Vermont currently has 6,800 farms and 1.2 million acres in agricultural production, with a farm-gate value of roughly $781 million dollars1, and in 2017, Vermont’s food manufacturers generated $3 billion in economic value.2 These food and beverage businesses are essential to the cultural and economic fabric of our rural economy. Given the limited population of Vermont, many agricultural business owners rely on populations outside of Vermont to make purchases and sustain their business. Without the support of regional consumer markets, the growth and earning potential of Vermont farms and food businesses will be limited and this important sector will see stagnation or begin to shrink in size.
Within a six-hour drive, or 330 mile radius from Montpelier, Vermont, there are 49 metropolitan areas, with a population of 49.4 million people, and 17,818 U.S. grocery stores4. These metropolitan markets are and will continue to be integral to the success of Vermont food and beverage companies and the growth of the rural economy.
When Vermont products are sold in the regional market, they compete directly with other international, national, regional, and local products, and often do not obtain the same premium price that they receive in Vermont. While Vermont’s reputation, or the Vermont brand, has some clout in metro areas such as Boston and Albany, there is lesser affinity in New York City, Syracuse, Hartford, Philadelphia, and others, forcing businesses interested in those markets to invest more heavily in marketing and branding, look more closely at their cost of production, and build relationships.
Staying front-of-mind with retailers and distributors requires a great deal of effort and investment, and requires certain volume, consistency in product quality, successful branding, and ability to offer promotions. Many small businesses have limited administrative capacity, lack of funds for marketing initiatives, limited time to travel and build relationships, and lack of expertise in sales, distribution, and logistics.
While wholesaling is one of the primary ways to reach metro areas within the region it poses unique challenges for small businesses. Distributors selling in large metro areas have an expansive pool of local, regional, national, and international products competing to meet the customer demand (see Grocers, Distribution, Marketing briefs).
Finally, despite the many Vermont resources available for assistance navigating these complex relationships, producers have limited capacity to step away from the business and invest in learning about opportunities or seeking resources such as grant funding or technical assistance. Food brokers and distributors who serve as intermediaries in gaining access to and servicing metro markets are increasingly important to producers.