How to Start a Lobster Business

by Vanessa Cross; Updated September 26, 2017
Uncooked lobster

In 2007, the U.S. lobster industry produced 75 million lbs. These 10-legged marine crustaceans primarily populate coastal areas such as the North Atlantic coastline of the United States, from New Jersey to Maine. In 2007, the state of Maine's lobstermen caught more lobsters than any other state at 64 million lbs. Massachusetts came in second at 11 million lbs. While there are many market actors within the lobster business, a great entry-way into the lobster industry for either a newcomer or experienced business person is as a lobster processor or lobster distributor that supplies this celebration food to restaurants and supermarkets.

Items you will need

  • Lobsters
  • Storage facility
  • Pens
  • Nets
  • Delivery packaging
  • Commercial Freezers
Step 1

Create a business plan. This includes identifying potential customers, competitors, and wholesale resources for operational equipment, such as commercial freezers. The business plan also is the place to identify prospects for the operational facilities, as well as identify commercial shipping and delivery vendors. Initial start-up costs are often calculated in the business plan.

Step 2

Obtain necessary business licenses, permits and certifications. Applicable state and federal laws apply to this regulated industry. Federal regulations include the Atlantic Coastal Fisheries Cooperative Management Act. Membership in established and respected associations will provide resources for staying abreast of local, state and federal regulations. The Maine Lobstermen's Association and Massachusetts Lobstermen's Association are two well-established organizations.

Step 3

Learn about the lobster industry. There is a Lobster Institute at the University of Maine, which is a resource to learn about industry training programs. Additionally, apprentice programs are available where veterans are paired with industry newcomers to learn about industry regulations, harvesting and sustainability practices. Read lobster industry publications such as Seafood Business Magazine for market information. Like any other commodity, the cost of lobster will vary based on supply and market demand. It can be impacted by such factors as weather conditions and the price of fuel.

Step 4

Obtain lobster inventory. If sufficient financial resources are available consider lobster farming as a supply source. A one-square-meter lobster pen can stock 10 fingerling lobsters weighing up to 1/2 to 1/2 lb. each. Lobsters are carnivores and should be placed with those of similar size to avoid the smaller ones being eaten by the larger lobsters. After 6 to 10 months an average fingerling lobster can grow up to 2 lbs. Alternatively, lobster inventory can be purchased from lobster farms, directly from lobster-men catches or from wholesale lobster distributors.

Step 5

Market the lobster business to restaurants, hotels and supermarkets. Join national organizations such as the National Restaurant Association (NRA), the American Hotel & Lodging Association (AH&LA), and the National Supermarkets Association (NSA) to network and establish vendor contract opportunities for the new lobster business.

Tips

  • The Lobster Conservation Management Committees (LCMTs) are fishermen, policy managers and scientists that report to the Atlantic State Marine Fisheries Commission, an interstate fisheries organization, on the important issue of the sustainability of the lobster ecosystem.

Warnings

  • This article is for informational purposes only and should not be used as a substitute for legal advice.

About the Author

Vanessa Cross has practiced law in Tennessee and lectured as an adjunct professor on law and business topics. She has also contributed as a business writer to news publications such as the "Chicago Tribune" and published in peer-reviewed academic journals. Cross holds a B.A. in journalism, a Juris Doctor and an LL.M. in international business law.

Photo Credits

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