providing farmers the tools to manage risk in value-added ventures national women in agriculture...
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PROVIDING FARMERS THE TOOLS TO MANAGE RISK IN VALUE-ADDED VENTURES
National Women in Agriculture Educators Conference Memphis TN March 27-29, 2012Winifred McGee, Senior Extension Educator, Penn State ExtensionLynn Kime, Senior Extension Associate, Penn State Extension
The Pennsylvania State University is an affirmative action, equal opportunity university.
This presentation includes material is based upon work supported by USDA/NIFA under Award Number 2010-49200-06201."
Agenda• The Setting -- local foods marketplace• consumer expectations• farmers’ response
• Need for food business knowledge/skills• The Food for Profit project• workshop• on-line• fact sheets• risk management for food businesses
•KASA gains and impacts of the project
Consumers and Local Foods• Demand for fresher, more nutritious foods• Desire to support local economies and local
farmers• Desire for better food security– Safe growing and processing practices– Enough food for all citizens
• Concern about environmental effects of food transportation
Source: Measuring and Understanding Local Foods: The Case of Vermont, David S. Timmons, University of Vermont (May 2006)
Farmers’ Response to the Demand
• Farmers’ markets• Community-supported agriculture (CSA)• Local food policy councils and coalitions• State buy-local programs• Community gardening • New emphasis on food security
Source: The restructuring of food systems: trends, research, and policy issues M. Koc and K. Dahlberg. Agriculture and Human Values 16 (1999)
Farmers’ Response to the Demand
• Farmers’ markets• Community-supported agriculture (CSA)• Local food policy councils and coalitions• State buy-local programs• Community gardening • New emphasis on food security
Source: The restructuring of food systems: trends, research, and policy issues M. Koc and K. Dahlberg. Agriculture and Human Values 16 (1999)
Farmer’s Share of Food Dollar
Farmer ShareSupply Chain
Statistical Support for Growth• 136,817 farms (in 2007) selling agricultural
products directly for human consumption– An 17.2 % increase from 2002 statistics– $1.21 billion in direct sales nationwide
• Small farms (sales <$250,000) generated 56.7% of the total value of agricultural products sold directly to consumers
• 93.3% of farms selling directly were family farms (limited resource, P/T and lifestyle)
Source: 2007 Census of Agriculture USDA NASS
Translation of a Trend• Farmers see direct marketing of fresh and
value-added products as– Source of additional income (diversifying)– Low cost, low risk(?) entry into agriculture
• Consumers see local foods as – Regaining a feeling of “safe food”– Opportunity to support the community– Reducing the “carbon footprint”
How to mesh the opportunities and threats?
USDA ERS Report – Local Foods“Growers often need education and training”– Meeting the market requirements– Respond to consumer-expectation issues:• Risk management• Postharvest practices• Recordkeeping• GAP certification• Liability insurance requirements
Source: Martinez, Steve, et al. Local Food Systems: Concepts, Impacts, and Issues, ERR 97. May 2010. U.S. Department of Agriculture, Economic Research Service.
Food for Profit ProgramBasic food business start-up instruction:• Realities of business ownership• Legal requirements• Food safety• Developing a business plan• Niche marketing strategies• Packaging and labeling• Pricing your product
Incorporating Risk ManagementIn 2011, added these topics to the workshop:•Good Agricultural Practices (GAP)/Good Handling Practices (GHP)•Hazard Analysis Critical Control Points (HACCP)•Adequate/correct Insurance Coverage•Allergen notification•Pro-active recall planning
Growing the Program• Massive updates/changes (since 1990s) • Focus changed from “pin money” to “serious
business”• Increasing percentage of farmers seeking
diversification of income• Increasing percentage of food entrepreneurs
seeking locally grown commodities
The Workshop• “Annie’s Project” type class– Interactive environment– Discussion-based learning
• Learning facets include– Guest entrepreneur– PDA/Municipal sanitarian– In-class activities– Post-class application/individualization
The Fact Sheets• Before You Start• Registering Your
Business• Home Food
Processing• Working with PDA• Insurance for Food
Entrepreneurs
•Food Labels•Business Planning•Marketing Your Food Product•Price and Pricing•Price and Pricing Worksheet
The On-line Course• Six Modules:– Getting Started– Safe Home-Based Food Production– Developing a Game Plan– Finding a Marketing Niche– Packaging Your Product– Pricing Your Product
• NE SARE Grant supported this project• 24/7 access to much of workshop material
Client Response • Since fall 2010, 463 participants; 235 of those
since Sept 2011• Demand exceeding the “supply”• 168 respondents, 2011/12 post-survey tool:– 91% (n = 152) rated “Information Met My Needs”
as Very Good or Excellent– 95% (n = 159) rated “Quality of Materials” as Very
Good or Excellent– 54% (n = 90) said program Met Expectations; 37%
(n = 61) said program Exceeded Expectations
Knowledge Gain: Food Code/Business Liabilities
Remained theSameOne Step Increase
Two or MoreSteps Increase
Knowledge Gain – Business Start-up Steps
Remained theSameOne Step Increase
Two or MoreSteps Increase
Post-Session Attitude: Importance of Identifying/Studying Market Niche
SomewhatImportantModeratelyImportantVery Important
Food Risk Aspects in Food for Profit
0
10
20
30
40
50
60
70
80
90
100
GAP/GHP HACCP Insurance List Allergens Recall Plan
First Exposure
Not Applicable
Want > Info
Will Adopt
Managing Risk for Food Businesses: Post-program Knowledge Levels
0
5
10
15
20
25
GAP/GHP HACCP Insurance List Allergens Recall Plan
Minimal
Moderate
Considerable
Attitude Change: Need to Pre-Test Recall Plan
Remained theSame1 Step Increase
2 Steps Increase
3 Steps Increase
Practice Change: Strategies that Resonated
InsuranceRecall/InventoryWritten PlanFood SafetyGAP/GHPAllergens
Future Opportunities• 2012 NE SARE funding for PA, MD, WV– Train/apprentice additional educators– Develop additional fact sheets/resources
• Goals – 3 year project– 23 Additional educators (2012)– At least 135 farmers attend resulting workshops
(2013)• At least 20 new food ventures (2014)• At least 20 adopt recommended risk strategy (2014)
Discussion/Questions