Secrets of the Spice Trade: How to Run a Spice Shop

The world is smaller than it used to be. That's thanks, in part, to spices and the globalizing influences of colonialism that were fueled by our hunger for tastes from far away.

So it's a small irony that when we want to expand our culinary world view, we turn back to spices.

Think about what's in your pantry right now. Your black peppercorns might hail from India, your cinnamon from Indonesia; your coriander might have been harvested in Bulgaria, while the cumin you often pair with it was grown in Turkey. Allspice, that favorite ingredient in so many Scandinavian dishes? It's anything but Nordic—it's usually grown in Jamaica.

It's fascinating—and a little mind-boggling—to think about the intricacies of the spice trade, a millennia-old business traversing the globe. To help us wrap our brains around it, we turned to two of our favorite spice experts: Lior Lev Sercarz, the master spice blender behind Manhattan boutique La Boîte à Epices, and Tom Erd, the co-owner, along with his wife Patty, of the Spice House, the premier mail-order Midwest spice shop that's been in operation for over 50 years. They shared some secrets of the trade with us.

Whole Spices Beat Out Ground—Every Time

"Nobody seems to understand shelf life," Erd says. Whole and ground spices are effectively separate products, each with their own shelf life. When left whole, spices' cell walls remain intact, but as soon as the spice is ground, those walls rupture and the spice's volatile essential oils—responsible for the very flavor and aroma of the spice—begin to dissipate at a rapid rate. "Now the clock starts ticking," Erd goes on.

His advice? When possible, buy whole spices and grind them just before cooking, as a coffee connoisseur does with beans. Stored whole, spices will keep for at least a year at full potency, if not several. A spare coffee grinder or burr grinder makes quick work of most whole spices.

When that's not an option, buy smaller quantities of ground spices and use them within a few months, or a year or two at most. Good spice shops will allow you to buy spices in small quantities.

Freshness is a Matter of Trust

When a spice merchant places an order, she does it blind: not knowing how fresh the spice is or what condition it'll arrive in.

"This business was started by pirates and there are still pirates in it," Erd likes to say. "Shippers will try to pass off crops that are one or two years old. I pay for this year's crop and I want this year's crop: you really gotta know your guy."

Spice trading, Sercarz agreed, is a profession where relationships are everything.

"It's still a bit old school," he says. "There's a lot of hand shaking. You need to know the right suppliers and you need to build on those relationships, on that trust."

The Best Kind of Storage is No Storage at All

Spice merchants deal with a volume of product that's hard to fathom—a bag of spices can weigh over 100 pounds—and the product inside is a ticking timebomb of freshness. So how do spice sellers store their product to maintain its quality? Well, preferably they don't do much storage at all.

"The goal is not to keep them here," Sercarz says. "The shorter time they can spend here, the better." That means ordering as little product as possible at a time, particularly when it comes to pre-ground.

"We buy smaller quantities of those items," Erd notes. "Just enough so that they'll be off our shelves in three weeks to a month."

So How Do They Get Those Spices, Anyway?

Both Erd and Sercarz rely on a network of spice brokers and middlemen scattered all over the world, but most are concentrated in Asia where the majority of the world's spices are grown. These brokers use their own relationships to purchase spices directly from farms.

"It's very hard to buy directly from spice farmers," Sercarz explains. "Many of these people live in extremely remote places, and it's near impossible to get in touch with them." "Through the centuries, it's been a word-of-mouth thing, and it still is," Erd says.

But that's starting to change, if slowly. Sercarz now purchases directly from a few farms in Israel, France, and Cambodia, and here at home Erd buys some herbs from California farms.

The Market Dictates Their Inventory

With hundreds of herbs and spices out there, how do spice merchants decide what to stock? For the most part they listen to their customers. And who do costumers listen to? The media.

"I don't set the pace," Erd explains. "That's TV chefs and food writers. If they're using Sichuan peppercorns, I better be selling Sichuan peppercorns. You have to follow the food trends."

20 years ago—in the era of Paul Prudhomme—Cajun seasoning flew off the Spice House's shelves so home cooks everywhere could get their taste of blackened fish. Today Erd struggles to keep Middle Eastern flavors in stock, thanks in large part to the continued popularity of 2012's wildly successful cookbook Jerusalem by Yotam Ottolenghi and Sami Tamimi.

It's a different story at Sercarz's business, where the chef-turned-spice-merchant lavishes his attention on minutely-tuned imaginative spice blends with names like Penang, Orchidea and Tangier. Sercarz mainly designs custom blends for high-end restaurants like Le Bernardin, and some of those blends then join his retail line. But he's noticed an increased demand for Middle Eastern spices as well.

Restaurant Collaborations are Key

While retail sales establish a spice merchant's brand and build visibility, contracts with restaurants are their bread and butter. A third of the Spice House's business comes from its sales to restaurants—in-store sales and internet sales make up the other thirds—and La Boîte supplies more than 80 restaurants, bakeries, and bars from here to Paris and beyond.

Both Sercarz and Erd sell proprietary spice blends to restaurants, either recipes they develop or ones that chefs provide based on their own tastes. "Every year it's a bigger part of our business," Erd says.

Desirability—and Profitability—Varies by Season

You might think that a spice shop's big money-makers are the high-priced specialty seasonings like saffron (price: up to and over $10,000 a pound) and vanilla ($2 or more per bean). But Erd's most important items are reliable seasonal staples: baking spices like cinnamon in the winter and grilling spices like cumin and chili powder in the summer.

Big Spice vs. Little Spice

Small specialty spice merchants have a hard time competing against giants like McCormick. With high-volume orders, large companies can set the pace of the market and have far greater purchasing power. While Erd and Sercarz rely on broker connections, large companies' needs are so vast that they can approach a whole farm and buy out their entire stock during the late season: when prices are lower.

"At our level, we just can't do that," Erd says.

But small shops offer a different kind of value for consumers: freshness.

"We grind only about 100 pounds of spices at a time," Erd says, "and then we sell them within two days and grind again. Big companies grind only once every month or two, so by the time you get your hands on one of those bottles the spice inside may have been ground eight months ago. With our stuff? When you get it, it was probably ground only a week prior."

And, of course, as at any small business, owners Erd and Sercarz wear many different hats.

"I handle everything," Sercarz says. "I do finance, I do the books, I'm responsible for creativity, for purchases, the list goes on. I highly doubt McCormick's CEO does the purchasing."

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