Cooking up new businesses in Hawaii
By Curtis Lum
Advertiser Staff Writer
By Curtis Lum
Tucked away at the end of a narrow lane off 'Umi Street in Kalihi is a place where business dreams are hatched.
The Culinary Kitchen Incubator is home to dozens of small businesses, many owned by low-income residents, hoping to someday have a place of their own. The incubator has 12 Department of Health certified kitchens and storage space for rent, and also holds classes to help fledgling business owners get started.
With the high cost of doing business, many can't afford to rent, much less buy, their own equipment and space and have to rely on the incubator for help. The facility is a program under the nonprofit Pacific Gateway Center and receives state and city funding that allows it to offer rates that are up to 60 percent less than what a commercial kitchen would cost.
"Our primary goal is to help people through the first few years and hopefully get them to the point where they're successful enough that they can move on and have their own kitchen," said Rebecca Soon, vice president of economic development at the incubator.
At any given time, Soon said, about 70 clients use the facility. Because it receives government funds, at least 60 percent of the clientele must fall in the low- or moderate-income group.
Hourly rates run from $12 to $32.50, but most business owners opt for monthly leases because they're cheaper in the long run. Monthly rates range from $600 to $750 for up to 50 hours of use and the incubator is available round-the-clock.
Soon said renting a commercial kitchen would cost a business thousands of dollars a month.
"Most can't afford to have their own kitchens, so facilities such as ours allow them the flexibility," Soon said.
Rick and Sasha Reichart have operated cakelava for more than two years and specialize in wedding and custom-made cakes. Rick Reichart said he bakes about six wedding cakes a week and all of the work is done at the incubator.
As a long-term user, Reichart pays $12.50 an hour to use the baking kitchen and is at the incubator four to five days a week. He said the cost is much lower than the estimated $4,000 he'd have to pay monthly just to rent a storefront.
"I tried everywhere. I tried community center, churches. I tried everything," the California native said. "On the Mainland you can rent space everywhere. Here, you can't find it. You can rent a storefront and convert it to a kitchen, or buy out a restaurant that's failing, but that's super expensive."
He said his goal is to own his own bakery because he is limited in the amount of jobs he can accept.
"It's just a matter of making that leap," Reichart said. "I have to turn away business all the time because I have a limited amount of space."
Cheryl To has used the incubator's kitchens since April 2004 when she began producing ginger syrup for drinks. The owner of Pacifikool said she also couldn't afford her own kitchen when she first got started.
But To said her business has grown to the point where she has to decide soon whether to expand production and find her own facility, or stay at the incubator and keep production at current levels. To pays $600 a month to use the incubator's kitchen.
"I can't have an office here and if you have special equipment you can't just leave it in the kitchen," To said. "But that's what you have to deal with when you're starting your business."
Still, To said she's glad she found the incubator because it gave her a start and would recommend it to others.
"What you want to do is first of all make sure that your business is viable, that you've got a good idea. You don't want to be putting all the money into a kitchen," she said.
One complaint that To and Reichart had was they did not know the incubator existed as they began their businesses. To stumbled upon it while meeting with another business owner at the incubator, while Reichart said he discovered it only after an exhaustive Internet search.
"I kept hitting the search engines trying to find something and I found an obscure article that mentioned it and that's how I found it," he said.
Soon said that because the incubator relies on government funding and grants, there is no money to advertise the facility. She said it relies on word of mouth to attract most of its clients and as a result is at only 40 percent capacity.
"I go to every food expo there is out there and I go to every food manufacturer's event because we have a huge issue with the fact that there are so many people with need and we have the capacity to meet it, but unfortunately our worlds aren't communicating," Soon said.
Soon cautioned, however, that potential business owners can't just walk in and expect to start cooking. People must be serious about starting a business and also must fulfill 13 requirements, including being a U.S. citizen and having a general excise tax license, before they are accepted.
"This process can take months," Soon said. "We are constantly calling people, following up with them. If they are hitting walls, we help them figure out ways through those walls."
Reach Curtis Lum at email@example.com.