EMERGENT RESEARCH is focused on better understanding the small business sector of the US and global economy.
The authors are Steve King and Carolyn Ockels. Steve and Carolyn are partners at Emergent Research and Senior Fellows at the Society for New Communications Research. Carolyn is leading the coworking study and Steve is a member of the project team.
Emergent Research works with corporate, government and non-profit clients. When we reference organizations that have provided us funding in the last year we will note it.
If we mention a product or service that we received for free or other considerations, we will note it.
The chart below shows the stunning growth in the number of Google hits for the search term "food trucks" over the last 4 years.
I even had to cheat a bit on the chart to get the 83,000 hits in 2008-2009 to show up.
The rise of food trucks is being driven by a variety of trends, many of which we're seeing across the small business space. These include:
- New Localism, which the trend Americans relearning the value of community and reestablishing stronger ties with family, friends and their communities. Part of the new localism trend is a growing interest in local and unique products, which includes meals from gourmet food trucks.
- Local food, which is part of the new localism movement. Consumers are increasingly focused on what they eat and where it comes from, with a focus on quality, freshness and organic. Many of the new gourmet food trucks offer high quality food sourced from local producers.
- The New Artisans, which are people starting artisan businesses and focused on exploring new ideas and approaches and creating high-quality, authentic products. Earlier this week we posted on another example of this trend, Artisan Distillers. Many of the gourmet food truck owners are artisan chefs looking to explore and develop new recipes and menu items.
- Social Media, which allows food trucks to create an audience and keep them up to date on their location, new menu items, etc.
- The Great Recession, which has made it much harder to finance and start a traditional restaurant. This has led many budding restauranteers to start food truck operations instead. The costs and the financial risks are much lower - and food trucks can be used to test out menu items and concepts that, if successful, can become brick and mortar restaurants.
So if you haven't had a chance to try out a food truck, we strongly recommend you do. As part of our project we've recently eaten at dozens of food trucks (it's a tough job, but someone has to do it) and the food is, on average, excellent.
We'll have more on food trucks as our project progresses.
So it comes as no surprise that artisan distillers (craft makers of spirits) are becoming more numerous.
I attended a Commonwealth Club meeting tonight that focused on Bay Area craft distillers. The description of the event was:
Bay Area craft distillers like St. George and Charbay drive the handcrafted cocktail scene, creating community-conscious and drinkably delicious products that pay tribute to the locavore spirit. Their hyper-local beverages compete with the top foreign and national brands on drink menus across the country.
It was also no surprise that the owners of these small, local distillers described their businesses much like other new artisans do. They talked about being authentic, making great products and finding a niche audience for their specialized offerings.
They also described their industry as having a barbell industrial structure (my words - they said it was dominated by a couple of soulless, money grubbing giant corporations that made mediocre products).
The meeting was followed by a tasting from a group of local distillers. My favorites were two gins - Terroir Gin from St Georges and Blade Gin from Old World spirits.
Both were unique and I've never tasted anything quite like them before. Go to their sites for their tasting notes. They do a much better job of describing them than I can - especially after tasting multiple products from 5 distillers.
They cover two sites that have recently gone into beta. Match Puppy is available in New York City and according to the article it allows dog owners to:
"... arrange playdates, find matches for breeding or just meet up with other dog owners. They can find their favorite dog parks, schedule meetings with other users or join upcoming playdates."
Alert readers will recognize that doggie dating is not just for the dogs. Pet parents also get a social experience and the opportunity to make new friends. Match Puppy makes this very clear in their tagline:
A brand new way for you and your dog to meet new friends in your neighborhood.
The Internet and social media are creating new ways to participate in local communities. Online doggie dating is a good example of this new localism trend.
The premise of the book is technology - and especially social media - is combining with tougher economic times to create business conditions that reflect those traditionally associated with small towns.
The book outlines these changes and provides advice designed to help companies big and small adapt proven small town business approaches to what the authors call today's "global small town".
We agree that business is becoming more small town like. And I would add that, if anything, the authors may be underestimating the strenght of this trend.
The growing availability and use of Big Data and analytics is making it easier and cheaper for large companies to "go local" by personalizing products and services and looking and acting like small businesses.
Small businesses will need to respond by upping their game - and a good place to start is by reading Small Town Rules.
As the report's title indicates, the Great Recession had a major impact. From 2007 to 2009 the number of Americans living in multi-generational households increased from 46.5 million to 51.4 million.
But as the chart below (from the report) shows, the trend towards an increase in multi-generational households pre-dates the recession and has been moving up for almost 30 years.
There are a number of drivers of this trend. Real (inflation adjusted) housing costs have increased over this period making it harder for people to live on their own. Immigration increased substantially during this period, bringing in people from cultures where multi-generational housing is the norm. Social shifts, in particularly delayed marriages, are also a driver.
But one of the major drivers not often discussed is the rise of two income families. This, coupled with the aging of baby boomers, is leading an increase in multi-generational households for child care or elder care reasons - or for both.
We're forecasting this trend to continue. We also see this as a driver of the New Localism trend, which is the growing interest in local communities.
The reason? According to the article, they move "to get access to venture capital, top talent and other resources." Interesting quote from the CEO of Trulioo on why he moved his company from Canada to Silicon Valley:
"The speed at which things move is quite key," said Chief Executive Stephen Uford, adding that he was able to accomplish in three months what would have taken years back home."
The theme of the series is how the relationship between small businesses and their customers nurture local communities. The movies do a nice of job of capturing that relationship, and the day to day concerns and issues small business owners face.
I particularly like the story about Groundswell Coffee and how new, local owners and volunteers from the neighborhood are trying to make it going concern.
One of the most interesting trends we follow is the growing importance location plays for technology startups. The Boston Globe's The Road to Awesome looks at this issue from Boston's point of view.
It seems that many of Boston's most talented young interent entrepreneurs are moving to Silicon Valley and New York. The article trys to figure out what the Boston area needs to do to keep these folks. Key quote:
"Boston likes to see itself as a hive of innovation ... But when it comes to young, first-time founders working on websites, mobile applications, and devices designed for consumers, the magnetic pull of Silicon Valley and New York City is strong ... the city seems to be grappling with a coolness deficit when it comes to retaining twentysomethings and newly-minted college grads ..."
The article focuses on Boston not being cool, or at least not as cool as Silicon Valley or New York. What's the definition of "cool?" In this case it's being located near the action:
"So what constitutes coolness to techies not generally known for being the hippest of the hip? Accessible investors willing to take a risk on wild ideas. Hangouts that attract entrepreneurs and investors, and encourage serendipitous meetings. An endless succession of office-warming and product launch parties with open bars. Companies that make stuff that your friends from college actually use or have heard of. Chief executives with big personalities, and experienced entrepreneurs willing to mentor up-and-comers."
For many tech startups, being in Silicon Valley or New York is not enough. Last year we posted on Internet startups being willing to pay higher rents to be in the same building or neighborhood as Twitter.
The main driver for this frenzy around location is the ability to easily meet and rub shoulders with others in the tech startup ecosystem. The CEO of TaskRabbit says in the Globe article "the serendipitous moments to talk with other amazing entrepreneurs and influencers in the consumer Internet space has been the coolest factor, by far ..."
The growing role that location plays in business is but one facet of the much broader New Localism trend. It is one of the most complex, multifaceted and important trends we follow.
The study authors looked at travel patterns for a number of countries between 1970 and 2008. They found a strong correlation between rising prosperity and travel. But the trend flattened starting in 2003. Key quote:
“Since 2003, motorized travel demand has leveled out or even declined in most of the countries studied, and travel in private vehicles has declined,” the authors wrote in their study. “Car ownership has continued to rise, but these cars are being driven less.”
The article suggest several potential reasons for this - rising fuel prices, aging populations, traffic congestion - but doesn't mention the Internet or telecommuting (these may be mentioned in the study, I haven't read it yet).
Based on our research, it seems quite clear that distributed work, telecommuting, online shopping and other connective technologies are fundamentally changing transportation patterns.
While more research is required to connect all these dots, I'm confident that the Internet and related technologies are reducing travel.