Going Local Models and Solutions

for Local Systems

Amber Bieg, MBA www.green-ideas.com

How do you define the boundaries?

Watershed Foodshed Fibershed

“Local” doesn’t necessarily mean within 100 miles. I define local as a system where 100% of the benefit returned to the community where materials, goods or wealth is sourced = wealth is not extracted.

Keys to successful local systems

3

Integration (vertical or virtual)

Community Investment

Consistent Brand & Marketing Accountability

Stewardship

The Food Commons Model

5

What is the Food Commons?• A business development initiative

to create integrated, sustainable, and economically competitive regional food enterprises that are owned by and for the communities in which they operate.

• A large-scale initiative to design and build a nationally networked system of physical, financial and organizational infrastructure that enables these regional food enterprises to develop, collaborate and thrive.

What does this look like?

The Food Commons is made of up three integral parts: a land trust, a financing arm, and an operating entity

Fresno Food Commons

Trust

Fresno Food Commons

Fund

• Vertically integrated, community-owned regional food system enterprise including farms, processing, wholesale distribution, and retail stores

• Non-profit community-based financial institution that aggregates and supplies capital and financial services to Food Commons-related enterprises

• Non-profit community-based land trust to acquire and steward critical foodshed assets

Fresno Food Commons

Community Corporation

7

Potential Ancillary Hub Functions (for profit, non-profit, and/or public):

Combining the hub with vibrant public spaces

8

• Value-added processing• Commercial kitchen• Incubator kitchen

• Demonstration farm

• Educational programs• Health and human

services

• Public market• Mobile vendors

• Gleaning program

• Public meeting space• Community garden

Core Hub Functions:• Strategic planning and enterprise management• Sales & marketing• Production planning• Packing & light processing• Aggregation & distribution• Logistics• Certification & quality assurance• Training• Business services (HR, IT, accounting, legal, government

relations, etc.)• FC Bank & FC Trust offices

Point of Purchase Marketing is Key!

Local

Fresh

Trusted

Just simple sign indicating “local” drives up local sales by 3%

Point of Purchase Prompt

The Fibershed Model

90% Drop in US Sheep Population

Why is New Zealand Successful?

Why is Australia Successful?

The Myth of Overseas Competition

Credit: New York Times

The California Wool Mill Example

Why people buy local

Support ag and local economy

Perceived Safety and Quality

Env. Benefits from farms

Reduce fossil fuel use

0

100

200

300

400

500

600

700

Source: Iowa State University, Allan Ortiz 2010

$597 Million in Ag

Exports to Mainland

Only $79 Million was

edible

The Hawaii Context

Estimated less than 8% of it was eaten in the State of Hawaii

Vertical Integration

Strengths Weaknesses

Start-up cost and complexity

Management complexity

May be perceived as competitive threat to

independent businesses

Built-in visibility Broad-based local

ownership and control

Transparency and system efficiencies resulting in lower

prices to consumers

Consistent HR policies and practices

Employee mobility and advancement opportunities

Virtual Integration

Strengths Weaknesses

individual profit maximization

Transaction costs

Barriers to new entrants (capital, skills) and high

failure rate of independent businesses

Participation and support from existing enterprises

Reduced start-up cost and complexity

Potentially high individual rewards for

entrepreneurship and risk-taking

Tools for Virtual Integration

Eco Trust Food Hub (www.food-hub.org)

Local Dirt (www.localdirt.com)

MARKETING!!!!

Community Financing is Key

Shareholders• Direct Public Offering

CSA Model• Credibles.com

Cooperative ownership• Farmer • Multi-stakeholder

Non-profit ownership• Land Trust

Keys to successful local systems

24

Integration (vertical or virtual)

Community Investment

Consistent Brand & Marketing Accountability

Stewardship