Springvale organic mushroom seller Farming Fungi saw its best month of sales in January 2020, but grocery store sales dropped by half in the second week of February.
The reason was a marked shift in shopping habits. Many worried about buying unwrapped produce, even though the coronavirus is generally transmitted through the air. The company, which sells Mousam Valley Mushrooms through Hannaford, Shaw’s and Whole Foods, was selling bulk shiitake mushrooms at Whole Foods, but consumers no longer wanted them.
“The largest single product that we sold through Whole Foods was bulk shiitake mushrooms,” he said. That product was eliminated between a Monday and Thursday.
Farming Fungi had to pivot quickly to stay in business. The 6-year-old company got financing to buy a packaging machine, hired more staff and quickly caught up to demand for the mushrooms. It also set up a website where it could sell to consumers, at the same time online grocery sales in the U.S. took off as many shoppers shied away from in-store purchases. Online grocery sales in the U.S. rose almost $3 billion to $9.3 billion from March 2020 to March 2021, BrickMeetsClick.com estimated.
Farming Fungi was not alone. Maine Grains in Skowhegan had been selling only 10 percent of its flour through retail when the pandemic began. That is now at 50 percent, including a new contract with Hannaford and more online sales. It benefited from the shortage of flour from large producers on grocery shelves last spring. And Wyman’s, the legacy Maine company known for frozen wild blueberries, set up website sales and diversified into shelf-stable products that it could sell directly to consumers online, such as dried wild blueberries and powdered wild blueberries.
All three companies saw sales increases during the pandemic, and all three are growing their companies using services offered by the Maine Center for Entrepreneurs, which has programs for startups and for mature companies that want to figure out the best way to grow. The center has information on government programs, educational tools, data on new markets, business contacts in new areas, mentors and resources that companies can use as they pivot or expand product lines.
“The fact that the food accelerators were in place prior to the pandemic is fortuitous,” Janine Basaillon-Cary, MarketShare program manager at the center, said.
Clockwise from left: Jimbo Tuck feeds containers of Mousam Valley Mushrooms into a machine automatically wrapping them in plastic at Farming Fungi in Springvale on Monday May 3, 2021. Early in the pandemic, consumer demand for unwrapped mushrooms plummeted; Packs of Mousam Valley forest medley mushrooms roll out of an automatic wrapping machine in Springvale; Mousam Valley chestnut mushrooms grow in a damp room at Farming Fungi. Credit: Troy R. Bennett / BDN
Wyman’s, which has 15,000 acres of wild blueberries in Washington County and Canada, is using the center’s program for market research to help identify four or five new frozen food products that it hopes to launch in retail stores by the end of the year, said Patrick Carroll, vice president of the Milbridge-based company.
“The strategy is to find opportunities where there hasn’t been a lot of innovation, such as in areas where large players aren’t defending a small part of their business,” he said.
The website, set up during the pandemic, is a big part of its overall strategy going forward. It began to sell frozen fruit on dry ice online during the pandemic and added new items like the wild blueberry powder, which is used to flavor smoothies, and wild blueberry juice. Nearby Whitney Wreaths became its fulfillment center for shelf-stable products.
It could cost $100,000 just to get three flavors of a product on a supermarket shelf, and if it doesn’t sell, “you’re gonna get kicked out in a matter of months, so it’s a really big gamble,” Carroll said. Launching new products online is a good way to understand the market with less risk and cost, he added.
Wyman’s, which began in 1874 as a fish cannery, also started selling yogurt and banana puree fruit cups with chunks of fruit last year through major supermarkets and retailers including Target and Walmart. It’s part of the company’s aggressive strategy to double sales over the next five years. Current grocery store sales top $100 million.
“It took us 150 years to get to where we are now, so doubling the business in five years is rather ambitious,” Carroll said.
Wyman’s is trying to get Americans to eat more fruit, which fits with changes in consumer eating and habits turning toward healthier options during the pandemic. Sharood of Farming Fungi said he’s seeing strong sales for packaged mushrooms, with 2020 ending as the best year since the company started in 2014 at more than $2 million in revenue.
Sharood said that with more people cooking at home and experimenting with recipes, mushrooms are changing from a side dish to more of a main course. Mushrooms are part of the greater pandemic demand for healthy produce, he said. Progressive Grocer estimates that produce sales reached $69.6 billion in 2020, an 11.4 percent increase over the previous year.
“People are looking at food differently than they did before the pandemic and they care more for healthy food,” Sharood said. “I think that trend will continue.”
Maine blueberry grower Wyman’s set up website sales and diversified into shelf-stable products, like blueberry juice and blueberry powder, and new products, like frozen blueberry and Greek yogurt bites, as a way to weather the 2020 pandemic. Credit: Troy R. Bennett / BDN
Farming Fungi operates in a total of 25,000 square feet of space, including grow rooms that it hopes to double in size this year. Sharood has used the entrepreneur center to widen his network of contacts and share information. Farming Fungi is considering value-added products with partners, including incorporating mushrooms into sausages, he said.
Amber Lambke, president and co-owner of Maine Grains, also is looking into value-added products such as breads that require only an egg and liquid to make and seasoned farro and barley ready to boil and eat.
The grain company saw sales rise quickly early in the pandemic when flour was in short supply and sourdough baking at home became a trend. At that time last spring, only 10 percent of its business was retail, with the rest to bulk and restaurants. Retail sales were soon half of Maine Grains’ business. It started selling more products online and saw 20 orders per week rise to 180 a day to a backlog of 3,000 orders. It figured out the least expensive way to ship flour and hired more staff to fill two shifts a day.
The grain company also got three types of flour into 174 Hannaford supermarkets last month, which Lambke said means a lot of its customers can find its product more easily and it can add mainstream grocery shoppers.
Maine Grains’ revenue was up 38 percent in 2020, Lambke said. To handle the strong business, Maine Grains has added more machinery, including a second millstone and a machine that can sort out unwanted grains using a digital eye and color-sorting technology.
“We’ve continued to scale with new equipment purchases,” Lambke said. “I think the shift to more healthful foods and home cooking is going to last.”