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The Boston Globe’s recent reporting on the mounting pressures facing independent restaurants captured an uncomfortable truth: many of the beloved restaurants and cafes that make Massachusetts neighborhoods vibrant are in crisis. According to the Independent Restaurant Association, as many as 25% are in danger of closing by year-end.
And restaurants are only the tip of the iceberg.
At CommonWealth Kitchen, we work with hundreds of food businesses—restaurants, caterers, bakers, food trucks, and product companies—the people who make the food that supplies our cafes, cafeterias, and retail stores, and feed us in offices, events, and on the street.
As described in Devra First’s story, we have seen how the entire food industry is facing enormous headwinds from changing consumer habits, rapid growth in online delivery, and economic pressures from rising costs and immigration crackdown. However, the biggest threat is from accelerating corporate consolidation.
Grocery shelves are increasingly dominated by a handful of companies swallowing up small and independent brands- like Unilever’s purchase of Ben & Jerry’s, and General Mills’ purchase of Annie’s Homegrown and Cascadian Farm. Sysco, which controls over 35% of broadline US food distribution, will purchase Restaurant Depot, the go-to supplier for independent food businesses, unless the Federal Trade Commission stops it. Food served in colleges, hospitals, schools, cultural institutions, stadiums, airports, and offices are dominated by just 4 corporations- COMPASS, Sodexo, Aramark, and Delaware North, and their subsidiaries. These companies have opaque and insular purchasing practices and exclusivity agreements that make it nearly impossible for small businesses to collaborate meaningfully, let alone compete. Similarly, office buildings without cafeterias increasingly sign exclusive catering agreements with large intermediaries and technology platforms that charge 20-25% fees to the businesses actually providing catering services.
These aren’t simply business challenges. They represent a foundational shift in the industry. Without focused intervention, Massachusetts risks hollowing out our beloved main streets, and losing the next generation of entrepreneurs who build wealth and vibrancy in our communities, create jobs, improve food access, and make our economy more resilient in the face of climate change. We’re already seeing local favorites like Clover Food Lab struggling to survive, while Bar Mezzana, Chickadee, BoLoco, Boston Chops and Party Favors have all closed in just the past few months.
It’s time for State policy makers to step up.
First, Massachusetts should make an immediate and sustained investment in business technical assistance to support small and independent food businesses. Organizations like CommonWealth Kitchen exist to help entrepreneurs navigate the complexities of shifting markets, product and menu costing, finance and cash flow management, marketing and social media, procurement, and regulatory compliance— the foundations essential to business survival.
Second, the State should provide seed capital to launch a group purchasing organization to represent small and independent restaurants and related food businesses in negotiating more competitive pricing on ingredients, packaging and similar costs, giving these businesses access to the same savings that larger brands, franchises, and restaurant groups access.
Third, the state should expand access to flexible, patient capital for food businesses. Too many promising entrepreneurs cannot obtain the working capital needed to purchase inventory or equipment, or invest in marketing or production scaling despite having viable businesses and growing demand. Expanding loan guarantees, revolving loan funds, lines of credit, and other capital programs for small food enterprises would allow more businesses to grow instead of simply getting by.
Supporting local food businesses is not about preserving nostalgia. It is about strengthening one of Massachusetts’ most important economic sectors, representing over $86B in annual revenue and fully 10% of the State’s workforce, while anchoring the state’s vital travel and tourism economy.
Some may say these shifts are simply the market working as it should: if a business cannot survive without public support, maybe it should not survive at all. That argument might hold in a fair market. But food businesses today are not competing on a level playing field. They are competing against corporations many times their size, ones that can absorb short-term losses, dictate terms to distributors, outspend on marketing, and buy out smaller rivals rather than out-compete them. Public investment in food entrepreneurs is not a thumb on the scale. It is a counterweight to a scale that is already tipped.
Jen Faigel is co-founder and CEO of CommonWealth Kitchen, a Dorchester-based food business incubator supporting small and independent food entrepreneurs across Massachusetts.
