LYONS FALLS — When you start a business out of passion and watch it grow knowing the positive repercussions it has on the surrounding community, it is elating.
When that business suddenly grows exponentially from providing products and services during a worldwide health crisis, it is mind blowing.
When the bottom suddenly falls out of that growth, it is disorienting.
Ultimately, all that matters is what you do then: Do you give up or do you double down?
For James Munn, co-owner of Black River Valley Natural, the choice was to double down and take the business to the next level, right after he solved a cash flow problem as business slowed. But it took some soul searching, he said.
Through the BRVN creamery, Mr. Munn helped create different pathways for dairy farmers having to dump their milk and provided businesses and individuals with products that were in short order in large stores that had yet to adapt to COVID-19 safety restrictions at the beginning of the pandemic. Until May 2020, they were “very busy.”
“Once the (retail) chains figured out how to get their supplies and do curb side pick-up and online orders, we took a big hit,” Mr. Munn said. “The people that loved shopping local when there was no other option went back to their old shopping habits.”
He described the rest of the year as “rough,” culminating in the fact that BRVN had to lay off the operations manager for the North Star Food Hub, a straight-to-retail and wholesale online ordering service under the BRVN banner. North Star Food Hub picks up products directly from farmers for delivery.
He was scrambling to find ways not to lay off more people.
In November, he had to “soul search.”
“I wasn’t sure what we were going to do but we decided to go big,” he said. “We’d accomplished so much already, it just wasn’t time to give up.”
Fate had a hand in Mr. Munn’s search for his next move when he ran into an old high school friend, Andrew Gracey, who shared his vision for what a good business should be and what it would take to get there. A physical therapist by trade, Mr. Gracey is also an entrepreneur, making and selling BOOM! energy bars.
With Mr. Gracey in the mix as the BRVN director of operations, the two made their pitch in February to Point Positive, an angel investor group based in Saranac Lake, and continued to look for other financing avenues.
“I hit the pavement in the spring. I spoke to officials, foundations, nonprofits ... there wasn’t anything, really,” Mr. Munn said.
They had secured a $99,000 loan for new equipment more than a year ago via a grant through the Lewis County Industrial Development Agency for expanding production capabilities, but it still hasn’t come through and wouldn’t have helped as much as they needed over the winter.
Ultimately, Point Positive agreed to invest and offered a low interest loan with a balloon payment at the end rather than a straight investment and equity exchange, which was, to Mr. Munn and Mr. Gracey, even better in both the short and long term.
“What we saw was their obvious passion mixed with some really good business sense. James, when he pitched to Point Positive, did a very wonderful job, and continues to do a wonderful job, of being clear about what they’re doing and going to extraordinary means to make sure that they execute well,” Point Positive Coordinator Melinda L. Little said. “We liked their vision. ... It is very unlike the kind of deal that we do. James pitched for a deal more similar to what we (normally) do, but it didn’t make sense for their operation, so we got creative.”
During a site visit to the company earlier this year, the “great and resourceful” BRVN team treated her to a full spread of their products for lunch, which was all delicious and impressed her, she said.
Ms. Little noted that their effort to integrate production and distribution with value-added products at retail and wholesale, essentially all the different parts of the food chain, makes particular sense in light of the need, exacerbated by the pandemic, for many people to know the source of their food.
What became clear to Mr. Munn during the pandemic is that the North Star Food Hub, while a great idea in line with the BRVN ethos and successful in other places, was not in its current format designed for the long distances between producers and customers, resulting transportation costs nor the limited growing season of the north country.
He and his team are still working on ideas to tweak the model to make the Hub profitable, even with those hurdles.
Their ideas about how to invest the Point Positive capital and reload the business were clear: They needed to diversify the product line and they needed a retail outlet of their own.
So, that’s what they did.
They created three new product lines with a dozen new products in three months.
“We did that in a short period of time by leveraging assets (and) production capacity that we had in place” Mr. Gracey said. “Our product selection was based on (choosing) a staple we can ‘step up’ — granola is a great example and it’s in growth mode.”
A line of four flavors of hummus and a line of a half dozen fermented products, he said, have been stepped up.
Deep Roots Market and Cafe, 3950 Route 12 in Lyons Falls, has shelves and coolers filled with BRVN products, from their classic dairy line which now also includes whole milk yogurt and flavored cheese curd, to their new “tiny batch” granolas, hummus, sauerkraut, kimchi and Korean carrots.
There are also locally grown fruits and vegetables, maple syrup, baking mixes, gift baskets, and fresh bread made from scratch, among many other products, on the premises.
The cafe menu features a number of dishes with the company’s products as key ingredients for all day breakfast and lunch items, from sandwiches and wraps to a few key “comfort food” dishes, homemade soups and salads.
“We’ve had to reinvent ourselves and adapt by diversifying and really expanding,” Mr. Munn said, adding that BRVN is still processing dairy, more than ever before. “But now, to broaden the conversation we’re having with all of our retail partners, we have to come with more than just the dairy. We have to come with a broad array of different products and that’s what we’re trying to do.”
Many of the new products require ingredients that can’t be sourced locally, the two men concede, but through these products they could create a market that might make opportunities for local farmers to diversify what they grow.
“The more we can do to expose the farmers and the producers to the market, the better,” Mr. Munn said. “I think one thing that many of our farmers have suffered from is being insulated from the marketplace by working through these co-ops and other insulating bodies. They are an arm’s length away from what’s really going on in the market place. What we can offer them is more direct feedback about what’s hot, what’s selling, what’s moving. And maybe it’s not the volumes they’re used to, but maybe they can start to see (they can) get a premium (for these things.)”
With these changes, the company has doubled its team to 13 people and hopes to grab a piece of the $4.1 billion spent annually on food in the north country and surrounding counties, an estimate based on the USDA data Mr. Gracey and Mr. Munn compiled.
They believe this, even more than sticking to only local products, will help them have a positive impact on the community around them and throughout the north country.
“There’s many ways to help the economy,” Mr. Gracey said, “We can do that by providing dignified, meaningful and equitable employment opportunities; and the more of that we can provide the more good we can do. In order to do that as a food manufacturer, we need to reach a wider spectrum of customers, and to do that, we need a wider spectrum of products.”
BRVN strives to provide their employees with competitive wages, dental and vision coverage, paid time off and, somewhat uniquely, paid “volunteer time” to do some giving back to the community.
“They can do it by themselves, but it’s even better when they do it together as a team,” Mr. Munn said. “It’s the little things we can do that maybe other employers don’t that make the difference.”
While the company is not yet able to supply health care coverage that would be as good or as cost effective for their team as coverage through the state marketplace, a “health and wellness stipend” is provided to help team members cover the cost.
So far, BRVN hasn’t had a challenge finding the staff they need as has been the case for many businesses throughout the pandemic.
“When you talk about where we’ve come from and where we’re going, a lot of this learning is done on the fly,” Mr. Munn said. “We’re adjusting as we go along. We’re talking to people, we’re finding these market opportunities, we’re looking at the trends and, as Andrew said, in order to provide that dignified employment, because that’s our goal, we always have to be on the cutting edge of the food trends, so you have to kind of be creative and adaptable to make that happen.”
Now, things are going well. They are just barely keeping up with orders that are coming in fast, and more products and variations are in the works.
In June, BRVN secured a $34,650 Microenterprise Grant from the county IDA to purchase bulk storage tanks and a cream separator. The company is hopeful the $99,000 low interest loan also through the IDA will come through soon, as production-expanding equipment is needed more every day.
The two men seem to have found a model that works.
“The reason we get along so well is that although we come from different backgrounds professionally — Jamie, two decades in the high tech industry and myself, two decades in health care — we have a commonality and that’s a deep appreciation and understanding of the north country,” Mr. Gracey said. “That’s what kind of brought us back. It’s a really sincere desire to want to create opportunities for the next generation of north country kids and the current generation of moms and dads.”
Mr. Munn and Bethany, his wife, started BRVN together in 2019, and in January 2020, took on the North Star Food Hub from Jefferson County Cornell Cooperative Extension.
Mrs. Munn returned to health care, administering a small nursing home in Utica, during the pandemic and is running for office in the November election.
For more information about BRVN and its products, visit blackrivervalleynatural.com.