Marketing Ecologically Grown Produce in the Mainstream Marketplace

Final Report for LNE02-165

Project Type: Research and Education
Funds awarded in 2002: $150,000.00
Projected End Date: 12/31/2005
Matching Federal Funds: $14,000.00
Matching Non-Federal Funds: $1,024,611.00
Region: Northeast
State: Massachusetts
Project Leader:
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Project Information

Summary:
1. Summary—the context in which this project operates

Red Tomato is part of a growing international effort to keep family farms alive, increase sustainable farming practices, and make high-quality locally-grown healthy foods available to everyone. But the global food system will not be budged very far in this direction by organizations acting from the periphery (outside the places where most people buy their food). Organizations and farms in this international effort are having to learn how to interact with the dominant food companies—retailers, distributors, and food service providers—and to compete effectively as part of their system.

In our proposal to NESARE we wrote that “Red Tomato offers family farmers a durable wholesale path to market, creating opportunities for farmers to sell more, earn more, learn, improve product quality, and focus.”

There’s one daunting fact that sets the context for this report better than all others: The price farmers receive today is close to what they received twenty years ago. This fact might conceivably be acceptable had costs declined in proportion, maintaining a respectable margin of profitability. However, costs have been rising steadily.

Richard Bonanno runs a diversified vegetable farm in Methuen, Massachusetts called Pleasant Valley Gardens (PVG). His father ran it before him. His great-grandfather immigrated from Italy in 1910 to begin the operation.

Since 1988, the cost of labor to PVG increased 62% (from $5.25/hr. to $8.53 in 2003). The cost of lettuce boxes went up 260% (from .55 each to $1.43). The refrigerated delivery truck PVG purchased in 1996 for $68,500 replaced one purchased in 1988 for $34,000. While the farm was paid $7.04 for a case of lettuce in 1988, it received $8.00 a case in 2003, an increase of 14%.

The corporations that dominate the food industry today are at war with one another, slashing costs dramatically, searching for efficiencies everywhere and anywhere as they compete to survive against each other and against Wal-Mart. The only two options sustainable farmers have to compete and participate successfully in this environment today is (i) to be the low-cost supplier, or (ii) to differentiate and transform one’s products from being easily-replaceable commodities into something unique.

Red Tomato is in the business of differentiation and decommodification. This NESARE project has been an important part of Red Tomato’s ongoing effort to build a produce business whose focus and raison d etre is increasing the long-term viability of family farms that employ sustainable practices.

Red Tomato started with fruits and vegetables from family farmers in the Northeast, most of them committed to organic or ecological practices (i.e. the most innovative, strictest users of IPM). The assumptions behind the original business model were: the more successful RT became at differentiating farm produce, and the more effectively that RT and farmers together became at quality control and on-time delivery, the easier it became to grow sales and earn premium prices. As RT’s volume grew, more farmers would take part, more benefits would be experienced by participating farmers, more trucks and warehouse space would be needed, and, presumably, the unit cost of operation would go down steadily. Eventually (projected for 2007) this project would become self-sustaining financially.

The Red Tomato cycle of product distribution, learning and evaluation, planning for new products, recruitment of new farmers, detail planning, and then distribution again repeats annually. The process and business is controlled by the employees of Red Tomato, a mission-driven nonprofit (501.c.3) corporation. Farmers are involved in every step along the way, and have a major role in shaping the marketing plans for their particular product lines.

Introduction:

2. Introduction—abstract—this NESARE project

In this project, NESARE supported the growth and innovation of Red Tomato’s direct-store-delivery (DSD) business in order to extend marketing benefits to 35 Northeast fruit and vegetable farmers.

Red Tomato entered the world of produce distribution with rapid success. Sales of our DSD program (“local” sales, i.e. from Northeast, plus sales of watermelons from family farmers in southeast US) grew from $205,000 in 1999 to $462,000 in 2000 to $729,000 in 2001. We were on the road to self-reliance and profitability. We moved to a larger facility in April 2002 so that we could continue to grow at 35% a year. Growth would occur by selling more to current customers, and by expanding the customer base from 24 to more than 50 stores.

Farmers benefited in numerous ways: by having new markets, by earning above-average prices (at times), by having their farms and products promoted in stores, and by having a business partner (Red Tomato) who treated them respectfully and was transparent with trade and price information.

At the project inception, Red Tomato was settling in to its new warehouse, running three refrigerated trucks that picked up at farms all over New England and delivered directly to a couple dozen stores in greater Boston. While this NESARE project had positive direct measurable impact on participating farmers, as planned, when the project reached its endpoint in the summer of 2005, the most dramatic transformation had been to Red Tomato itself. This story is told as part of section 3 below.

Performance Target:
3. Performance target

Restated from original proposal: “Of the 75 fruit and vegetable farmers with whom Red Tomato will evaluate the feasibility of a marketing relationship over the next three years, 44 will become marketing partners. Of these 44, at least 35 will experience at least two of the following changes or benefits, with the year 2001 as the baseline for measurement.”

"Changes or benefits"
· New markets. They sell an increasing share of their wholesale-market produce to new customers who specifically seek out product on the basis of freshness, flavor, and local origin;
· Improved or market-matched product quality. They modify their production, post-harvest handling, and/or packaging methods to achieve a more desirable product;
· Enhanced name/brand equity. They build equity (recognition) in their farm name and brand as a result of point-of-sale promotion (signs, ads, and tastings) in stores;
· Better returns. They realize higher and more stable prices on average over the long term than through other wholesale channels;
· Diversification. They grow new varieties/crops that result in new markets and/or increased income;
· Sharper focus. By marketing through Red Tomato, they focus their time on activities they do best;
· Enhanced job satisfaction. They feel better about their wholesale marketing due to feedback and appreciation from trade buyers and consumers, (ii) winter/spring planning to set strategy and expectations, and (iii) a marketing relationship based on trust and common goals.”

Results Summary: From our verbal qualitative and quantitative evaluations in 2002 and 2004, 80% of the top 10 growers (by sales volume sold through RT) we worked with experienced at least two of the benefits. From our written evaluation in 2003, 100% of the 17 growers we surveyed experienced 2 or more of these benefits. We did not reach the targeted # of growers projected to sell through RT each year.

There are two key points which relate to these results:
I. Red Tomato’s Brick Wall and Reinvention: In the first year of this grant we encountered a number of significant unforeseen obstacles (we hit a large brick wall) which forced us to change our strategy, i.e. reinvent the way we would market local farm produce. The obstacles included: losing our largest customer at the time (see below for more details), and a serious crop failure in tree fruit due to a hard spring freeze. In addition, we learned through experience that the distribution strategy we chose in order to market local farm produce - DSD (direct-store-door) distribution in our own trucks and through our own warehouse - did not prove to be economically viable. Lastly, we realized we were spreading our efforts too thinly over too many product lines (over 100 products and varieties). For a complete description of these events please see “Appendix A: The Details.” As a result of this extremely difficult year we made several key strategic changes:
(a) We changed our distribution strategy from DSD (in our own trucks through our own warehouses) to logistics managers - we sourced out the trucking and consolidation to other entities, such as farms and independent companies – but continued to coordinate these logistics ourselves. And instead of hiring truckers to make DSD deliveries to individual supermarkets, we directed our produce through central warehouses and to other distributors. This distribution model proved to be successful and we continue to operate this way today.
(b) We reduced our product line from over 100 products/varieties to less than 50, in order to have greater market leverage with the products we focused on, and to have a more powerful impact for the growers we worked with. Specializing in a smaller product line would enable us to make more of a difference in the long term, expanding the volume in these lines and eventually adding more growers of these products. Our Eco Apple program is evidence that this was a wise strategic move – this program is taking off this year and 2005 apple sales are projected to double this year over 2004 sales. But this change in strategy meant that we reduced the number of growers we worked with, predominantly a number of organic vegetable growers that were successfully marketing on their own.
(c) We put time and energy into new sales work and expanded the number of customers we sell to, in order to avoid having all our eggs in one basket. As of 2005 our customers include: Trader Joe’s, Whole Foods Northeast and Whole Foods Texas, Stop & Shop, Roche Brothers, Big Y, Conde Nast, NYC Zoo, and distributors, including Albert’s Organics, Associated Grocers, Black River, and Shapiro Produce.
(d) We invested considerable resources towards differentiating our growers’ products through branding, packaging and labeling, in-store promotion. For a more complete description of these activities, see the “Outcome” section below.

The initial challenges we experienced in 2002 set us back significantly. Our sales dropped as did the numbers of growers we worked with. During this grant period we implemented and tested the strategic changes outlined above, and rebuilt our program year by year. The results of this work are just starting to pay off. This year we project our sales to meet and possibly exceed our highest year of sales to date, ~$750,000 - $815,000.

II. Farmer Benefits: Based on input from farmers, we realized that we needed better evaluation measurements to capture benefits to farmers. The 7 “changes or benefits” to farmers that we chose at the start of this grant did not completely resonate with growers as they were written. Out of the original seven areas of “changes or benefits” from our performance target, only two points were of critical interest to the growers. The first is new markets that are long term and reliable. The second is better returns through higher and more stable prices. Growers also indicated that a third benefit was important to them: selling significant and/or strategic sales volume through Red Tomato. Other changes or benefits were of secondary importance to farmers.

We did learn, however, that we were not completely off base with the other 5 benefits to growers. Some of these other benefits were the key reasons why we were able to deliver on price, volume, and secure markets, namely:
(a) Enhanced name/ brand equity;
(b) Improved or market-matched product quality
(c) Diversification.
The successful fulfillment of these three functions, which were part of the original 7 benefits to farmers, were important factors that lead to farmers experiencing their most important bottom line results – better prices and sales volume, and secure markets.

In 2005 we developed new evaluation measures to capture farmer satisfaction on the points that farmers value most (see below). This evaluation system will be implemented between Nov. 2005 and January of 2006, and the results will be available by February 2006.

Summary of what happened—the # of farmers from our original performance targets
MILESTONE 02proj actual 03proj actual 04proj actual
1. Learning and evaluation 27 30 33 32 39 25
2. New farmers & products 10-20 9 10-20 8 10-20 6
3. Planning at detail-level 37 35 43 31 49 21
4. Implementation 33 35 39 31 44 21
5. The performance target 25 80% of 30 100% of 35 80% of
10 measured 17 measured 10 measured

The 5 step process shown in the above summary occurred every year, as described in our grant application, but we were not scientific about recording the numbers of farmers involved in each step. For example, each year we probably had at least 10-20 conversations with new growers in many different venues, and by different RT staff members (i.e. at conferences, cold calls that came in to RT, our active search for growers, etc). These conversations served as filters for the selection of new growers. But we did not systematically record all these different conversations by different staff members in order to get an accurate count. This type of recording information proved not to be a useful business practice as we balanced our needs of operating as an efficient produce business.

Despite our discontent with internal evaluation measures in the area milestones and farm impact, we are pleased to learn that our internal sensors seem to track reality pretty closely. This was confirmed by both Molly Anderson’s independent evaluation in the winter of 2002, and our own survey in February 2004. This sensitivity is due to the frequent contact we have with growers during times when their products are for sale. It’s also because of our frank and transparent style of communication. We sense when growers are dissatisfied. It’s usually no secret as to why. And we ask when we’re not sure. As Anderson wrote:

“...overall the farmers were overwhelmingly positive about Red Tomato and its impact on their farms...They [the farmers] are much less critical of Red Tomato than it is of itself.”

In a confidential, written survey about the 2003 season, here’s what 17 Northeast farmers who raise tree fruits (12) and vegetables (5), said about the usefulness of RT services...
for the purpose of market diversification?
14 said very useful; 2 said somewhat useful; 1 said not useful
as a source of feedback that improves product quality and marketability?
6 said very useful; 8 said somewhat useful; 1 said not useful; 2 didn’t respond
as a channel for earning, over the long-term, above-average economic returns?
9 said very useful; 5 said somewhat useful; 1 said not useful; 2 didn’t respond
as a vehicle for promoting their farm to the general public?
4 said very useful; 6 said somewhat useful; 7 said not useful
as a marketing ally who freed up some of their time to focus on other things?
5 said very useful; 7 said somewhat useful; 4 said not useful; 1 didn’t respond

We have developed a new evaluation measurement system which we will implement over the next 2-3 months to evaluate the 2005 growing season (the 2005 season will wrap up in December). Farmer satisfaction will be measured based on:
(a) Price: growers earn higher and more stable prices on average over the long-term through RT than through other wholesale market channels
(b) Sales Volume: growers increase sales volume sold through RT and/or sell parts of their crop volume that are strategically important to the overall success of their business (i.e. varieties or sizes that they do not have any customers for)
(c) Secure markets: growers diversify their customer base (and therefore mitigate their risk) by selling through RT, and/or RT's customers prove to be more secure markets because trade buyers seek out RT products because they are differentiated (have added value) thru branding, packaging, variety selection, promotion, and/or quality.

Cooperators

Click linked name(s) to expand
  • Lynn Colangione

Research

Materials and methods:
4. Methods—basic approach and design of the project

‘Reinventing local food systems’ was the original Red Tomato slogan. In practice, it’s how we solve problems and operate—through constant reinvention and experimentation.

As mentioned earlier, one key strategic approach that we changed during the project was our decision to abandon running our own trucks and warehouse. We became brokers and logistics managers instead of being a distributor who physically handled the product.

As brokers and logistics managers we were able to keep the same customers and work with the same farmer base (reduced slightly). We relied on farmers to consolidate product, utilizing their barns and coolers and good will. We outsourced trucking, which proved to be the most difficult challenge of all. In the first year alone (2003), we increased labor productivity (sales/cost of labor) from 3.99 to 9.09. Each year since, we’ve been able to increase sales without adding extra labor.

Here are two examples of the logistics we manage:
(a) We arrange to consolidate apples from 5 different farms at Clark Bros. Orchards in western MA (2 farms from VT, 1 from NH, 1 from MA, and 1 from CT). We then have this load picked up and trucked to several customers located near the New England Terminal Market in Chelsea, MA
(b) We have 7 vegetable farmers from the Pioneer Valley in Western MA deliver their produce 3 times a week to one farmer’s warehouse in Western MA. We then arrange for a truck to pick up this produce 3 times a week at midnight, along with strawberries at another farm nearby. This trucks delivers the strawberries at 4am to a customer at the Chelsea Terminal market, and picks up lettuce from another one of our growers at a trucking company that we contracted to serve as a drop off point for us. The driver then goes and makes five direct deliveries to retailers and food service providers.

We chose a nonprofit structure to allow for total focus on the mission while navigating the shark-infested waters of the global produce industry. Grants enable us to do economic development work, and to emphasize trade with under-resourced, small-scale, local, and/or ecological farmers. Even if our trading business were so profitable it could operate without grant support, the nonprofit sector would still be a recommended home for a mission-driven low-margin perishables business at this moment in economic history.

We chose against a formal farmer cooperative structure having witnessed it to be slow, conservative, and risk-averse, regardless of which farmers are involved. Instead, we wanted a more entrepreneurial culture in which a small, tight, highly experienced group of employees exerted the most influence over business strategy and decisions. There is a constant, significant informal farmer cooperation in all RT systems.

We also wanted farmers to have ongoing significant voice in how their products get marketed, but through informal day-to-day conversations and meetings rather than through more formal or bureaucratic channels.

In every product line, one or several participating farmers provide ongoing tutelage and information, helping shape how competitive strategy evolves over time. However, the process is driven by a Red Tomato employee who is advised by scientists, customers, and marketing advisors as well as by farmers.

Research results and discussion:
6. & 7. Accomplishments and Potential Long-Term Contributions

We survived the tough, challenging years of 2002 and 2003. We applied hard lessons learned and reinvented our business model. We are continually learning how to decommodify or differentiate every product we handle through variety and product selection, through quality control, by investing in our brand, and by creating unique packaging for all kinds of products.

The revised business model—Red Tomato as logistics manager and regional broker—suits us well. We are more efficient. We can expand sales steadily while holding down costs, and eventually make our way to a self-supporting local trade operation.

Red Tomato is leading the Eco Apple project and introduced Eco Apples in the Northeast marketplace for the first time in August 2005. The Eco Apple program creates economic rewards for apple growers in New England that reduce the use of highly toxic pesticides that are harmful to human health and the health of the region’s soil, water, and wildlife.

This program was an offensive move to establish a position for the most earth-friendly Northeast-grown apple available in large supermarket quantities. It was also a defensive move, imagining five to ten years down the road when Chinese apples come to shore at low prices, as Chinese apple concentrate already has.

Eco Apples are grown according to a protocol that was created by the IPM Institute of North America, and reviewed and advised by scientists at U. Mass. and Cornell. We aim to establish the highest standard of environmental stewardship that growers can achieve. We plan to both improve the standards year to year in order to hold on to that position, and to draw in more growers and more acreage every year as the program slowly expands. The growers that are using the Eco Apple protocol are certified by the IPM Institute and their apples are marketed in specially branded Eco Apple packaging created by RT.

Participation Summary

Education

Educational approach:
8. Publications and Outreach

Our publications are associated with the sales and promotion of product. Romaine lettuce bags, apple tote bags, apple 3 lb. polybags all act as promotional tools, reaching hundreds of thousands of people a year. They are also educational tools: they advocate a regional or bioregional approach to thinking locally; they introduce people to heirlooms; they teach people to associate the freshness and flavor they enjoy in a product with the fact that it was grown locally by a family farm.

We are reaching a new audience with greater depth, since the onset of our Food System Development consulting program. This has proved a valuable source of winter income, and an effective way to recycle the learning from our produce business to similar ventures being started or considered in other regions of the country.

One example is a study we did in the first half of 2004 for a network of Midwestern funders. They hired us to research and recommend strategic leverage in their effort to fund and build a more sustainable food system in the State of Illinois. The report we wrote can be found on the website of the Chicago Community Trust.

No milestones

Additional Project Outcomes

Project outcomes:

Impacts of Results/Outcomes

5. Outcomes and Impacts

Red Tomato is devising wholesale marketing and distribution programs so that small- and medium-sized family farmers can remain profitable and stay in the game. Other regional mission-driven marketing efforts can learn from our breakthroughs and mistakes, and learn the particular solutions and tools we have devised along the way.

Getting distribution right in the local (Northeast) program has been Red Tomato’s holy grail. When we received this SARE grant in early summer 2002, we had already succeeded at a start-up level in differentiating local fruits and vegetables on the basis of freshness and flavor, delivering produce from local farmers directly to 35 stores in the Boston area. Both farmers and customers, on the whole, were satisfied. And customers wanted more. Though we projected healthy growth for 2003 and beyond, the challenges we encountered in 2002 left us exploring new strategies.

Holy grail found—the transformation of Red Tomato. The transformation of Red Tomato during this grant period was based on four substantive changes outlined earlier in this report:
(a) changing our distribution strategy; (b) reducing the number of product lines; (c) expanding the number of customers we work with; (d) investing in branding and product differentiation.

The change in our distribution strategy is covered in two sections of this report, “Performance Target” and “Methods,” and it is also covered in depth in “Appendix A: The Details.” Reducing the number of products we market is covered in the “Performance Target” section, and expanding the number of customers we work with is covered in the “Performance Target” section and in “Appendix A: The Details.” Here is a deeper look at the important impact that branding and product differentiation is having for the farmers we work with:

Branding/Product Differentiation: We made a decision to build the Red Tomato story into a brand for consumers. Until now we have been operating as a brand for store buyers, assuming that a consumer brand would be too expensive and taxing for a small organization. Your assumption is wrong! is what media and business advisors told us. And we are most encouraged by the response from retailers and farmers. The work has involved: new ways of telling the Red Tomato and farmers’ stories; changes in product packaging and identification in stores; and getting the stories and information to people who can easily find the products that go with them.

For the new brand, we chose to put the Red Tomato brand front and center, in association with the farm name, and made a commitment to brand as many products as possible. Prior, we had featured the farm name first, and positioned Red Tomato as a secondary element, like the Good Housekeeping Seal.

Branded products have proven an effective way to differentiate local fruits, turning them from a commodity into a unique product that trade buyers seek out and cannot find elsewhere. Down the road, we expect it will help growers earn a higher price. Meanwhile, it is opening the door to new customers and new sales. And the packaging has become one of our best vehicles for telling the Red Tomato story to the public.

Branding efforts have involved developing specialized packaging for certain products, as well as art and design work for the appearance of the packaging. We designed special farm-stand like baskets for peaches and tomatoes that could be sold in supermarkets. And we developed the “heirloom” packaging concept – selling mixed varieties of heirloom apples and tomatoes in specially designed baskets that are supermarket-friendly.

We also produced dozens of laminated, color point of sale signs for each product, and developed large, farmer portrait posters to be displayed in supermarkets. These posters put the face, name and town of the farmer squarely in front of shoppers so they are buying local.

We’ve launched the Red Tomato website that features bios and photos of some of our growers, as well as a list of the stores that carry our produce.

In the spring of 2005, RT sought out renowned artist Anthony Russo (who can be seen in the New Yorker and the New York Times, among others) to draw a series of illustrations that would become the basis for several of our packaged branded products lines, including apples, lettuce, and raspberries. Russo agreed to take payment in-kind—strawberries and apples in season. Recently Gene Kahn, the founder of Cascadian Farms and Director of Sustainability for General Mills, visited RT and said he thought the branding and packaging we are producing are “on the cutting edge” and “some of the best packaging designs” he’s seen.

Here is a list of just some of the packaging and labels developed during the grant period:
¼ peck apple tote bags
½ peck apple tote bags
“Born & Raised Here” farm stand-like peach baskets
Heirloom tomato baskets
Heirloom apple baskets
Raspberry half-pint clamshells
Romaine Heart 18 oz poly bags
Apple 3 lb poly bags
Corn bags

Promotional Materials:
20” x 28” farmer portrait posters
Color laminated point-of-sale cards for every fruit and vegetable line
Eco Apple pamphlets
Apple Education booklet for grade school students focused on apple nutrition and the “buying local” concept

The impact on farmers. Every one of the 21 Northeast farmers marketing through Red Tomato in 2005 benefited from market diversification, this year more than ever as we are adding several new customers to the mix. Most also benefited by having their products differentiated as a result of being marketed through Red Tomato.Those that participate in branded items are part of a long-term investment that should yield market security and, in some cases, a premium price. Here are some specific examples of how Red Tomato’s marketing and education work benefited farmers between 2002 and 2005:
· Strawberries. Between 2002 and 2004 we were able to increase the price we paid strawberry farmers by $2.00/flat due to increases in efficiency and to the popularity of the program.
· Medium and small sizes. It’s easier to get premium prices for the best and fanciest grades than it is figuring out how to move the medium and small-sized produce. (Keep in mind that every time you run the packing line to generate the large and fancy grades, you are simultaneously generating piles of the smaller product.) In 2004, we designed and manufactured a farmstand-like cardboard basket which boasted the RT brand and our slogan “Born and Raised Here.” It was tedious and expensive for farmers to construct, however, at retail it was successful. Originally, it proved a successful way to sell medium-sized peaches. This year it also proved effective as a sales and education vehicle for heirloom tomatoes and apples (see below).
· Packaged greens are now 70% of all the lettuce and salad greens sold in the United States. In 2005 we conducted a trial marketing effort with packaged romaine hearts from one farm. The return per case increased from $8.50 (for a standard case of 24 romaine heads) to $20.00 (for 24 romaine hearts packaged two per bag). The leaves that were stripped off the heads while making the romaine hearts were bundled in 5# bags and sold as “romaine leaves,” for an additional $18.00 (for 2/5#). While the increased return was substantial, so were the added costs of labor. We will have to explore how and to what degree this tiny pilot project can be expanded before understanding the potential significance for this one lettuce grower, not to mention others in New England.
· Heirloom tomatoes and heirloom apples. After trying for years to get it right marketing heirlooms, in 2005 RT converted its farmstand-like cardboard peach basket into a marketing tool for heirlooms. With an in-your-face handle that says “HEIRLOOMS,” the basket contains an exotic Dr. Seuss-like mix of heirloom tomatoes—guaranteed inconsistency and marvelous flavor. The apple version has several small pamphlets which explain Eco Apples, heirloom apples, and relay the unique story of the apple varieties included. The tomatoes, introduced at Trader Joes stores from Massachusetts to Maryland, generated more consumer response than we’d ever received for a product introduction.
· Eco Apples represent a strategy for differentiating ecologically-grown apples from New England and New York. With these certified apples, RT was able to open new markets, introduce new packaging, and market 12/3# polybags for the first time. The program is explained more fully in section 7.

The evaluation of impact, that is, the evaluation of benefits to farmers, especially price, is tricky and complex. If one doesn’t evaluate the whole farm and the whole marketing mix together, and take a multi-year perspective, one could miss a lot and come to the wrong conclusion.

For example, Farmer X might have participated in a brand new program that took all of the best grade tomatoes (3% of total sales) and sold them to a specialty marketer at a price 15% above what he received for the same product the previous year. Farmer X might have been selling 55% of his crop through a farmer cooperative for ten years, typically at market price. And say, that same year, on his own initiative, he discovered a processing outlet for the 20% of his large tomato crop which paid .25/pound for tomatoes that in prior years were composted.

It is easy to imagine the glowing report of the new program that boasted it had been able to sell Farmer X’s product for a gain of 15% above historical market prices. In reality, however, Farmer X’s overall economic performance and security is just or more dependent on the farmer co-op for the large volume it has been able to sell over a long period of time, and on the innovative market uncovered for processing tomatoes (the cost of harvesting which must be paid in order to get the top quality tomatoes), thus turning compost into added income. The most valuable marketer for Farmer X would be one who could do all of the above, making use of the entire crop.

We are still searching for an effective measure of the impact of our marketing activity on a family farm. We assume it requires both quantitative and qualitative assessment. It’s not that the performance targets we presented in this proposal were off track. They didn’t communicate effectively enough to growers, and didn’t lead us to the understanding we sought.

The impact on other organizations. The successes and failures of Red Tomato’s experience in the produce world have been showcased repeatedly at regional and national conferences, largely due to our participation in the Kellogg Foundation Food and Society network. RT staff have done an average of 6 to 8 workshops and presentations a year at events sponsored by organizations such as New England Vegetable and Berry Growers Association, SARE, NESAWG, Practical Farmers of Iowa, National Community Food Security Coalition, Co-op America, Fair Trade Association, and several CSA farm annual meetings.

More and more community-based organizations in the United States who once focused exclusively on policy or advocacy work are discovering that marketing and markets are a constraint, if not the critical constraint, on survival for their farmer constituents. We are fielding more and more requests for information about our approach to marketing and consolidation and logistics management.

We took on consulting—food system development (FSD)—as a major activity, targeting organizations like Red Tomato in other parts of the country, as well as farmers and for-profit food companies. FSD work puts our senior traders to work on income-earning activity during the winter. It’s a channel for sharing lessons learned in our trade work with others around the country. But the learning goes in both directions—FSD has also proven to be an effective research lab for Red Tomato’s local trade program. When we are analyzing and researching other people’s issues and problems, we gain perspective in a way we rarely do when we are stuck in the day-to-day mud of our own world. Some of the conclusions we reach are surprisingly relevant to Red Tomato!

Assessment of Project Approach and Areas of Further Study:

Areas needing additional study

9. Future Recommendations

Our recommendations, as a result of our change in business model and its success, are included in the discussion of the above points.

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.