Groceries will never graduate to sustainable local food sales
A new U.S. Department of Agriculture study, issued in early November, documents the increase in local, direct food sales. For year 2008, the latest data available, such sales through both direct-to-consumer channels and intermediaries, including grocers, totaled an estimated $4.8 billion in 2008. USDA predicts that figure will rise to about $7 billion in sales for 2011.
The number of farms selling direct has increased from 86,000 in the early 1990s to about 136,000 now, the report says. Alongside that growth, the number of farmers markets has grown from 2,756 in 1998 to 5,274 in 2009.
Grocers who see promise in local foods to boost produce and private-label sales may find the statistics promising, but they have to be taken with care. Here's why:
The survey reported that the smallest farms, those grossing less than $50,000 annually, accounted for more than eight in 10 farms making local sales. On average, they sold only $7,800 in local food sales apiece, and were more likely to rely exclusively on direct-to-consumer marketing channels, such as farmers markets and roadside stands. In contrast, the largest farms, those grossing more than $250,000 per year, accounted for only 5 percent of the farms selling direct, but 92 percent of the value of local foods sold through intermediated channels, such as supermarkets.
That statistical reality underwrites with data the contention of those like London professor Tim Lang, the originator of the term “food miles,” who argues that modern supermarkets simply aren’t capable of competing in the local-food arena in any meaningful way. Hampered by their reliance on “cheap oil, pretty unlimited resources and infrastructurally supported by the state in the form of motorways,” he told the online publication JustFood.com, Lang believes supermarkets will never graduate to sustainable local sales because that infrastructure won’t make it profitable in the long-run, despite apparent consumer demand.
“Unimaginably large investment has gone into the system that we have now,” he told JustFood. “[But] basically if f you want to apply a localist perspective to current supermarkets, they can't do it. It's impossible. What they are doing is some niche markets.”
In the broad sense of “sustainable/local” foods advocated by activists like Lang, he’s correct. Local sourcing is a “proxy,” for much broader food system changes, even revolution, than simply bringing in a few crates of cucumbers grown by local farmers during season. But in that sense, grocers may both fail and succeed at local, if they understand the underlying dynamics.
Consumer-research firm the Hartman Group gets it right when it observes that "local" in the typical consumer's mind is less about the number of miles a food travels than it is about much deeprer issues of value. "Local" is a proxy, Hartman agrees, but not necessarily a proxy for something as relatively narrow as sustainability, climate-change reduction, or even local food production, as Lang contends. Just like the broader term "Made in the USA," the local brand is a shorthand label to express solidarity with a way of much broader way of viewing the world, with a shared system of values and ethics.
That means for many consumers, Hartman argues, buying local is about holding on to values. When people are given a choice as to where and how they live, they choose to do so in a way that reflects their values at the most basic level. The economic uncertainty and fast paced change of today's world, Hartman notes, leaves many consumers feeling they run the risk of losing their way of life. For them, buying local gives them a lifeline to hang onto those values, and a sense of control in a world gone out of control.
So in that sense, "local" is a double-edged sword for locally owned, community grocers. You can't fake the authenticity consumers are longing for when they buy local, Hartman cautions. So the fact that 90 percent of locally sourced food is originating with farms grossing more than a quarter million dollars annually puts grocers riding that train at risk of appearing to be inauthentic. On the other hand, if consumers are looking for a means to stay rooted in time and place via a sense of community, few retailers are in better position to lead that than the community focused grocer.
If true, then the "food" portion of the "local food" movement may be a case of the marketing tail wagging the dog. Grocers who see locally sourced food as only a small part of fulfilling their commitment to the community, through community relations, employee relations and true contributions, will put themselves in the lead in capturing the loyalty of those local-focused consumers, regardless of how many miles the food they offer travels to get to them.
Photo courtesy Flickr/USDA
Photo courtesy Flickr/Mike Gogulski