Framework for Localization-in Action

In my previous posting, Framework for Localization – an Overview, I introduced a set of slides that illustrated the interrelationships among key participants in a business ecosystem (see Framework4Localization Overview posted on SlideShare).

The final slide below, “Complete Localization Framework,” summarizes all of the key elements in one view:

It provides the starting point for this posting which outlines steps one can take to use the framework as a tool to help localize a community’s business ecosystem.

The slides shown in this posting are part of a presentation, Framework4Localization – in Action, which you may view or download from SlideShare by clicking the link in the title.

Purpose of Localization

The purpose of localization is to increase a community’s self-reliance and improve its chances for long-term sustainability. Localization done well results in more businesses that start-up and scale-up in response to demand from community members and do so profitably so they, too, are sustainable. But in order for that to happen within a local context, the metrics of success must be clear and the processes for business development must be well-managed.

Slide 1 below recommends that community members establish portfolio management practices and market metrics as a first step in their localization strategy. Given the emphasis on self-reliance and sustainability, the metrics that relate to basic needs, e.g., gallons of water, calories of food, kilowatts of electrical power, square feet of living space, etc., met by the local economy take precedence over others that are more readily available through the global economy.

Slide 1

Because all businesses within the community function within a business ecosystem, seeing them within a “community portfolio” is a useful construct. The dynamics of adding new, expanding some, and redirecting others to build the local economy invite wise use of community assets to do so, in other words, portfolio management. As pointed out in an earlier posting, participation by community members on many different levels which includes “investment” of community assets they own or control, is essential for localization to work. In effect, portfolio management practices provide the guidelines by which community members can effectively exercise their participation.

Bear in mind, this is not a social experiment. Even though businesses are in a community portfolio, that does not give them the latitude to be mismanaged and perform poorly. Profitability remains their primary goal since that is the only way businesses can stay in business and the only way the business ecosystem can sustainably localize.

Businesses listed in the community portfolio can be anywhere in their development cycle from an innovative idea, to a business case preparing for launch, to a business already underway and looking to expand, to a mainstay in the business ecosystem needing to modernize and redirect. In addition to where they are developmentally, they also have a spot on the localization framework.

Slide 2 below shows the distribution of business ideas and cases that surfaced during a series of stakeholder sessions conducted in Lorain County, Ohio during 2010 – 2011. While this does not capture all of them, it does show the variety of ideas and cases in each category.

Slide 2

Typical of our experiences in these forums, participants generated more ideas and cases in production than any other area. But knowing how ideas and cases fit into the framework is useful information because it offers insights into how to design the localization strategy going forward and where to bolster the localization inroads already made. For instance, strong output from local food production is certainly a plus in the overal drive to localize a community’s business ecosystem. However, a preponderance of local food production compared to downstream, value-added stages may relegate market access to a smattering of direct sales to community members in the local economy through farmers’ markets and community-supported agriculture (CSA) subscriptions, or contracted sales to food aggregators / distributors or retail food chains in the global economy. The former lacks sufficient volume at marketable prices to cover the cost of operations whereas the latter runs counter to localization.

Value-added stages between production and consumption with insufficient businesses to create viable business-to-business connections and increase access to local markets become opportunity spaces for new or expanding businesses to fill. Slide 3 below outlines several value-added stages in a red border to designate them as opportunity spaces ripe for business growth in the Lorain County example.

Slide 3

As examples, among those opportunity spaces identified, “energy flows” and “waste flows” offer a considerable range of freedom for business development in composting, anaerobic digesters, and other waste-to-energy alternatives. Notice, too, the absence of established portfolio management practices. If left unaddressed, this deficiency leads to poor communication and coordination among community members about how to populate the community portfolio and how to invest community assets to advance those entries.

Sound portfolio management practices include the development of a strategy that localizes the business ecosystem as expeditiously as possible. With sustained profitability as the goal, preferred strategies increase the number of high-margin transactions closer to points of consumption. This both speeds those businesses directly involved toward profitability and increases the amount of revenue that can be distributed throughout the value chain. The result contributes to the profitability of the overall localized business ecosystem, which derives maximum benefit and return from invested assets.

Slide 4 below draws attention to those transactions that occur within the opportunity spaces closest to the points of consumption.

Slide 4

In the case of localizing the food system in Lorain County, that meant focus on food preparation for quick delivery of ready-to-eat calories to consumers. Potential venues include schools, health care facilities, food trucks / carts, farm-to-table dining experiences, take-home meals for employees, and home deliveries.

Those business ideas and cases that emerged through this kind of gap-filling / start-closest-to-the-points-of-consumption strategy provide ample opportunities for community members to participate. Slide 5 below points out those areas of participation that are oftentimes discounted or forgotten compared to their more notable value-added counterparts.

Slide 5

These data management services identify, record, and track utilization of community assets through tools and techniques that include mapping, modeling, information flows, decision support, and portfolio management. In actuality, the processes that account for community assets build a formidable knowledge commons and know-how value network. These can be combined with available land, facilities, equipment, etc., under the control of community members to create highly adaptive business models and develop innovative solutions to address roadblocks along the way to start-up, scale-up, and sustainability.

Accounting for assets is an important step in any localization strategy. Slide 6 refers to the set of templates and tools available on LocalFoodSystems.org (LFS) that enables entrepreneurs, business ecosystem participants, and community members to begin documenting their assets and developing their strategies to apply them.

Slide 6

Note that the categories and color-coding listed in the legend for the LFS site correspond to the Framework4Localization diagram.

Click Business Ecosystem Map (see screenshot below) and, as the previous slide suggests, get your business on the map…and into your business ecosystem.

Also, check the LFS site frequently for new features you might find useful as you further develop your business ideas and cases.

Epilogue:

Lorain County participants led one of the first initiatives in Northeast Ohio to load their business ideas and cases into a “Community Investment Portfolio” and use it to shape the rollout of their localization strategy. Today, this strategy is encapsulated in The Oberlin Project.

Look for future postings on this blog which explore the general concept of a community investment portfolio in more detail and note how it has evolved over the past two years to become an effective economic and business development tool.

Originally posted to Sustainable Local Economic Development by Steve Bosserman on Saturday, August 25, 2012

Framework for Localization-an Overview

The simple dictum is: successful localization of a business ecosystem demands widespread participation by community members. Easy to say. It’s another thing for community members to know what that means and what to do about it. This is where another kind of map — a “framework for localization” — comes in handy to help community members define their business ecosystem, understand its dynamics, and assess to what degree it is already localized.

During the course of my work on the USDA-SCRI and FFEF grants, I had the opportunity to develop such a framework. I documented it in two presentations available for view and download on Slideshare. The first, Framework4Localization – Overview, provides a graphic representation of a typical business ecosystem. It is the subject of this posting. The second, Framework4Localization – in Action, offers steps community members can consider as they develop a strategy for localizing their business ecosystem. It will be the topic of the second posting in this series. Together, these set the stage for community members to build a “portfolio” of business cases that attracts widespread participation and drives the localization process. The nature of this portfolio and how community members invest in it will be the theme of a third posting.

Let’s begin this overview with a general description of a business ecosystem. Like a natural ecosystem, the business version functions due to material and data flows from source points to use points. Again, as with its natural counterpart, sustainability depends on a continuous flow from sources to points of use.

As sources become scarce, costs go up and the search is on for a suitable alternative. For instance, businesses that require inputs that are unavailable locally at competitive prices, import needed materials from source points further away. And if suitable sources cannot be found, those businesses in the ecosystem that depend on them cease to operate because they cannot secure what they need.

The challenge for sustainability of business operations in their ecosystem is to draw upon their sources at rates that allow them to recharge, or slow their use so as to not exhaust them, or provide a window of time large enough to find suitable substitutes.

In the context of a community whose members have basic needs that must be fulfilled daily, the availability of water, food, housing, etc. becomes significant in terms of THEIR sustainability. The sustainability challenge is similar to what businesses must confront only with the caveat that the distance between life-giving sources and community members who depend on their delivery imposes another level of dependence and urgency. Localization, then, closes this distance gap and reduces dependence and anxiety levels.

With the general explanation of terms in mind, the purpose of this overview is to help community members “see” the various elements of their business ecosystem in relationship to one another as a first step in taking action to localize.

Slide 1 lays out the basics for a localization framework that, in effect, ties source points on the left to downstream use points and markets on the right.

Slide 1

Slide 2 outlines value-added (see USDA definition in italics below) functions that are central to the business ecosystem. This includes stages of production, processing, and preparation, installation, construction as well as the flows of energy necessary to make the conversions in each stage, and the waste management flows that seek to recharge sources with what is not used, repurposed, and recovered during conversions and consumption.

Agricultural product that has undergone a change in physical state or was produced, marketed, or segregated (e.g., identity-preserved, eco-labeling, etc.) in a manner that enhances its value or expands the customer base of the product is considered a value-added product.¹

Slide 2

Slide 3 highlights a distribution and logistics system that manages the shipping and storage of material as inputs and outputs on their way to various markets. These functions are non-value-added given the USDA definition of “value-added” (see definition in previous slide).

Slide 3

Slide 4 targets those data-driven services that provide a virtual representation of the material side of the business ecosystem. Asset maps utilize a graphical user interface to capture all relevant data about participants in a business ecosystem so they are easy to see; ecosystem models readily demonstrate the dynamics among business ecosystem participants and generate likely scenarios about how to improve the efficiency, performance, and sustainability of the business ecosystem; information flows deliver real-time, continuous, detailed overlays and insights into the behaviors of preferred ecosystem models upon their adoption; and decision support provides an information-enriched knowledge commons for business ecosystem participants to access and apply in their decisions.

Slide 4

Slide five identifies the three main service areas that influence the larger context in which the business ecosystem functions. These three hold significant implications on the cost to adopt a different business ecosystem model, such as one dedicated to localization of the food system. The current globalized food system is held in place by entrenched legal, capital, and education institutions. To localize requires changes in all three. This means confronting major inertia.

Slide 5

Slide six posits governance as the backdrop for change in the system. Governance is the process by which laws, codes, rules, regulations, and curricula change. And that changes the legal, capital, and education institutions. And that expedites the localization of a business ecosystem. Governance provides fair and impartial incentives for community members to participate in localization by playing a diverse array of roles and exercising certain responsibilities, delivering value, and building on their reputations.

Slide 6

Slide seven illustrates the complete localization framework as a “map” that can be tailored to the specific circumstances of a community and its business ecosystem.

Slide 7

And that sets up the second posting in this series which shows how community members can use this framework to guide their localization strategies. Stay tuned…

Originally posted to Sustainable Local Economic Development by Steve Bosserman on Saturday, August 18, 2012

Community Food Systems-Other USDA Grant Opportunities ↩

How to Have a Successful Start-up before Launch

As the title of my previous posting, “Want to Localize? Participation is Required!”, suggests, if community members truly want to strengthen their local economy and become more self-reliant, the majority must be actively involved in making it happen. The posting goes on to mention five areas of social, economic, and political activity in which community members can choose to participate in support of their local businesses. Savvy, local entrepreneurs and business owners within a particular business ecosystem know that community involvement is critical, not only for the success or failure of their businesses, but for the overall localization underway. As a result, they make it easy for community members to choose how they will participate in these five areas. In effect, they demonstrate how community member participation supports local businesses, strengthens the local economy, and contributes to their collective commitment to localization.

Such an engagement strategy does not come by happenstance, but by deliberate planning. In 2010, Michelle Ajamian and Brandon Jaeger value received a one-year Value-Added Producer Grant (VAPG) to develop product, marketing, and business plans for their budding community-based enterprise, Shagbark Seed & Mill.

Michelle and Brandon convened and led the grant team for the project that included Leslie Schaller, one of the co-founders of the Appalachian Center for Economic Networks (ACEnet) and co-author of “The 25% Shift – The Benefits of Food Localization for Northeast Ohio Local & How to Realize Them”; and June Holley, a network weaver par excellent, co-author on “Building Smart Communities through Network Weaving” and author of the Network Weaver Handbook; and myself as members.

One of the outcomes of our effort was a market network plan that outlined ways to increase participation by the community in starting, scaling, and sustaining the business. While the financial details of this plan pertained exclusively to Shagbark Seed & Mill operations, I extracted the main process points to form a market network planning template below that can be applied to local agriculture-based businesses in other communities.

This template applies to any food product, product line, or suite of products a local business seeks to put into the market. The primary purpose of the template is to inform marketing strategies that gain community member participation in support of a business venture (for simplicity’s sake, we’ll call it Local Foods) because of the value it brings to the community through its operations and products.

The template begins with the basic assumption that Local Foods is a community-based business regardless of how many communities in which it may do business. In other words, Local Foods strives to localize the value chain within the market area served by any one of its operations and products. The goal is to “know the local market” and “reach the local market” rather than identify and pursue customers wherever they are located. Just like it takes a village to support its members, it takes a healthy, localizing business ecosystem to support start-ups and scale-ups like Local Foods.

The template presents two views: Knowing the Market and Reaching the Market, based, in part, on one of my earlier postings entitled “Participation in Local Food Systems”. The Knowing the Market table below identifies five prompts for market participation in the left-hand column followed by three columns listing specific ways community members can participate according to those prompts. The levels signify a continuum ranging from the more individual-based at the first level to the more community-based at the third level. The more cells covered by the strategy, the more effective it will be in terms of impact.

The Reaching the Market table below identifies ways to connect with the market in support of the Knowing the Market process. The organizational structure of this table parallels that of the first table: five interface areas in the left-hand column followed by three columns of ways to connect with the more familiar at the first level to the more contemporary at the third level. As with Knowing the Market, the more cells put into play, the more connectivity throughout the market, the more informed the marketing strategies, and the more participation by entrepreneurs and business owners in the business ecosystem as it localizes.

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In summary, this template works best in a community where its members at least express a willingness to localize their business ecosystems, strengthen their local economy, and become more self-reliant. After that, it is a matter of how and to what degree they exercise that willingness through active participation. A sound market network plan provides awareness and rationale that invites participation as well as structured incentives that acknowledge community members for their participation. The better the execution of a sound plan, the greater the chances a business, like Local Foods, can successfully start, scale, and sustain.

Look for more examples and guidelines in subsequent posts on how to increase participation, buy-in, and support for business ecosystem localization using some version of this template!

Originally posted to Sustainable Local Economic Development by Steve Bosserman on Monday, August 13, 2012

The Economics of Happiness and Meaningful Work

Recently, one of the community activist groups in our area hosted a screening of the prize-winning movie, The Economics of Happiness, followed by a Skype interview with Helena Norberg-Hodge, one of the co-directors and founder and director of Local Futures – Economics of Happiness, formerly known as the Institute Society for Ecology and Culture (ISEC).

It’s definitely worth seeing, if you haven’t already done so. In addition to information available on the Local Futures website, a YouTube film clip offers a quick overview of the main themes explored in the movie: The Economics of Happiness – Official Trailer.

In her commentary on the Skype call, Ms. Norberg-Hodge emphasized the importance of launching and supporting community-based initiatives that rebuild the local food economy and deliver education for action.

She encouraged attendees to mobilize democratic action and draw upon the power of the electorate to influence politicians to enact, rescind, or amend laws regarding taxes, subsidies, and regulations so that locally-sourced products have an even playing field with their globally-sourced alternatives.

Her rationale suggested that the resulting decentralization of corporate and governmental structures would increase the number of jobs. It would also provide community members with meaningful work based on values and skills resurrected from a nearly lost ancient wisdom inherent in our cultural roots. In many instances this worthy work translated into farming using simple tools and adhering to millennia-old agricultural practices.

While Ms. Norberg-Hodge did not openly discount technological developments, the significance of them as a defining force on the pace and degree with which our civilization continues to advance received short schrift.

The loss of jobs today comes primarily as a result of technology. The machine replaces human labor–period. Our challenge is to figure out what we do with our time as the machine continues to eliminate the need for us to spend it in drudgery. The increased redistribution of power as decentralization takes hold opens the door for a new definition of meaningful work WITH the machine, not against it.

No doubt, localization will give us the opportunity to learn how to invest our time in our personal development, care and support for one another, and adaptive community cultures. That would be a dream worth making a reality. But if the future of localization means becoming reacquainted with a shovel, rake, and hoe for hours on end, that seems more like a nightmare! Better to master the machine for our well-being rather than our destruction.

Originally posted to Sustainable Local Economic Development by Steve Bosserman on Wednesday, August 8, 2012

Introduction to Key Terms: Local and Localization

As one might infer from the title of this blog site and the objectives of our grant proposals, the concept of “local” featured heavily in the design and development of our projects. Local is one of those terms that carries multiple meanings. In some respects, it waxes nostalgic, recalling seemingly slower-paced times when we were more available in the present to do things that mattered for ourselves and those we cared about. Ah, if only we could return to that era.

Well, maybe.

For others, though, local translates into dull and boring and may even haunt some with the spectre of unwanted meddling, close-mindedness, and meanness that severely limits possibilities. We should get away and stay away.

Yet, there are those for whom local carries a more expedient meaning about survival over the long run. We belong to a community in which all our members commit to establish a sustainable course for this and many generations to come.

Of course, the truth for each person is a unique blend of these three. Local becomes a personal sense of place. It has a familiarity that says whoever is here belongs here; this is where I can do my best; this is where we can make our stand. It provides a measure of safety and security whereby I, along with my fellow community members, have the means among us to meet our basic needs and more. It establishes a foundation of community-centeredness and fair-mindedness for all to draw upon, yet encourages each of us to exercise personal freedom to pursue our individual goals, live our lives fully, and make a positive difference for ourselves by whatever criteria.

In this context, localization is the process by which members make their community that place where they and their families want to stay because there is nowhere else they would rather be. Localization is a community’s drive toward self-sufficiency and commitment to sustainability. It is an act of collective responsibility.

With this sense of “local” and “localization” in mind, community members direct more of their focus toward achieving self-reliance. This prompts them to take greater responsibility to meet their basic needs through the use of their own resources rather than importing from others much further away. Using terms introduced in my previous posting, such a shift in responsibility redraws the boundaries of the business ecosystem within a radius much closer to home. This opens the door for the development and application of business models that support the successful start-up and expansion of small-scale enterprises throughout the community and region. The net result is that more transactions occur locally, which keeps the wealth of the community at work for the community and goes considerable distance toward making the community the place to be and stay.

As a community localizes its business ecosystem, it produces more of its basic needs in terms of gallons of water, calories of food, kilowatts of energy, units of housing, articles of clothing, quality of sanitation, etc. This, in turn, spurs numerous opportunities for entrepreneurial activity specifically in agriculture and bioscience. Given these were focus areas for our grants, we could tap into the energy generated by the push for localization and the use of agriculture, particularly in food systems, as the economic development engine to advance our projects. In fact, our experiences with those dynamics in the course of our projects became the subject of multiple postings such as Which Food System Do You Use to Get Your Calories? over the past four years. Look for several more along similar themes to be referenced here in future posts under the Sustainable Local Economic Development heading and tagged as “localization.”

Originally posted to Sustainable Local Economic Development by Steve Bosserman on Tuesday, August 7, 2012

Introduction to Sustainable Local Economic Development

Since 2008, I have been actively involved as a Co-Principal Investigator on a 3-year USDA-Specialty Crop Research Initiative, Regional Partnerships for Innovation grant awarded in September 2008 and back-to-back 1-year grants from the Fund For Our Economic Future (FFEF) in 2009-2010 and 2010-2011. These grants complemented one another. The USDA grant sought, in part, to develop a social networking infrastructure —LocalFoodSystems.org — for connectivity and collaboration that would inspire participation in agriculture localization. The FFEF grants focused on providing social networking participants with templates, processes, and tools necessary to catalyze significant entrepreneurial activity through increased localization within a regional agriculture-bioscience industry cluster.

During this 4-year period, I posted to blogsites, created websites, tested platforms and applications, prepared presentations, provided coaching, and contributed to papers and proposals all related to the themes of these two grants. Most of the information generated unfolded chronologically and addressed particular topics of interest in the moment. Furthermore, it was made available through the media that best supported the message being delivered to specific audiences. This led to a general mishmash of material with wide variations in timing, theme, track, and target making it difficult for those who may have an interest to consider what I tried, why I did it the way I did, what happened as a result, and what I learned along the way.

To address this shortfall, put a final wrap on the grants, and move my thinking into new areas of interest, I will begin a series of postings under the heading of Sustainable Local Economic Development that recasts my work in a more searchable framework. As with this introduction, these postings will appear on Blogger with links to the Sustainable Local Economic Development group on LocalFoodSystems.org (LFS) — you may need to join LFS (free) in order to view posts linked to it — Tumblr, Slideshare, and Scoop.it and announcements to Steve Bosserman on Twitter.

To help organize the information in the postings and maintain consistency in the framework, I will apply one or more of the following tags to each entry:

organization dynamics
business ecosystems
food systems
localization
local economy
mapping
business case
work space
market network
business model
governance
self-reliance
transactions
community investment portfolio
project management

I welcome your feedback about any of the postings as well as input on the tagging convention. This is a complex, yet very important subject about which there are few absolutes and far more questions than answers. The more we can learn together from our different experiences with sustainable local economic development through these media, the more valuable the outcomes. Thanks in advance for your interest and consideration.

Originally posted to Sustainable Local Economic Development by Steve Bosserman on Sunday, August 5, 2012

Fill the Food Gap – The Mission of Meals on Wheels in Boulder, CO

Meals on Wheels America (MOWA) delivers affordable, healthy noon meals to seniors in their homes or at MOWA-sponsored group dining locations. In that single instance each day MOWA fills the food gap between the point of preparation and the point of consumption for seniors. And with that meal come the only calories some seniors will have for the entire day.

What if a local food system delivered ALL the calorie needs for each person in that community every day? Kind of a MOWA on steroids! Yet as far-fetched as this proposition might seem, it is the challenge every community faces if its members choose a sustainable path. After all, everyone NEEDS food and to not have it puts survival at risk.

How might a single meal everyday for everyone system work? The Meals on Wheels of Boulder, Colorado offers a glimpse. The MOW of Boulder mission is

…to provide tasty, nutritious meals to residents of our community who need and want our service, regardless of age or income.

That’s quite a statement. Add “affordable” and “familiar” to the description of the meals and the stage is set for meeting the food needs of the community.

The current MOW of Boulder tagline reads, “Building a Future, Nourishing Our Community.” Formerly, it read, “We Deliver Energy”! And that’s exactly what nourishment is—energy in the form of calories for the human body!

Here’s the rub, though. On average, each of us needs 2,000 calories per day. Those calories are delivered via three meals plus a snack. Like all MOWA chapters, MOW of Boulder delivers one meal per day for a sliding-scale fee based on ability to pay. If we take the cost of a meal yielding 600-700 calories times three in order to meet the 2,000 calorie daily requirement, the total cost may well exceed the threshold of $10 per day. That brings us back to the challenge of affordability each community faces if it is to have a self-sustaining local food system.

The key to the solution rests in how well value-added operations throughout a local food system fit and function together. As a result, sustainability depends on the successful integration of local food preparation and distribution, such as what MOW of Boulder provides, with upstream local food processing and food production. When done effectively, the result is a flexible, interdependent food value chain that stretches from the points of consumption to the points of production. Interestingly, MOW of Boulder shows significant progress enrolling value chain partners with the inclusion of several Community-Supported Agriculture (CSA) shares and other fresh produce from local farms and community gardens.

The community of Boulder has a long way to go before its local food system has the capacity to serve all members and be sustainable. But the efforts of MOW – Boulder and its partner organizations has given it a tremendous leg-up in the process. Keep it up, Boulder!

What can YOU do to help YOUR community establish a Meals on Wheels chapter? And if there is a MOW chapter already up and running, what can YOU do to help it extend its scope to fill the food gap wherever it exists in YOUR community?

Originally posted to Sustainable Local Economic Development on Tumblr by Steve Bosserman on Saturday, August 28, 2010

Which Food System Do You Use to Get Your Calories?

Is there an alternative to the global food system where a person in the U.S. can get 2,000 affordable (no more than $10 / day), accessible, available, nutritious, tasty, familiar, quick, convenient, and safe calories? Obviously, the global food system is quite capable of hitting most of those guidelines as evidenced in Tom Barlow’s posting on Aol, “Eat for a Dollar a Day; Thanks, Costco”. Such foodstuffs comply with government regulations and they are acceptable to consumers who cannot afford or find otherwise.

Unfortunately, these same foods contain high levels of saturated fat, sugar, and sodium. When eaten to excess, which is too often the case when the target markets are those demographic groups that rely on them most to meet their basic food needs (see Natasha Singer’s posting in The New York Times, ”Fixing a World That Fosters Fat”), they contribute to serious obesity-related conditions such as hypertension, heart disease, stroke, and diabetes. But is health reason enough to go for another food system?

The diagram below illustrates the flow of food from points of production that can be almost anywhere in the world, through processing, preparation, and retail, to points of consumption that can be almost anywhere else in the world. Various non-profit, for-profit, governmental, and non-governmental organizations have assigned or assumed responsibilities to inspect food for compliance with safety regulations as it travels throughout the global distribution system on its way to consumers in communities and neighborhoods wherever they are located. The system is highly evolved and marvelously effective given its design specifications. However, it is also highly subsidized through trade agreements, tariffs, duties, taxes, incentives, price controls, and limited accountability for externality costs, which offset costs and keep prices low.

The major issue with total reliance on the global food system is that residents of a community / neighborhood are dependent on others outside their jurisdiction for food. Their lives are literally in the hands of those who do not suffer the abject consequences of failure to deliver. Climate change, natural disasters, unavailability of or exorbitant prices for fuel, political upheaval, and widespread pandemic outbreaks can singularly or in combination set a series of events in motion that threaten food security and safety. It is this risk to survival that makes the establishment of a local food system in every community, neighborhood, and rural area an imperative.

How does a local food system compare to the global food system? The diagram below offers a quick look. First of all, residents of a given local community / neighborhood take significant responsibility for their food supply, hence, the title “People-Centric Food System”. People are the social fabric or operating system by which skilled / licensed practitioners conduct food production, packaging, processing, and preparation so that “accessible, available, nutritious, tasty, familiar, quick, convenient, and safe calories” are delivered to community members through myriad retail outlets.

But does such a system provide sufficient calories to sustain residents? That depends on its business model and key metric. The diagram below offers three alternatives:

Food products of special types that target high-end niche markets and command top prices. The consumer subsidizes the local food system by paying a premium for unique, locally sourced products that cannot be easily purchased from global food system retail outlets. The key metric is cost / type.

Food products packaged in units (pounds, quarts, containers, bunches, etc.) generally available from the global food system for a lesser price. However, the locally sourced products are subsidized through grants and gifts (property, equipment, inputs, labor, etc.) awarded to those who produce, process, package, and prepare them so that prices are comparable to global system offerings. The key metric in this instance is cost / unit.

Food products are packaged into meals that, when consumed in a given day, yield 2,000 accessible, available, nutritious, tasty, familiar, quick, convenient, and safe calories for no more than $10. Additionally, the businesses involved in producing, processing, packaging, and preparing those calories for eventual consumption are profitable. As a result, the local food system is sustainable, not subsidized. The key metric is cost / calorie.

The first two are prevalent business models for local food enterprises in the U.S. today. They require subsidization through prices, grants, or gifts to remain solvent. However, they do not provide sufficient affordable calories in a given day for each community / neighborhood resident. The third alternative claims to meet all the criteria, but how does it work?

The graphic below begins to answer the question.

First, the clear intentions of the people-centric food system are as follows:

No more than $10 is spent by each person in the system for 2,000 calories per day
The businesses involved are profitable
The system is sustainable.
That intent drives the design of the system.

Second, community members transfer the knowledge they need to be successful through multiple forums, systems, processes, and tools made available by the community / neighborhood. They use this know-how to set the rules for local food security and safety, license food businesses, and build the community’s skill base in food system operations, In other words, they establish a strong foundation of competency upon which to take ownership of their food supply and focus on attaining self-sufficiency.

Third, the entry point is delivery of affordable calories where people live their lives. Mobile kitchens and food carts strategically distributed throughout communities and neighborhoods is the most effective way to accomplish this. The startup investment and operating expenses are low, the market penetration is high and offers a wide range of excellent meals from which to gain the needed calories, and the opportunity to catalyze significant interdependence among all manner of businesses throughout the local food system is substantial.

Today, less than 5% of the food (and calories) consumed in the U.S. is locally sourced. The answer to the question posed in the title is decidedly obvious–the global food system is the major source of calories. But the point of the question is to prompt thoughtful consideration as to the consequences, understand that there is a way out of the predicament, step up, step out, and make a difference in your community / neighborhood by participating in its local food system.

Future postings on this blog will go into more detail about how to implement a people-centric food system. Meanwhile, you are welcome to ask questions.

For examples about the evolution of a people-centric food system in Cleveland, take a look at the Growing Good Connections article, “A Local Government’s Transition from an Urban Agriculture Focus to a Comprehensive Food Systems Policy Approach” and postings about food desert mitigation initiatives in Cleveland on NEO Food Web.

More to come…

Originally posted to Sustainable Local Economic Development on Tumblr by Steve Bosserman on Sunday, August 22, 2010

What’s in the Center of Your Local Economy?

A local economy delivers needs such as food, water, energy, housing, etc., to those who reside within a specific neighborhood, community, or rural area. Like any social system, its function is predicated on what or who is in the center.

In the diagram below, those who produce goods and services are in the center. From there, the system distributes output across stages of processing, preparation, and retail into a market where people choose to purchase what is delivered from multiple competitive options. Such a design opens up the possibility to purchase needs delivered by providers in the global economy and far removed from the transactional boundaries of the local economy. With such choices comes a reduction in local business revenue, outsourcing of paid work, and leakage of expenditures to provisioners outside the area. Basically, this is the way the current global economy works. It is the antithesis to the intent of a sustainable local economy.

In contrast, people placed in the center of a local economy invite a very different dynamic as suggested in the graphic below. Members of the social system meet their needs as close to the point of consumption as possible. The retail “ring” represents the transactional space wherein people take delivery of a needed product or service after completing its value-added cycle.

Since people within a given locality share the same basic needs, they, collectively, define a steady market. This stabile and consistent demand invites an interdependence among businesses in the locally-oriented preparation, processing, and production “rings”.

A local economy is, by definition, a needs economy (see At the Bottom of the Pyramid, It’s Looking Up!). The survival and sustainability of people as a social unit depend on whether they can meet their basic needs without interruption. This imperative places people at the center of their local economy. This gives them access to the assets and resources within their purview and grants them license to deploy those means in ways that assure their continuity and reasonable quality of life.

To have production in the center invites those who are not invested in the sustainability of the local system to have control over its destiny. That is not an enviable situation in which to be. What’s in the center of your local economy?

Originally posted to Sustainable Local Economic Development on Tumbler by Steve Bosserman on August 20, 2010

Another Opportunity Space for Local Food Systems

Not to detract from the value of having fresh fruits and vegetables available in urban food deserts, but the article “Vegetable Truck Pushes Nutrition in Detroit” by David Runk, Associated Press, August 11, 2009, referenced in Dana’s posting highlights yet another opportunity within neighborhood-based food systems:

“I can’t say if they have their own jingle, but I can imagine the sadness a child might feel when they run out to the front yard telling, “Ice Cream!” and instead find lettuce and string beans. But it’s about time eating healthy goes mainstream. Two Detroit teens hired to help with the vegetable truck service were presented with zucchini and had no idea what it was.”¹

The last sentence suggests that people would benefit not only by having access to fresh, locally-grown food, but by having it processed / prepared on the spot into tasty meals that preserve natural nutritional value and are served quickly, conveniently, and affordably.

Perhaps some Veggie Vans or Peaches and Greens trucks could be outfitted as mobile kitchens that offer a full-range of options for neighborhood residents concerning their food supply. Then, imagine that the source of fresh food for those mobile kitchens is local in terms of food produced on vacant lots and abandoned properties in the neighborhood rather than within 100 miles. Then, imagine further that the owners / operators of the mobile kitchens are residents of the same neighborhood so that a complete food system begins to take shape within the community.

This lays the underpinnings for a local economy based, in part, on a local food system. It initiates a process by which resources are “grown” in the community, reinvested in the community, and used to strengthen the community through wider participation. This a local food system that truly means something to those who own it and care about it – community members.

Imagine. And with only a couple of converted vans and trucks to get it underway!

Originally posted to Local Food Systems by Steve Bosserman on Friday, October 2, 2009 16:31

Version of article with this quote is not available online ↩