Growing Local Food Businesses by Leaps and Pounds

 

Vicki Pozzebon


Many years ago, over a locally sourced meal, a group of food activists and nonprofit leaders came together in my kitchen to discuss how we might further move our food system in New Mexico to self-sustainability. At the time, in 2008, less than 3 percent of the food New Mexico produced stayed in the state. We wondered how we might increase that number to keep more money in our own backyards. We laughed at our own struggles and our many stops and starts to make things happen. We also saluted the successes of our local farmers’ markets. But we were looking for solutions on how to make it easier to localize our food system to help more farmers grow more food for our schools, institutions, restaurants and retail outlets. It was a lofty goal, to be sure, and one that would require more talks, more food to nourish our ideas and more partners to collaborate.

Since then, various nonprofits have carved out their niche in this work and identified what they do best to move the needle on the local food system in New Mexico: farm to school and restaurant, active and lively farmers’ markets, successful food co-ops, community gardens, just to name a few. Without a doubt, the local food movement in New Mexico is alive and well. What was missing, we discovered, was a focus on the value-added sector, that is, the great artisan products often found only at farmers’ markets or at specialty food shops and quaint cafés, or in limited supply in a few grocery stores.

 

Making Food Creates Jobs

According to a Bioneers’ Dreaming New Mexico study on local food, New Mexico households spend about $4.2 billion on food every year: $2.6 billion in stores, and $1.6 billion eating out. In addition, New Mexico exports about 97 percent of the food that is grown in this state. This presents an enormous opportunity to help create wealth locally, through numerous jobs in various food-industry sectors. Dreaming New Mexico further reported that:

Sixteen percent of all jobs are farm-related, which translates into over 147,000 jobs. (About 32,000 are farm operators and 84,000 work in agricultural processing. The remainder are in food services industries and government-related jobs.) If 25 percent of the food produced in New Mexico was consumed in New Mexico, then 10,000 new jobs would be created—about 15 percent more in the agri-food sector; 17 percent in forage and crop farms; 18 percent from livestock, game and fish; and 65 percent from food manufacturing, distribution, retail and restaurants.

In Albuquerque’s agriculturally and traditionally rich South Valley, a local-food movement started in earnest in 2006 at the South Valley Economic Development Center’s (SVEDC) Mixing Bowl commercial kitchen. The kitchen has been home to over 100 small food producers who have tested their products and received help to establish themselves in local markets. With over 60 of those businesses “graduating” out of the kitchen incubator, the Río Grande Community Development Corporation (SVEDC’s parent organization) identified the need to support these businesses’ continued growth. Locally owned businesses generally contribute more to the “economic multiplier” than nonlocal businesses—more income, wealth, jobs and tax payments—because they spend more money locally. When just one dollar is spent with a locally owned food business, 42 cents of it stays in our communities, multiplying repeatedly into our local economy.

With an eye on the dramatic numbers to be reached in keeping locally grown and processed food local and creating more food jobs, Delicious New Mexico (DNM) was born in 2012. The organization has grown to be one of the largest and fastest-growing models for supporting local food businesses.

 

Delicious New Mexico: Growing Local Businesses

As an entrepreneurial network for food-based businesses, DNM provides access to specific resources. One of the most valuable ways to support local businesses is to give them the opportunity to share and learn from each other. Providing networking opportunities in workshops and at events, DNM gets its members together to talk about marketing, label design, merchandising, co-packing and other industry-specific topics. Case studies on challenges and successes in the industry have helped many businesses identify their own needs for growth and success.

DNM seeks to raise the bar for all food businesses across the state, which in turn helps provide the state with a sustainable and meaningful form of economic development that stays true to our state’s agricultural roots. Members in the organization pledge to source as locally as possible for their ingredients and, if they can’t, then DNM finds out what the barriers are—seasonality, lack of available products, prices, or other—and works with the New Mexico Department of Agriculture (NMDA), the USDA, and other partners to identify areas for opportunities. In addition, members receive support through statewide marketing efforts, branding and technical services. Offering workshops, connections to capital, access to distributors and buyers, DNM is quickly becoming the state brand for local food.

The largest need for DNM’s members is in the second stage of their development. Barriers to growth include lack of suitable facilities to grow their business once they graduate from commercial kitchens. In partnership with the Río Grande Development Corporation, the Mixing Bowl and many community partners, DNM is now working on growing a statewide kitchen network that will help small businesses in rural communities by activating underutilized kitchens, often in county-owned facilities or community centers. Using the Mixing Bowl’s successful model to support start-up food businesses, the kitchens will become hubs of activity. DNM will serve as the marketing arm for these products and provide technical assistance for growing into grocery stores and wholesale distribution throughout the state. The kitchens will have three types of users:

Start up businesses: those that are testing recipes and looking to get started.

Established businesses looking for a commercial kitchen: In many cases, these businesses are working from restaurant kitchens after hours or in shared spaces that are less than ideal.

Co-packing: These are businesses that are looking to grow a product but aren’t interested in being in the kitchen themselves. DNM will help by providing a staff that will test, process and package products for wide distribution.

The first model is in the testing phase in northern New Mexico in cooperation with a new food hub. DNM, as the marketing arm, will broker deals with restaurants and wholesale buyers for the hub and its own kitchen clients and network members. With a commercial kitchen serving the needs for processing raw goods and a hub ready to distribute products, it’s a win-win situation and partnership.

Several kitchens are poised to open their doors to food businesses. The goal for the statewide network is to help over 120 new food businesses, which will create nearly 300 jobs. In rural communities so often desperate for jobs, these are not insignificant numbers.

 

Creating a Trusted Local Brand

DNM’s success is partly due to its already recognizable brand for local quality products. Growing markets for value-added, locally made products in a local food system requires building demand, and that means building a consumer-awareness campaign. Eaters are a part of the system, and they play a valuable role within it. DNM helps eaters understand that products they find at local farmers’ markets, like organic raspberry red chile jams, artisan breads, lavender chocolate bark or apricot scones, are in limited supply because the makers of those products need a support system to help them grow into larger markets. The makers of your favorite mustard can’t possibly be at every farmers’ market or grocery store doing one-off sampling every weekend, unless they have a stock of cash to pay employees to do that for them. What they need is a support system that helps them get beyond farmers’ markets, into grocery stores that stock their shelves full of their products and reorder from distributors who deliver consistent products by the pallet. DNM also helps eaters understand that, when they ask for local products that are using more locally sourced ingredients, they are helping grow the market themselves. They are creating demand, voting with their voice and their dollars for their favorite products.

The local food movement has grown by leaps and pounds (pun intended) in the last five years, with more food hubs coming online every year. We must be willing to test ideas quickly and move on fast if they fail and, by contrast, celebrate the small victories when we create models that work. Connecting farmers, ranchers and growers to food processors and consumers is key in keeping the system well fed (pun also intended.)

Delicious New Mexico was designed to be a support system for businesses that grow the economy from the ground up. Growing homegrown businesses that share in pride of place by celebrating the flavors of our great state is a benefit to all.

 

This article first appeared in Green Money Journal (www.greenmoney.com).

Vicki Pozzebon, a BALLE Fellow, is the owner of Prospera Partners, a consulting company, and Chief Foodie at Delicious New Mexico (www.deliciousnm.com). She is the author of the forthcoming book For the Love of Local: Confessions from the Heart of Community. Read her blog The Local Voice at www.prosperapartners.org and follow her on Twitter: @vickipozzebon

 

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