You already know that locally grown food is fresher, and tastes better because it spends less time in transit and storage. You already understand that mounting scientific evidence and good old common sense both tell us that, on average, the carbon footprint of local food is smaller than its imported counterpart. But did you know that buying local can turn $100 into $500?
When you make the decision to put more of your grocery budget toward local products you’re building a stronger local economy. Your purchase has economic benefits that extend far beyond the farmer or market owner to whom you hand your money. The power of local spending is best described through The Multiplier Effect. The premise itself is simple: The more money we spend on locally produced goods, the more money gets circulated locally—and spent again—to strengthen the economy.
For us, here on the edge of the Salish Sea, a good example is Hardbite potato chips. Owner Sepp Amsler understands the power of local dollars—he buys 400 tonnes of potatoes and other ingredients from three Fraser Valley potato farms and two suppliers. The farmers buy seed potatoes from Pemberton, and most of the company’s processing equipment is custom-made and maintained locally. “All of these enterprises employ hundreds of employees supporting their families, cultivating the soil, planting, weeding, harvesting, sorting and grading,” says Amsler. He goes on to express how the economic spin-off goes deeper. “Let’s not forget the pest control guy and all those civil servants we keep busy collecting our taxes, PST, GST and permits.” All those employees receive paycheques that are directly linked to the Hardbite business.
The obvious competitor for Hardbites is Kettle Chips. This darling of the “natural food” sector was recently bought by UK-based Lion Capital, a private equity firm that owns companies as diverse as La Senza, Weetabix, and something called the Russian Alcohol Group. Hmmm. I may be wrong, but I don’t imagine that the owners of Kettle Chips give much thought to the families of their suppliers, or the economic benefit that their product provides to anyone but themselves.
When I walk into my neighbourhood grocery store and I choose between Kettle Chips and Hardbite, here’s how that decision breaks down economically. Let’s agree on a price of $2.50 a bag. (I’ve seen both brands for less and for more.) If I choose Hardbite, my $2.50 supports a local retailer, a processor in Maple Ridge, a farmer or two in the Fraser Valley, and all the people who rely on these businesses for jobs. The multiplier effect dictates that my $2.50 will generate $12.50 of economic activity by the time it cycles through the local economy. Now, if I decide to buy Kettle Chips from the same retailer, my $2.50 will still roll around in the local economy, but only to the tune of $3.12. That is 75% less return in our collective pockets. The economic benefits of buying Kettle Chips slides quietly into the pockets of private investors in the UK.
One of Amsler’s suppliers in the Fraser Valley is BC Fresh, a company started 17 years ago to bring the fresh harvest of the Fraser Valley to the dinner tables of the region. “Your best dollars are always close to home,” says company President Murray Driediger. BC Fresh generates in excess of $40 million in annual sales into the local market, and it’s clear that Driediger understands that the benefits of his marketing efforts go beyond his own pocket book. Looking at the entire supply chain, BC Fresh “helps support over 6,000 families throughout the province who earn their livelihood on farms or in the agri-business community.”
Okay, so it’s obvious that buying from local companies benefits those companies directly, but what about the greater good? Let’s look at what would happen if we all decided to spend a little more of our dollars on food that we know is locally made and processed. A report out of Maine states that if residents of that state shifted just 1% of their expenditures to “direct purchases of local food”, it would increase the local farmers’ income by 5%. So, what if in BC we all shifted a measly 1% of our food purchases to local products? Fraser Valley farmers would see a total annual income increase of almost $37 million (using 2001 farm receipt figures), and that translates to more cash that flows to local carpenters, piano teachers and fishermen.
Historical evidence supports this thinking. Way back in the 1940s Walter Goldschmidt, a young social anthropologist, compared two farming towns in a USDA-funded study. The towns were of equal size and both were located in central California. The biggest difference between the two was that one was surrounded by smaller scale family farms that sold their harvest into the local market, and the other was surrounded by corporate large scale farms that were growing for markets outside of the immediate area. In a 1993 speech about the study Goldschmidt stated that, “The study showed unequivocally that the town surrounded by the small farms was far superior by every measure that I could devise.” The small farm community had double the organizations dedicated to civic improvement, and over 50% of the residents owned their own businesses, in comparison to 20% for the large-scale farm community. Not surprisingly, publication of the study was suppressed by big agriculture interests with connections to the government.
Using the above examples, what we’re left with is a win-win situation when farmers grow food for the local market and consumers support those farmers by buying their product. We’re constantly hammered with the message that consumers have the power to dictate what is available in the market place, and nowhere is this more evident, or more powerful, than with our food choices. Despite recent hiccups in the global economic system, money still is the bottom line. As Driediger from BC Fresh says, “The consumer dictates what goes on the shelf.” Spend your food dollars wisely.
Editor’s Note: Math geeks have determined that if 80% of what we spend is recycled in the local economy it generates five times the amount of economic activity—that’s how your $100 turns in to $500. We could explain the formula, but that would just give us both a headache.
Jeff Nield, based in Vancouver, works with FarmFolk/CityFolk to cultivate a local, sustainable food system where the money grows. www.farmfolkcityfolk.ca
