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Ever wondered what it takes to build a fresh produce supply chain that customers really care about? It’s time to put sustainability in the context of today’s competitive environment.
Most fresh produce suppliers see sustainable sourcing as an unnecessary cost center that complicates their business model. But the fact is sustainable sourcing is the greatest opportunity in the fresh produce industry right now.
80% of consumers are willing to pay more for sustainably produced food and beverages. On average, that’s 9.7% more per item. That is money left on the table.
Why Sustainable Sourcing Actually Matters Today
Sustainable sourcing isn’t a feel-good concept designed to keep your grandpa happy. It’s a direct route to improving your business today.
The fresh produce supply chain is under attack like never before. Climate change is destroying traditional growing areas. Labor costs are increasing exponentially. Customers are more demanding than ever before.
Smart fruit wholesalers and fresh produce suppliers that have sustainable sourcing strategies in place are crushing their competition and taking market share.
Why? Sustainable sourcing opens up a flood of revenue channels. You get premium prices from eco-conscious customers. You reduce waste and streamline costs. You build long term partnerships with growers that actually want to work with you.
Nearly half of all consumers (48%) are willing to pay a 10% premium for sustainably produced fresh produce. This is not a niche customer base, this is a billion dollar revenue opportunity.
The Real Cost of Ignoring Sustainability
Let’s talk about what happens when you don’t embrace sustainable sourcing…
Your competition steals your market share. Premium customers shop elsewhere. And worst of all – you are 100% reliant on a supply chain you have no control over and which is completely broken.
Here’s the secret that nobody wants to talk about:
Traditional fresh produce sourcing models are getting more expensive and less reliable by the year. Weather patterns change. Water shortages become more common. Growers can’t produce consistent quality with outdated methods.
Sustainable sourcing is stability. When you work with growers that use regenerative practices and water management techniques, you get more consistent quality and better long term partnerships.
It’s not just about being green. It’s about being smart as well.
5 Proven Strategies That Work Right Now
Are you ready to turn your sourcing strategy around? Here are the exact same methods that the best fresh produce suppliers use to build sustainable businesses…
Build Direct Relationships With Regenerative Growers
Stop relying on brokers that don’t care about your long term success.
The best sustainable sourcing strategy involves building direct relationships with regenerative farmers. These are growers that are dedicated to the health of the soil, water conservation and biodiversity. This means better quality produce and less environmental impact.
Here’s how to find them: look for farmers in your local area that are certified organic or part of a regenerative agriculture program. Contact them directly and offer long term contracts with fair pricing.
You will receive better quality. You will have a more consistent supply. And you will have the sustainability credentials your customers want.
Implement Seasonal Sourcing Programs
Want to lower costs while also improving sustainability? Think seasonal. Seasonal sourcing takes advantage of natural growing cycles. This means you lower transportation costs, improve the quality of the products you buy and have access to peak season pricing.
The strategy is simple: identify when the main items in your catalog are in peak season in different regions. Build your procurement calendar around these seasons and let your customers know when these products are at their best.
Customers who are in the know understand that seasonal produce just tastes better and costs less.
Focus On Local and Regional Networks
Something that many suppliers get completely wrong is… They assume sustainable sourcing is about finding the lowest priced global options. But local and regional produce often has better margins and sustainability credentials.
Local produce has lower transportation costs and emissions. It is fresher and has a longer shelf life. It appeals to customers that are dedicated to supporting the local economy.
Start by identifying growers within 500 miles of your distribution centers. Build relationships with these producers and sell their products as local premium offerings.
Local and regional growers offer competitive pricing if you take transportation costs into account.
Develop Waste Reduction Programs
Food waste is the enemy of sustainable sourcing. Every pound of fresh produce that is thrown away is revenue you never got and is doing damage to the environment. Smart suppliers implement waste reduction programs that turn waste into revenue.
Negotiate with farmers to take “ugly” produce at a discount. Build relationships with food processors that will utilize less than perfect items. Develop value added products from excess stock.
Invest in Supply Chain Transparency
Customers need to know where their food is coming from. Supply chain transparency is no longer a luxury, it is a competitive differentiator. Only 20% of Americans understand sustainability terms, but all of them want to trust their food supplier. Document all of your sourcing methods with photos and stories from your partner farms. Track and report key sustainability metrics, such as water used and carbon footprint. When you provide the proof that shows customers where their produce comes from they are willing to pay a premium.
How To Implement Without Breaking Your Budget
You don’t need to overhaul your entire business overnight. The most intelligent approach is to slowly and methodically implement sustainable sourcing strategies and measure the results. Pick one product line or one supplier relationship. Try sustainable sourcing with a small segment of your business and measure the effect on quality, cost and customer satisfaction. Once you can see the value in real terms you can expand the strategy to other parts of your business.
Sustainable sourcing pays for itself in the long term through cost savings in improved efficiency, less waste and better supplier relationships.
Making Sustainability Your Competitive Advantage
Sustainability and sustainable sourcing are not fads that will pass. Consumer demand for more environmentally responsible products is growing year on year. 72% of consumers now make food purchases based on how a product was produced and this percentage is increasing.
Fresh produce suppliers that embrace sustainability and sustainable sourcing today are going to be the market leaders of tomorrow. They will have access to premium customers, stable supplier relationships and efficiencies that their competition cannot match.
The real question is whether you can afford to sit back and watch your competition build the advantages that sustainable sourcing will give them.
Getting Started Today
Sustainable sourcing of fresh produce comes down to three key principles:
- Building direct relationships with quality growers that have the same values as you do. Implementing systems that are sustainable by design to reduce waste and improve efficiency. Transparency to provide the customer proof that your food is sourced in a sustainable way.
- Start small with one strategy. Pick the strategy that works for your business and execute it well. Once you have demonstrated results you can expand into additional strategies.
- Suppliers that adapt to the customer demand for sustainability will be the long term winners.