The mission of Appalachian Sustainable Development is to The mission of Appalachian Sustainable Development is to create, promote and expand economically viable, create, promote and expand economically viable,

environmentally sound and socially responsible opportunities environmentally sound and socially responsible opportunities to help improve the lives and the health of our local to help improve the lives and the health of our local

communities and ecosystems.communities and ecosystems.

Food Hubs:Food Hubs:Moving Higher Volumes of Good FoodMoving Higher Volumes of Good Food

To Local MarketsTo Local Markets

A network of certified organic family farmerswho provide locally grown organic produce

to regional food markets

Our Appalachian RegionOur Appalachian Region

Temperate climate with good rainfallTemperate climate with good rainfall Strong, independent rural cultureStrong, independent rural culture ““Tri-Cities” area population around 500,000Tri-Cities” area population around 500,000 Largest city has around 55,000 residentsLargest city has around 55,000 residents 20% average poverty rate over the region20% average poverty rate over the region Most residents in scattered rural townsMost residents in scattered rural towns Agriculture built on beef cattle and tobaccoAgriculture built on beef cattle and tobacco

How ASD Stepped inHow ASD Stepped in 1995 ASD was established and launched cooperative local 1995 ASD was established and launched cooperative local

marketing efforts with interested growers (focusing on organic marketing efforts with interested growers (focusing on organic production)production)

Sold to restaurants and through a CSASold to restaurants and through a CSA In 2001 we captured the interest of a relatively large-scale grower In 2001 we captured the interest of a relatively large-scale grower

(12 acres) and realized that local markets were too limited to (12 acres) and realized that local markets were too limited to handle this potential increase in productionhandle this potential increase in production

2001 launched Appalachian Harvest with a local supermarket 2001 launched Appalachian Harvest with a local supermarket partner, Food City.partner, Food City.

Retro-fitted a bay in a grower’s tobacco barn in Stickleyville, VA Retro-fitted a bay in a grower’s tobacco barn in Stickleyville, VA into a small, but workable packinghouse (using funds from the into a small, but workable packinghouse (using funds from the Virginia Tobacco Commission)Virginia Tobacco Commission)

Hired a marketer and a agriculture manager to facilitate sales and Hired a marketer and a agriculture manager to facilitate sales and coordinate production schedules and provide organic training.coordinate production schedules and provide organic training.

Almost $98,000 in sales in 2001Almost $98,000 in sales in 2001

Appalachian HarvestAppalachian Harvest Slowly grew the business over several years, adding bays and Slowly grew the business over several years, adding bays and

two additions onto the barn.two additions onto the barn. Added buyers, went through several marketersAdded buyers, went through several marketers Slowly grew the number of farmers and acres in organic Slowly grew the number of farmers and acres in organic

productionproduction In 2007, a spring fire destroyed the barn and packinghouse and In 2007, a spring fire destroyed the barn and packinghouse and

we worked out of a rented space in nearby Gate City, VAwe worked out of a rented space in nearby Gate City, VA Constructed a new facility for packing and grading produce on Constructed a new facility for packing and grading produce on

purchased land in Duffield, VA with support from the Virginia purchased land in Duffield, VA with support from the Virginia Tobacco Commission (and insurance funds).Tobacco Commission (and insurance funds).

Working with over 8 buyers – shipping to Maryland, Georgia, Working with over 8 buyers – shipping to Maryland, Georgia, North Carolina and VirginiaNorth Carolina and Virginia

2008 produce sales approaching $600,0002008 produce sales approaching $600,000

Elements of a Food HubElements of a Food Hub1)1) LocationLocation2)2) ProductionProduction3)3) MarketingMarketing4)4) InfrastructureInfrastructure5)5) ManagementManagement6)6) Evaluation and Making AdjustmentsEvaluation and Making Adjustments

All of these elements are of equal (or All of these elements are of equal (or nearly equal) importance – an issue with nearly equal) importance – an issue with any of them will impact the success of any of them will impact the success of the effort.the effort.

LocationLocation

Is the location accessible for producers?Is the location accessible for producers? Is it close to your markets?Is it close to your markets?

To easily travelled roads?To easily travelled roads? Is it easily accessible for a variety of vehicles?Is it easily accessible for a variety of vehicles?

Are there already producers there or nearby?Are there already producers there or nearby? What is the potential for growth?What is the potential for growth?

ProductionProduction

Are there experienced producers in the area?Are there experienced producers in the area? Wholesale production is a different animal Wholesale production is a different animal

than home gardening or even direct than home gardening or even direct marketingmarketing

Do you have a plan for training/educating Do you have a plan for training/educating producers?producers?

Be prepared to plan planting dates and Be prepared to plan planting dates and varieties to meet the needs of your buyersvarieties to meet the needs of your buyers

MarketingMarketing

This is a relationship business – communication and This is a relationship business – communication and straight talk are key.straight talk are key. Fresh product is a seasonal product – maintaining Fresh product is a seasonal product – maintaining

relationships in off times is essential (or working towards a relationships in off times is essential (or working towards a year-round presence in the market)year-round presence in the market)

Buyers want the best deal they can negotiate, producers Buyers want the best deal they can negotiate, producers want the highest price you can negotiate – this can be a want the highest price you can negotiate – this can be a tough juggling act!tough juggling act!

Quality and reliability are key to maintaining relationshipsQuality and reliability are key to maintaining relationships When you make a mistake (and you will), take When you make a mistake (and you will), take

responsibility and make it rightresponsibility and make it right

MarketingMarketing

Forecasting and meeting orders are important Forecasting and meeting orders are important – buyers do not want extra work or problems.– buyers do not want extra work or problems.

Sell more than a product – healthy, local, Sell more than a product – healthy, local, organic, super-sonic.....organic, super-sonic.....

In-store promotions can help build customer In-store promotions can help build customer support for your productsupport for your product

This is a tough, competitive business, a This is a tough, competitive business, a marketer with some industry experience can be marketer with some industry experience can be a real plus.a real plus.

InfrastructureInfrastructure

Buildings, trucks, packing lines, coolers, truck Buildings, trucks, packing lines, coolers, truck repairs, computers, certifications, utilities, boxes, repairs, computers, certifications, utilities, boxes, stickers, promotional materials, office supplies, stickers, promotional materials, office supplies, coolers, construction, and a host of other stuff are coolers, construction, and a host of other stuff are EXPENSIVE!!EXPENSIVE!!

Grant funds can help with these things, butGrant funds can help with these things, but Do your homework to make sure you are investing in Do your homework to make sure you are investing in

things that you need and that will do the job correctly things that you need and that will do the job correctly and efficientlyand efficiently

Plan for expansion....Plan for expansion....

Management - ProducersManagement - Producers

Growers need to have access to the Growers need to have access to the knowledge, tools and materials they need to knowledge, tools and materials they need to succeedsucceed

They also need to work cooperatively in order They also need to work cooperatively in order to meet the needs of buyers over as long a to meet the needs of buyers over as long a season as possible.season as possible. This takes active coordination of planting dates, This takes active coordination of planting dates,

varieties and expected harvest dates and amountsvarieties and expected harvest dates and amounts Growers must buy into planting schedules to avoid Growers must buy into planting schedules to avoid

gluts (which can bring down prices)gluts (which can bring down prices)

Management - PackinghouseManagement - Packinghouse

Labor is expensive – it is vital to operate as Labor is expensive – it is vital to operate as efficiently as possibleefficiently as possible Invest in good tools to do the job correctlyInvest in good tools to do the job correctly Develop procedures to simplify everyday tasks and Develop procedures to simplify everyday tasks and

improve efficiency and time managementimprove efficiency and time management Work towards higher volumes of produce – changing gears Work towards higher volumes of produce – changing gears

frequently costs timefrequently costs time Look for other ways to improve efficiency – Look for other ways to improve efficiency –

backhauling, brokering other products, sharing truck backhauling, brokering other products, sharing truck space, etc.space, etc. Work towards year-round activity of some sortWork towards year-round activity of some sort

EvaluationEvaluation

The closer you can track your expenses and The closer you can track your expenses and income, the better able you will be to initiate income, the better able you will be to initiate changes that will strengthen the businesschanges that will strengthen the business Time and energy spent grading, #1’s vs #2’s (and Time and energy spent grading, #1’s vs #2’s (and

trash), distribution costs, time spent planning, trash), distribution costs, time spent planning, training, dealing with problems, etc.training, dealing with problems, etc.

Be honest in your evaluationsBe honest in your evaluations Real, constructive change demands good, well Real, constructive change demands good, well

organized records. organized records.

Determining SuccessDetermining Success

Appalachian Harvest was developed with two Appalachian Harvest was developed with two main goals main goals (which at times contradict each other):(which at times contradict each other):

Provide a solid, expanded market for Provide a solid, expanded market for producers of sustainably grown produce in producers of sustainably grown produce in AppalachiaAppalachia

Develop a stand-alone socially responsible Develop a stand-alone socially responsible business.business.

How to Measure Success?How to Measure Success? Business-wise, Appalachian Harvest is still largely grant Business-wise, Appalachian Harvest is still largely grant

dependent, although we made some big strides towards dependent, although we made some big strides towards profitability in 2011profitability in 2011

Efforts to broker local, conventionally grown produce have Efforts to broker local, conventionally grown produce have made our truck runs more profitable (by filling trucks) and made our truck runs more profitable (by filling trucks) and have widened the reach of Appalachian Harvest’s benefit to have widened the reach of Appalachian Harvest’s benefit to the local farming community (and engaged Cooperative the local farming community (and engaged Cooperative Extension in our work in a much more active way). These Extension in our work in a much more active way). These sales enabled Appalachian Harvest to break $1 million in sales sales enabled Appalachian Harvest to break $1 million in sales in 2011!in 2011!

Several of these conventional growers are planning to add Several of these conventional growers are planning to add certified organic acreage in 2012.certified organic acreage in 2012.

How to Measure Success?How to Measure Success?

In 10 years, Appalachian Harvest has In 10 years, Appalachian Harvest has generated over $4 million in fresh produce generated over $4 million in fresh produce sales!sales!

Over the past 6 years, Appalachian farmers Over the past 6 years, Appalachian farmers have netted over 72% of the sale price of have netted over 72% of the sale price of Appalachian Harvest produce Appalachian Harvest produce (the balance covering (the balance covering marketing, boxes, labels and transportation of produce)marketing, boxes, labels and transportation of produce)

Please Feel Free to Contact ASDPlease Feel Free to Contact ASDfor More Information:for More Information:

Appalachian Sustainable DevelopmentAppalachian Sustainable Development P.O. Box 791, Abingdon, VA 24212P.O. Box 791, Abingdon, VA 24212 276-623-1121276-623-1121 www.asdevelop.orgwww.asdevelop.org

Tom Peterson; Agriculture Education Tom Peterson; Agriculture Education CoordinatorCoordinator

tpeterson@asdevelop.orgtpeterson@asdevelop.org