The Growing Role of Local Food Markets: Discussion

Abstract

The timeliness of the papers submitted by Thilmany, Bond, Keeling Bond, Hardesty, Brown, and Miller is heightened by the fact that official tracking of direct farm sales has not kept pace with the sector's growing importance in the U.S. food system. Sales of nonedible or namental crops, which, according to Brown, may be among the most profitable crops sold at farmers markets, are excluded from the Census of Agriculture's direct farm market ing statistics, as are direct sales by produc ers to commercial and institutional customers (USDA, NASS 2004). Furthermore, official statistics fail to capture information about the relative importance of specific direct farm mar keting channels, such as farmers markets and community-supported agriculture (CSA). In the absence of more comprehensive national data, the authors contribute much to our col lective understanding of the direct farm mar keting sector by helping us better understand the composition of the sector's customer base, the benefits-and challenges-of various di rect marketing options, and the specific prod uct and service requirements needed to elicit customer interest and engagement. Perhaps the single most valuable contribu tion of these papers is the extent to which they articulate the financial rewards of direct marketing channels beyond the farmers mar ket arena. The rapid growth of U.S. farmers markets from 1,755 in 1994 to nearly 4,400 by 2006 (USDA, AMS 2006a) has prompted many market observers to regard farmers markets as the primary engine of direct farm marketing growth. Yet, current data indicate that the bulk of consumer demand for local food is actually being satisfied outside of farmers markets. Be tween 2002 and 2007, the U.S. market for lo cal foods reportedly jumped from $4 billion to $5 billion (Packaged Facts 2007), compared to estimated farmers market sales of only $1 bil lion during 2005 (USDA, AMS 2006b). Brown appropriately identifies both the ad vantages and disadvantages of farmers market participation for growers. On the positive side, farmers markets provide an excellent venue for smaller-scale growers to try their hand at direct marketing with minimal upfront in vestment, solicit ideas for product develop ment from customers, test new products, and obtain instantaneous feedback. However, the meager financial rewards from farmers mar kets, and to a lesser extent from CSAs, appear to discourage more widespread participation. Consequently, despite evidence provided by Thilmany that one-third of surveyed produce shoppers-largely heterogeneous with respect to demographics and income-are motivated to purchase local food products directly from growers because of perceived superiority in food safety and quality (even in comparison to organically labeled food), the growth poten tial of direct marketing channels appears to be circumscribed by two factors: (a) resistance to direct sourcing among the segments of house hold shoppers who place great importance on value and convenience; and (b) grower per ceptions of limited financial compensation. In this regard, Hardesty's work appears to be an excellent and timely response. By diversifying marketing strategies to include institutional and commercial customers, smaller growers gain the capacity to move larger volumes of product during peak supply periods, especially off-grade or smaller-sized product, while re taining their ability to reserve their highest value fresh products for direct market outlets. Such a strategy should provide a more stable and lucrative source of income for growers by extracting maximum value from production, while making supplies of local food more ac cessible to convenience-oriented shoppers. Nevertheless, as Hardesty astutely observes, the successful implementation of this strat egy will likely require additional grower collaboration and coordination to expand product availability and streamline delivery and ordering processes. Even highly motivated Debra Tropp is the Branch Chief for Farmers Market and Direct Marketing Research with the USDA Agricultural Marketing Service.