DIRECT SALES CHANNELS Ch. – A. Descombes – Marta Arce – Ernest Vall s

1. R BIOTACC DIRECT SALES CHANNELS Ch. – A. Descombes – Marta Arce– Ernest Valls

2. Direct Sales Channels (DSCs) • Introduction: Direct saleschannels and local markets • Definitions • Are DSCs an alternative solution? • Identifying DSCs • Bibliographic review • Criteria • Typology proposition for DSCs • Descriptions

3. 1 Introduction

4. Introduction Definitions • Direct sales channels: • Not just a physical distance • …but the number of middlemen: at least one intermediary • No middleman Direct sales

5. Introduction Definitions • Intermediaries: • Shops • Distributors • Cooperatives open to the public... • Not considered as intermediaries: • Transport companies • Associations which regroup orders: producers, processors, consumers • Catering collectivities: restaurants, canteens…

6. IntroductionAre DSCs an alternative solution? • New alliances? • Between production and consumption • Between the urban and the rural world • The importance of DSCs in organic farming: • A review of the productive agricultural model? • A return to local and seasonal consumption? • A strategy for food sovereignty?

7. IntroductionAre DSCs an alternative solution? • DSCs do not always signify proximity • They can be through local markets … • … but also exist on a nationwide scale • Local markets and DSCs do not always imply small scale • In reality, a large company can optimise distribution logistics • Local markets and DSCs do not necessarily imply an equitable society and sustainable development

8. 2 Identifying DSCs

9. Identifying DSCsBibliographic Review • Scientific documentation • Articles • Project reports • Books • Direct sources • Associations • Administrative bodies • Activists in the domain

10. Identifying DSCsBibliographic review • Faced with an ecologically aggressive and globalised agri-industrial system … • …alternative food production networks which: • Redefine values in a sense which is opposed to those of the system • Re-establish trust between producers and consumers • Articulate new associative structures aimed at resilience and sustainability.

11. Identifying DSCsBibliographic review • Organic farming is a productive alternative to the agri-industrial system … • … but in many cases it does not build in alternatives to the whole process aspects: • Economic • Social • Environmental Product ecology = Process ecology

12. Identifying DSCsBibliographic Review • Two types of alternative food production networks • Weak  aimed at products: • Environmental protection • Quality of food products • Strong  aimed at the production process: • Working conditions • Animal welfare • Rural community life styles • The scale of farming outlets

13. Identifying DSCsBibliographic review In conclusion, DSCs • Offer the possibility of greater control over the expressed criteria • Provide a starting point for more equitable and sustainable farming and food production models – through: • Education • Training

14. Identifying DSCs Analytical criteria • Proximity • Relationships • Information • Participation • Equitable, sustainable economies • Sustainable social inclusion • Environmental sustainability • Diversity/variety

15. Identifying DSCsBibliographic Review • Some broad studies of the subject: • Kloppenburg et al. (2000) • King (2008) • Maréchal (2008) • Synergy may exist between some criteria • On the other hand, the development of one criteria can be to the detriment of another: • Achieve greater diversity  improve proximity

16. Analytical criteriaProximity • Spatial proximity relocalisation • Proximity: habitual mobility of operators – 50 to 60 km? (Valls, 2006) • Territorial reference: • Regional products/local produce • Products which are not necessarily traditional but which support sustainable rural development Food produced, harvested, processed, sold and eaten as locally as possible

17. Analytical criteriaRelationships • Faced with the anonymity of the agro-alimentary system, social proximity resocialisation • Facilitate through  (Jarosz, 2000): • The balance of power • Direct communication • Sharing information on costs Promoting direct contact between members of the food production chain

18. Analytical criteria Relationships • Creating relationships between producers results in new lines of cooperation • It brings renewed value to farming culture and social recognition to farmers and livestock producers

19. Analytical criteria Relationships • Consumers feel that their demands are better met • On the other hand this relationship requires a strong investment: • In order to build strong relations

20. Analytical criteria Relationships • Consumers feel more like they are being listened to • On the other hand this relationship requires a strong investment: • In order to build strong relations • Organise community activities

21. Analytical criteria Information • The consumers: • Those in demand of agri-industrial food production … • …or those who are misinformed or manipulated by advertising and marketing campaigns? • In Spain, a quarter of all television advertising is for food products (Mauléon, 2009). Promote areas designated for knowledge and education  responsible, independent decisions

22. Analytical criteriaInformation • A return to the possibility of choosing our diet: • Sane, balanced, in season, sustainable • And at the same time, economic • DSCs can therefore promote food sovereignty, diets and health: • As long as information is: • Accessible, plural and decentralised • With areas devoted to traditional, local know-how which is based on experience. • … and that the people are armed with both the resources and the capacity to manage and transmit this.

23. Analytical criteriaInformation • Organisation based DSCs can provide collective information management • For example, educational activities related to food consumption which are found in organic school canteens. • DSCs therefore form a bridge between local economic activity (consumption) and associated networks

24. Analytical criteriaParticipation • The producer often delivers to an intermediary at a fixed price or without knowing the price they will receive • The consumer buys … • Do they vote by choice of purchase? • What do they know about the produce they buy? - Methods of production, intermediaries, prices paid at each stage of the chain ... Direct participation in the control and management of the food production system and democratisation

25. Analytical criteria Participation • According to the FAO, 95% of the calories we consume come from only thirty plants • However, 15,000 new products are introduced onto the market each year in the United States Peter Menzel / Hungry Planet

26. Analytical criteriaEquitable, sustainable economies • DSCs  economic actors, neither stand alone operators nor regulated by global market forces … • Offering local, organic products at a price which does not exclude low income consumers. …but rooted in the community and its territory, forming a network which captures added value and reflects the actual costs of production

27. Analytical criteriaAn equitable, sustainable economy • Guarantee the economic feasibility of farming installation •  an adequate standard of living for both permanent and temporary farm workers DAR / PAE

28. Analytical criteriaAn equitable, sustainable economy • Promotion of both small and medium scale projects • Renewing the rural environment, ensuring a high standard of appropriate services for all Archives Agrocultura

29. Analytical criteriaAn equitable, sustainable economy • Promoting aspects of solidarity between producers and consumers: • Purchase prices and levels guaranteed throughout the season • Collective payments made in advance • Guarantee of a fixed annual revenue for producers • Elimination of intermediaries • Consumer participation in production tasks in order to control prices • Joint participation in campaigns aimed at the rural environment, local farming or other efforts to promote food quality and the territory ...

30. Analytical criteriaSustainable social inclusion • Facilitate access • Operational flexibility  avoids excessive workload: • Working hours • Accumulation of tasks • Accessible to those on low income

31. Analytical criteriaEnvironmental sustainability • Distribution • Promote local markets, by reducing food miles • Good access to distribution sites • Product packing and homogeneity: • Possibility of buying loose goods • Packaging materials…

32. Analytical criteriaEnvironmental sustainability • Incorporate new dimensions of sustainability into production • Biodiversity management • Use of traditional and local varieties • Energy efficiency etc.

33. Analytical criteriaDiversity/variety • Important criteria for promoting consumer loyalty • Sometimes in conflict with other criteria: • Diversity in terms of the cost of sourcing supplies over a greater distance • Diversity in opposition to the notion of seasonal products

34. 3 Typology proposition for DSCs

35. DSC TypologyA systemic blueprint + proximity – proximity Direct sales Association of producers and consumers Direct Sales Channels Consumers producers Consumer cooperatives Communal allotments Producer / consumer associations Consumer groups Collective Catering Sponsorship programmes For farms or cooperatives Individual At home Cooperatives with shops Specialist shops Grouped sales outlets Supermarkets For markets Drawn up from Maréchal (2008); Valls (2006) et Venn et al. (2006).

36. DSC descriptions1. Communal allotments • Consumers = producers • There is no market for trading produce • Alternative food product networks • They break down social isolation • They bring together consumption and production • In other contexts they can represent a large percentage of dietary intake

37. DSC descriptions1. Communal allotments • Two types of communal allotments exist in Catalonia: • Individually managed allotments • Those run by local authorities schools etc.

38. DSC descriptions 2. Producer/consumer associations A Solidarity contract governed by the principles of mutual trust and responsible consumerism • This formula exists in several countries: • France : AMAP – Associations pour le maintien d’une agriculture paysanne (Associations for the support of small farms) • 750 AMAP serving approximately 30,000 families • English speaking countries: CSA – Community Supported Agriculture • Japan: Teikei

39. DSC descriptions 2. Producer/consumer associations • Consumers buy in advance, normally at the start of a season, a fixed share of the production to be periodically supplied at a fixed price. • Producers and consumers share the risks – as well as the benefits of a good harvest – in as much as the quantities supplied can vary according to weather conditions and the health of crops • The price which is fixed is guaranteed. It is established as follows: • Average regional prices and/or… • A calculation of production costs and farmers’ wages, divided by the number of contracted families

40. DSC descriptions 2. Producer / consumer associations

41. DSC descriptions 3. Consumer cooperatives • Principles: • Collective purchasing according to common criteria • Direct contact with producers based on mutual trust • Permanent agreements with producers • Economy of scale • Practicing an alternative economy • A training ground for thought and critical debate on farming and food

42. DSC descriptions 3. Consumer cooperatives • Common features: • Having their own premises (owned or rented) where members make their weekly purchases • Often run by voluntary work, but can also be by a paid employee • Small profit margins on produce, preference being given to keeping down operating costs • Sometimes with periodical subscriptions and/or admission to the cooperative • Purchase of fresh produce – some dried products in stock, cosmetics and personal hygiene products

43. DSC descriptions 3. Consumer cooperatives • Order types or baskets: • Open baskets – reflecting actual consumption • Ordered from a list of available produce from producers which also provides information on price and origin • Farm baskets – better planning, no surplus • Pre-determined produce which can vary from week to week depending on what the farmer has available • There are normally a minimum number of products on offer • Mixed baskets • Farm baskets which offer the possibility of adding other purchases such as fruit, eggs or bread

44. DSC descriptions 4. Sponsorship • Sponsorship can be individual or collective • The reward for this is a share of the animal’s production over a given period • Involvement of sponsors in the management of the farm is however low: • They are sent information on the farm and the animals • They will occasionally pay a visit

45. DSC descriptions 4. Sponsorship • Key experience in Catalonia: Mas Claperol, pioneers in the production of cheese and milk products • The amount of sponsorship (1,500 €) is repaid in produce, with savings of 35% compared to normal public prices

46. DSC descriptions 5. Direct selling on site • A non-expensive point of sale for the farmer • Consumers can see where the goods are being produced • Problems: • The farm remains isolated and stand alone • Consumers must travel to the farm to buy

47. DSC descriptions 5. Direct selling on site • Different formulas: • Permanent sales point • Fixed opening times

48. DSC descriptions 5. Direct selling on site • Pick-your-own operations: • Good planning • Demonstrations on how to pick produce

49. DSC descriptions 5. Direct selling on site • Sales often combined with other formulas, and complemented by other products • More common for processed produce: wine, oil – bought at the mill, the winery or the co-op • Not often found in Catalonia

50. DSC descriptions 6. Direct selling at markets • Various formats • Local markets in larger towns and villages • Mobile markets, once or twice a week