The biggest challenge for the local food sector is distribution

"The demand for locally produced food is not a passing trend," believes University Lecturer Petri Ollila. But for local food to be sold more widely, supply and demand must be adequately balanced.

The biggest challenge for the local food sector is distribution

People care more and more about what they put in their mouths. Many shun plastic-wrapped vegetables transported from the warehouses of major retail companies as well as intensively farmed meat. In addition, a growing number of Finns now have the means to choose their food based on quality rather than price.

Despite these signals indicating change to the local food sector, many consumers still have to settle for bell peppers from Spain and beef from Brazil. The retail chains that dominate the food market aim to maintain a steady supply and buy in large quantities – things that small producers cannot always deliver on.

"The problem of the local food system is not production or transport, but distribution. Small production does not easily conform to the business practices of major retailers," says Petri Ollila, who works at the University of Helsinki Department of Economics and Management.

The Finnish food retail system is heavily concentrated in the hands of two operators: the S Group and Kesko. Producers and consumers have difficulty meeting each other outside this system on a large scale. It is difficult for consumers to know what small producers can offer, and for small producers to know what consumers want.

Ollila believes, however, that retailers and the food industry must learn to listen to their customers' needs and wishes if they want to attract well-to-do and quality-conscious consumers. The most active consumers have already established producer and consumer cooperatives, which either buy or even produce their own food. Typical for such small cooperatives is that price is not the key criterion.

"Cooperatives and the local food movement involve not only concrete products, but also dimensions that are not easily tradable in the market: the need to be with others, return to nature, see things grow and to teach these things to your children, too."

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Text: Tuomo Tamminen
Photo: Herkkujen Suomi
27.8.2012
University of Helsinki, digital communications


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