Here's how the cost of processed food breaks down.
For every dollar you spend on processed food, $.19 is for the food and $.81 is for the marketing. I don't know about you, but I'd rather see it the other way around!
garv
8yr
Aren't we in some way responsible for this?
DietID_TeamDietitians
8yr
Crazy. And only about 11 cents goes to the farmer. @garv you bring up a good point - how can they have so much margin for marketing? Well its because the inputs are so cheap bc they are subsidized, so between the cost and the low price the end consumer pays, there is still a lot of room to get a big marketing budget. So I think the subsidies are partly to blame here
olivettefarm
8yr
Crazy. Those numbers make me sad. Even with subsidies, the low profit for the big farms often times is one of the causes of poor labor practices at the farm - especially on farms where crops cannot be mechanically harvested such as tomatoes.
garv
8yr
I think it more to do with a relentless cost cutting strategy. Ironically so, as some choose to spend less on raw material that are core to their final product.
DietID_TeamDietitians
8yr
If there was more transparency, then @garv - i don't think there would be as much cost-cutting on the input side. and @olivettefarm - how have you handled labor? I was talking to a friend yesterday who worked on a very well-run small organic farm, and even with volunteer labor, they still had a tough time breaking even. Does the consumer just need to pay more? Do subsidies need to be redirected?
olivettefarm
8yr
@Rachna we are able to provide our employee with a living wage. It means we have less help, but quality help. Volunteer labor is very important for us. We generally exchange knowledge and veggies for volunteer labor. In the end though, the value of food is skewed. We also have done an apprenticeship program in the past - it involves intensive education, free room and board and a weekly stipend. It's a complicated issue, but food should cost more and smaller farmers should have more resources available to us.
DietID_TeamDietitians
8yr
thanks for sharing @olivettefarm! @johnnybowman - thoughts on how this applies aquaponics farming? Are the margins better? I know you guys are supporting the local labor force as much as possible.
JohnnyBowman
8yr
I haven't read the article but as a heads up for those who haven't as well, 19% goes to the farm - the rest goes to the "go to market" - transportation, packaging, taxes etc which is vital stuff even if a farm sold direct to consumer. Straight up advertising is about 4%. That said farms like ours are able to capture 40 - 70% of the food spend as opposed to 19%.
JohnnyBowman
8yr
I believe the source is Howard Elitzak at ERS/USDA for anyone who wants to go deep
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