Online Distribution Channels for Farmers
Are you looking for a new method to market your farm products? Recently, a group of farmers, Extension staff, and community members in Tioga County, NY joined together to evaluate more efficient methods for farmers to get products to consumers. The group is currently looking into online market models that enable producers to deliver pre-purchased products to a set pick-up location once a week. It turns out, in recent years, an overwhelming number of websites have come online for this purpose.
Two members of the group, Rebecca Heller-Steinberg, an AmeriCorps member serving at Cornell Cooperative Extension and owner of local food business Extended Harvest, and Laura Hobbs, a local farmer and web designer, offered to research the options and then present to the group. This article represents our personal opinions and not those of the group as a whole or Cornell Cooperative Extension.
Our hope is that sharing information about these models and how best to evaluate them can help you figure out which model(s) are right for you.
Why do you need a new distribution channel?
What is the problem you are trying to solve by creating a new distribution channel?
That is, what is not working for you about your current distribution channels that you want the new model to address?
Possible problems include:
- Not selling enough, need a new outlet for products
- Spending too much time on marketing, travel and distribution
- Costs are too high/profit margins are too low
- Not finding enough local customers
- People can’t make it out to or don’t have time to visit the farm
What are your criteria?
In addition to knowing what problem(s) you’re trying to solve with the new system, you may also have some specific needs or features you want available on the online market site, such as:
- Credit card processing
- Ability for each producer to upload and update their own products and availability
- Incorporate actual costs into the system to create long-term viability
Breakdown of the models
As you start to look at the online models, you’ll notice that most fall into one or more of a few major functional categories:
- CSA vehicles (such as farmigo.com or seedleaf.com) – these often have options for adding a la carte items, but are intended primarily for producers operating CSAs and other subscription-based services
- Online farmers markets (such as goodeggs.com) – these are intended for retail customers and often designed to mimic the feel of a farmers market, where customers shop separately from each individual farmer
- Online wholesale markets (such as farmersweb.com) – these are for larger sellers and buyers, including restaurants, schools, and other institutions
Important things to consider
As you begin to look at some of these models/websites and narrow down which type is right for you, there are a number of other details you’ll want to consider:
- Is it for individual producers or groups of producers?
- Is the audience local, regional or national in scope?
- Is there a start-up cost? How much?
- Does the site charge a monthly flat fee, a percentage mark-up or margin on sales, or both? What are those costs?
- If the site does not charge, how do they make money and does it seem viable long term?
- Are grants or start-up funding available?
- How many producers and/or customers are needed to make it viable?
- What are the delivery and pick-up options for customers?
- How do goods get from the farmer to the customer? If the farmer must transport them, are they able to add that cost into their pricing?
- Is there a way to incorporate consumer education?
- Does it foster connections between producers and consumers?
- Can you integrate it with your website, blog, facebook, or twitter?
For a group distribution model, there are some additional things to consider in your planning, plus what their costs might be. Does the group need a coordinator and a location for distribution and storage? Will any equipment be needed such as a scale or freezer?
Aesthetics and usability
What does the site look like? Some of the websites we looked at are very basic visually or looked a bit dated. If they have the functionality you need, this may not matter to you or your customers. But in some markets, this could turn off potential customers. Also, how easy or intuitive is it to use? It is essential to get on the site and try it out, both from the consumer and producer ends. If it isn’t easy to use, it’s not going to be practical.
Local vs. National
At first we considered having a website created for our group, though after some research we discovered so many existing websites that would fit our needs that having a site made locally was like “reinventing the wheel “ and start up would cost more than using an established website. These regional and national companies can offer lower prices since the costs of website development and upkeep are spread out over a larger number of producers.
Websites that could fit our needs
Researching a couple dozen websites yielded a few that had the right model we were looking for. The main differences between these websites were the upfront fees, the aesthetics of the website and the availability of different features. Almost all these websites took a small fee on sales but no start up fees, had webpages where products could be listed and described, processed credit cards, kept track of orders and produced invoices. We have included below some brief discussion on the websites we think could work for us and maybe you as well.
- The Local Food Marketplace (localfoodmarketplace.com) offers four different kinds of online markets for individual farmers to buying clubs. LFM will design a website to suit each person/groups needs with many different functions. There is a start-up cost to build a multi-page website but it is a really good price for all the functionality they can provide as compared to starting from scratch with a web design company.
- Local Dirt (localdirt.com) also offers services for farmers, Farmers Markets, buying clubs and wholesalers. Could set up a group of farmers to sell products online. The product list goes out as an email to customers vs. other websites that have items listed on a website. Their services are currently free except for wholesalers.
- Locally Grown (locallygrown.net) is set up as a virtual farmers market with groups of vendors. The design of the website is plain, not modern looking like other sites and the adding of logos or pictures is left up to the user. The site has been up and running for 5+ years.
- Fresh Nation (freshnation.com) is a virtual Farmers Market set up for connecting Markets to vendors to customers, social media style with customers following vendors and markets. Selling is an option for customers to pick up items at market.
- Wholeshare (wholeshare.com) is a buying club website but we are considering it since it has the option of adding farms or a farm collective as a vendor on the site as well as the other items sold through the buying club. Could be one stop shopping for customers; they could get products from local farms and other pantry and produce through the club for great prices all in the same delivery.
- Honorable mentions: goodeggs.com, farmfresh.org/hub/, greenling.com. These all had good websites but were only covering a small region.
How to choose the right model for you
As you consider different distribution models, we recommend going through our list of questions and considerations. Then, generate your own list and use these criteria to compare models to each other and to your needs. Be sure to visit any website you are seriously considering and really try it out. Ask Vendors using the site already how well it works for them.
We wish you the best of luck finding a model that works for you!