Last month, Noelle and I had the pleasure of attending the SBN Local Food Trade Show. Fifty vendors and hundreds of other food producers and buyers were in attendance for a lively day of networking and discussions focused on buying and selling local food. Whether you are a buyer in a restaurant or retail market looking to purchase more local food, or a local food producer looking to increase your sales and expand your customer base, here are a few guidelines we picked up on how to get started. You might find it interesting to read the perspective from the other side: if you’re a buyer, what are producers thinking? (And vice versa.)
As a buyer, you’re in a powerful position. When you develop a strong relationship with a producer you trust, you are able to support and directly influence your local food system. You’re also able to spread that influence around, by creating informed consumers who know where their food comes from. You know what they say about great power and great responsibility…
Define your terms. While there is no standard definition of “local” or “sustainable” food, you need to decide what it means to you. The 2008 Farm Act defines local as “under 400 miles from its origin, or within the State in which it is produced.” This definition is challenging in a region like New England, where a product could be coming from out of state and still be travelling fewer miles than if coming from the opposite end of your own state. Perhaps you would like to source a given product as locally as possible but are comfortable sourcing from a location further away, based on the season and availability. Likewise, perhaps you are comfortable defining sustainability based on a certification or by offering less meat on your menu. Either way, it’s important to think about why you want to purchase local food and what aspects are important in defining “local” and “sustainable” for yourself and your business.
Make a plan. It’s true that local/sustainable products typically cost more than conventional/non-local for a wide variety of reasons. For this and a few other reasons, it does not always make strong business sense to go “all-local.” How much of your total budget do you want to commit to locally produced food products? This will depend on how flexible you can be with pricing your products and how much you can afford to increase your costs. Think about how you might offset some of the increased prices of buying local food in other ways (for example, roasting your own meats instead of buying pre-cooked meats or changing your menu mix). Many local food producers aren’t able to offer price breaks on large volume purchases, although this depends heavily on the size of the farm and the scalability of their operations. Also think about how you can build your menu to reflect year-round availability. For example, branching out into other species of fish that are more readily available locally (such as hake) or embracing root crops in the winter in New England is a good way to start.
Communicate and coordinate. Finding local food producers that are good communicators is key. If there are shortages or issues with an order, you want to be sure you can count on your producer to let you know as soon as possible. Even so, it’s important to remain as flexible as possible; bad weather can cause real challenges for local producers. For example, a particularly cold spring means that some crops won’t be available as soon as hoped. There are two ways to coordinate: with other buyers to increase buying power and with farmers to make sure they are growing what you want. If you are a small business, you might be able to access more local food as part of a larger group. Consider partnering up with other businesses in your area to increase your order volumes and reduce producers’ transport costs. Some buyers are able to track their customers’ needs and preferences in a way that can help local farmers plan what they grow and expand the farm’s operations. If this is something you’re interested in, be sure to coordinate carefully with the farmer and not over-commit.
Educate. Letting your customers know about your local food sourcing practices is not only a boon to your marketing, but also a way to sensitize them to menu changes and the natural variations that come with local food. Let them know how you’ve incorporated unfamiliar local varieties into favorite recipes and let them taste the difference in fresh local produce even if it doesn’t look “perfect.” Moreover, if your operation relies heavily on a distributor, encourage them to also buy more locally-produced foods and let them know you are willing to pay for it.
As a producer, you need to protect your business’s viability and profitability by reducing environmental limitations and inefficiencies in your production, while refining the arts of communication with your buyers and working the market to your benefit. All this, of course, while producing a quality product. Easy, right? Read on for our tips on taking the question marks out of the equation.
Diversify. Seasonality and cash flow are closely tied and can sometimes be the determining factor between an economically sustainable business and one that only lasts a year or two. Diversifying your products for sale is generally a good practice so that you aren’t putting all of your eggs in just a few baskets. If something goes wrong with your whole flock of chickens, for example, will you still have other products to sell to your customers? Another way to approach diversifying your sales is through expanding your sales channels. Selling your products via a CSA, to local restaurants, and at farmers markets can help you manage cash flow and volumes and let as little of your product go to waste as possible.
Standout. It’s critical to understand that for many of your potential customers, price is their number one concern. With this in mind, try to understand the full value of your products to your customers and price your products accordingly. While product quality is paramount, think about how you can make your product and its value stand out in other ways as well. This might include the stability of your pricing, your packaging, or your consistent communication. Remember that building relationships with your buyers and deriving long term commitment takes standout products and performance.
Set minimums. A large portion of your business’ profitability will likely be driven by logistics and transportation. For this reason, it is important that you understand your transportation costs and establish minimum delivery sizes accordingly (i.e. larger minimums for further distances). While you do want to make every sale possible while your establishing your business, every delivery eventually needs to make sense financially. If you work with a distributor, try to help them understand your costs and so that they can work with your needs.
Invest in food safety. Maintaining quality control and transparency throughout your entire production chain (not just end quality) is perhaps the most important aspect of selling your product. While food safety is an amazing opportunity for local producers to shine in contrast to industrial agriculture, it can also create additional expenses and could create a huge risk for both your business and the local food movement in general if not managed properly. Larger buyers will often require their producers to have some form of food safety certification, such as HACCP (Hazard Analysis and Critical Control Points) or GAP (Good Agricultural Practices), but other tools are also available to help you invest properly in food safety, such as the Commonwealth Quality Program.
In summary, buying or selling local food can be challenging and requires some extra effort, but there are many successful businesses that are actively engaged in it and have found ways to thrive in the local food trade. Others’ knowledge and tips gained from experience is a great place to start.
 Find more examples here: http://www.juliashanks.com/9-tips-for-incorporating-local-sustainable-foods-into-your-menu/