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Sustainability News

May 22, 2020

From his experiences in the beverage business, Master of Sustainability Solutions student Nicholas Shivka was painfully aware of how hard it is for local businesses to compete with the global giants. He knew that local business start-ups lack the financial support cities provide to multinational corporations interested in establishing a local presence. Those companies promise the addition of new jobs in exchange for tax breaks and other “attraction” incentives offered by city officials enamored with Fortune 500 companies, while local businesses receive minimal support and suffer financial disadvantages in the local economy.

Shivka saw a need to encourage and support local entrepreneurs in their quest to build sustainable businesses by creating a sustainable business incubator program. Using the co-op ownership model, sustainability methods, and participatory practices, he partnered with MSUS students Hanna Layton and Huda Khalife, under the guidance of Professor Arnim Wiek from the Sustainable Food Economy Lab, to build an educational program for aspiring entrepreneurs interested in sustainable food production. To test the program, they began the incubation of “Together We Brew,” a sustainable beverage business, with a group of Phoenix entrepreneurs.

The team started by designing and running a series of workshops with the entrepreneurial participants to help them set guidelines for running a sustainable business. They used a holistic approach to design workshop experiences that included discussions about products, jobs, sustainable sourcing, operations, ownership and decisions, location and facility, finances and customers.

Nicholas Shivka

Workshop topics were all infused with sustainability principles. Examples of sustainability principles and practices — checking triple bottom line boxes — included packaging products with reusable materials, focusing on local job creation, and sourcing ingredients from within 50 miles of the business location.

The local-sourcing guideline is an important business tenet that shortens supply chains and promotes local resilience, which is why the team was adamant about building relationships with growers and producers in the Phoenix area. Local and transparent value chains support local businesses because consumers want to know with what, and how, something is being created and that the benefits of the final product are equitably distributed. When benefit distribution is unbalanced, some actors profit to the detriment of other stakeholders in the chain.

As part of the incubation process, the team worked to increase the entrepreneurial group’s financial literacy by getting them familiar with financial operations and industry players like credit unions, banks and other financiers. They also met downtown Phoenix stakeholders to get ideas about the best approaches to business establishment and finance.

The COVID-19 pandemic has disrupted the project, but it has also presented new opportunities for business development pathways. The team believes that small business owners are among the most resilient stakeholders right now and that cooperative businesses have been the quickest to adapt because the burden is equally distributed within the business and local residents have a stake in keeping their business viable. The incubation process has helped the participants recognize the value of a employee-owned businesses that invest in the community.

"What the participants experienced in light of COVID-19 through the duration of the incubator program is not trivial," Shivka said. "They have come together and are working passionately and capably to make their shared vision of a worker-owned sustainable beverage company a reality here in Phoenix."