Small-Scale Manufacturing: A Key to Revitalizing Your Downtown
This week on The Bottom-Up Revolution podcast, we did an interview with Ilana Preuss, Founder & CEO of Recast City. You can check out that episode here. Below is an excerpt from Preuss’s book, Recast Your City: How to Save Your Downtown with Small-scale Manufacturing, which she has allowed us to share with you today.
In 2019, I was in a van full of residents and visitors being driven down the old neighborhood main street of McComb-Veazey, a historically Black and Creole neighborhood in Lafayette, Louisiana. At one intersection, Tina Bingham, the driver, pointed in different directions and explained, “That used to be our grocery store, but it closed ten years ago and is a hair supply store now. Over there, we used to have an old bank building, but the property owner let it sit empty for so long it became a safety hazard and was bulldozed last year. And this old car dealership building with the glass front right along the street edge just sits empty and is used for storage.” In every direction we looked, we saw vacant lots or buildings that had seen better days.
This neighborhood had once been home to zydeco music legends, markets, and churches and had been a cultural center for Creole foods. It was clear from Bingham’s description of the old main street that it had been the heart of the neighborhood, a place where people came together. Over time, this area had been cut off from downtown and the neighboring areas by new railroad tracks, then by the state highway, and now by the threat of a new elevated highway. There had been little investment coming to the area for a long time.
Now, though, neighborhood leaders are working hard to change things for the better. Bingham, who leads the McComb-Veazey neighborhood association and serves as the community development director for the local chapter of Habitat for Humanity, has brought those two organizations together to redevelop delinquent properties and create new homes and community spaces in the neighborhood. This old main street was next on her list—the residents didn’t own any of that property and had lost control over that space a long time ago.
I was there to find ways to get locally owned small-scale manufacturers into these spaces to bring this main street back—for the neighborhood and by the neighborhood. On our tour, we met neighborhood business owners offering amazing Creole food such as boudin and pickled okra but who had no place to grow, and no place to get business development support. Bingham believed in the value of the skills of her neighbors and the history of the place, and she knew that this street could be so much more. She recognized that small-scale manufacturing businesses—businesses that make products—could help bring the neighborhood back to life.
The Secret Sauce: Small-Scale Manufacturing
Small-scale manufacturing businesses create a tangible product—in any material—that can be replicated or packaged; my catch-all is “hot sauce, handbags, and hardware.” The business can be all about technology (for example, a supply chain business that uses 3D printers to supply parts for the Department of Defense) or can be artisan (for example, a consumer-facing business that handcrafts leather handbags). It can be food-based (beer or chocolate anyone?), or it can be food material–based (all-natural lotions). It can sell direct to consumers, sell wholesale to retailers, or sell into business-to-business supply chains.
Such businesses are considered small scale because of their number of employees and the amount of space they need. Small-scale manufacturing businesses have fewer than fifty employees; most of the time, they have fewer than twenty. Their space needs are smaller, too; they generally need less than 5,000 square feet of space, and most need less than 1,000 to 2,000 square feet. They can operate in storefronts and smaller spaces that are not considered “manufacturing” and in general, large, distant industrial spaces don’t serve their needs because of their small space requirements. In addition, these businesses are modern manufacturing and are most often quiet, clean, and great neighbors.
Small-scale manufacturing businesses help us create thriving places, with business ownership opportunities and good-paying jobs that other business types cannot fulfill. They are the hidden gems in the economic development strategy and downtown reinvestment efforts of every place (yes, I really mean every place).
You already have some type of small-scale manufacturing business in your community, and as you learn more about these businesses in this book, you may start to notice them. One example is Katie Stack’s shop, Stitch & Rivet in Northeast Washington, DC. There, you can walk in and see three employees busy at their sewing machines. Little pieces of leather are neatly piled on the table corners, and the sound of the machines makes the air hum with activity. The front of the small shop is filled with Stack’s leather and waxed canvas bags alongside items from complementary producers—some jewelry, funny gift cards, and other small items that round out the shop. It is easy to see all the activity because this business is in an 800-square-foot microstorefront alongside other small producers in a real estate development project called the Art Walk at Monroe Street Market, NE.
Stitch & Rivet is one of a few dozen shops along this walkway. These businesses are an essential part of what makes this project work: they fill a pedestrian walkway with active storefronts that you can’t find anywhere else in the city.
These kinds of product businesses—called small-scale manufacturing—are a critical part of what makes local real estate and economic development work. I often call them hidden gems because they are in every community. The owners are working hard, with their heads down, and are rarely brought into discussions about downtown and business development opportunities, yet they are essential engines to local economies.
Tell Me More!
These businesses are all over the United States. I mean it. They are everywhere—in homes, storefronts, corners of warehouse space, coworking offices, and garages. In some cases, they are a second or third source of income for a household; in others, they are scaling businesses expanding throughout national and international markets.
These businesses are growing in new ways because of e-commerce. Many are native to the internet; others are legacy businesses making the transition.
Throughout this book, I use the terms downtown and main street to refer to any specific place you want to make great. To become a thriving place, however, each place needs to be valued and supported, and small-scale manufacturing businesses are essential to creating a thriving place with businesses that benefit the community. These businesses help diversify the tenant base in our downtown or neighborhood main street, and they also make our local economies and markets more inclusive and resilient. They help a place feel valued and allow more people to contribute to the success of main street and the local business community.
These businesses offer an opportunity to build stronger connections between people, increase the economic resiliency of the neighborhood, and create more wealth building opportunity for more people in the community. Here’s why those pieces are important.
Connection
People crave connections to one another. Even in the age of COVID-19, we try to find ways to safely connect, celebrate, and build community both online and in person. Small-scale manufacturing businesses give us a reason to come together.
They are the vendors at our festivals and farmers’ markets showcasing their products and making people proud of what is made in their com- munity. They are also the “cool factor”—you can see something made in person and you won’t find that business anywhere else. These business owners welcome the opportunity to come together, procure materials from one another, and attract other producers to the area.
Small-scale manufacturing businesses on main street and at festivals make people proud because they see their neighbors showcasing their skills. These businesses can fill storefronts on an empty main street and attract foot traffic (people love seeing stuff made), even while earning most of their revenue from online sales. Successful small-scale manufacturing businesses attract more business owners because entrepreneurs want to be around other entrepreneurs.
Resiliency
Economies are stronger when they are diverse. This diversity means that the community is not completely dependent on one sector (like tourism) to bring in all the local revenue, but can be supported by other parts of the economy as well. Cities with a diverse set of businesses can weather market changes more successfully and are less likely to lose their growing businesses to other cities or countries.
Even during the COVID-19 shutdowns and pauses, having a diversity of businesses allowed some places to continue to build revenue while others were closed. The Baltimore makerspace Opens Works closed at the start of COVID-19, but quickly reopened to become an essential producer of personal protection equipment that local hospitals desperately needed. Small-scale manufacturing businesses add a sector to the local economic development strategy that helps expand that diversity. They are there in the community and might be able to grow or hire more local employees with the right business development programs.
Community Wealth Building
Today, the power and energy behind local small businesses are more important than ever. Local efforts to buy from small businesses exploded during the COVID-19 shutdowns, bringing more and more people to focus on the importance of these businesses as the backbone of our local economies. Small-scale manufacturing businesses expand this opportunity.
Residents are proud to see these businesses create and sell products. The product businesses can access a strong local market alongside a global market through the internet. As more people gravitate toward unique and custom products online, artisan businesses grow in power, and dollars spent on them are increasing. The power to build community wealth pairs with the national interest in unique products, allowing these business owners to bring revenue into the community from far away. Local residents can use their skills, be business owners, build community wealth, and retain what is special about the neighborhood’s culture with these businesses.
More Economic Opportunity
Small-scale manufacturing businesses can make a major difference to help more people create economic opportunities, regardless of education or background. This business sector often includes many people who have been excluded from opportunities in the past. Someone who has an entrepreneurial spirit and the ability to make something can become a business owner; they just need the right support and the right space in town to become a thriving addition to the business community. Small-scale manufacturing businesses are found in every part of our communities and include people across racial, ethnic, immigrant, and income types. This kind of entrepreneurship can help families create economic opportunity for themselves and the people around them. Small-scale manufacturing businesses often hire from within the community and on average pay 50 to 100 percent more than retail or service jobs.
Who They Are, Where They Go, and Why They’re Important
What are these businesses, and what kind of space do they use? Here are a few examples to illustrate some of the variety and the terms used to define the different kinds of businesses, starting with the smallest and scaling up.
Artisan Businesses and Microenterprises: Artisan businesses are stand-alone businesses that produce goods, often by hand or with a small set of tools. They have a few defining characteristics: they are full-time producers, they are generally a sole proprietor business or have one to five employees, and they sell their goods online or at local markets.
Scaling Micromanufacturing: Scaling micromanufacturing businesses are those starting to grow. They have dedicated production space and more tools of their own. They generally have five to twenty employees and often sell through wholesale outlets, as well as online or at local markets.
Production at Scale: Small-scale manufacturing includes those businesses producing at scale for broad distribution. In this classification, the producers top out at about fifty employees, but some of these businesses continue to expand in the same space. These businesses generally use 5,000 to 30,000 square feet of space. The maximum size of the business will be most dependent on the size of spaces in the community.
Shared Kitchen, Shared Woodshop, and Shared Textile Space: Shared commercial kitchen, woodshop, textile, or production spaces provide access to space and tools to local small producers for a fee or with a sublease. These shops are often focused on tools within one industry, such as a health-inspected, commercial kitchen for food production that a small business can rent by the hour or a well-outfitted woodshop accessed by a set of subtenants who share the tools. These spaces generally range from 2,000 to 15,000 square feet or larger.
Makerspace: Makerspaces are community centers with access to shared tools. These spaces generally range in size from 3,000 to 35,000 square feet. They provide public access to a combination of production equipment and offer classes that teach people how to design, prototype, and create tangible items that you may not usually make at home. These spaces are open to hobbyists, people who want to learn how to use a tool for fun, and anyone else from the community. The space may provide workforce development programming or startup classes, but that is location dependent. Many makerspaces are not necessarily business focused since they are open to the public. They often focus on access to maker education versus business development.
I’m guessing that you are starting to see the benefit of small-scale manufacturing businesses to your downtown and local economic development, but let’s be clear about why all this is important.
Small-scale manufacturing businesses help people feel valued and help us see the value in the places in our community. They help us create more opportunity for more people. And most important is that they help us feel proud of who we are and where we are from.
From Recast Your City: How to Save Your City with Small-Scale Manufacturing by Ilana Preuss. Copyright © 2021 Ilana Preuss. Reproduced by permission of Island Press, Washington, D.C.
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Ilana Preuss is the Founder & CEO of Recast City and the author of Recast Your City: How to Save Your Downtown with Small-scale Manufacturing. She is also the co-author of Discovering Your Maker Economy and Made in PLACE: Small-scale manufacturing & neighborhood revitalization, and a chapter author for Creative Placemaking and Sustainable Nation. She is a TEDx speaker on, “The Economic Power of Great Places,” and a featured keynote speaker. Preuss’ passion for great places grew out of her experience working with big and small cities all over the country when she led the technical assistance program at the U.S. EPA Smart Growth Program, and as the Vice President & Chief of Staff at Smart Growth America. She has a Bachelor of Arts in Urban and Regional Studies from Cornell University and a Masters of City Planning from the University of Maryland.
When Preuss is not working with a city or coaching a community leader, she can be found cooking up a storm with her two amazing teens. She lives in Maryland, always hunts down the local chocolate production business when onsite for a project, and still sings along to all 80’s music with her husband and two kids.