Small to mid-sized food manufacturers represent a growing sector within the food industry, and as such have the potential to provide new market channels for Minnesota’s agricultural producers. With the state’s interest in increasing markets for Minnesota agricultural products, it’s attractive to envision synergy that could elevate both farms and food manufacturers: farms could sell their product to these businesses, thus increasing sales and diversifying their market channels, while manufacturers could source ingredients from Minnesota with the advantage of having closer relationships with their suppliers, shortening their supply chains, and adding to Minnesota’s economy. For a growing number of food manufacturers, this sourcing model aligns with their values, their customers’ values, and their business strategy.
While this idea sounds enticing, the feasibility of food manufacturers sourcing Minnesota-grown ingredients is often complex and based on a wide range of factors. The purpose of this study is to better understand these factors and to discover best practices and successful strategies that food manufacturers have implemented in order to be able to source locally. It also sought to understand challenges and identify gaps that deter local sourcing and gather ideas for solutions from those participating in the research.
The research focused on small and mid-sized food manufacturers who are using Minnesota-grown products from different sectors (dairy, meat, fruit and vegetable, and grain) to either differentiate their products or because doing so aligns with their values. Our reasoning was that these manufacturers are early adopters, and as such would have the most to tell us. We found these businesses through AURI, the Minnesota Department of Agriculture, and the FEAST! Local Foods Network. Data collection methods included focus groups, an online survey, and interviews with food manufacturers.
The highlights from the research as summarized here include 1) challenges to sourcing locally, including factors manufacturers and suppliers should consider; and 2) recommendations for increasing local sourcing, including infrastructure and resource needs.
To download the full report, click here.
Watch the webinar on the report here.