Tre-Fin seeks to expand its operations by securing a new production facility, serving as a foundation to build out in-house processing capacity & retail space.
Funded on 03/11/2021
Tre-Fin Day Boat Seafood makes berth in Ilwaco, WA, and brings the holistic approach of Community Supported Agriculture (CSA) to the sustainable seafood industry, operating as a Community Supported Fishery (CSF). Day boat seafood means fish are individually caught and returned to dock within 24 hours, eliminating the wasteful and destructive approaches of industrial-scale fisheries. Upon return to the dock, each fish is hand-cut and flash-frozen to maximize quality, nutrition, and flavor before being delivered directly to restaurants and consumers’ doors.
Tre-Fin’s short supply chain and minimal impact harvest methods yield a high-flavor product that has won acclaim from professional chefs and discerning seafood lovers throughout the Pacific Northwest. After proving the validity of their business model, Tre-Fin is ready to scale their sustainable processing capacity and provide a responsible roadmap for the broader seafood industry to follow.
For small-scale fisheries, limited access to waterfront, ice supply, and seafood markets are “choke points” that large-scale distributors use to leverage fishermen into compromising on price, quality, and sustainability in order to turn a short-term profit. Every ounce of operational efficiency has been wrung out of Tre-Fin’s current setup, and market demand for day boat seafood continues to grow. In order to fend off industry giants and maintain their high bar for ethical sourcing, fair wages, and sustainable practices, Tre-Fin needs a loan to secure a permanent site where they can control their full seafood processing chain—from boat to plate.
Tre-Fin’s accomplishments have been achieved thus far from a cramped 700 sq ft facility (shared with the Ilwaco Tuna Club), all while driving ice down to the docks in coolers each day. The shared space limits Tre-Fin to a maximum of six employees (3 cutters, 3 packers), a staging capacity of 300 fish, and a processing limit of just 200 fish per day—well below current market demand.
Tre-Fin’s current processing space is leased and their rent is set to double this year, which makes purchasing their new facility and establishing infrastructure for in-house processing critical priorities. A new site has already been identified, and Tre-Fin is currently leasing a portion of it as storage to maintain its availability. The property—which is strategically located near the port—is a 15,000 sq ft lot that has two 1,700 sq ft adjoining retail buildings and a detached 288 sq ft building ideal for ice making. The new location will triple the staging space for fish processing, increasing both capacity and revenue.
Phase one of a larger plan, a business loan from Steward will be used to purchase the new property and to lay the groundwork for phases two and three, which will include infrastructure upgrades for the future building, processing equipment, ice machinery, and storefront.
Participating lenders can expect to receive products from Tre-Fin when lending at the following tiers:
We were introduced to Mike and team in the summer of 2020 and were absolutely thrilled when he reconnected with us in late autumn to discuss his needs and his goal for expansion. We personally purchase Tre-Fin's product and can attest to its superb quality (their albacore is out of this world!), made even better as we know it's truly been sourced as responsibly as possible. Tre-Fin cuts no corners, whether in relation to sustainability, transparency, or ethics. These are wonderful people catching fantastic fish, with big dreams to completely change the seafood industry for the better. Tre-Fin is the pinnacle of the type of business we strive to support, and we are 100% behind them. We hope you join us!
With the generous support of 83 lenders, the first phase of our three-stage In-House Processing Facility project was fully funded in mid-March. Today, our team is one BIG step closer to realizing the dream of building our own base of operations. We continue to work diligently, to grow the market for our products and support the small, local day boat fishers we work with, while simultaneously growing our physical footprint to include more processing and cold storage space, ice production, and walk-up retail.
We are immensely grateful to everyone who made the successful completion of the Phase 1 a reality. And we’re eager to share your seafood incentives with you. We’ll be inviting our Portland-based participants to collect their incentives at our April CSF pickup (keep an eye out for that email). Another way to give back, if you live elsewhere, is to offer your share as a donation to a local family in need. We are happy to coordinate that donation if you are interested.
The second and third phases of our In-House Processing Facility will fully develop the property you helped us acquire.
Please help us get the word out about the next round of funding by registering your interest here: https://gosteward.com/farms/tre-fin-day-boat-seafood, particularly if you weren't able to join us for the exciting first round. You and your network will be among the first to hear when we launch round two.
With gratitude until next time,
The Tre-Fin Team
Our hearts are filled with excitement and can not thank the 84 participants enough for your support and desire to be part of our vision. We are honored to lead the charge of making lasting improvements to the way we produce local seafood and now are on our way thanks to you and the efforts of the great team at Steward.
Wow, hard to explain the gratitude we have and the excitement brought by the thought of getting to the finish line. We have had a great week and to date have 62 participants helping out. Much thanks, and we are optimistic that if we keep that momentum, we will reach our goal and be on our way to make lasting change.
The seafood sector is comprised of five key components: fishermen, working docks, processors, wholesalers and finally, the end consumers. The middle of this supply chain is controlled by 2-3 large operators that leverage fishing logistics against fishers (ice availability, offload and processing) to maintain low pricing and availability, even limiting access to markets. The less transparent the supply process is, the more control commodity distributors have. The end result is low-quality products harvested with high-impact methods.
Rather than participate in a broken system, Tre-Fin chose to reinvent it. Replace weeks-long harvesting treks with Day Boat fishing in fast, nimble rigs that return fish to dock within 24-hours. Replace catch-all methods with individual hook-and-line harvesting. And remove the murky middlemen all together. By taking on the giant task of in-house processing and direct-to-market distribution, Tre-Fin ensures customers get top quality, and fishermen—the foundation of the industry—get to keep more of the value they create.
Tre-Fin’s model includes five-steps:
60% of Tre-Fin’s product is sourced from Tre-Fin Marine’s boat, F/V Oppor-tuna-ty, and 40% is sourced from other day boats in the Tre-Fin Co-Op. As processing capacity increases, that ratio will shift towards 40:60, empowering Co-Op fishers.
Within the Co-Op, whole albacore and groundfish are purchased at $2.00/lb and $3.50/lb, respectively. Those whole fish fetch a product price of $3.50/lb and $7.50/lb. Once processed, that increases to $11.50/lb and $17.50/lb. That gain of 500%+ demonstrates the value captured by orchestrating the entire supply chain.
Tre-Fin sales are diversified, which reduces risk and increases ability to withstand market disruptions. Since Day Boat Seafood is not marketed or sold as a commodity, but rather a valuable local resource that remains attached to its producer, target markets (both direct-to-consumer and wholesale channels) are those that recognize high quality and traceable methods of production.
Roughly 20% of whole fish are immediately directed to market (Portland metro) before ever being frozen, where they are sold under the trademarked Day Boat Tuna brand wholesale to restaurants and grocery stores. Each fish is traced from catch to point-of-sale by the boat/captain, date and time of processing, and journey to market. This creates a standard-setting level of transparency for the path of origin to the consumer.
The rest of the catch is destined for farmer’s markets, strategic partners, and CSF customers’ doorsteps as frozen, vacuum-packed portions.
Throughout 2020, Tre-Fin heavily invested in direct-to-consumer sales outlets. The COVID pandemic resulted in a substantial increase in direct sales, and marginally used delivery services such as MilkRun exploded. Tre-Fin now supplies five farmer’s markets and CSF sales have increased 130% since January of 2020.
Tre-Fin’s diversified sales strategy is mirrored by a diversified product line, including whole fish, processed CSF shares, value-added pouches and smoked products, and custom processing and ice sales.
2021 product projections:
The additional cold storage and processing capacity of the new property will allow an increase in sales of high-margin processed fish. CSF sales will increase from 38% of gross sales in 2020 to 45% in 2021 and 62% in 2022 by producing additional groundfish integrated into the mixed seafood shares. Continuing to build on 2020’s investment in Tre-Fin’s farmer’s market program and strategic partnerships with New Season Market and MilkRun will provide additional opportunities to move high-margin processed fish products.
A variety of sales outlets allows Tre-Fin to find the right balance between moving higher volumes of wholesale fish and capturing the higher returns of value-added fish products.
Tre-Fin’s growing CSF creates a reliable and quantifiable market for direct-to-consumer distribution of value-added processed fish. The CSF is a subscription based e-commerce platform where members pre-purchase a portion of Tre-Fin’s annual harvest and receive it in four installments throughout the year. The higher investment means new customers must be earned, but once connected, the retention rate is high. The earliest CSF subscribers have been regular customers for nearly 4 years.
In 2017, Tre-Fin’s CSF program sold a total of 100 boxes of albacore and retained 16 annual members to the program. In 2020, the CSF customer base increased to 331 purchases of boxed seafood thanks to the addition of several new species of groundfish, and by year-end the annual CSF membership doubled to 33 annual members receiving 4 boxes per year. With the new processing facility, Tre-Fin anticipates growth to 420 purchases totaling 10,874 lbs/year by 2022, representing 32% of Tre-Fin’s annual processed fish production.
From July 2017–June 2018, Tre-Fin sold 6,500 lbs of processed Day Boat Tuna representing 54% of processed fish production. The following year, by increasing the number and size of restaurants serviced, Tre-Fin’s restaurant wholesale program grew to 8,331 lbs of processed fish, a 28% increase. Prior to the COVID pandemic, restaurant sales were limited only by supply and ability to store and hold inventory—limitations that will be addressed with the new facility.
As restaurant channels reopen, Tre-Fin is prepared to eclipse a 20% increase again through 2022, to 10,195 lbs in wholesale restaurant purchases. However, 2020’s market disruption made clear the value of direct-to-consumer sales outlets, a market Tre-Fin will continue to focus on for the foreseeable future.
Tre-Fin utilizes partnerships with like-minded CSFs and distributors to maximize marketing value and share operational efficiencies. Partnerships with Kenai Red, MilkRun, Nehalem River Ranch, and Carmen Ranch accounted for 4,836 lbs of seafood sales in 2020. By strengthening these relationships and adding New Season Market, Tre-Fin anticipates an increase in sales to 8,496 lbs/year from 2021–2022, representing 25% of processed fish.
The working port of Ilwaco has an established but underserved base of walk-up customers, particularly during the summer months. Walk-up sales are limited at the current space, as sharing the small facility with the Ilwaco Tuna Club and the Tre-Fin processing team can create disruption and confusion for walk-up customers.
The new facility will include a stand-alone seafood market to properly showcase Day Boat Seafood. The retail storefront will allow Tre-Fin to capitalize on the available market at the port, while also educating new customers about just what Day Boat Seafood is and why it is so valuable. 2020 walk-up retail totalled $12,000. With the new facility, the walk-up sales target will nearly triple to $32,000 per year. These sales will account for 5% of Tre-Fin’s total processed fish along with whole fish, value-added products, ice sales and merchandise.
Transparency is hard to come by in the seafood business. Even products branded as “sustainable” are often mixed with industrial catches, so only a small fraction of the final market product is responsibly sourced. The truly murky waters of seafood sourcing fueled Tre-Fin’s mission to rebuild an entirely new and transparent supply chain.
Tre-Fin founder Mike Domeyer can’t remember a time when he wasn’t fishing. From the open ocean of his grandparents’ home in SE Alaska, to tagging along with his Dad through freshwater fisheries, fish have always been a part of his story.
When Mike relocated to Portland in his twenties, he dipped his toes back into saltwater, entering offshore albacore tournaments. Albacore led to salmon, which led to bigger boats and deeper waters. The quality of the catch is the foundation of sport fishing. Fishermen take a great deal of pride in how they handle the fish in the water and eventually bring it to the table. But that quality is clearly lacking in the industrial side of seafood, which led Mike and his colleagues to question why the ethics and processes of sport fishing couldn’t transfer to market seafood.
In order to consistently bring seafood to market in a more responsible manner, Tre-Fin—which Mike originally founded as a fisheries consulting group—shifted to commercial fishing. Over the years, the team developed the unique commercial fishing and processing operation that is Day Boat Seafood, bridging the gap between fishers and the rest of the food chain.
Daily hook-and-line harvesting allows top-quality seafood products to reach market year-round, without the supply chain disruptions common to industrial-scale fisheries. The rapid turnaround and individual attention maximizes flavor while minimizing ocean disturbance, and by selling a value-added product direct to consumers, the fishermen of the Tre-Fin Co-Op earn a consistent, living wage—a legacy that Mike is proud to build for his family and all those who share his craft.
Mike and the Tre-Fin team bring an unprecedented level of market understanding to the table. For more than half a decade, they have not only been honing their craft, they’ve been reinventing it from the ground up. Tre-Fin consists of 5 full-time employees and during the rush of albacore season employs over a dozen seasonal team members.
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