AboutIn 2015, RAFI’s staff and NC State University embarked on a farmer interview project to better understand the barriers and opportunities for farmers selling to low income communities. We’ve produced a short report based on these interviews. Click to read it below!
BackgroundWe wanted to understand farmer motivations for targeting low income consumers and the revenue impact of including low income consumers in their customer base, along with exploring broader themes regarding farmers decisions on marketing and pricing.
We began by approaching North Carolina farmers who had identified as receiving a meaningful percentage of their income from low income consumers. We put together a sample prioritizing regional distribution as well as diversity in race, age, and gender. Our total sample will include 20 to 30 farmers by project completion.
ThemesAdvertising and marketing
Several farmers, particularly farmers selling a higher percentage to low-income customers, said that they put a lot of effort into marketing, but faced challenges in effectively marketing, including time, knowledge, and technical skills. Farmers told us that one thing that would help increase their sales to low-income customers was support in terms of marketing, advertising, and promotion – for their specific operation or produce stand, the farmers’ markets, or in general (regarding healthy food and local produce).
Farmers told us that it was hard to get into markets with adequate customer bases; many farmers felt that customer demand had plateaued. As the number of farmers’ markets has grown, this has led to competition between farmers for the same customers. Bigger, more established markets were hard to get into, while farmers felt that smaller and newer markets were less profitable. Competition between farmers (and between markets) posed challenges in terms of having to juggle multiple markets, trying to find niche products, and creating income dependency – and thus risk- on a handful of bigger markets.
Farmers defined success by the ability to survive.
When asked about their biggest challenges and accomplishments, farmers indicated that their greatest achievement was keeping the farm running. Some farmers said that they were not yet profitable, but that goal was second to survival. One of the ways that smaller-scale farmers achieved survival or profitability was to limit themselves to family labor.
Most farmers set their prices in comparison to other markets, and not based on cost of production.
The reference points for setting prices varied according to what market they were in, for example, some set their prices compared to high end supermarkets, or mainstream supermarkets, while others compared themselves to other farmers in the market. One farmer specifically said that he could not compete with conventional supermarket prices because he pays a fare wage to his employees; another said that he could not “in good conscience,” charge the going rate for products, implying that the cost was out of reach for his customers. The farmers who had a larger low-income customer base seemed to have lower prices, but one said that people had told him that his prices were too low.
Several farmers described their main customer demographic as white, middle-class, educated women, often mothers or grandmothers. They described them as making household food decisions, and some specifically targeted them (in terms of how they marketed their products or the products they grew).
When asked how they defined sustainability, farmers emphasized soil health and their land, but also their physical health (their ability to provide labor for the farm) and their ability to balance economic considerations and keep their farms. We are very grateful to the farmers who offered their time and insight to this project, and hope that our research results will find useful application in programs and policies designed to support farmers and increase food security.
ContributorsNorth Carolina State University
Sarah Bowen, Ph.D. Associate Professor of Sociology Director, Voices into Action: The Families, Food and Health Project
Dara Bloom, Ph. D. Assistant Professor and Local Foods Extension Specialist Dept. of Youth, Family, and Community Sciences
Angel Cruz, MS PhD Student in Agroecology NC Appalachian Foodshed Project Coordinator
Michele Scott, MA Department of Sociology and Anthropology
Rural Advancement Foundation International-USA (RAFI-USA)
Francesca Hyatt, Former Program Director, Beyond Hunger Relief, Come to the Table