Friday, June 11, 2010

Supermarkets & Farmers Markets - An Opportunity to Work Together?

The following note from The Lempert Report was shared by a colleague after a recent discussion that several of us had while discussing opportunities for farmers selling their products locally. The text of The Lempert Report follows.

Do Farmers' Markets Grow On You?

Supermarkets ought to stop looking at
farmers' markets as quaint gatherings of like-minded growers that appeal to a
segment of buyers who want their produce fresh, fast and local. They should also
stop looking at them as competition to their own showpiece departements.

Rather, by hosting farmer's markets in
their parking lots or other adjacent spaces, they could project a fairly
unassailable image of wholesomeness, of having high regard for local food
sources, and respect for their shoppers - who might just become more prone to
buying more dressings, accompaniments and center-plate foods inside the store to
accompany their earthy scores of fruits and vegetables.

Better still, we believe at The Lempert Report,
if a supermarket with the right physical setup were to schedule these as regular
branded events, they'd draw increasing traffic and motivate farmers to become
regulars too. Imagine all that face time for growers to cultivate customers, and
with no need to open their own physical store or give up a percentage to a
distributor. They do need to pay something, and they do. According to the Los
Angeles Times, vendors at a popular Hollywood farmers' market pay 6.5 percent of
their sales as rent to the market, and "many of the 100 produce stands take in
about $400 on Sundays, while a few make as much as $2,500."

Should supermarkets shun their potential to build
buzz and a rental revenue stream with such events? We think not, since consumers
are looking to eat healthier, and they often like to support local
grower-entreprenerurs. Moreover, celebrity farmers bring co-branding
opportunities, as do restaurateurs who might be inclined to organize themselves
to ensure their supply of quality produce, such as the Batali-Bastinanich
Farmers' Market in Las Vegas.

Think about Ralphs, Bruno's, Stew Leonard's and Balducci's, and realize
these stores attained celebrity status because their namesakes knew food well
and were credible to their customers. The Lempert Report believes it is
absolutely possible that with nurturing branded or co-branded farmers' markets
could experience similar local and regional successes.

If you're a farmer or food entrepreneur, is there an opportunity for you or the farmers' market you participate in to approach a local grocer about partnering in a fashion similar to that described above? They may already be considering such possibilities and this would be a perfect opportunity to demonstrate willingness to work together, demonstrating shared values to local consumers. If groceries in your area haven't thought about partnering, this note provides several points that can be used to illustrate the advantages for both them and you.

No comments: