New Partnership Benefits Lobsterman, Restaurateur By Cutting Out Middleman

Jul 13, 2016

A young restaurateur from Maine and a group of forward-thinking lobstermen have joined forces in Tenants Harbor to form an unusual partnership that is attracting attention in the fishing industry.

Luke Holden, of the Luke’s Lobster restaurant chain, is buying nearly every single lobster that the newly formed Tenants Harbor Fisherman’s Co-op can land. He has also built a wharf-side lobster shack at the co-op and has pledged to reinvest half of its profits back into the fisherman’s organization.

Peter Miller fires up the engine of his 38-foot lobster boat named the Sasha and heads out for another day of hauling traps off the Maine coast. Now in his 60s, the Tenants Harbor fisherman has deep roots in an increasingly competitive industry.

Miller says things are looking up in Tenants Harbor, and that has almost everything to do with Holden, who will buy as much as half a million pounds of lobster this year and sell it in nearly 20 franchises he owns around the country and Japan.

“Most of the fleet that fishes here is happy to know where their product is going instead of winding up on a cruise ship or whatever,” he says. “I think they like that idea and Luke has been great to work with.”

Holden’s franchises rake in more than $20 million in sales worldwide and are the brainchild of the 32-year-old businessman, who grew up in Cape Elizabeth and fell in love with the lobster business.

Now, in addition to restaurants in Las Vegas, Washington and six other cities, there is also a new Luke’s Lobster Shack on the wharf in Tenants Harbor. About 20 lobstermen, including Miller, have agreed to work exclusively with him as part of a new partnership.

Managing the newly opened Luke’s Lobster Shack at Tenants Harbor is about the only thing on the wharf that fishermen don’t have a hand in — unless, of course, they feel like having a lobster roll for lunch.

“He buys all our lobster and processes it for his own restaurants of which, this one is one now,” Miller says.

Holden’s pledge to deliver half of the profits from the shack to the co-op each year is one of the benefits of what’s known as a vertically integrated company, or one that controls the supply chain for the products it makes.

All Holden needed was a willing partner. And when Miller’s family became eligible for a $250,000 grant from the state to designate Millers’ Wharf as a commercial pier, it became a natural backdrop for that new partnership.

Miller’s son Josh says he and his father could see the merit of sharing expenses and profits, even when others didn’t.

“I think there was some skepticism at the beginning, not necessarily because it was a co-op, just because it’s a new business venture so there’s going to be skepticism associated with that,” Josh Miller says.

If the marriage between a lobstermen-fishermen co-op and a lobster shack mogul works out, then Peter Miller says Merritt Carey will be credited as the matchmaker. Carey is a family friend who could see the potential cash benefits of eliminating a middle man in the delivery system that gets lobsters to the kitchens of restaurants like Luke’s.

In this case, that middle man is essentially the lobster dealer.

“Luke responded right away and we set up a call initially and we went to Luke to see if he was maybe interested in doing some buying from the wharf,” Carey said.

“I love what I do now, but the best job I ever had was being a stern man and then being a lobsterman,” Holden says in a telephone interview from his office in New York City.

He says his partnership with the co-op ensures a sustainable stream of lobster to a sister company of Luke’s Lobster. Cape Seafood in Saco relies on the lobster meat that is processed, frozen and shipped across the country and around the world. Holden says the partnership is good for his customers and for his fellow co-op members in Tenants Harbor.

“Tenants Harbor Fisherman’s Co-op is building a better, more diversified business and in return are putting themselves in a position where they ought to earn more for their catch than, say, the next wharf down the harbor,” Holden says.

The agreement with the fishermen’s co-op also allows Luke’s Lobster to show its customers where their lobster dinners are coming from and who the people are that help get it to table using what he says are sustainable harvesting methods.

State Marine Resources Commissioner Pat Keliher says he will be watching the relationship between the co-op and Luke’s Lobster to see if it is a business model that holds promise for other Maine fishermen.

Editor's note:  Luke's Lobster Shack in Tenants Harbor is a franchise of Luke's Lobster, but it is incorporated differently and is technically is known as "Luke's At Tenants Harbor."