Camden Food Economy Strategy October 25, 2013 Campbell

Camden Food Economy Strategy

October 25, 2013

Campbell Soup Company

The Reinvestment Fund

TRF Development Partners

Policy Research

Business Lines

Lending & Investing

$1.2 billion in community investments

$700 million in capital

under management 800

individual & institutional investors 2600

projects financed

PolicyMap

New Jersey Food Access Initiative

TRF organizes & manages public-private partnerships to improve

access to fresh foods in underserved communities

Public Policy Advocacy • Improve access to healthy

foods

• Foster better health outcomes

• Support small business development

• Create & retain jobs

• Revitalize communities

• Contribute to local food system development

• Incent public-private partnerships

Healthy Food Financing Initiative

A National Campaign

Research & Analysis

• Economic Impacts of Supermarkets

• FFFI Rural Grocery Case Study

• Limited Supermarket Access (LSA) Study

• Food Systems Research

Building Capacity

www.healthyfoodaccess.org

Camden’s Institutional Food Sourcing

1. Food Service Industry Timeline

2. Selection of Institutions

3. Interview Topics

4. Key Findings

5. Food Vendors and Managers

6. Recommendations for Policy and Planning

Camden’s Institutional Food Sourcing

Food Service Distribution Created in response to The National School Lunch Act

(1946) – known as “institutional distribution”

Restaurant growth further expanded distribution: 25% of food dollars in 1950s to 49% today

Sysco was formed in 1970 by 10 independent distributors with a broad geographic scope

Industry is now an oligopoly due to economies of scale in warehousing and transportation

Technology is the new “economies of scale” – real time inventory, long-term delivery and supply chain schedules, computerized transportation routing, and even apps…

Selection of Institutions and Vendors

Selected 12 institutions from DVRPC’s Stakeholder Analysis

Hospitals (3), primary and secondary education (4), higher education (3), and two others

Responses from the first 5 institutions revealed additional food supply networks

Exploring rabbit holes…

Interview Topics

Primary food sources

Interest in purchasing regional foods

Options to purchase regional foods

Barriers to purchasing regional foods

Interest in collective purchasing with other Camden institutions

Key Findings

Interest in Regional Foods Strong interest, but significant barriers

Sometimes part of organizational mission

Driven by health, regional economy, sustainability, and consumer preference

“There is no lack of interest in purchasing local foods, but someone needs to make it easy. Even if it costs more.”

Key Findings: Primary Food Sources

National Managers Aramark Sodexo

National Vendors Sysco US Foods Compass

Regional Vendors and Distributors Common Market Ambrogi Foods Nu-Way Novick Brothers Prepared Meals Local catering companies Revolution Foods

Key Findings

Options to purchase regional foods National managers offer fewer regional options – they control the

entire process (Aramark, Sodexo) National vendors are more committed to regional options – customer

demand and regional offices (Sysco, Compass, US Foods) Small to medium size regional vendors are the most likely to sell

regional foods – fits their supply chain and scale

Dairy and grains are almost universally sourced from regional producers, even by national managers

Proteins are the most difficult to source regionally

Key Findings

Barriers to purchasing regional foods

Cost o Schools are limited by federal reimbursement o Hospitals and Universities are less constrained, but still cost conscious

Ease of acquisition o Many respondents cited this as the largest barrier o Having more than one or two vendors requires too much time

Seasonal production o Menus are often planned quarterly, requiring steady supplies o Northeast is a higher-cost market for regional foods due to limited growing

Safety and quality o Hospitals and educational institutions are especially concerned about safety o Consistent quality is important when planning menus far in advance

Key Findings

Interest in Collective Purchasing

Smaller organizations are interested, but wary of scheduling conflicts, choice, and bureaucracy

Larger institutions are less interested, as they tend to use food managers

Some institutions participate in group purchasing organizations (GPO)

GPOs are often associated with specific vendors or industries

o Sysco and Compass have dedicated GPOs

o HealthTrust GPO represents 1,400 hospitals

Independent Food Vendors

Common Market Common Market sources local and regional produce and sells to

a wide range of organizations and institutions, including schools, hospitals, and grocers

Full product line, with seasonal variation

Nu-Way NJ-based distributor to childcare centers and charter schools Full product line with both regional and international sourcing Novick Brothers Philadelphia-based distributor to childcare centers, independent

institutions, and restaurants throughout Mid-Atlantic Full product line with both regional and international sourcing,

including paper goods and cleaning supplies

Sysco

Recommended Strategies

Develop a food inventory system that coordinates the collection and distribution of regionally produced and processed foods – the inventory system would be more logistical than physical

Work with Sysco to make the Camden region one of its test markets for regional food sourcing (Grand Rapids, Kansas City, and Chicago are current test markets)

Explore the potential for creating a Camden group purchasing organization (GPO) that represents a wide variety of institutions, regardless of their services.

When creating regional food strategies, focus more on the region’s producers and processors of livestock, poultry, and seafood – distributors and interest groups seem overly focused on the region’s capacity for fruits and vegetables

Supply Chain Matrix

Contact Information

Lance Loethen Research Associate TRF Policy Solutions

lance.loethen@trfund.com

TRF Policy Solutions