Red Tomato - MASSACHUSETTS State Winner

Congratulations! This Entry has been selected as a winner.

Red Tomato - MASSACHUSETTS State Winner

United States
Organization type: 
nonprofit/ngo/citizen sector
Budget: 
$1 million - $5 million
Project Summary
Elevator Pitch

Concise Summary: Help us pitch this solution! Provide an explanation within 3-4 short sentences.

Red Tomato coordinates marketing, logistics, and sales to create market opportunities for a regional(New England, NY, NJ, PA) farm network. By offering supermarkets one-stop access to season-long, farm-identified local, Red Tomato increases consumer access to local produce and ensures that small and mid-size farmers can compete in today’s wholesale market thereby solidifying farm sustainability.

About Project

Problem: What problem is this project trying to address?

In the cutthroat world of produce commodities, it’s nearly impossible for small Northeast farmers to differentiate their tomatoes or apples in order to compete with those brought in from California, Chile or China. Most farmers sell into a system where distributors and retailers hold the power. Farmers are treated as interchangeable, dispensable commodity suppliers. The lowest price usually determines what is sold. As a result, while very large farms are increasing in number, small and medium-size family farms are threatened with extinction. When farms go out of business, farmland is lost forever to development or industry, and farming knowledge disappears rather than being passed along to a new generation. Rural communities collapse and those losses affect urban residents’ access to clean water and healthy food. Maintaining a place for these farms depends on creating market relationships based on fairness, equity and stewardship. Conventional supply chains do not provide such rewards.
About You
Organization:
Red Tomato
Section 1: You
First Name

Laura

Last Name

Edwards-Orr

Organization

Red Tomato

Country
Section 2: Your Organization
Organization Name

Red Tomato

Organization Phone

781-575-8911

Organization Address

1033 Turnpike St. Canton, MA 02021

Organization Country

, MA

Your idea
Country and state your work focuses on

, MA

Innovation
What makes your idea unique?

Red Tomato is one of the first organizations in the country to explore a regional value chain that provides fair returns to farmers and functions in the modern marketplace. We do this through marketing, trade and education, and through a passionate belief that a family farm, locally based, ecological, fair trade food system is the way to a better tomato—and a better food system.

We’ve been built a prototype of a regional distribution and marketing network for fruit and vegetable growers in the Northeast. We serve millions of eaters, while demonstrating that wholesale growers can be compensated fairly (our “dignity deal”) for a high quality product, receive rewards for sustainable practices, and have a voice in strategy and price setting. The characteristics of our farmer-focused, market-driven model include:
• Differentiation: through branding and farm identity preservation;
• Fairness: pricing based on the “dignity deal,” and transparency;
• Rewards for ecological farming: advanced IPM and organics; certification; a learning community for ecological farming;
• Efficient systems: a coordinated, decentralized, cooperating farm network;
• Collaboration: through a network of farmers, researchers and retail partners committed to sharing knowledge and continuous improvement; and
• Quality: flavor and freshness as a basic requirement.

RT’s regional grower network maintains quality control and packing of product, thereby retaining extra value-added dollars to farmers. RT develops quality control standards, coordinates pick-ups and deliveries, covers growers with product liability, provides branding and packaging design and purchasing, and provides food safety training, and an eco certification.

Do you have a patent for this idea?

Impact
What impact have you had?

• Sales growth from $98,000 in our pilot year to $2.8 million in 2009, with peak sales at $3.2 in 2008
• Grower network of 40+ farmers in 7 states
• In the 2009 Grower Satisfaction survey, the average ranking of Red Tomato’s overall benefit was 4 (on a scale of 1-5(highest)
• 26 trade buyers with over 200 retail location exposures
• 13 certified EcoAppleTM growers, 3 peach growers to be certified in 2010
• 3 GAP certified farmers in 2010, 26 more in process which will protect growers from impending mandates on behalf of trade buyers that all growers be food safety certified
• 2-3 consulting jobs/year to share what we know with organizations starting up in the logistics, marketing, and distribution world. Each year we recieve hundreds of speaking requests and informational sessions with people who are interested in learning more about what we do.

Actions

Red Tomato’s is reinventing the supply chain so that local farms to thrive, more citizens to obtain good food from nearby, and communities to reap rewards from a robust, sustainable regional food and farming system. RT’s unique model of regional produce distribution is designed to make it more feasible for supermarkets and distributors to buy and sell ecologically produced fruits and vegetables from our region’s farms, thereby making it easier for consumers to find good food, and easier for farmers to stay in business. In RT’s approach, farmers are treated fairly as partners. This is pioneering work that goes against the current of mainstream produce wholesaling. RT is not just another trade company. Our model involves risk and experimentation and pushing against entrenched systems. It is a creative laboratory to test and innovate.

Results

1. Thriving mid-size family farms –this is crucial to achieving a truly sustainable food system
2. Ensuring access to local produce where people shop everyday – we want to bring the pleasures of regional produce to everyone, not just for their health but for a stronger connection to the food they eat and the farmers that grow it.
3. Sharing what we know – we believe in the importance of our work within the Northeast. However, we also believe that sharing what we know with non-profits, businesses, and farmers across the country multiplies the impact of our successes far beyond our own market share.

What will it take for your project to be successful over the next three years? Please address each year separately, if possible.

Grow the network: Red Tomato is a regional organization. Because of the many microclimates within the region, our network of growers are able to work together to offer customers almost gap free product supply – an important factor in maintaining customers and markets. Right now, we are close to doing this with lettuce and apples. We hope to expand this concept to most of our product lines by developing more growers in all corners of our region.

Expand our reach - more products in more stores for more consumers: Over the course of the next three years we hope to expand the number of local product items we have in stores while expanding our customers base to include a wider variety of retail locations and end consumers.

Product differentiation: It’s not enough to simply get local product on the shelves. Consumers want a connection to the person who grew their food. When we can “differentiate” a product by telling the farm story, it has more value to the person taking it home. Consumers want to know that their food was grown safely both for them and the environment. To accomplish this goal, Red Tomato is expanding the number of products that are branded and carry farm identification as well as the number of products grown as part of our Eco program.

Organizational effectiveness: Red Tomato is halfway through an intensive strategic planning process. Through this process, we’ve identified several areas within the organization that will be improved over the next three years. These include use of technology, leadership and training skills, and better ways of sharing what we know.

We feel that a concerted effort on these four areas over the next three years will significantly increase our ability to meet our mission and exceed our goals.

What would prevent your project from being a success?

Red Tomato operates in a world where we can only plan for half of what’s to come. Weather patterns, as well as the economic climate, have become increasingly difficult to predict. Assuming that we can’t know what we don’t know, our security plan, just like any good farmer, is diversity. Diversity in customers, products, growers in every part of the region – we need this security net to protect ourselves against the unforeseen challenges in the marketplace and the climate. Insufficient diversification would severely limit our ability to fully fulfill our mission.

How many people will your project serve annually?

More than 10,000

What is the average monthly household income in your target community, in US Dollars?

Less than $50

Does your project seek to have an impact on public policy?

Sustainability
What stage is your project in?

Operating for more than 5 years

In what country?

, MA

Is your initiative connected to an established organization?

Yes

If yes, provide organization name.

Red Tomato

How long has this organization been operating?

Less than a year

Does your organization have a Board of Directors or an Advisory Board?

Yes

Does your organization have any non-monetary partnerships with NGOs?

Yes

Does your organization have any non-monetary partnerships with businesses?

No

Does your organization have any non-monetary partnerships with government?

No

Please tell us more about how these partnerships are critical to the success of your innovation.

Red Tomato is engaged in a number of partnerships with other NGOs engaged in similar efforts to create distribution options for famers. For example, we helped to create NE Sustainable Traders Network for sharing info, collaborating. We provide both free and paid consultation and advice to other NGOs, grower networks and businesses re: our approach to fair pricing, marketing and branding, and logistics management. At the moment, Red Tomato has partnered with the Northeast Sustainable Agriculture Working Group NESAWG to develop a regional distribution working group which will assess the opportunities and gaps distribution infrastructure within the Northeast.

Red Tomato’s Board of Trustees is also a strong collaborator that brings a wealth of experience and a diversity of expertise that strengthens our ability to make strategic decisions, keep a laser focus on our mission, and evaluate our impact.

What are the three most important actions needed to grow your initiative or organization?

Foster grower ownership of the network: As we continue to develop customer demand for the high quality products our growers raise, our value to their farm rises. What we’ve also experienced, however, is that the growers who benefit most are those who take ownership of the network. Grower ownership translates into leadership within the network, a willingness to experiment and share risks with Red Tomato, and the understanding that short term challenges may strengthen Red Tomato and the network over time. One of our key actions over the next few years will be to grow and foster an ever-deepening feeling of grower ownership within our network.

Sharing what we know: As more and more organizations are attempting to figure out the marketing, logistics, and distribution puzzle, it is more important than ever that Red Tomato act as a resource to share the lessons learned in our laboratory. We do not seek to be the biggest or the most successful produce company in the country. Instead, we seek to be at the cutting edge of innovation, progress, and movement towards the development of a sustainable, regional food system. As a though leader it is not only a responsibility to share what we learn but our best way to test the solutions that we have developed in a variety of market places and regions around the country.

Staff Development: Red Tomato has grown by over 60% in staff over the past several years (from 6 to 10 staff). As we grow, we must continually work to ensure that are staff have the tools they need to bring their personal and professional goals to fruition. We do this through coaching, leadership training, and full participation through out the staff in organizational development, strategic and short-term planning, and sharing project management responsibilities.

The Story
What was the defining moment that led you to this innovation?

Red Tomato was founded in 1996. Michael Rozyne, one of the founders of the fair trade company Equal Exchange, took a sabbatical in 1995 from the fair trade coffee world to explore what it might look like to apply the lessons and principles of the fair trade movement to support farmers in the northeastern U.S.
Local food had yet to grab the attention of consumers, retailers, food writers or policy makers, but it was clear that small and medium sized farmers were losing their ability to compete in an increasingly consolidated, global marketplace. At the same time, fresh produce available to consumers had lost much of its flavor, seasonality, and even nutritional value thanks to standardization and long-distance transport and storage. Red Tomato was born out of the question: “What would fair trade look like for regional produce in the Northeast?”
At first, Red Tomato functioned as a small warehouse and distribution operation, in addition to marketing, selling and helping to develop new products. Eventually, it became clear that a conventional distribution model at that scale could not compete economically. In a risky and carefully considered shift, Red Tomato closed its warehouse, cancelled its truck lease, and began to concentrate on managing logistics through a network of farmers, independent truckers, and wholesale partners. Coupled with renewed focus on marketing, branding, and packaging to help give the farms and products more visibility with consumers, this strategy is working. Today our grower network is stronger than ever and despite the economic downturn and growing unpredictability in the weather, the volume of produce that we have sold over the past two years has remained steady AND at an all-time high.

Tell us about the social innovator behind this idea.

Michael Rozyne’s career in food began when high school ended. On an AFS trip to Bombay in the summer of 1974, Michael saw famine in India. He walked miles through city streets, followed by young children begging. Upon reflection, Michael could not reconcile the poverty and disease in India with the standard of living that existed in the United States. India also left him addicted to papaya and mangoes.

As a college student at Bowdoin College, Michael organized a natural foods dining program which survives to this day. His college mentor was a political economist, David Vail, whose research was on the economics of successful organic farms in Maine. Under his guidance, Michael studied the root causes of world hunger, U.S. farm policy, and socialist economic systems.

After graduation, Michael worked 60 hours a week at $3.00/hour, no overtime pay, for two years after college, for a Yankee curmudgeon farmer named Mel Estabrook. The combination of mental and physical work with growing and harvesting things developed a new passion in Michael. Michael’s next step was to develope purchasing and product development skills at Northeast Cooperatives. There Michael also learned how to manage a wholesale food business and studied financial management in night school.

Founding and launching Equal Exchange was Michael’s next milestone. There, with two trusted colleagues, the young entrepreneurs had the opportunity to do business in a new way. They built a structural fortress around the fair trade mission, while financing the business with investments from individuals who believed in that mission. Employees controlled the business, yet contributed only 10% of the working capital. In 2002, with sales of $10.2 million, EE paid coffee farmers premiums over the world market price of coffee that totaled $1.2 million.

The farms of the Northeast, though, still had a hold on Michael. His sabbatical in 1995 brought him back to this first passion and Red Tomato was born.

How did you first hear about Changemakers?

Email from Changemakers

If through another, please provide the name of the organization or company

50 words or fewer