Can the Local Food Movement Scale Up to Meet the Demand of Hospitals and Other Big Purchasers?
At dawn, at the loading dock behind the kitchen at St. Joseph Mercy Hospital of Ann Arbor, Michigan, small lift loaders and handcarts trundle boxes from food trucks to storage rooms. The perishables go straight to immense walk-in refrigerators packed with processed produce—buckets of cubed melons, bags of pre-washed lettuce, packages of onions diced by the quarter-, half-, and three-quarter inch.
That St. Joe’s executive chef can peel open a three-pound bag of diced onions and dump it into the steel cauldron he calls a soup pot is an efficiency triumph of no small consequence. Preparing the soup du jour from whole ingredients—all sixty-five gallons of it—would take hours of chopping.
When you’re making soup for 600, changing your grocery list can quickly get complicated. Hospitals like St. Joe’s are emerging as the next frontier of the local food movement, but they are struggling to navigate the tensions between their new food goals and their reliance on standardized, low-cost products delivered dependably day in and day out. The question is, Can the local food movement scale up to meet institutional demand without losing sight of its original values?
Last fall, as part of the hospital’s sustainable food efforts, St. Joe’s loading dock had a new visitor. Farmer Richard Andres arrived from just down the road with 200 pounds of his green beans—local, organic, and grown by a family farmer. They were a point of pride for the hospital’s good food advocates, including CEO Rob Casalou and chief clinical dietitian Lisa McDowell. Like Farm to School initiatives, which are flourishing with support from Michelle Obama’s anti-obesity campaign, St. Joe’s sees enthusiasm for fresh local produce as a way to encourage healthier eating while supporting local farm economies.
In the kitchen, however, Andres’s superbly fresh beans meant eight hours of washing, snipping and slicing. Even St. Joe’s food purchasing coordinator sidled out from behind her computer to help get the job done. “Nobody understands how long it takes to prepare certain things,” says Executive Chef Ryan Kendall. “If it’s from a major food distributor, it comes in ready to rock and roll.”
Farmers’ markets have long been the darlings of the local food movement, but the bags of goods exchanging hands at some 7,000 locations nationwide represent less than 1 percent of total US agricultural production. Meanwhile, vast quantities of food crisscross the nation in the industrial food supply stream, quietly showing up, day after day, at the loading docks of the largest food buyers.
“Farmers’ markets are an important part of building local food systems,” says James Barham, an agricultural economist at the US Department of Agriculture, “but more fundamental change will come from connecting small and mid-sized local farmers with institutional purchasers that are expressing ever more demand for sustainable food.” Even small shifts in institutions’ purchasing can have major consequences. An average hospital food budget can run upwards of $4 million, while the healthcare sector as a whole commands $12 billion worth of food and beverage purchases annually.
Buying food at that scale means relying on certain industrial-style standards. To tap the institutional market, local food advocates would do well to learn about the workings of the mysterious middle ground of wholesalers, processors and distributors that move the majority of food from farm to fork. Efficiency and convenience reign in this realm. The online ordering form for St. Joe’s main distributor, Gordon Food Service, is the ultimate in one-stop-shopping (hence the common industry term “broadline” distributor). Chicken noodle soup, hamburger patties, paper plates, orange juice—just click and you shall receive. Most orders show up at St. Joe’s loading dock within twenty four hours by way of a Gordon truck.
The company’s guaranteed supply (which evades the vagaries of weather and season thanks to its global reach) is crucial for menu planning. It takes a team of dieticians to develop targeted diets for St. Joe’s patients. Patients with kidney disease can’t have black beans, and heart patients can’t exceed two grams of sodium per day. Changes can take weeks of planning and paperwork.
The widget-like standardization of food sourced through the conventional supply stream also helps hospitals meet exacting federal dietary guidelines. Broadline distributors sourcing from poultry giants like Tyson and Perdue can deliver entire pallets of chicken breasts that are each within a fraction of the targeted four-ounce weight. In contrast, locally sourced chicken breasts might come in a four- to eight-ounce range, requiring staff to mete out perfect portions.
Gordon Food Service is part of the hospital’s contract with Entegra, one of a handful of powerful national Group Purchasing Organizations (GPOs) that act as a gateway between hospitals and the companies they buy from. Hospitals commit to purchasing 80 to 90 percent of their food budget through their GPO. In turn, the GPO pools hundreds of hospitals’ buying power to negotiate lower prices and secure rebates, often with the most recognizable names in the food business. GPOs source through broadline distributors like Gordon, SYSCO and US Foods, whose shipping and stocking requirements can be significant barriers to small and mid-sized farmers and local food companies seeking to plug in to the supply chain.
Although scores of hospitals across the country are achieving new food goals through creativity and commitment, it often requires swimming upstream against entrenched contracts, efficiency constraints, and cost restrictions. “You have to remember,” Kendall says, “it’s a business.”
But the business of hospitals is also to protect people’s health. Within the healthcare sector, there has been an explosion of interest in enacting that mission through foodservice departments. St. Joe’s is one of 400 hospitals nationwide that have signed the Healthy Food in Health Care Pledge that articulates this approach. Generated by the nonprofit coalition Health Care Without Harm, the pledge states that healthy food is not just about the back-of-the-package nutrition facts but must come from a food system that is environmentally sound, economically viable and socially just.
Like the first hospitals to ban smoking on their grounds, St. Joe’s is putting its moral weight behind societal change through its new food initiatives. “It’s not just about the food we serve,” says CEO Rob Casalou, “it’s about the message, the symbolism of it.” The hospital has revamped menus to incorporate seasonal produce, switched to rBGH-free dairy products and lunch meats produced without antibiotics or added hormones and reduced meat servings as a way to model healthier choices and reduce greenhouse gas emissions. The most dramatic evidence of their commitment is the twenty acres of St. Joe’s sprawling property that have been plowed under to create an educational farm. The crops are incorporated into patient meals and cafeteria offerings, and patrons can pick up a bag of fresh fare from a farm stand in the hospital lobby each Monday.
Hospital-grown food is as local as it gets, but St. Joe’s has more expansive plans. Along with over 100 hospitals in the state, they are aiming for twenty percent of their food purchases to be Michigan grown by 2020 in alignment with the Michigan Good Food Charter. How that food gets to the hospital may determine whether it upholds the values often assumed to be inherent to buying local—creating a diverse food system with decision-making power closer to the ground and with money in a greater share of hands. “Local” has been imagined as an inoculation against the co-optation of big agribusiness because it’s about changing the structure of the food system rather than substituting sustainable for conventional products. But can the values implied by the farmer-to-customer handshake of a farmers’ market transaction be maintained when the supply chain lengthens, when price becomes less negotiable, or when product standardization comes into play?
Advocates for so-called food hubs hope that they can; they aim to combine the social and environmental values of alternative food movements with industrial values of efficiency and convenience. According to the US Department of Agriculture’s Know Your Farmer, Know Your Food initiative, a food hub is a business or organization that manages the aggregation, distribution, and marketing of source-identified food from local and regional producers to help them meet wholesale, retail and institutional demand. The middlemen and infrastructure that could have satisfied this role have largely been lost in recent decades because of corporate concentration, leaving an increasingly bifurcated system that favors small-scale direct markets and large-scale commodity markets.
While over 170 food hubs have emerged across the country, broadline distributors are also responding to increased demand for local products. With a solid hold on the healthcare market, these companies offer hospitals a way to achieve their goals with the utmost convenience—just look for the ”local” symbol in the online ordering catalog. While many hospitals applaud these new options, some point to concerns about the looseness of the term local. Distributors like US Foods have marked products like Doritos and Pepsi-Cola as local because they come from nearby processing plants. A fascination with food miles is the thinnest reading of the term, glossing over production methods and ownership structures for a rote counting of distance on a map. St. Joe’s interest in Richard Andres’s green beans is not simply that they come from twenty-nine miles away but that they are grown by an independent family farmer who practices environmentally responsible agricultural methods.
Food hubs, because of their supply chain transparency and values-based missions, can ensure that institutional purchasers are getting the sort of local food they’re aiming for. That’s why St. Joe’s is doing anything they can to help the nascent Washtenaw Food Hub in their region get off the ground.
However, guaranteeing that the green beans come in the door ready to rock and roll remains a challenge for many food hubs, both because processing equipment and distribution infrastructure are costly, and because their leadership can be long on vision and short on business savvy. Michigan advocates would do well to talk to their neighbors across the Great Lakes. The failure of the Producers & Buyers Cooperative in Wisconsin serves as a cautionary tale. The food hub attempted to ride on enthusiasm and trust between its members but soon ran up against stark business realities including lack of sufficient capital and management expertise and the need for a broader set of buyers secured with binding contracts. Two hours south along Highway 53, the Fifth Season Cooperative is successfully serving hospital and college clients by partnering with broadline distributor Reinhart FoodService. The alliance captures the best of both worlds, ensuring transparency related to social and environmental values on one hand and providing infrastructure, efficiency and expertise on the other.
Creating a new food hub may not always be the answer. Much like family farmers, small independent distributors are disappearing from the food system. Hospitals keen on supporting their local economy should beware they don’t favor new hubs at the expense of these companies. With a mixture of prodding and support, some hospitals are finding that local distributors can act as food hubs themselves by strengthening ties with family farmers and increasing the transparency in their supply chain from farm to hospital.
If efforts like St. Joe’s thrive, hospitals and their fellow institutional purchasers will play a major role in moving the local food movement beyond farmers’ markets to engage more farmers, acres and eaters. But the leap in scale from an individual’s buying three onions at a farmers’ market to a hospital’s buying 300 cases of local onions is not simply one of numbers; it presents a different game entirely. “Middlemen” is still a dirty word in some local-food circles, but if the movement hopes to expand beyond boutique status, it will need to embrace it. The real innovation will be developing that missing middle ground in a way that honors a comprehensive range of social, environmental and economic values.