Maine’s Own Organic Milk Co., also known as MOOMilkCo, Sustainable Food News reported Nov. 10.

The $25,000 loan to the organic milk company is part of its Whole Foods Market’s Local Producer Loan Program, which will grant up to $10 million in low-interest loans to small local producers.

MOOMilkCo. is a cooperative venture of five Maine-based organic dairy farmers who formed the L3C in 2009 after being released from their contracts with a major dairy ­company, the report said.

To date, Whole Foods Market’s Local Producer Loan Program has funded more than $5 million in low-interest loans for farmers, food artisans and small businesses.

To apply for a loan through Whole Foods Market’s Local Producer Loan Program, ­producers must meet Whole Foods Market’s Quality Standards, use the funds for expansion and have a viable business plan.

To view online video testimonials and to learn more about the Local Producer Loan Program, visit www.wholefoodsmarket.com/loans.

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