Maine’s Newest Cooperative, Lobster 207 Making Waves

There’s a new lobster cooperative in Maine. Lobster 207, located in Lamoine, is operated by the Maine Lobstering Union, a local of the International Machinists and Aerospace Workers (IAM) Union, which was established in 2013. The Union purchased the Trenton Bridge Lobster Pound, a wholesale lobster distributor, in 2017 from fourth-generation owner Warren Pettegrew’s family for $4 million. Pettegrew remains the company’s chief executive officer of wholesale operations.

“We’re growing by leaps and bounds,” said Rocky Alley, president of the Maine Lobstering Union and a Jonesport lobsterman. “This is in the best interests of the lobster industry. The profit is going into our hands, not into the hands of big business.”In a fundamental sense, Lobster 207 operates largely as Maine’s other lobstering cooperatives do. Members of the co-op sell their lobster to the company, which holds the lobsters and grades them; the company then markets and sells those lobsters to customers large and small. At the end of the year, co-op members receive a dividend, based on the pounds of lobsters they sold that season to the company, minus the expenses it took to run the business.

What makes Lobster 207 different is that all elements of the business are done by unionized workers. That means many of the lobsters brought to the wharf are harvested by Maine Lobstering Union members. The employees who pack the lobsters for shipment are unionized. The trucks that move the lobsters from Maine to far-flung destinations are operated by unionized truck drivers. It is that trait — that Lobster 207 is a union-based company — which plays a key part of its marketing strategy.

The purchase of the Trenton Bridge Lobster Pound was a crucial element in the union’s mission to improve the price paid for its members’ lobsters. Funding that $4 million purchase was enabled by financing from the Bank of Labor, a Kansas City bank established in 1924 by the International Brotherhood of Boilermakers for labor union members in that state. The Bank now serves labor unions throughout the United States. “We had to have three appraisals before we closed [on the property],” Alley said. “We had to pay out nearly $1 million last year. But we’ve paid the debt to the Bank of Labor. They were great to us.” According to Alley, Lobster 207 sold between 13 and 14 million pounds of lobster last year — soft-shells to processors and hard-shells to accounts in the U.S. and abroad. The dividend paid to Union members at the end of 2017 was 5 cents per pound. The number of Union members that sell to Lobster 207 fluctuates between 300 and 350 each month, said Alley, depending on whether each member has paid his or her Union dues. In addition, non-union lobstermen also sell their catches to the company.

Lobster 207 began its online retail sales in August 2017. The online sales “means diversifying our business operations, owning as much of the supply chain as possible and taking advantage of our strengths, working with our union brothers and sisters,” said David Sullivan, IAM business representative, in an interview with Payments News and Mobile Payments Trends last year. The company has delivered Maine lobster to Philadelphia’s mayor after that city’s Super Bowl win this year as well as to a group of Google employees attending the famous Burning Man celebration in the California desert.

“We have a three-phase plan,” Alley said. Lobster 207 first approached Union members and other lobstermen in the Jonesport area and Vinalhaven to sell to the company when it started operations in 2017. This year Alley said the company wants to get lobstermen in the Boothbay Harbor area to sell to it. And after that, “lobstermen all the way to the Kittery Bridge,” Alley said. “We’ve got eleven lobster brokers working for us. We hope to get a better dividend this year and more members.”