Lobsters to Dollars: The Economic Impact of the Lobster Distribution Supply Chain in Maine
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1 Lobsters to Dollars: The Economic Impact of the Lobster Distribution Supply Chain in Maine Maine Fishermen s Forum Friday, March 2, 2018 Michael Donihue, Professor of Economics Colby College Annie Tselikis, Executive Director Maine Lobster Dealers Association
2 WHAT IS A LOBSTER DEALER?
3 Maine Lobster Dealers Dealers take lobster and move it into and through the supply chain. Those activities may involve: Buying lobster from harvesters or wharves Trucking Aggregating and distributing product Long term holding Grading lobster for quality and quantity Adding value via grading or through processing Marketing, promotion, and sales
4 WHAT IS THE SUPPLY CHAIN?
5 IT IS COMPLICATED What happens when lobstermen come in from fishing? What does the wharf or co-op do with the product? How does live boat run lobster become A-grade quarters or B-grade halves? Frozen 4 oz tails or fresh TCK meat? How does any of this product get to customers and consumers around the world?
6 FOCUS OF THIS STUDY Economic impact of the wholesale distribution supply chain in Maine Lobster dealers spend billions of dollars each year purchasing lobsters From fishermen From each other Distribution supply chain begins at the point of landing and ends at the customer
7 UNDERSTANDING ECONOMIC IMPACT Direct effects all spending and income by the dealers (e.g., wages & salaries, crate purchases, spending on bait, utilities, maintenance, and packaging). Indirect multiplier effects successive rounds of economic activity resulting from business-to-business transactions related to a dealer s operations. Induced multiplier effects successive rounds of economic activity resulting from earned income spending by a dealer s employees. Economic output value added to the Maine economy via the wholesale distribution of lobsters purchased by dealers. Jobs supported the number of workers whose jobs are impacted by the direct spending and related multiplier effects of the dealer network in Maine.
8 WHAT DID WE MEASURE? Employment costs and training (TSA, HACCP, MSC, BRC) Utilities (heat, fuel, water, energy, phones) Operating expenses (insurance, legal, gear, equipment, marketing, taxes and fees, office expenses) Contracted services (trucking, sub contractors, etc) Lobster purchases
9 Distribution of Lobsters in Maine Wholesale distribution of lobsters, like the supply chain for just about any product, is largely invisible to customers and policy makers Their activities involve grading, packaging, processing and shipping No publicly available data on their activities Economic footprint has never been studied 21 dealers participated in a detailed study of their spending and income for 2016 Result is an estimate of the total impact of their operations on the Maine economy Lobsters Purchased (lbs) million Jobs Direct Effects $187 million 740 Indirect Effects $36 million 393 Induced Effects $20.6 million 173 Total Impact $244 million 1,306
10 Economic Impact of the Lobster Dealer Network Lobsters Purchased (lbs) million Jobs Direct Effects $187 million 740 Indirect Effects $36 million 393 Induced Effects $20.6 million 173 Total Impact $244 million 1,306 IMPACT ANALYSIS: An annual contribution of $1 billion to the Maine economy Supporting 4,000 jobs annually
11 PARTICIPATING MAINE LOBSTER DEALERS: A.C. Inc. Atwood Lobster Bean Maine Lobster D.B. Rice Fisheries LTD Eastern Traders Garbo Lobster Gouldsboro Enterprises Greenhead Lobster Inland Lobster Island Seafood J.P.'s Shellfish Maine Coast Maine Lobster Outlet Maine Seafood Ventures Ready Seafood Rocky Coast Maine LLC Sea Salt Lobster Seaview Lobster Stonington Lobster Co-op Taylor Lobster Company Vinalhaven Fishermen's Co-op
12 THANK YOU FUNDING PROVIDED BY: Lobster Research, Education and Development Fund RESEARCH AND PROGRAM ADMINISTRATION BY: LEARN MORE: Visit our website
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