Harvest America CUES BLOG

The concept of centralized farms was based on a classic supply and demand opportunity within a growing nation and the need to support the consumer’s desire for everything, anytime, anywhere.  Since climate and soil (terroir) are not the same from coats to coast, certain crops and livestock do not flourish year-round in every region of the United States.  The de-centralized farm that was the backbone of America could not support this growing demand from the consumer.

With centralized farming comes numerous other challenges, not the least of which is quality.  Impact on the environment, making large concentrations of crops susceptible to climate changes, the use of fertilizers to keep the soil productive, pesticides, genetically engineered seeds to increase yield, use of growth hormones in animals, over-use of antibiotics to keep animals free of disease, the loss of the family farm, and the list goes on and on.  We are all familiar with the issues.

The Slow Food Movement and numerous studies about the impact of these practices has influenced a change in many people’s food philosophy.  Organic is no longer a fad, buying local is becoming a national call to arms, a young cadre of energetic farmers are putting their stakes in the ground, and chefs are taking on the movement as part of their food persona.

Now the challenges.  Restaurants are money pits.  The cost of delivering a great, even a good meal is not very forgiving.  A well-run restaurant might be able to squeeze out 5% profit as long as they can control waste, theft, spoilage, and labor costs.  The reality is that many restaurants are not very good at this.  The one saving grace is the ability to find cost effective sources for the food that they use.  The major part of cost effectiveness is how the raw materials that they buy can save on labor.

Consistency is another challenge for restaurants.  Customers expect, and rightfully so, that what they buy from a restaurant today will look and taste the same when they return a month later.  The reason that so many chain restaurants are successful is that customers know what to expect. The vast majority of restaurant patrons are not willing to gamble.

Restaurants are in the “service business”.  This means that they are willing and able to adjust and respond to customers needs and are able to deliver on their promises.

Finally, we come to cost.  The restaurant business is an industry of pennies.  There is a ceiling to what we can charge for the product we serve and a major part of a chef’s job is to learn how to control costs.  Obviously, watching spoilage and waste as well as effective menu planning can help to control the cost of goods, but finding an acceptable price for the raw materials chefs buy will set the stage for profitability.

Small de-centralized producers are very challenged with all of these issues.  Consistent product quality, quantity, form, shape and size, are all very difficult for the small producer to address.  When an item is placed on the menu, there should be an expectation that the chef will be able to find the raw materials to deliver the “promise” to the guest.

The more that a chefs’ crew must do to a product to bring it up to working standards in a restaurant, the higher the cost of labor.  Trimming, sizing, cleaning, sorting, etc. in the hands of the restaurant can make the cost of delivering that item prohibitive.

If a chef cannot depend on an item being delivered at the quality expected, the quantity ordered and the day and time needed, then the promise is again broken.  In some cases in order for a chef to work with farmers they need to pick-up product rather than depend on a delivery.  There are only so many hours in a day and chefs typically work 60 plus hours as it is.

Farmers, like restaurateurs, work on small margins, thus they are not able to compete with price like the one-stop carriers can.  Farmers are unable to allow restaurants to defer payment for 30 or more days like the larger vendors, thus making it very difficult for the restaurant to purchase in this manner.

Now, I am a strong advocate for farm to fork.  I appreciate the flavor differences in local ingredients vs. those from a box supplier.  I want to give a hand to local producers and keep regional economies strong.  I am very concerned about the integrity of the food supply and the depletion of our American terroir.  I am also a restaurant person who understands how difficult it is to make money in this business.

At some point soon, farmers and chefs need to collectively build a business model that addresses all of these issues.  The farmer needs the restaurant and the restaurant needs the farmer.  There is a solution, but both parties need to understand the challenges and address them strategically.

Your thoughts?