|IMPORTANT LEGAL NOTICE: The information on this site is subject to a disclaimer and a copyright notice.|
Marketing local products:
“Short” or “long” distribution channels?
What a long way we have come in such a short time! Looking back we can see the scale of the revolution that has taken place in only 20 years.
In 1980, local agribusiness products, whether “farmhouse made” or “made by traditional methods”, were at the fringes of the mainstream food sector. In terms of production, local product development and farmhouse processing were chiefly concentrated in mountain areas, where people in the agricultural sector were required to counterbalance their natural handicaps by taking a “quality added value” approach, a typical example of which was farmhouse cheese .
By the late eighties, although promoting local products was considered to be a natural asset for Europe’s disadvantaged regions, any talk of collective approaches and business professionalism was seen as totally futuristic at the time. In those days, the key commercial concept was local direct selling.
Over recent years, the pace of change has accelerated as a result of rising demand coupled with rapid agricultural developments. Consumers have shown their increasing relish for products associated with a specific local region that are of distinctive quality, healthy and not only tasty, but also a source of pleasure and a little fantasy.
This stems from the urge of urban consumers to compensate for the stresses of modern living, the increasing uniformity of lifestyles and consumer patterns and environmental problems. A string of incidents, associated in particular with the uncontrolled use of animal feedstuffs, has served to accelerate and heighten the self- preservation instincts of consumers, who more than ever are demanding assurances as to the origin and traceability of the food they eat.
At the same time, changes in agriculture have intensified:
So, in spite of the inertia exerted by ingrained habits, voices are starting to be heard loudly and clearly proclaiming that, although Europe’s rural areas have structural handicaps when it comes to ordinary goods (which can always be produced cheaper elsewhere), they have at their disposal a whole range of traditional resources waiting to be exploited, for which a ready market exists.
This aptly highlights the value of the triangle of territorial identity / breed or local variety / human input and know-how. In other words, now there is a growing awareness of the resources available in rural areas, animal breeds and plant varieties on the verge of extinction are being regenerated and these resources are being exploited to improve the quality of life.
An analysis of a number of cases has produced the following figures. In France, for example:
Exploiting local potential (sometimes known as “valorisation”) is an approach that was derided and considered marginal until only a short while ago. Now it is on the way to becoming a strategic goal for large sections of many European regions.
The goal of exploiting available resources does of course mean resolving numerous problems and means that farmers will need to learn new skills, such as processing techniques, compliance with EEC plant health standards, marketing and management skills, and so forth.
However, this is no longer enough on its own because, although up until now it has been possible to make do with small-scale individual solutions for supplying a niche market, things are now changing. Many of the numerous surveys carried out into the consumption of farmhouse and local products, as well as into potential consumer demand for organic products, point to a possible market share of 30%. The diversified range of products involved is therefore no longer aimed at a market niche, but at a market segment (itself segmented) that is now highly coveted by manufacturers and distributors alike because of its potential for growth and added value.
In economic organisation terms it is therefore easy to see that the issue can no longer be approached in the same way as in the past. It has become more important than ever to create structure and professionnalism.
This is all the more necessary since the distribution scene has changed radically in just a few years. Mass retailing has escalated dramatically and in some countries mass retailers have swallowed up between 60% and 80% of the food distribution sector. Mass retailers have become highly concentrated and have centralised their buying. They impose their own laws because they are in a position of dominance over the large and small suppliers who have come to depend on them.
To counteract such centralised buying, the solution is to group supply, standardise quality and professionalise services, which are all elements that are changing recent habits.
This does not preclude direct selling or “short” distribution channels, which satisfy the desire of urban consumers to know exactly who the producers are. That is why there is greater potential today for direct farm sales, “farmers’ markets” and collective points of sale for farmhouse products.
So, what should it be, “short” or
The answer, of course, is both.
Both distribution channels are necessary and complementary and they provide solutions to a wide range of situations, suited to the type of product (fresh products versus preserved or dried products, for example) and to the type of geographic region. In the typical case of farmhouse cheese, two examples aptly illustrate this:
Attempting to lay down doctrine would be to over-simplify the issue. The diverse solutions available to cater for the many different scenarios encountered are a valuable, not to say necessary, asset. This is why nowadays it is necessary to develop and professionalise not only short distribution channels for local products - on an updated, modernised basis - but also long distribution channels - supplied by collective structures that have achieved the necessary threshold of viability.
The objective of this dossier is therefore to:
 Daniel Pujol, “The collective organisation