Sitka Salmon Shares is still a small business. Our investors are all individuals (including fishermen) who are aligned with the company's mission and purpose. We are not venture or private equity funded. We are making these changes not because we’re looking for bigger and better opportunities or because of an increase in demand, but because they will help us continue to do the things we founded this company to do–support small boat fishermen by bringing their responsibly harvested catch to values-aligned consumers, preserving a transparent supply chain and high quality product along the way.
Am I getting the same fish as I was getting before? How do you know your partners can uphold your quality and sustainability standards?
Yes, you are getting the same fish. Our sourcing commitment has not changed. Before we had our own processing facility in Sitka, we sourced our fish through Seafood Producers Co-op in Sitka. Once we opened our own processing facility in Sitka, we continued to work with partner processors for some of our needs because we weren’t able to process all of the fish for our members and because some we wanted to offer species from other Alaskan communities outside of Sitka. With the closure of our plant, we will go back to sourcing from processors like Seafood Producers Co-op in Sitka and our other trusted partners around the state with whom we have long standing relationships and who share our values. Our members have been receiving partner processed fish for years, and we’re confident that this model brings incredible value to small-boat fishermen in Alaska because it creates a market and stable demand for their catch.
Over the years, we have built a network of partner processors that we know well and trust to process our fish. When we evaluate new processors, we look at who they buy their fish from, we consider their ownership structure and community impact, we evaluate their processing facility’s ability to produce great quality. We wouldn’t be working with them already if they couldn’t deliver amazing quality and also support the fisheries that we believe are least impactful to our delicate ocean ecosystem. If the answers to these questions make us confident that they will meet our quality, sustainability, and community impact standards, then we feel good buying fish from them.
We continue to maintain high standards for harvesting, handling, and processing our fish that includes chilling, bleeding, and blast freezing, all of which help ensure a high quality product. We have spent years working with these partners honing their production process to meet our stringent quality standards. We have learned a lot about the processing side by running our own plant and that knowledge helps guide our understanding. They have grown their production to fill our market and, in doing so, set up their fillet and freezing operations to produce the best. Yes, your fish will continue to be sushi-grade!
Will I get fish from the same fishermen?
Fishermen have a choice on where to sell their catch. Having said that, if they sell to the processors where we are buying fish, you will continue to receive their catch. You will also likely receive fish from other small boat fishing families. The Salmon Shares marketplace will now benefit fishermen by working with other processors with that benefit spread between more fleet members.
Who owns the company? Are fishermen still owners?
Yes, fishermen are still owners. The company has two classes of shares–investor shares and fishermen shares. The investor shares are owned by individuals who are aligned with the company’s mission and purpose. We have many smaller investments from a large group of investors. Most of those investors were members first and wanted to help the company succeed. Some of those member-investors also serve on our board and bring a diverse set of skills and knowledge to help guide our company. The ownership structure of the company has not changed–fishermen still own shares in the company. For our Kodiak fleet, nothing will change. They are still accessing our marketplace by working through a partner processor in Kodiak WildSource. Some of our Sitka fishermen may choose to sell their equity since we closed down and will bring their production to other local processors. We still have fishermen board members and we still believe in building this supply chain to benefit the fishermen we rely on.
What is the response of the fishermen to this change?
Our Sitka fleet is sad to lose our processor and the people that they have been working with over the last 8 years. They overall are very understanding that we still had millions of dollars of investments to make to offer them the year-round services they require. Other processors already have that infrastructure, and we have the direct marketplace, so they understand how that makes a good combination. Generally they are proud of what we built together, how we drove forward quality, and built real connections with where the fish ends up (in your boxes). Many of them had been wanting something like this to exist before we came along and were happy to be part of it.
They are largely equity holders in our company and understand very well how rising costs and not enough fish through the plant can put our operations at risk. Our legacy in the community is positive in that we drove higher prices to the fleet and built a direct marketplace nationwide. Many of our fishermen have dabbled in direct-marketing, but it is very challenging to run that side and also be successful in the actual catching of the fish. They really appreciated the differentiation of quality and how we held our fish to the highest standards to ensure our members get the best. This marketplace has been important to them still, and they are disappointed that we aren’t operating to compete with other buyers to drive the high dock prices they have seen in the past couple of seasons. We care deeply about how we interact with our fishing communities and we are proud of the work we have done to push the industry forward. Our fleet recognizes that and we are grateful for the work they have put in to help to get us here.
Will the fish still be traceable to the boat?
Yes, when possible. Some of our processing partners don’t have their systems of buying and moving fish set up to trace their fish back to each vessel. In those cases, we will continue to trace back to the processor. Some do have the ability to trace to the boat, and we are continuing to build up the ones that can. In our member communications we will talk through how different instances don’t allow traceability so you understand how we make these decisions. We believe in that connection to the boats so that our members know what they are getting and from whom, and the fishermen know that every fish they handle has to be perfect because their name will be on it. This season as we transition there might be some instances where we are less traceable than we were in previous seasons, but know that we are working diligently to build boat traceability into our future offerings.
Are your fishing methods or locations changing?
No. All of our seafood comes from wild-caught U.S. fisheries, with the vast majority sourced from the productive waters of Alaska. Our Albacore tuna comes from the North Pacific. From time-to-time, we work with partners in the lower-48 states to source new and diverse products for our customers for our one-time boxes. In these cases, we review the status of the fishery and ensure the fish stock is healthy and that impacts to other species and the ecosystem are minimized.
We actively monitor the health of the fish stocks we source from, their environmental impacts, and stay engaged in relevant fisheries policy and management issues. We do not source from fisheries that are considered overfished or are experiencing overfishing.
We primarily source from low-impact hook-and-line, pot, and gillnet fisheries operated by small-boat fishermen (vessel length of 60 ft. or less), and will continue to do so in the future. On a few occasions, we source from other gear types where the fishery and partnership is carefully evaluated.
We have, in the past, sourced from the Bering Sea, where ocean conditions require larger vessels to operate safely. This seafood was still sourced using pots (for bairdi crab) and hook-and-line (for pacific cod). Normally our bairdi is from small boats in southeast Alaska, but if their season doesn’t go well, we have options to still source the same crab from the Bering Sea where bigger boats are necessary. The partners we worked with for this catch are part of a unique program that benefits western Alaska communities called the Community Development Quota, which ensures these fisheries in the Bering Sea benefit rural communities in the region. This commitment to community support and their commitment to sustainable fishing practices is the reason we were willing to source from these fisheries.
Our fish has been, and will always be, caught, processed, and delivered within the U.S. Our entire supply chain is within the U.S. That hasn’t changed and our standards of how we choose which fish we source hasn’t changed.
Why did you close your plant?
Operating a processing plant requires incredibly high investment and incur costs that are prohibitive for a small processor to be competitive. The bottom line is we did not have the volume required to make our plant viable. The past couple of years with growth being so strong we had enough fish going through over our docks to cover the overhead. With changes in demand starting early this year, we are going to be a smaller company than in 2021. That change was very hard to absorb with the fixed costs of operating our plant. There are processors who are way more efficient and cost effective than what we could be. For us to get there we would need to invest millions and millions of additional dollars into our infrastructure and we would then be even more exposed if there were future downturns in sales. We can continue to add value to the industry by bringing consumer demand that insists on supporting small boat fishermen, sourcing seafood from sustainable fisheries with responsible fishing methods, and on a high-quality product. The relationships we have built in this industry are paramount to being able to deliver that value back to the fleet. One of the partners we work with is a cooperative of fishermen where all profits go back to the fleet. Relationships like these leave us confident in this marketplace’s ability to deliver value back to our fleet. Other processors are very similar to ours that are operated by former fishermen to create a better marketplace and to deliver the best quality to people. They pay similar prices to the fleet that our processor paid and only work with boats that can adhere to their quality standards.
Will working with processors increase the price to consumers?
No. Our partners are able to produce fish more cost-effectively than we were in our plant. The costs of us running our processor meant that we couldn’t deliver value to our fleet members and customers. To keep our plant operating we would have had to raise prices significantly this season and we were worried that would drive people to leave and make the problem of not enough fish through the plant even worse. In working with other processors that can filet and freeze fish efficiently, we can focus on what we do well in delivering your boxes for a fair value.
What happened to your employees?
The wellbeing of our employees has always been of the utmost importance to us, and that is no different with this change. We employed about 45 people in our Sitka processing facility and 10 home delivery drivers, and are doing everything we can to support them. We have offered each of them severance packages. We have worked with other processors in Sitka and around southeast Alaska to facilitate the transition for some of those workers to other jobs. With the shortage of labor, we are confident most of our labor force will transition to other roles quickly. This was a hard call to make, and we made sure we did the best we could to land everyone on their feet the best we could.
Why did you stop your home delivery program?
Most of our members currently receive their boxes by UPS. Our home delivery program was the way we delivered subscription boxes to our members in some areas in the midwest. With cost increases in fuel and fleet management, we decided to discontinue our home delivery service so that we have more flexibility during periods of lower deliveries. It was a strain to the whole operation to have all the hubs and our own delivery when we can reach people really efficiently out of our Galesburg warehouse.
Our delivery failure rate for UPS is very low (1% or less) and we stand by all of our deliveries. If there is a delay and the fish arrives thawed we will send a replacement no questions asked. We also actively monitor UPS delivery delays to increase dry ice amounts in certain areas if trends in delays appear. In addition, we have worked hard to make all of our UPS packaging curb-side recyclable.