Thank you, Dave Milano, for making an important connection between the move to locally produced natural foods and effective business planning, and pushing me in that direction. I have tended to keep these matters separate, both here on this blog, and in my mind, when in fact, as you suggest, they are very much related. Moreover, community-oriented farmers today are very well position to achieve significant ongoing market success, as Dave notes, and as John Mackey of Whole Foods was essentially saying in his Berkeley talk.
Why my tendency to separate such matters? That’s a subject for some serious introspection, reflective of my personal biases, and perceived biases of readers. But I probably should begin the exploration.
First, there’s my tendency to see community-oriented farmers as being so dedicated to quality that they are willing to forego aggressive business practices, aka profit.
Second, I’ve tended to associate industrial agriculture with overly aggressive business practices, really the worst of business planning. They take potentially useful practices, like pushing for efficiency and lowering overhead and increasing market share, to such extremes as to suppress competition and make a mockery of morality and decency (as just one example, their unconscionable treatment of animals).
These are some of my biases. They shouldn’t preclude today’s community-oriented farmers from running their farms as growth-oriented businesses. Generally speaking, businesses, like people, have a tough time staying the same—they either grow or they decline. It can even be argued that farmers who fail to apply effective business techniques are failing their families and their customers, since these techniques are essential to ensuring the farms’ ongoing ability to serve their communities.
Just because industrial agriculture has fostered unhealthy business growth doesn’t mean today’s smaller farms can’t continue serving local communities and promote healthy growth at the same time. As Dave Milano notes, farms can develop effective web sites, promotion approaches (beyond publicity created by politically motivated persecution), and sales techniques to expand on what they do.
It’s important to appreciate the larger implications of such a move by community-oriented farms. To the extent they can expand their market share, they will take customers away from the industrial behemoths. This process becomes easier if your competition is so misguided and arrogant that it is poorly serving its customers. Moreover, the process tends to accelerate over time.
A great example of what can happen is apparent in the auto industry. Those of us old enough can still recall when General Motors was the largest corporation in the world. Ford and Chrysler weren’t far behind. These companies looked impregnable, despite the fact that many of their products were badly designed and came off the assembly line with major defects. I remember buying a new Chevrolet Nova in the late 1970s that wouldn’t go into reverse gear. While the dealer eventually fixed it, my confidence in that car, and in General Motors, never recovered. How did that car get out of the factory and the dealer’s lot in that condition?
Japanese companies like Toyota and Nissan looked totally outgunned. But they stuck to their commitment to produce better quality than the American companies, and today are moving ahead of the American companies, which appear like shadows of their impregnable selves.
What can the community-oriented farmers do to improve their positions in the marketplace. I see opportunities on two levels: the individual farm and in cooperation with each other. I have a few ideas, which grow out of some research I just completed for a BusinessWeek.com article coming out tomorrow. But I’ve gone on long enough here. I’d welcome input from others, and will be reflecting more on this subject upcoming.
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