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Adaptability of Local Product Companies Strengthen Diversification of Hawai‘i’s Economy Amid Absence of Tourism
Honolulu – Mana Up, a local accelerator for Hawai‘i-based consumer brands, reported an aggregate revenue of $43.4 million in 2020 from 47 companies surveyed, up from $36 million in 2019. Despite challenges brought on by the pandemic and the absence of tourism, 53% of companies grew in revenue. These companies provided a total of 315 jobs last year across the Islands.
While the pandemic impacted the expected growth paths of companies – the median annual growth rate was 17.6% (compared to 25.3% in 2019) and the mean annual growth rate was 65% (compared to 142% in 2019) – many were able to replace lost revenue streams by adapting to the new online-first environment while others with stronger brick-and-mortar presence had a tougher time.
For the majority of the companies surveyed, e-commerce and mainland sales channels were responsible for replacing revenue lost to sales typically generated from in-state tourism. At least $18.5 million of the $43.4 million in revenue was earned from sales outside of Hawai‘i, bringing new dollars into the state that adds to economic diversification. Additionally, 69% of companies conducted 50% or more of their business via e-commerce in 2020, up from 40% in 2019. While an increased e-commerce business comes with higher costs in online marketing, packaging and shipping, it also comes with higher margins compared to wholesale accounts and ability to reach a global marketplace.
The report also highlights the benefits of growing the number and success of locally owned product businesses, including that these companies source ingredients from Hawai‘i farms, serve as customers for Hawai‘i-based professional services and banks, and spearheaded substantial community giveback efforts in the midst of the pandemic.
Government funding programs were also a much-needed relief according to the companies surveyed, especially in the immediate months following the state shutdown. Mana Up companies received at least $4.29 million in grants or PPP loan funding, helping to keep employees on payroll.
“By utilizing e-commerce and establishing Mainland U.S. and international sales channels, we’ve found that locally owned businesses can earn significant revenue from out of state – which gives us an industry that doesn’t solely depend on tourism but leverages the global love for Hawai‘i. We can build on these strategies to grow jobs, profitability and new ways to support complementary industries such as agriculture,” says Meli James, cofounder of Mana Up.
The annual report further highlights milestones the company achieved during 2020 such as the grand opening of House of Mana Up, its first brick-and-mortar shop; expansion to Japan; and its first ever live broadcast Showcase event, which reached 198,635 viewers worldwide and generated an estimated $80,000 in sales from its virtual shopping marketplace.
The report also details the diversity of Mana Up’s companies, which are all headquartered in Hawai‘i – 63% are female operated, 48% are Native Hawaiian owned and 68% are Asian-American Pacific Islander owned.
To view the complete 2021 Economic Impact Report, which includes industry trends and other economic impact statistics, visitwww.manauphawaii.com.
About Mana Up
Mana Up is an accelerator for consumer products who are based in Hawai‘i and have the goal to expand to global markets. The accelerator hosts an annual six-month program to help product businesses scale by uncovering opportunities for growth and tackling production challenges that typically come with fast-growing revenue such as sourcing, manufacturing and shipping. To date, the Mana Up has seen a total of 63 local companies participate in its program. Through these efforts, the company aims to expand economic opportunity and grow well-paying jobs across the Islands. Mana Up also has an online shop and brick-and-mortar retail experience, House of Mana Up, located at Royal Hawaiian Center in Waikiki, which highlights products from Hawai‘i’s rising makers and artisans who have participated in the accelerator program.
Mana Up is supported by Kamehameha Schools, DFS Hawai‘i, Castle & Cooke Hawai’i, Hawaiian Airlines, American Savings Bank, Ulupono Initiative, Dole, Kaiser Permanente Hawai‘i, Hawai‘i Technology Development Corporation, Innovate Hawai‘i, UHA Health Insurance, Pineapple Tweed, Shopify, The Kahala Hotel & Resort, and Foodland.
For more information about the accelerator program, visitwww.manauphawaii.com, and to shop House of Mana Up, visithttps://houseofmanaup.com.