Distribution Strategies for Developing Farm-to-School Connections

Final Report for GNC06-069

Project Type: Graduate Student
Funds awarded in 2006: $9,784.00
Projected End Date: 12/31/2008
Grant Recipient: Michigan State University
Region: North Central
State: Michigan
Graduate Student:
Faculty Advisor:
Mike Hamm
Community, Agriculture, Recreation & Resource Stud
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Project Information

Summary:

A qualitative study was conducted with farmers, food service professionals, and food distributors participating in one of seven farm to school (FTS) programs in Michigan and New York. Differences in opportunities and trade-offs among stakeholders participating in different distribution models of local school food procurement were not observed. Stakeholders across farm scale, school district size, and distribution models reported similar experiences with respect to the program’s economic (e.g. future market) and non-economic (e.g. support local community) opportunities. Structural constraints to local school food procurement included oppositional school year and agriculture production cycle, tight school food service budgets, and procurement regulations.

Introduction:

Background: In a 2004 survey conducted by the Mott Group and the Michigan Department of Education (MDE), food service directors expressed interest in purchasing locally grown foods for their school meals program (Izumi, Rostant, Moss, & Hamm, 2006). More than 73 percent of respondents reported being interested or very interested in connecting their schools with local farms and more than 85 percent expressed interest in purchasing locally grown food through their commercial distributor. However, food service directors also expressed a number of concerns about implementing FTS programs including cost, distribution, delivery and procurement regulations.

In a follow-up pilot study, distribution emerged as one of the key barriers. For example, many food service directors prefer food deliveries be made to individual school buildings in small quantities rather than receiving one large shipment to the central school district store room. Yet this may not be cost-effective for farmers. The distribution barrier may present an opportunity for food distributors (including shippers and produce wholesalers). It is not clear whether or how such intermediaries impact the cost of locally grown food to the food service director or the profitability to the farmer. Furthermore, the impact of intermediate distribution structures on the proffered social benefits of food-to-school (FTS) programs is unknown.

To our knowledge, there have been no studies to date that evaluate different supply chain models for distributing locally grown foods into schools. As more schools try to source locally grown food for their school meals programs, food distributors will play an important role. However, as food distributors become more involved in FTS programs, it is imperative that we learn more about their potential role. The purpose of this project was to better understand the economic and non-economic factors that motivate FTS program stakeholders to participate in efforts to integrate locally grown foods into school meals programs and the structural constraints that limit the market potential of such efforts.

Literature Review: Anecdotal reports and our research have identified distribution as a key barrier for making FTS program connections. Many school districts are simply not able to work with individual farmers. According to one financial evaluation, such programs have not yet made a significant difference to the bottom-line for small local farmers (Brillinger, Ohmart, & Feenstra, 2003). While farm direct relationships may be appropriate for some farmers and food service directors, recently funded SARE projects have clearly identified a need for an intermediate distribution system to facilitate institutional purchasing of locally grown foods (Wheeler, 1997).

There is indication that food distributors could increase procurement of locally grown foods in schools. The New Hampshire Farm to School Program has achieved success in distributing locally grown apples and cider to schools (Kelly, 2004). The program attributes its success, in part, to the ability of schools to work through their commercial distributor. Similarly, the Hartford Food System Farm to School Food Education Project increased the integration of locally grown foods into seven school cafeterias by working with a produce broker (Wheeler, 1997). The proposed research project complements and extends our current understanding of intermediate distribution structures by assessing the impact of these structures on farmer profitability, educational objectives and other ancillary benefits of FTS programs.

Project Objectives:

Objective 1
To use qualitative research methods to analyze different supply chain models for distributing locally grown foods in K-12 public schools in Michigan and in New York.

Objective 2
To use qualitative research methods to better understand the conditions around which FTS program connections will be profitable for farmers and beneficial for school food service directors.

Objective 3
To develop outreach materials based on research findings to assist farmers, school food service directors and other stakeholders in making long-term FTS program connections.

Research

Materials and methods:

This study used a case study approach and qualitative methods. Research participants were recruited from seven FTS programs in Michigan and New York between January and April 2006. Seven food service professionals, seven farmers, and four food distributors participated in the study. FTS programs were selected through maximum variation sampling, a purposeful sampling technique aimed at capturing the central themes that emerge from diverse cases (Patton, 2002).

To maximize the variation of FTS programs in our study, I constructed a matrix of programs that varied on school district and FTS program characteristics. Eight programs were identified by key informants who were intimately familiar with programs in their respective states. One food service professional did not return my phone calls requesting participation in this study. Only those school districts that had been integrating locally grown foods into their school food programs as a regular part of their food procurement routine for at least two years — a length of time I felt would allow stakeholders to articulate the opportunities and challenges of local school food procurement — were recruited for the study. Food service professionals at seven school districts were invited to participate in the study as were the farmers and food distributors they identified as sources for locally grown food. The food distributors identified all were mid-tier intermediaries that operate on a more regionally as opposed to a more national scale. These regionally based food distributors fall into one of two categories: produce wholesalers or food distributors who sell produce plus other perishables.

In-depth interviews were used as the primary data collection strategy. Procurement documents and other written material also were collected and examined in order to cross-check findings and enhance validity of the results.

I interviewed each research participant twice over the course of this study. The first interview was conducted between January and April 2006 and a follow-up interview was conducted between March and April 2007. All interviews were tape recorded and transcribed verbatim. A semi-structured interview guide was used to ensure that all questions were covered and to accommodate the limited amount of time with each of the participants. Probes and follow-up questions were asked to elicit depth of information and to follow-up on leads initiated by the participants. The interviews lasted between 60 and 90 minutes and took place in research participants’ offices although some questions were asked on tours of their workplace.

The data were analyzed in two stages. In the early stages of the study, while data were still being collected, memos were written after each data collection, emerging themes and concepts were identified, and codes were created. The codes were defined operationally and organized into a code dictionary that included the code name, definition, rule, and example for when each code should be applied. I coded each interview transcript and a sample of the transcripts was cross-checked by another researcher who was not involved with the study. Coding was an iterative process. New codes progressively emerged during the analysis and those that were no longer appropriate were discarded while others were broken down into sub-codes or refined. When major code changes were made, data that had already been coded were recoded with a revised dictionary.

After all of the interviews were coded a series of displays for drawing and verifying conclusions about the data were developed. Displays allow researchers to reduce their data and systematically organize answers to their research questions (Miles & Huberman, 1994). They increase the chance of drawing and verifying valid conclusions because they are arranged coherently to allow for careful comparisons within and across cases (Miles & Huberman, 1994). The data were analyzed by stakeholder group. For example, codes related to food service professionals’ motivations for buying locally grown food were identified and passages associated with these codes were extracted from each interview transcript. Codes and passages were compared across the seven food service professionals and organized into a display, which in this case was a matrix that included motivations (columns) and food service professionals (rows). For each cell, a quotation or summary phrase was first entered to indicate the relevance of the motivation for each food service professional. The data in the display were further reduced by using acronyms to indicate themes. Conclusions were drawn about each case and across cases by reading down the columns and across rows. Transcribed interviews and memos, and feedback from research participants and other individuals engaged in FTS programs were used to verify our conclusions. Atlas.ti 5.2 (Atlas.ti 5.2, Scientific Software Development GmbH, Berlin), a qualitative data analysis software package, was used to code the data, organize memos, and note patterns and themes. Data displays were created by hand. For confidentiality, pseudonyms are used to identify the individuals who participated in this research and distinguishing characteristics are veiled to protect their identities.

Research results and discussion:

This research is the first to study, in depth, FTS programs from the perspectives of farmers, food service professionals, and food distributors — three stakeholder groups that are critical to the institutionalization of local school food procurement in public K-12 schools in the United States.

Overall, this research supports two major conclusions. First when making decisions about buying and selling locally grown food, the stakeholders in this study balanced various economic and non-economic motivations. Second the institutionalization of local school food procurement is limited by oppositional school year, tight school food service budgets, and procurement regulations. Greater detail of stakeholder motivations for buying and selling locally grown food (organized by stakeholder group) and the structural constraints are presented below. All names used in this report are pseudonyms.

Motivations

Farmers
Contrary to Ohmart’s (2002) study, which suggests that philosophical rather than practical reasons drive farmers’ participation in FTS programs, this study found that farmers were motivated by a strong economic imperative and desire for personal autonomy. Despite the fact that food service sales contributed negligibly to their total sales by volume and income, the farmers in this study persistently pursued schools as customers. Farmers were hopeful that their investment in cultivating school food service markets now would result in future economic benefits. Ancillary benefits identified by the farmers I spoke with were framed in terms of helping to improve children’s eating habits, and supporting the local economy.

Food Service Professionals
The food service professionals who participated in this study purchased locally grown food for their cafeterias because, in their own words, “the students like it,” “the price is right,” and “we’re helping our local farmers.” The first two explanations suggest that an important motivator for and benefit of integrating these foods into the cafeterias is their fit with school food program goals. The third theme invokes the notion of regard for and symbolic sense of community that has been identified among consumers as a motivator for sourcing food locally. The food service professionals associated children’s preference for locally grown food with three factors. First, food service professionals were able to purchase foods from farmers and produce wholesalers which they felt were of superior quality of the products they were able to buy their broadline distributor . They explicitly stated that this same level of product quality, expressed in terms of variety and freshness, was not available or affordable through their broadline distributor. Second, the food service professionals felt that school staff played an important role in motivating students to try locally grown foods. Staff support for FTS programs had a “trickle down effect” onto students. Third, students’ relationship with farmers, which was developed through formal educational visits from farmers or through point-of-sale signs in the cafeteria, changed the symbolic meaning of fruits and vegetables and turned them into “cool foods.” It is important to note that the motivators or perceived benefits expressed were associated with farmers and produce wholesalers but not with those food distributors that carried produce plus other perishables.

Food Distributors
The food distributors who participated in this study were involved in FTS program efforts in large part because the idea of integrating locally grown foods into the cafeteria converged with their normal business practice of buying fresh produce from local sources whenever possible or exclusively, as was the case for one produce wholesaler, Local Fresh!, who only sold produce grown within state lines. Local Fresh! did not have an infrastructure capable of meeting the relatively small volume needs of school food service yet they still supplied apples to a nearby school district as a way to support their local community and to invest in a market they hoped would ultimately provide an economic payoff.

Among the other three food distributors, FTS programs were seen as a niche market that, due to their existing relationships with farmers, they felt they could fill better than their broadline competitors. These food distributors believed that their long-standing relationships with farmers gave them access to high quality and competitively priced produce not always available to broadline distributors — a comparative advantage and marketing tool in what has become an increasingly competitive industry. In addition to capturing the cost and quality advantages of decreased transportation time, these food distributors were motivated to buy directly from farmers and farmer cooperatives whenever possible as a means to supporting their local communities.

Structural Constraints

The fall through spring school year and summer-centered agriculture production cycle have little overlap and thus limits the types of locally grown products that schools can use in their cafeterias. However, understanding this constraint goes beyond a discussion about “seasonality.” With the exception of applies, fresh fruits and vegetables that are in season or available locally as stored items during the winter months (e.g. winter squash, root vegetables) are typically not seen in school cafeterias due to a lack of perceived or real demand. Since school food service revenue is based on the number of meals served, schools are not likely to experiment with foods that students may not buy. Furthermore, the inclusion of locally grown foods that requires additional labor to prepare such as carrots with their tops still attached or whole watermelon is not likely to be financially feasible in today’s fiscal climate. While this issue of mismatched calendars is perceived to cap the growth of FTS programs, its detrimental impact can be lessened through the development of new structural arrangements such as educating youth about new foods in an effort to increase demand, adding local food such as dried fruit, eggs, or meats to the cafeteria menu, or by changing the school year to match the production cycle.

Tight school food service budgets were repeatedly mentioned by farmers and food distributors as a roadblock to integrating locally grown foods into the cafeteria. Tight budgets limited schools’ ability to utilize many of the food grown in their regions, especially those which required additional labor (as mentioned above) or those which were considered specialty items (e.g. asparagus, pears) and therefore had a higher cost per serving. Fiscal constraints also meant that schools necessarily took advantage of the commodity fruits and vegetables offered through the Department of Defense Fresh Fruit and Vegetable Program (DoD-Fresh) whenever possible. This program negatively impacted farmers’ and food distributors’ sales. When farmers’ sales were displaced by DoD-Fresh, some had to sell their product to a processor for less value. Food distributors were able to find other markets for their products but still felt that DoD-Fresh undercut their school-focused business.

School food programs must follow procurement regulations that require food to be purchased through a competitive bidding process that prohibits consideration of geographic proximity . These regulations interact with school food service budget constraints in multiple and complex ways. First, the federal rule against using geographic preferences when evaluating bids means that farmers are unable to reap any sort of monetary value for the localness of their products. The inability to do so makes FTS
programs substantially different from other alternative food system efforts such as farmers’ markets where consumers may be willing to pay more for a product that has been grown locally. The bid process also meant that farmers and food distributors must compete for school food service bids. Since food service professionals are working under tight budget constraints, the criteria used to justify bid awards typically gives priority to vendors like broadline distributors who can offer streamlined service and financial incentives such as early payment discounts.

1. Broadline distributors are one-stop-shops which carry nearly all of the food, supplies, and equipment needed to operate a food service kitchen.

2. This data was collected and analyzed before the 2008 Farm Bill was amended to allow schools to use a geographic preference for the procurement of unprocessed agricultural products.

Participation Summary

Educational & Outreach Activities

Participation Summary:

Education/outreach description:

Izumi, BT, Alaimo, K & Hamm, MW. Farm to School: Perspectives of School Food Service Professionals. Journal of Nutrition Education and Behavior (In Press).

Izumi, BT, Wright, DW & Hamm, MW. Farm to School: Exploring the Potential of Public Procurement of Locally Grown Foods on Farmers’ Incomes. (submitted Journal of Rural Studies)

Izumi, BT, Wright, DW & Hamm, MW. Farm to school programs: Differentiating distributors in local school food procurement. (submitted Agriculture, Food, and Human Values)

Project Outcomes

Project outcomes:

This study provided much needed data to support the introduction and passage of a legislative bill designed to stimulate local school food procurement. On December 18th, Governor Jennifer Granholm (D-Michigan) signed House Bill 6368, which immediately created the “Farm to School Procurement Act,” requiring MDE and Michigan Department of Agriculture to collaborate to encourage school food authorities to purchase local farm products. This act requires MDE to (1) educate food service professionals on how to buy locally farm products and incorporate them into their menus, and (2) house a FTS program point person to coordinate FTS program efforts and investigate opportunities to stimulate local school food procurement.

Two other bills, which are designed to simplify procurement procedures for buying local farm products, are currently awaiting the Governor’s signature.

Recommendations:

Areas needing additional study

Research that describes and analyzes individual FTS programs as well as trends associated with the larger national effort. Are FTS programs realistically contributing to a more sustainable food system? If so, how and under what conditions? The proliferation of FTS programs across the country and speed with which supportive policies and programs aimed at institutionalizing local school food procurement make such research critical.

There is an urgent need for research on the conditions under which FTS programs benefit school food service departments, children, and farmers. In today’s climate of fiscal constraints and rising costs, comparing how local school food procurement impacts revenue and expenses is important. In particular, further study on the conditions under which FTS programs increase revenue or decrease costs would be useful. For children, research is needed on how efforts ancillary to local school food procurement (e.g. school gardens, harvest festivals, educational visits from farmers) influence their preference for farm-fresh foods. Do such activities change the symbolic meaning of fresh fruits and vegetables? Longitudinal and retrospective research would allow us to gain a better understanding of whether and how these different dimension have positive and sustained impacts on children’s health.

The finding that school food service sales contribute negligibly to farmers’ sales is consistent with other reports on the impact of FTS programs (Joshi & Beery, 2007) (Ohmart, 2002). How do farmers negotiate the tension between their need to pursue market opportunities that contribute meaningfully to their sales and their desire to support their local communities and improve children’s health? Important insights can be gained by interviewing farmers who are currently selling their products to schools as well as those who are no longer engaged in FTS programs.

Finally, many schools already use regionally-based food distributors to supplement the produce they purchase through broadline distributors. The potential role of regionally-based food distributors in increasing the scale and scope of local school food procurement efforts is often overlooked. Descriptive and analytical studies of current FTS program relationships between schools and regionally-based food distributors are needed as well as documentation of the emergence and development of new relationships including those that emphasize transparency and economic well-being throughout the supply chain.

REFERENCES:

Brillinger, R., Ohmart, J., & Feenstra, G. (2003). The Crunch Lunch Manual: A case study of the Davis Joint Unified School District Farmers Market Salad Bar Pilot Program and A Fiscal Analysis Model. Retrieved August 17, 2005, from http://www.sarep.ucdavis.edu/cdpp/farmtoschool/crunchlunch32003.pdf

Izumi, B. T., Rostant, O. S., Moss, M. J., & Hamm, M. W. (2006). Results From the 2004 Michigan Farm-to-School Survey. Journal of School Health, 76(5), 169-174.

Joshi, A., & Beery, M. (2007). A Growing Movement: A Decade of Farm to School in California. Retrieved August 28, 2007, from http://departments.oxy.edu/uepi/publications/a_growing_movement.pdf

Kelly, T. (2004). SARE Project Number LNE03-183: Towards a community-based food system Retrieved January 3, 2006, from http://www.sare.org/reporting/report_viewer.asp?pn=LNE03-183&ry=2004&rf=0

Miles, M., & Huberman, A. (1994). Data Management and Analysis Methods. In Handbook of Qualitative Research (pp. 90-165). Thousand Oaks: Sage Publications.

Miles, M. B., & Huberman, M. (1994). An Expanded Sourcebook: Qualitative Data Analysis (2nd ed.). Thousand Oaks: Sage Publications, Inc.

Ohmart, J. L. (2002). Direct Marketing to Schools - A New Opportunity for Family Farmers. Retrieved February 5, 2007, from http://www.sarep.ucdavis.edu/CDPP/directmarketingtoschool.htm

Patton, M. Q. (2002). Qualitative Evaluation and Research Methods (3rd ed.). Newbury Park: Sage Publications.

Wheeler, E. (1997). SARE Project Number LNE96-065: Farm to School Food Education Project. Retrieved January 3, 2006, from http://www.sare.org/reporting/report_viewer.asp?pn=LNE96-065&ry=1997&rf=1

Any opinions, findings, conclusions, or recommendations expressed in this publication are those of the author(s) and do not necessarily reflect the view of the U.S. Department of Agriculture or SARE.