On April 22nd, 35 people from over 20 organizations involved in Food Hubs in their communities met at Heart & Hand’s Market Place in Philippi, where the atmosphere was one of problem solving, information sharing, and camaraderie around one single goal: creating a new way for West Virginians to buy and sell local food.
ACENet: ACENet is a “food enterprise center” in Appalachian Ohio, and was there to learn about other organizations in West Virginia. They have primarily worked with The Wild Ramp in the past.
Alderson Community Food Hub: A relatively new organization, having just opened their doors, they were there to meet other food hubs and network.
Arthurdale Co-Op: They were there to get help and learn and meet people. Arthurdale is struggling to find additional suppliers – currently they just have suppliers from Preston County. They are also investigating ways to process SNAP/EBT sales.
CAMC Farm to Hospital Value Chain: Were there to learn about what else is happening in the state.
Project HOP2E (Helping Our People To Eat): Based in Grafton, Project HOP2E is a mobile food-pantry. Their goal is to serve parts of their county especially in the winter months. They have worked with the faith-based community to plug into churches and distribute from those avenues.
Heart & Hand House: The host of the event, Heart & Hand shared their history and vision for the local food economy in Philippi.
McDowell County Farmers Co-Op: Newly formed, they were looking to meet people and learn.
Mid Ohio Valley Edibles (MOVE): Currently a 24-farmer cooperative. They distribute locally as well as wholesale in Charleston. Excited to see people from all over the state working on similar projects.
New River Community Market: Just getting started in Fayette County, lots of food is available and good farmers markets – but there’s no access to these foods outside the venues. Looking for inspiration and to meet people doing similar work.
Panorama At The Peak: A farm to table restaurant in Berkeley Springs, here to learn.
Pocahontas Produce On The Move: Aggregates produce for sale in Marlinton, as well as a CSA. Mobile deliveries around Pocahontas County. Hoping for bigger and better things.
Rural Appalachian Improvement League (RAIL): They are trying to start a farmers market in Wyoming County, here to learn more and meet people.
RCBI Agricultural Innovation Initiative: Here to learn more about projects around the state. They have done some work with process and efficiency with The Wild Ramp.
Richwood Pantry: They hope to start a farmers market and Food Hub and/or Grocery store in Richwood, which does not have a full service grocery store.
Small Business Development Center: Here to learn about the projects around the state and to offer business plan advice.
WVU Extension Small Farm Center: Here to learn about the projects around the state and see how they can assist these efforts.
Tygart Valley Growers Association: Growers in the Barbour/Tucker/Upshur/Randolph/Taylor area. They work with Heart & Hand.
Value Chain Cluster Initiative (VC2): Offers business coaching in 17 counties in West Virginia, as well as funding for technical assistance.
Wild Ramp: Since July 2012, The Wild Ramp has had a total income of $1.2 million and returned over $730,000 to its farmers. They are currently working on multiple projects, including a CSA, and becoming a partner on a “local food corridor” between Abingdon, Virginia, and Athens, Ohio.
“If you know one food hub, you know one food hub,” said Tom Snyder, Program Director of the Ohio Cooperative Development Center. This theme of variation between different food hubs underscored what one could see as a positive – that food hubs can be built to uniquely fit their community’s strengths and identities. Nevertheless, there are some good centering questions for organizations to ask themselves.
Different goals can lead organizations down different paths. For example, a food hub with a mission to address a food deserts will need to operatively different than one that exists to create jobs. Organizations were encouraged to think through their primary goal: were they focusing on economic opportunity through wholesale, or direct-to-consumer sales, or filling a nutritional need in the community, or something else entirely?
Tom Snyder shared financial information from the National Good Food Network that showed how food hubs with different goals operated differently. A food hub that existed to address a food desert might not create jobs in the community. Wholesale food hubs that run a profit may not break even until $1.2 million – or $2.4 million to be viable. Direct-to-consumer hubs were more forgiving, needing $314,000 to break even and $567,000 to be viable. For in-depth information about food hub financials, visit this National Good Food Network webinar.
Multiple models exist for viable food hubs that address and focus on different needs:
Many of the organizations that came to the event were interested in authoring formal business plans, which is one of the activities being supported by the food hub mini-grants due on May 8th. The message was clear: Even if you’re looking for grant funding, build a business plan that you can take to a bank to pay for directly.
Business plans start simple and expand, with the overarching questions being: What is your business, and why will you be profitable; what is it that will make you profitable over someone else? And in the case of local food, what happens in the off-season to keep the doors open and make a profit?
Businesses need to know their market, and food hubs are in the sometimes-frustrating situation of needing to know two markets: people that buy producers, and the numerous local farmers that can supply their products.
Tom Snyder says to start with the buyers, and then look to the producers once you identify the purchasing market. Identify reasonable prices for their consumers in your area, and take those to producers to see if the equation can make sense for them.
Advertising should focus on why your product is different and reframing potential weaknesses such as price into benefits such as identity.
With food hubs, there are dangers in both overstaffing and not being able to afford to have good staff.
Filling out the mini-grant application might seem like busywork, but there was a lot of intention behind formulating a grant and intake form that will move organizations towards viability — the questions the are asked in the application are components of any successful business.
In order to be considered for the mini-grants, organizations will need to define milestones & outcomes. Milestones are activities that get you to an outcome that show you used the funding wisely. Milestones should be SMART – Specific, Measurable, Attainable, Relevant, and Timely.
Funding from the food hub mini-grants are largely unrestricted – they could pay for rent, staff, equipment, etc. Sharing sales data during the granting period will allow us to keep figuring out what models of food hubs in West Virginia are viable! At the end of the grant, the question is: did you meet the goals you set out to meet? If not, that’s still good data.
A food hub must negotiate a price that works for both the producer and the end buyer, and take a portion to cover costs of the hub. It’s important to make sure that in the long term the food hub will be able to cover operating costs from that percentage.
How are hubs setting prices? The Wild Ramp lets their farmers set their own prices, but works to communicate a range of price for the product in question based on what a good price is for both farmers and the customers who are shopping there. They are striving to streamline this process and reduce staff time spent on this coaching and pricing work.
Hubs reported setting prices by looking at price lists of bigger distributors, prices at produce auctions, prices at the local markets. Hubs need to charge more that big distributors, and not try to compete with them. It’s tricky because there’s a misconception that “Local foods should be cheaper, since they’re produced locally.” But really, local food lasts longer and has greater value so should be more expensive. It takes education to growers, buyers, and customers to enhance the understanding of the real value of local foods.
Find a full write up on the pricing session here.
This was an enthusiastic meeting. To quote Dawn Baldwin-Barret of Pocahontas Produce On The Move, “There’s a lot of love here, and so much wisdom that I’ve learned! There are many of us living in remote places, and when we all get together and realizing we’re struggling with the same issues, our solutions may be different, but I always come away with something new.”
Work that people in the group wanted to focus on for the future: