Success stories

Snackwerks

Battle Creek, Michigan

The sweet smells of cinnamon and apples waft through a northside Battle Creek neighborhood that is traditionally one of the poorest in the state. A former grocery store has been reinvented into Snackwerks, a contract manufacturer devoted to quality food and quality jobs.

“[Northern Initiatives] brought a lot of intelligence into the process.” – Jeff Grogg, founder, Snackwerks

And jobs there are. Northern Initiatives, through a $800,000 grant from the Department of Health and Human Services, is helping Snackwerks build a fourth production line and create 27 jobs.

“I’ve always been focused on creating jobs for those who have barriers to employment,” said Jeff Grogg, who founded Snackwerks in 2016. He has a track record of hiring at-risk employees, and helping with offender re-integration and language skills. Snackwerks currently employs 85 people; Grogg had a goal to hire 10% of the workforce from the adjacent neighborhood, but blew past that and is close to 30% now.

“It’s a job that’s both stable and flexible,” Grogg said. “There’s no manufacturing on this side of town,” and no reliable way to get to the other side of town unless you own a car, he said.

Other nearby jobs are mainly in retail or the service industry and don’t promise full-time employment or even a regular schedule, he said. At Snackwerks, employees work a 40-hour week (overtime is available if they want it), Monday through Friday, staffing three shifts. They get paid holidays, paid time off, a 401(k), and, beginning in 2022 now that they have enough employees, health insurance.

Northern Initiatives has also had a presence in Battle Creek since 2016. Working in partnership with other community stakeholders, the W.K. Kellogg Foundation (WKKF) launched the Battle Creek Small Business Loan Fund and brought Northern Initiatives on board as a partner to run lending operations for the $10 million fund. In five years, Northern Initiatives has made 38 loans, totaling close to $4 million.

It was one of those loans, in 2020, that helped Snackwerks enjoy the surge in demand for healthy snack foods during the pandemic. At the beginning of 2020, Snackwerks had 55 employees; early in the pandemic that number dropped to 24. Northern Initiatives helped with working capital so Snackwerks could add labor shifts to its three production lines, bringing employment to 85.

Grogg (at left, with Gunther Brinkman, general manager) is well-suited to guide Snackwerks through its growth. He began his career in product development at the Kellogg Company and also runs a consulting group, JPG Resources, to support the growing better-for-you food business nationally. Battle Creek also is well-positioned to support Snackwerks. The Midwest location makes it advantageous from a distribution cost viewpoint for Snackwerks’ customers, most of whom have nationwide distribution, and Battle Creek has a workforce with a food manufacturing history.

Snackwerks is partnering with MichiganWorks to help find the new employees and, even though that hiring process hasn’t started, Snackwerks embraced one of the programs early. A success coach holds regular office hours, onsite at Snackwerks and free to employees, to help with financial planning and connections to resources, including for transportation, housing, and child care. The coaching helps with job retention, but also helps with employees’ financial resiliency, Grogg said, and the employee feedback has been great.

Snackwerks also encourages its workers to set goals and loves to promote from within, including one general laborer who worked on the second shift after he relocated from the Middle East as a refugee. He’s now a supervisor.

“We’ve created a lot of avenues for growth,” Grogg said.

Part of the reason a fourth line is needed is for allergen-free production, which currently has to move from line to line, with extensive cleaning in between.

The loan for the fourth line came at just the right time, Grogg said, saving him from negotiating with banks or searching for investors. But the 80-page application almost did him in. “We don’t know how to write grants!” he laughed. “But Northern Initiatives was very effective in helping us structure it. They brought a lot of intelligence into the process.”