Innovation & Technology Innovation & Technology

E-Commerce Platforms Powering the Local Food Movement

The local food movement has thrived in recent years, bolstered by consumers’ growing concerns over what is in their food and where it came from – and startups are jumping at the opportunities it presents. From California to New York, a host of apps and business models are connecting growers, buyers, sellers and eaters. At the same time, many small farmers are still struggling.

By Hannah Furlong | Published 8 years ago | About a 5 minute read

“Current U.S. farmers markets and Community Supported Agriculture shares (CSAs) are barely sustaining for small farmers — they’re suffering,” Dave Ranallo, founder of Azoti, told PSFK.

E-commerce platforms such as Azoti and Local Line are digging deeper to help the local food movement better support the farmers at its core.

Azoti hopes to streamline how large food buyers interact and purchase produce from small farmers. In food and hospitality, most businesses currently order food from contracted distributors who buy from local large farms due to extra challenges associated with buying from small growers, such as managing safety certifications and supply forecasting. Azoti circumvents these challenges by enabling buyers to order everything they need for a delivery as a whole, and small farmers are able to fill the order as needed. The buyers can also set forecasts during the offseason for as little as five percent of their order value, offering predictability for both the buyer and the farmers. Regional food hubs or contracted distributors handle the deliveries.

“With our platform, there will be less need for them to rely on CSAs or selling at farmers’ markets—we can help them scale predictably,” Ranallo explained.

Azoti is currently operating in Ohio and has partnerships with two of the state’s two largest food distributors. In addition to selling to restaurants, schools and institutions, the Columbus-based startup also works with companies to offer pre-paid ‘workplace farmers markets,’ a turnkey program for human resources and wellness teams. The program allows the employer to host markets where their employees benefit from discounted rates on high quality local food.

Meanwhile, the growing consumer demand for transparency has driven some of the largest food companies to make changes. For example, Campbell Soup, General Mills, Kellogg, ConAgra, and Mars have all committed to labelling genetically modified (GM) ingredients nationwide. Other companies have gone even further. Dannon, for one, recently announced it would not only label GM ingredients, but is also restructuring its supply system to work more closely with dairy farmers.

Local Line is where these trends – the local food movement and increased supply chain transparency – converge. Local Line’s platform allows buyers and sellers to build relationships directly, and includes a host of features for managing operations. Restaurants, caterers and institutions are able to tell their patrons exactly where their food ingredients came from, while farmers, butchers, bakers, vineyards and brewers are able to establish strong ties with their customers.

The Local Line platform not only facilitates these relationships, but serves as a springboard for them. In a phone call with Sustainable Brands, Local Line Founder Cole Jones recounted the story of a farmer who felt that Local Line served as “an automatic warm introduction to whoever he was reaching out to.” As a supplier on the platform, the farmer had access to “the contact information of over 100 purchasers in his own community that he could go and talk to and build relationships with,” Jones explained.

“No matter who he was reaching out to on the Local Line platform, they both had something in common, which was Local Line. And all of the purchasers on Local Line are pre-qualified to care about great local, sustainable food,” Jones said. “And that was so important, because this wasn’t just 100 random leads on an Excel spreadsheet, this was 100 perfectly curated leads for his business.”

Suppliers can also view information on the demand for their products for an area over time. For example, a farmer can track his pork sales in in a given city over any period of time to see how his sales are performing, and then receive actionable insights to improve those sales with the right customers. On the other side, buyers are able to browse the farmers selling in their city, see all the products available and their prices. Suppliers manage the deliveries, and make their delivery area(s) and schedule(s) available on Local Line for buyers to see. The platform facilitates the sourcing process and handles the orders, invoices, and reports.

Local Line is also equipped with a messaging system that suppliers and purchasers can use to communicate with each other, or within their own teams. The value of this feature became apparent when Jones and his team worked with a chef that was expanding his business to include 3 locations, each in a different city.

“It’s difficult for these kitchens to run according to plan without the executive chef on-site. We can put all of the kitchen staff on one account for for the restaurant and significantly improve their internal communications around ordering and invoicing,” Jones explained. “That was huge for [our client]. It was important for him to have a platform that allows him to not sacrifice quality, not sacrifice the sustainability of the food, but at the same time, see what the prices are in real time and make those products work for the multiple kitchens he's managing.”

“We ended up saving him 150 hours per year, per location – of time that he’d be spending on ordering, invoicing, generating reports for the business so that he knows where the numbers are,” Jones continued. “Chefs are being paid to make great food, we want to make sure they can do that.”

Next, the Local Line team has their sights set on food hubs. In early June, they plan to launch a new product catering to the unique needs of hubs, which both buy and sell food.

Local Line currently operates in California and Michigan in the U.S., as well as in British Columbia, Alberta, and its home province of Ontario, in Canada.