APPROACH AND METHODOLOGY
Local Orbit is building a web platform that streamlines the process of buying and selling locally produced food by providing tools for ecommerce, inventory management, marketing, logistics, and customer service. This platform helps people leverage existing physical resources and networks, making it easy for restaurants, institutions, and consumers to connect with farmers.
Local Orbit creates custom ordering systems for its partners, working with local market managers and coordinators to determine business rules that support the unique requirements of each market.
- Food hubs and farmers markets
- Entrepreneurs and community groups involved in distribution
- Farmers' co-ops that need a sales portal and inventory management
- Institutions looking to streamline local purchasing
The commitment provides online tools for 30 new local food distribution partners.
Local Orbit is currently in discussion with prospective partners in five states, plus additional sites in Michigan. These relationships have been developed through referrals, attendance at conferences, and people who have found Local Orbit online.
Monitoring and evaluation
Key deliverables are clear and quantifiable. Because this is a platform built on databases, all activity is tracked and can be turned into a variety of financial and user activity reports, as well as tied to web analytics. (Data sales are a secondary revenue opportunity - and there are several academic and government researchers who have expressed interested in data Local Orbit will be able to provide over time.)
IMPLEMENTATION, TIMELINE, AND DELIVERABLES
2011 - Four new sites, two new hires, raise $300 thousand
2012 - Six new sites, 11 new hires, raise $1.7 million
2013 - 10 new sites, 12 new hires
A confluence of market trends have created exploding demand for locally produced food. Chefs and consumers want to purchase food from farmers they know and trust, but they have to work very hard to get it. State and local governments are recognizing the economic impact of robust local food systems. It is not a passing trend.
Direct sales generate the highest profit margins for farmers, but existing business tools to get product to these markets are inadequate. Communications are inefficient. Distribution channels are disconnected.
Online supply chain management, and transaction and marketing platforms have helped small businesses in most sectors of the economy become more efficient and responsive to customer needs and business opportunities. This innovation has not yet been applied to the unique needs of local food systems.
Farmers are already making deliveries, going to markets, and managing direct sales. The USDA estimates $7 billion in local food sales in 2012, even with limited infrastructure. But this is a tiny fraction of total food sales. Entrepreneurs, institutions, economic development agencies, and community groups are establishing local sourcing initiatives, creating 'food hubs' to aggregate deliveries, and building networks to improve local food distribution. Their pain point is communications and transaction infrastructure.