1. SAN FRANCISCO FOOD & BEVERAGE INDUSTRY CLUSTER PLANNING DEPARTMENT OEWD SPUR BAE URBAN ECONOMICS

2. INTRODUCTION What is the Food & Beverage Industry Cluster?  Food Manufacturing  Bakeries, Chocolate & Confections, Seafood Processing, etc  Beverage Manufacturing  Breweries, Wineries, Distilleries  Food & Beverage Wholesalers  Grocery, Alcoholic Beverage, Farm Products & Supplies Wholesalers Why is this important to San Francisco economy?  Supports Employment and Socio-Economic Diversity  Blue-collar jobs create opportunity for all educational backgrounds  Cluster Effects  Positively reinforcing loops can accelerate growth and innovation  The San Francisco Brand  Unique, creative businesses attract diverse residents and support the tourism, hospitality, and other

3. REGIONAL TRENDS  Manufacturing and wholesaling make up a small part of the regional and San Francisco economies...  …but Food & Beverage jobs make up an important part of those sectors, especially in San Francisco. Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014

4. REGIONAL TRENDS Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014. *As per QCEW disclosure policy, employment data for Beverage Manufacturing and Alcoholic Beverage Wholesalers in Solano County and for Farm Product Raw Materials Wholesalers in multiple counties are not publicly disclosed. 22,930 23,308 18,085  San Francisco plays a small role in the region’s food and beverage manufacturing.  Alameda, Napa, and Sonoma Counties are major players.

5. REGIONAL TRENDS  In the Bay Area, San Francisco had the largest loss in food manufacturing jobs Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014. San Francisco Alameda Santa Clara Sonoma San Mateo Solano Contra Costa Marin Napa

6. SAN FRANCISCO TRENDS  Since 1990, food manufacturing has accounted for most of the loss in cluster jobs  In recent years, however, wholesaling and manufacturing have both grown again Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014.

7. SAN FRANCISCO TRENDS  Food and beverage manufacturing jobs have declined in San Francisco since 1990…  … even as jobs in restaurants, bars, grocery stores, and liquor stores grew Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014.

8. SAN FRANCISCO TODAY (2,986) (1,853) (211) Fruit & Veg. 46 Breweries & Distilleries 113 Farm Supplies 43 Sources: Bureau of Labor Statistics, Quarterly Census of Employment and Wages (QCEW), 2012; BAE, 2014.

9. SAN FRANCISCO TODAY Sources: Dun & Bradstreet, 2013; BAE, 2014.  Bakeries have highest revenue in total, but also large number of small establishments (not shown)  Coffee & Tea and Candy manufacturing are small subsectors in terms of revenues

10. BUSINESS SURVEYS: KEY CHALLENGES  Real estate and capital access are the top challenges for manufacturers Sources: SFMade, 2014; SF Planning, 2014; BAE, 2014.  Transportation/access and workforce issues are bigger challenges for wholesalers than for manufacturers

11. BUSINESS SURVEYS: LOCATION DECISIONS Sources: SFMade, 2014; SF Planning, 2014; BAE, 2014.  Top reasons for San Francisco location?  Near customers and “brand” of San Francisco

12. BUSINESS SURVEYS: SPACE & EXPANSION  Most manufacturers operate in their own space or a commercial kitchen  More than half of manufacturers will need new or expanded space within one year Sources: SFMade, 2014; SF Planning, 2014; BAE, 2014.

13. KEY FINDINGS  San Francisco’s Food and Beverage Cluster:  Has relatively small share of Bay Area Food Cluster employment  Accounts of ¼ of all City’s manufacturing/wholesaling jobs  Has seen a steep decline in employment since 1990, but appears to be leveling off since 2006  Has more jobs in wholesaling than manufacturing (with grocery wholesalers as largest)  Bakeries is largest type of food manufacturer  Top challenges facing Cluster in San Francisco:  Real Estate (Affordable/Available Space + Build-Out Costs)  Access to Capital  Labor Costs  Regulatory Issues  Skilled workforce  Mobility (Transportation + Distribution Access)

14. FOOD & BEVERAGE CLUSTER “MAP” Sources: BAE, 2014.

15. KEY DISCUSSION QUESTIONS  Did we “get it right on the challenges facing this cluster?  Affordable space  Access to capital  Transportation issues  Workforce issues  Regulatory issues  How can San Francisco help existing food and beverage manufacturers and wholesalers to stay and grow?  What facilities, infrastructure, or services are missing today that, if located in San Francisco, would help existing businesses and attract new ones?

16. THANK YOU FOR YOUR PARTICIPATION! Next Steps  Steering Committee Meeting February 26 th  Draft Report March 17 th  Steering Committee MeetingMarch 26 th  Final ReportApril 21 st  Final Steering Committee MeetingDate TBD Contacts Diana Sokolove Food System Policy Manager San Francisco Planning Department (415) 575-9046 diana.sokolove@sfgov.org diana.sokolove@sfgov.org Eli Zigas Food Systems and Urban Agriculture Program Manager SPUR (415) 644-4881 eli.zigas@spur.org eli.zigas@spur.org Tiffany Garcia Business Development Manager Office of Economic and Workforce Development (415) 581-2322 tiffany.garcia@sfgov.org tiffany.garcia@sfgov.org