Azoti Building Partnerships, Making Strides Towards Scalability

Since its inception in 2011, Azoti has implemented a myriad of supply chain solutions and programs that make local food more accessible to a number of audiences. It’s as much about introducing local food to as many people as possible as it is about supplying resources for small farms.

“The goal was always to help these small farmers find new sales channels,” says Founder Dave Ranallo. What started with sales channels was really a need to tackle theazotilogo entire supply chain, from marketing and logistics, to food safety and GAP certification.

“The buyers were not as familiar with the plight of the small farm as you might suspect,” Ranallo continues. Smaller operations can’t afford high waste or brokering with larger produce distributors, so Azoti built a solution.

“We created a supply chain solution that allows the buyers and distributors to have visibility into farmer inventory,” Ranollo says. But how do you get the farmers to participate? By creating demand.

A huge part of Azoti’s programming is their food delivery service. Deliveries to corporations, schools and other community locations provide a steady outlet for farmers’ goods. And, it’s a huge convenience factor for participants. They choose the items that they want, the frequency that fits their needs, and the goods are delivered to their office for them to take home.

From its foundation, Azoti has found several creative ways to further expand their supply chain.

A new program called Market Day is a fundraiser for schools. Similar to programs Gordon Food Service might offer where families can buy typically center-aisle products in-bulk, Azoti offers the same thing, only with healthy, locally grown food.

“Individuals then put pressure on cafeteria groups to start buying from us as well,” Ranallo says. Azoti finds many school cafeterias want to buy local, but they have to overcome the hurdle of higher costs. Showing schools that it’s an investment in not only better produce, but also the community provides the ah-ha moment that they can help farms grow.

“The hardest part for the farms and why things cost so much there is because of labor,” Ranallo says. “If these farms can have growth they can attract people because now there’s a career path.”

It’s just one example of the end-to-end solutions the company is creating.

Another new partnership is finding some unique ways to funnel locally grown produce to the Mid-Ohio Foodbank. The food bank moves 55 million pounds of food a year.

“Half of that is fresh food,” Ranallo says. “Of that half, only three percent is from small farms.”

While the food bank can’t pay the farms market price for their produce, Azoti subscribers can donate directly to the food bank. Say an individual that’s signed up for a custom membership goes on vacation. They can either defer their credits to the next week, or they can donate that week’s produce to the food bank.

Minimum orders are also required for delivery. If a school or employer isn’t quite at the 100 percent needed for a truck to make the trip, they can opt to donate the remaining percentage to the food bank.

A third program results in monetary donations. Ranallo says a common road block they have to work with is the slightly higher costs of locally grown produce. Some individuals realize the value and are willing to pay a little bit more. For other lower-income workers, as much as they may want to support local, a 15 – 30 percent increase in price really does make a difference.

Dave Ranallo

“So we created something called the pre-paid farmers market,” he says. Employers pre-pay and Azoti will come to the workplace and set up a farmers market with discounted prices determined by the HR department’s requests. All the money they take in then goes to the food bank.

“It’s these type of collaborative efforts where there are pools of money, pools of interest [and] education – Azoti just brings these things together,” Ranallo says.

A recent partnership is poising Azoti for exponential growth. Premier ProduceOne is a merger of three Ohio-based produce distributors.

“They have partnered with us and they are going to provide us with all the fulfillment capabilities – trucks, storage – but also I’m training their sales people and now we have an entire sales team spreading the word of all these programs,” Ranallo says.

Through the partnership, Premier ProduceOne will also subsidize GAP (Good Agricultural Practices) certification for Azoti’s farmers. Generally buyer-driven, it’s a food safety protocol that can be extremely expensive for farmers to achieve.

Finally, the partnerships is huge for Azoti’s scalability.

“If we do well in Ohio this year, they then are part of a group called Pro*Act USA, it’s like the NFL but for produce distributors,” Ranallo says. “They have 71 distribution centers…[and] they do about $7 billion in collectives sales, and we can then take the Azoti solution to those areas.”

While eating local is something “everybody supports” Ranallo hopes more people will put their money where their mouth is and support small, local farmers.

“We haven’t been able to take away all the excuses yet but by the end of 2015 we will,” he says. “People are slowly but surely recognizing that there are a lot of benefits it eating locally grown things.”

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