Why Amazon’s Whole Foods Acquisition Will Revitalize Rural America

Friday, July 16 sent seismic shock waves through the grocery industry, as well as any other company on its peripheral. Grocery stocks plummeted and Wal-Mart heirs lost over billions. Friday, July 16 was the day Amazon announced it was buying Whole Foods, regulatory hurdles notwithstanding. Arguably the world’s most intimidating company has just gotten a whole (pardon the pun) lot scarier.

Amazon and its “anything you want you can get delivered to your door – with free shipping” is now about to add 450+ brick and mortar stores in prime (again pardon the pun) locations to its arsenal. The pontifications by pundits have spanned the gamut of views from outright alarm to guarded optimism of the opportunities that may arise.

Whole Foods organic

The Fallacy of Amazon as the Bad Guy

The chicken littles of the world will prophesize that Amazon will destroy what’s left of America’s Main Street small businesses – using the book industry as an example. What they won’t say is that since Amazon has entered the market, independent book stores have actually done better – the main causality of the Amazon’s online surge being chain stores like Barnes and Noble, and the dead and buried Borders. These two corporate piranhas were on a Sherman’s March to the Sea destruction plan of the industry before Amazon blew up their plans. We can never go back to the days of fifty years ago when independents were the only players in the game. But people will always go to physical bookstores – just not in the same numbers. Clearing out the homogenized corporate boxes like Borders help ensure those numbers flow to independents.

When we talk about small businesses it’s easy to myopically look only at retailers and resellers. What about the entrepreneurs that create the products sold in those stores? What about the writers that supply the bookstores? Under the corporate chain model, independent writers and other small batch producers have no chance of getting their work any shelf space. With Amazon – you, I or anyone else can write a book and sell it worldwide through their ubiquitous online distribution channel. Even with independent book stores we can’t do that; locally probably yes … nationally or worldwide, no. It’s easy to pick and choose the facts to back up our preconceptions and worldviews – but seldom are things so cut and dry. Whether they produce the product or sell it on the street corner or Main Street – entrepreneurs both produce and sell, and we must support the entire independent channel … even if not all parts of the channel are independent.

Self-Efficacy

Over the past two or three months I’ve been on a crusade of self-efficacy. The return of my lymphoma has put me in a “what I do matters to my very existence on this planet” mentality. While I have faith in the conventional chemotherapy treatment that has been prescribed to me (more or less) – I feel it’s my own efforts; whether it be nutrition, exercise and especially attitude, are going to be what makes or breaks the state of the journey down the road to my Perfect World.

In America the healthcare industry spends very little time, energy and resources working with patients to raise their level of self-efficacy. Even with overwhelming proof – discussions of diet, exercise and attitude are seldom raised, let alone made a priority. I don’t know if this is intentional, or just lack of training. It’s hard to believe it could be the latter since even the mainstream media has been covering the research ad nauseam. Whatever the reason – too many of us put way too much faith in “the man on the white horse and man in the white hat” and their ability to fix all that ails us (literally and figuratively).

Amazon and Whole Foods

This brings me to Amazon’s acquisition of Whole Foods. In American culture, Whole Foods is emblematic of healthy food – often overpriced health food … but healthy nonetheless. A trip through the isles of Whole Foods is not one populated by the brands normally seen at a Kroger’s, Albertson’s or other grocery chain. The shelves are filled with foods from providers and farms (all organic) that you wouldn’t otherwise find. Many of them sourced locally. Unfortunately Whole Foods is located in primarily in upscale areas, relegating those who often could benefit from healthier food choices less-than-optimum options

With Whole Foods, the hope is that through their ubiquitous distribution network; Amazon will not only find another piece to their puzzle of being the “everything store” – they’ll make the Whole Foods catalogue available to a wider less-affluent demographic. How this hope plays out, we can only wait and see. America is firmly rooted in an epidemic of obesity and bad food choices. Moving the dial away from the inevitably of chronic health conditions that result from these choices could go a long ways toward creating a society focused on well-being; rather than just the after-the-fact fixes that has immersed our country in the healthcare crisis we’re currently warring over. And that’s just the demand side of the Amazon/Whole Foods equation. The supply side offers up another set of possible variables and effects.

Current State of Affairs in Farming

For several years now I’ve lamented about the farming situation where I live in southern Montana. The climate is moderate and the land is irrigated. Most any type of food can be grown here – yet the only things that are; are sugar beets, feed corn and barley contracted by multi-national beer conglomerates. Ironically our farming community doesn’t grow food. It produces components for manufacturing processes –  beer, processed sugar, cattle or ethanol for our car’s gas tanks. The produce I buy at the grocery store is trucked in from hundreds if not thousands of miles away. The only local food I have access to in this farming community comes from the garden in my backyard.

What this type crop selection has done (along with other factors) is decimate the population of farm-supported small towns. Fewer people are needed to produce small-margin crops like corn. Automation and standardization has replaced craft labor and unique crops options – often those seen on the shelves at Whole Foods. We bemoan the decline of rural of America, often affixing blame on liberals living in the coastal urban areas – when short-sided business decisions by rural areas may very well be main causes. We’ve turned our food supply over to multi-national conglomerates on Wall Street and abandoned local businesses in favor of box stores; and the farms and small towns traditionally supported by food production are the ones suffering most from it.

This does not bode well for upcoming generations wanting to farm either. Small rural towns have made themselves unappealing socially and economically to the very talent they need to sustain themselves. Instead of nurturing young farmers and their fledging families, they sell out to factory farms furthering the cycle of rural exodus. Multiple generations need to evolve together, leveraging the traditions of the past while being willing to reshape them for the needs and wants of today’s generations. Simply expecting young people to fit into the world of their parents not only isn’t fair – it’s not practical as they’ll just abandon it, leaving the old world to simple fade away.

Amazon and the Opportunity for Small Towns

We can look at the Amazon acquisition of Whole Foods as bad for small towns and their local businesses, as many naysayers have. We can ready ourselves to play the blame game – even before-the-fact. Or we can look deeper, past the surface of a ninety second news segment or 400 word blog piece.

I see the acquisition as potentially empowering local producers with a new distribution channel they wouldn’t otherwise have. No matter how the media tries to compare and pit Amazon against Wal-Mart – they are nothing alike. First and foremost, Amazon is a distribution network of hundreds of thousands of suppliers – the vast majority of them small businesses. I see no reason this wouldn’t extrapolate to farms and the small-batch food industries. Rather than large corporate farms producing pesticide-ridden components for a manufacturing process – what if small plot farmers focused on producing food that can be processed and sold locally or through the Amazon/Whole Foods platform. My expectations are that Amazon, gravitating from the Whole Foods brick and mortar network of stores (present and future), will spur the increased demand needed to tip farmers to refocus their efforts towards growing actual food.

Organic farming

But we shouldn’t assume that this extrapolation of healthy food is automatically going to happen just because of Amazon has entered the market. It’ll be up to farmers and small local producers to take advantage this opportunity. It’ll be up to farmers in areas like where I live in Montana to decide to break from sugar beets and feed corn and venture into the unknown land of organic small-batch farming. This transition will be as much cultural as it is economic or logistic. Most farmers are not only economically conservative – they’re politically conservative. Irrationally so, organic food is too often tied coastal liberals and all they represent. For example, kale (my garden’s most abundant crop) embodies all that’s wrong with America to many people in the small town I live in. 

Demand dictates supply, but let us not forget supply also dictates demand. If the product isn’t there; no business, Amazon and Whole Foods included, will make efforts to market and sell it. I want to believe farming groups in locales such as mine can literally create demand for their product by simply making supply more readily available. And by coordinating efforts, they can make their voices heard and their product more competitively available. Imagine local coops acting as a logistical go-between and marketing arm for farmers and small-batch producers. And taking it one step further – these coops can unite creating an even more powerful presence.

Wal-Mart, Costco and the other box stores don’t source locally. Amazon, having the technical backend to do so combined with the Whole Foods small-batch organic focus – most likely will. Farmers will have to break free from their comfort zone and become creative in their crop selection. They will need to maximize local resources (geographic and economic) by identifying the assets of the area and leveraging them rather than just doing the same thing they did last year … worse yet a decade ago.

Building a Sustainable Community Around Healthy Food

Wherever possible rural areas must nurture an environment of craft and small business by taking advantage of local organic food production. With this should be a rebuilding of Main Street – not only as a center of economic activity – but one of civic engagement: all revolving around collective community well-being originating from the production and consumption of healthy food. I envision a societal momentum moving to a healthier, organically based food supply – and an emphasis on health, self-efficacy and well-being. Food (selection, production and distribution) should be the catalyst in all community health efforts. Without it the effort has little chance of sticking, let alone being built on.

None of this is going to happen on its own though. It’s going to take creative thinking, breaking free of “what is normally done.” Ironically it will be a return to our grandparents’ and great-grandparents’ time when farmers grew food for their table and that of their neighbors. Only we’ll be able to utilize the production and distribution technology and processes of today. This cross-generational synthesis will anchor the revitalization of rural America. Growing corn for ethanol and relying on Wal-Mart for our (sourced from god only knows where) is what has put rural America in the dire straits its in now. Now is time to break the cycle of the destruction of our well-being.

Whether the catalyst to a movement of collective well-being turns out to be June 16, 2017 – the day Amazon announced they would purchase Whole Foods, only time will tell. Regardless what’s not to say it can’t act like it is? What’s not saying we can’t our societal norm one of collaborative self-efficacy where our neighbors and our neighborhoods are center to the solution, rather than just afterthoughts at best.

Remember; “The man in the white hat, the man on the white horse” …

They still aren’t coming.

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‘Farm-to-School-to-Market’ … Cross-Generational Entrepreneurial Synthesis

A couple of days ago I was having a Twitter discussion with Sandra, from Nebraska. Sandra is hard-core in the ‘farm-to-school’ movement. Actually it really shouldn’t even be called a movement since it’s just common sense. She posted an article from NPR discussing the fact that revenue from farmers markets nationwide have more or less peaked and in some locals even declined. There are areas that are still seeing increases, but overall the trend is not what you’d expect considering all the publicity of the last few years.

The article detailed several of possible causes. According to Sarah Low, a USDA economist and lead author on the report; “Farmers are increasingly using middlemen to sell to restaurants, grocery stores and distributors. With an increasing share of their produce, dairy or meat going to those channels, some farmers may choose to forgo the farmers market.” Simply put, the farmers market phenomenon may just be ‘growing up.’

However there was one quote that caught my attention.

“It’s just not as cost-effective for producers to be face-to-face with consumers,” Low says. “A lot of farmers like to spend their time farming, not necessarily marketing food.”

IMG_445732030

Thinking about it, this makes sense. And taking it one step further – what if this reason is a major factor why there’s not more locally grown food available overall. This especially hits home with me. I live in a farming community outside of Billings, Montana. The farmers around here grow either corn or sugar beets if their land is irrigated, or barley and wheat if it’s not. And that’s it. Aside from an occasional ‘corn-on-the-cob,’ nothing grown in the fields here make it to my table.

I have a small garden and grow herbs, kale, tomatoes, carrots, etc. And they all grow very well. Yet our local farmers don’t grow any of this, and most don’t people in my town don’t even know what kale is. I know since I give away a lot of it. Their crops are put in big trucks and driven to processing plants owned by multinational corporations headquartered in lands far removed from this little farming town.

But what if the farmers had another option, an option where they didn’t have to spend their time marketing to and groveling in front of those picky consumers looking for ingredients for their next caesar salad or Chicken Florentine (just kidding).

Now on a different subject, but not really, as I’ll come back to this in a minute: My town has a big generational gap. I’m not saying this divide is intentional, but rather I just don’t think there’s much contact between the teenagers and the retirees (or even just adults). And I guessing this might be the case in a lot a small towns and even big cities in America. We’ve always seen age divides, but with the advent of the diversion of personal technology, these chasms may be getting even wider. There seems little opportunity for common ground.

Schools are part of your community – and your community should be part of its schools

I believe a lot of this is the fault of schools. After all, aren’t schools responsible for developing the young talent that supposedly is the future for the community it serves? Yet how much connection is there actually made with its community? And yes schools are supposed to serve the community. The residents pay property tax to fund the schools. But schools are often viewed as the castle on the hill … including the moat. I’m not going so far to say there are crocodiles in the water under the drawbridge, but what hell. In some schools there might as well be. For example, in my little town, even my father, a high school teacher with 25+ years experience, is uncomfortable even going in the building. Here’s someone with a wealth of knowledge at their disposal he’s willing to share … and nothing. Yet they have no problem sticking their hands out asking for money for renovations to update a school that should be closed and consolidated with those of the neighboring towns.

But what if we could change this, especially in rural and farming communities. We have the perfect vehicle for it too … the farm.

Now, let’s get back to my previous point about farmers wanting to farm and not be marketers. After Sandra initially posted the NPR article I mentioned above, I tweeted back:

What about a middleman between farmer and a  handling marketing, packaging, distribution, etc.

And her response was:

One local farmer I know hires students from a nearby school to come out to help him get ready each season. Great experience.

And there was the synthesis that sparked the fire that created this piece and my Farm-to-School-to-Market’ concept.

What if rural high schools and middle schools created programs where students could be the marketers for local farmers producing farmers market ready crops. Not only could the kids market the crops, they could handle the whole post-harvest process as fledging entrepreneurs. Heck they could even help with the harvest if need be. And why stop there, they could even work out co-op deals with the farmers helping grow the crops in the first place. And who says the Farmers Market has to be their only outlet for sales? The students could negotiate deals with local independent grocers and restaurants for additional revenue streams for their products.

Kale 2 crop posterize

I’m sure virtually all rural schools have Vo-Ag programs in their curriculum, but what I’m outlining here isn’t just a farm project. It’s a hands-on exercise in entrepreneurialism and business development. Imagine each school having several groups of students, each potentially spanning different grade levels – creating mini-produce companies. The students in each group would be responsible for all aspects of their micro business, possibly even working with the farmer for crop selection down to the branding and packaging of their product. They would also determine where they would sell them; retail through farmers markets, door-to-door in town, or contract out for wholesale (stores and restaurants). And who knows, maybe some enterprising group could create packaged products from their raw crops – like kale chips. Their options are limited only by their imaginations.

Each group would structure their company how they wanted and allocate duties and decision-making accordingly. Some members of the group may want to take on more responsibility and then be compensated accordingly. I want to note that ‘Farm-to-School-to-Market’ is not meant to be a school fundraiser. It’s the kids who are putting in the work, so they should be the ones who are rewarded financially. The school benefits by the fact that here’s a ready-made curriculum piece dropped in their lap that actually provides real-world benefit, unlike most activity associated with the dreaded standardized tests, so much in vogue.

Many aspects of ‘Farm-to-School-to-Market’ could be integrated directly into regular class activity, either as part of traditional instruction or as independent projects. Each student group would also have to keep an account of their experience with their company, probably through an online blog. Their ideas, tips and suggestions would also be included and shared as other ‘Farm-to-School-to-Market’ groups spread geographically and became commonplace in the rural eduction curriculum.

Students who attend schools with farm-to-school programs are 28% more likely to choose healthy food options. This is especially important given the recent findings showing that once a person becomes obese they will most likely fight obesity all their life, regardless of whether healthy eating and exercise routines are adopted. Anything that can be done at early ages to promote healthy eating, must be done. And imagine if these healthy eating habits were taken home as homework to benefit the whole family. But these farm-to-school programs can’t happen with just desire. They need a supply of healthy food. And that means local farmers raising it … the core tenet of ‘Farm-to-School-to-Market.’ 

Be part of making your community’s school a real world experience

America’s public schools are often accused of creating test-ridden robots of their students. Here’s a way to counter that accusation, and at the same time help bridge a generational divide all too prevalent in rural America. Combine this with helping seed and nurture a much-needed ‘farm-to-school’ movement … you have trifecta of benefits.

Rural America needs outlets for its young people. The best and brightest of these communities will go where they can express themselves creativity, artistically or through business endeavours. Whether they flex these creative muscles in the towns they grew up in is up to their communities and the metaphorical canvases they provide. Their home towns have the advantage. Retaining talent is a lot easier than attracting new. But make no mistake, having young talent is not an option for a community to flourish. It is mandatory.

Literally and figuratively … it’s on your plate. Now it’s up to you. Wake up your schools! After all … they are your schools.

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I can be reached on Twitter at @clayforsberg or on Google+. And also please follow Sandra at @_prairiespirit. If it wasn’t for her … you wouldn’t be reading this.

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