An Insider's Account of Walmart's Local Foods Program
By Ronald G. McCormick, November 22, 2010 - 11:58am
In October, Walmart unveiled its commitment to sustainable agriculture, including a goal to double the amount of locally grown produce we sell in the United States. But what does that mean and how will we do it? To better understand where Walmart is heading, let's take a look at what we're already doing with jalapeño peppers.
When I was growing up, I didn't know anyone who ate jalapeños. But today you can't go to a party or a restaurant without seeing jalapeños, or salsa or some other dish that contains these peppers. The market for jalapeños has grown dramatically across the U.S., yet production is still concentrated in a few places: Florida, California, and Mexico. The number of "food miles" these peppers can travel is huge.
Three years ago, Walmart realized that there was an opportunity to cut costs and carbon emissions and empower more small farmers by sourcing more peppers closer to our stores. We realized that in almost every state where we have distribution centers—regional warehouses that take in shipments from around the world and distribute them to individual stores—there is a growing season that is right for jalapeños. In some cases, the farms were practically right down the street!
We went to farmers who were already growing produce for us and encouraged them to try growing jalapeño peppers. Although we already had relationships with them, some were reluctant to grow something new. Many farmers grow a specific crop because of tradition and because they are good at it. But as appetites change, farmers can benefit by changing with the times. One area where Walmart can really help small farmers is to share information on what produce is in demand in our stores and when—and to assure them that if they grow these new crops, we will buy them. Take a squash grower in Iowa, for example. We have all the squash we need, so even if the farmer can grow more, we can't buy it. But if that farmer can grow jalapeño peppers instead of extra squash, she or he has a large customer ready to buy.
Today, we source jalapeño peppers from 20 states—including some you wouldn't think of, like New York and Michigan—and jalapeños have proven to be a win-win-win. Our customers get a fresher product. We save money on freight so we can keep our prices low, while slashing carbon emissions. And our farmers are thrilled with our new strategy—they are earning more, and they're now coming to us to ask what else the market might want that they can grow.
That is exactly what our sustainable agriculture effort will find out. In particular, our Heritage Agriculture program will focus on sourcing produce from states and regions with long histories of agricultural production. We are expanding our local sourcing of tomatoes, blueberries, and broccoli in the I-95 corridor along the East Coast; of peaches, cucumbers and strawberries in the Delta region; and of potatoes, onions, and apples in the Mid-America region. And as the program grows, the opportunities will grow too. For example, a farmer who gets good at growing jalapeños this year might grow Anaheim peppers or red Serrano peppers next year—because we're now seeing an increasing demand for these peppers as well.
Together with our farmers, we are creating a sustainable program that will drive economic growth in rural America over the long term, and we're providing the high quality, fresh produce our customers want.