Retail Ready
For Local Food
S. Gary Bullen
North Carolina State University
Local Food Market
• Interviewed
87 buyers
• Focused on
fruits and
vegetables
• Business Skills
needed
What is local food?
Little agreement regarding
distance and political
boundaries
Defining Local in North Carolina
• Locally sourced is
highly variable
Grocery stores define
local as within state
• Coop groceries stated
“closer is better”
• Specialty food hubs
define as within or a
joining county
Why Local Foods
Survey of National Restaurant Association
Locally Grown produce is perceived as hot by 84%
Chefs want products that are raised locally and are
harvested right form the farm and go right to
the restaurant within one day
We shake hands with the people we get our food
from. How many people can say they know the
people from where there food come from?
Think Like a Buyer
• To be able to reach producers directly for
their product needs just as easily as they reach
wholesaler
• Producers to understand how a restaurant
grocery store or distributor operates
• Producers to be acquainted with the types of
food their customers prefer
• You need to understand their customers and
how you can provide them with a remarkable
product and experience
Market Channels for Local Foods
• Restaurants
• Coop Groceries
• Supermarket and Grocery Chains
• Wholesale Buyers
• Food Service Distributors
• Specialty Distributors
• Institutional Suppliers
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Child Care Center
Private Schools
Colleges and Universities
Hospitals
Business Skills
• What are your business goals and capabilities
• This will determine the market channel that is
the best fit for you
• What products do you offer?
•Quality, quantity, timing
Skills Needed by Farmers
• Reliability
–Farmers must delivery product
type and quantity as agreed to
–Buyer are planning on this and
should be told of any changes
–Consistent with all buyers
Skills Needed by Farmers
• Professionalism
– Many buyers made a distinction between
professional farmers versus hobby farmers
– Not as concerned about size but intent and
investment
• Appreciation of the buyers business
activity and availability (Ask about best
time to contact)
Restaurants
• Only restaurants promoting local
• Questions for restaurants
– Chef/owner philosophy and restaurant identity
– Size (size of kitchen, storage space, number of
meals served per week
– Price: how expensive are items on menu
– Menu: is it fixed or flexible, is local staple or
specialty
– How formal or informal are their system
Restaurants
• Local chefs like to visit the farm, are interested
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in sustainable practices
Want food that consistently tastes delicious and
is very fresh
Written information is much easier for them
Need regular communications
Perhaps most relationship driven market channel
One chef describe it as a long-term journey
Farmers are usually able to sell at retailish prices
Coop & Specialty
Grocery
• Company Stores Market, Hendersonville
Community Coop, Chatham Marketplace
Coop, Tidal Creek Coop, Deep Roots Market,
French Broad Coop
• Very engaged in local sourcing and often
mention it as part of their mission and vision
• Purchased all product categories and identify
origin in the stores
Coop & Specialty
Grocery
• Some coops were moving to 100%
organic while others favor local over
organic
• Some of the coops required farmers to
sign affidavit about growing practices
• May be able to accommodate a wide
range of products and a wider range of
volumes
• Some have restaurants or kitchens
Specialty Distributors & Brokers
Feast Down East, Madison Farms, Pilot
Mountain Pride, Produce Box, Sand hills
Farm to Table Coop, Mint Market, East
Carolina Organics, Farmhand Foods,
Piedmont Local Foods
• Buy 100% local, were created to supply
local products
• Establish a brand for local food and
aggregate products.
• Some process sales on line, some CSA like
Specialty Distributors & Brokers
• Capable management skills critical for the
success of these of organizations
• Work closely with farmers, some provide
financial support of improvements, usually
willing to work with smaller farmers,
provide training on quality, all required
liability insurance
• Distinctive philosophy “neighbors feeding
neighbors”
Specialty Distributors & Brokers
• Demand outpaces supply, more farmers are
needed, want more products in fall and
winter
• Lack of high value items such as fruits
• Wants to deal with larger customers who
may be able to absorb occasional higher
volumes
• Madison Farms emphasized need for stable
partnerships amid market evolutions
Grocery Store Chains
• Many express interested in local foods
• Standards of appearance, quality and
consistency are very important
• Local usually has a regional focus
Grocery Store Chains
• Retailers discussed how farmers
should know quality, volume, and
grading
• Retailers will buy at wholesale prices
• Volume is important as crops must be
supplied in sufficient amount during
the season
Grocery Stores Chains
• Getting in the door can be a challenge,
need to understand the direct to store vs.
selling to the entire chain may take some
work
• Three grocery store chains in NC who are
very interested in buying from local
farmers are Ingles in West, Carlie C's IGA,
Piggly Willey in eastern NC and Lowes in
NC SC and VA
Wholesale Distributors
• Honeycutt Product, Ward Produce,
Albert’s Organics, First hand Meats,
Leading Green, Southern Foods
• Goal of this group is to provide consistent
predictable products. Scale is usually large with
crops sources in many locations.
• Buying local presents a logistics problem for
many wholesalers
• Many companies are sourcing local but usually
do not label as local
Wholesale Distributors
• Many expressed interest in sourcing local
products, if they can make the logistics work
• Do not have the capacity to train farmers
• Working to keep the supply stream closer to
origin
• Many products sold to distributors are sold
retail ready, (clean, and boxed) very exact
specifications.
• Scale is usually large and fast paced
Wholesale Distributors
• Will pay wholesale prices
• Need exacting food safety and other
requirements, GAPS and liability coverage
is generally required
• May be difficult to break into market,
finding the right person
• With the market expansion of local,
may provide marketing opportunities
Food Service
• Foster Caviness, Bon Appetite, Fresh
Point, Ford Produce, Mountain Food
Products, US Foods, Compass,
Aramark, Sodexo
• Very similar to whole distributors sell
mainly to restaurants and other companies
serving food to public
• Food service is divided into commercial
and institutional, schools, hospitals,
nursing home
Food Service
• Very specific purchasing guidelines
• Increasingly provides more ready to
cook or ready to heat
• Schools have less space/staff/
equipment to prepare foods
Evaluating the Institutional
Market Channels
• Advantages
• Can offer a steady and large market less vulnerable to
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economy
Understanding the procedures and working of the
institution is critical for the farmer
• Challenges
• GAP certification and liability insurance required
• High volume and very consistent quality over longer
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period of time
Becoming vendor may be long and tiresome process
May take 30 days or more to be paid
Gov. institutions may use low bid procurement system
Institutional Market Channels
• The place of food, institutional culture
• Population characteristics
• Kitchen characteristics
• Can they prepare fresh food
• Does staff have kitchen skills
• Management of operations
• Some are self operated
• Others are contracted by food management
company EX: Compass, Aramark, Sodexo
Evaluating the Institutional
Market Channels
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What is level of interest in local foods
Do they cater for special events
Do they have multiple dining venues
Do they have the ability to process and
freeze
Interest in specific crop for seasonal menus
See the nutritional and maybe ed. value of
local foods
Hospitals
• Interviewed Carolina Medical Center (Charlotte) Wake Med,
UNC Health Care are very interested in fresh, local foods
rooted in wellness programs
• Food safety and emergency recall program must be in place
• Direct sales are very rare, and hampered by complexities of
becoming vendor and providing adequate supply and quality
• Some hospitals food services may be contracted or self
operated, either case will rely on large scale suppliers
• Some distributors have separate price sheets (local, state,
regional) items that meet the price points.
Retirement and Continuing Care
Retirement Communities
• Interviewed Southminster Retirement Community, Carol
Woods Retirement Community, Salemtowne Retirement
Community which are using the dining services as a way to
distinguish themselves. One dining room director mentioned
“hospitality not hospital”
• Some CCRC are hiring restaurant chefs with local food
experiences for their institutional kitchens
• Food safety including GAP certification is a priority
• Food and dining plans may focus tightly on nutritional
strategies
• Menus are planned months ahead, often quarterly to
incorporate nutritional planning
Opportunities
• Products: goat cheese, beef and pork
some vegetables broccoli and celery, and
onions, and fruit
• Shoulder season crops by season
extensions. Greenhouse tomatoes and
greens
• Valued added processed foods such as
jams and jellies
• Honey was mentioned by several buyers
Farmers Survey
• Why are selling to retail buyers
• market you can count on weekly
• Set price no worry of price fluctuation
• Price, get higher price from retail instead of
wholesale
• Value added product, supply of a local
product
• Local food movement
Farmers Survey
• What are your challenges of working
with retail buyer
Cooling and transportation
Need for constant supply and lower price
Getting orders filled in a timely fashion
GAP certification, cooling truck
Increased expenses while getting
commodities prices
• Need a way to sell to larger buyers like
a dedicated salesman for small farmers
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S. Gary Bullen
North Carolina State University
Gary_Bullen@ncsu.edu
919.515.6096