From Supply Chain to Value Chain: What does it take?

How do we develop value chains throughout the system?

Changemakers Day Panel - August 29, 2008

Typically, in the traditional food supply chain, margins are slim, competition is cutthroat and farmers are price-takers. Much of the control of the supply chain now lies with very large food retailers and food service corporations who are primarily interested in a low-cost supply especially given the nature of competition in a heavily globalized, industrialized and centralized food system.

Is it possible to create a new type of food system based on values-based value chains, where system players are working in greater cooperation and partnership, where farmers are involved in price making, where there is greater equity in the returns from the food dollar, where consumers have a voice, and where common interests and self-interests are in better balance? We believe yes! This session will briefly explore what a value chain is, the difficulties, challenges and benefits in creating value chains, and what the future might hold. Different food system perspectives will be represented – producer, distributor, producer co-op/distributor and retailer

_{Photos by Mike Kahn/Green Stock Media who retains all photo copyrights - http://www.greenstockmedia.com}

From left to right: Moderator: Larry Yee, Emeritus Cooperative Extension Advisor; Roots of Change Stewardship Council Co-Chair; Panelists: Walter Robb, Whole Foods Market; Larry Jacobs, Jacobs Farm/Del Cabo Inc.; Theresa Marquez, Organic Valley and Organic Prairie; Bu Nygrens, Veritable Vegetable.

Notes by Bu Nygrens, Veritable Vegetable, Roots of Change Fellow 2007

Larry Yee opened with points about developing a food system that features mid-size farms, and that enables farmers to move from their traditional position of price takers, a system of value-added food with a story to tell. Such a food system would be regional/local, healthy and affordable. People would pay more than current food prices, perhaps, but food prices would be fair and reasonable to everyone in the system. A values chain would include right relationships based on trust, and right operations with highly efficient logistics.

Larry Jacobs, from Jacobs Farm and Del Cabo, represented farm producers:
Larry spoke about the history of the two farm projects he is involved with, one in Northern California and a farmer’s cooperative in Baja Sur, Mexico. He spoke about better labor compensation, and land tenure being part of the history of the Baja growers. Both farms produced “information rich” product; more information at point of sale generated higher demand in the market. Much information throughout the chain is needed for appropriate planning and response at all levels. A focus on communication, training and education, and technology has led to solutions and much needed research.

Theresa Marquez, from Organic Valley, represented value-added producers:
Theresa spoke about the world paradigm shift that is happening; we are in very unpredictable times. There is a world food crisis, food prices are going up, the food industry is losing money, even if we do not feel it yet. The land grant system needs to change. We have an opportunity to bring values into the marketplace. Organic Valley growers federated to achieve scale, to build infrastructure. Theresa posed the question, “what is the community’s responsibility regarding food and water?” We should become a nation of gardeners.

Bu Nygrens, from Veritable Vegetable, represented distribution:
Bu spoke about exploring your own organization’s values, not making assumptions about what they are. Know your organizations decision making process, test it in action. Building relationships in a system requires transparency and sharing information. When you choose to do business, find out who are the decision makers? What are their true values? Like all relationships there is an ebb and flow, no one is 100% perfect or supportive 100% of the time. Know your own ethics and stay true to them. “Sweep your own side of the street.” For our food system to change we must share our wealth in a better way, share equity in the system, including land reform. What is reasonable profit for anyone or any organization to make?

_{Photos by Mike Kahn/Green Stock Media}

Walter Robb, from Whole Foods Market, represented retail:
Walter spoke about the new beginning that was happening with food awareness across the country. People do not want to domination of the natural world. People need to take personal responsibility for their own health and well being. Individuals vote with their purchases. The meat industry needs to embrace a reverence for life. Accessibility to good food is an issue; communities need to demand access and take responsibility for their own health. A true stakeholder philosophy is “satisfaction for all”.