You’ve probably heard this familiar story before.
In a bustling little village somewhere, some folks eager to find an option to mass produced food decide to start their own small business providing an alternative. After much research they kit out their premises, get all the appropriate authorities and start making their local and seasonal product and selling it at farmers markets and such.
The product attracts the attention of some foodies and before long interest picks up. In next to no time the product is regularly appearing on local menus and demand increases significantly.
Calls from mainland grocers and A list chefs have increased the burden on the producers now who have employed some staff and begin to get approached by distribution companies who are eager to represent their product in their portfolio.
Then the days arrives and like the deep timbre of a church bell sounding in a Gothic novel heralds a fork in the road, where demand completely outstrips the capacity for the fledgling producers to keep up and choices have to be made.
In order to meet this growing demand the producers are forced to consider ‘tooling-up’ to increase production and distribution. This will mean a hefty injection of capital investment on the existing infrastructure and perhaps call into question whether the current premises are suitable for expansion.
To justify the expenditure, forecasts are initiated on future growth of the product which means new markets will have to be tapped into. This brings marketing into the equation and its subsequent costs. By now, the product has attracted the attention of investors who are eager to ‘get in on the ground floor’ to park some money in the product for a while.
Soon, the bullet has been bitten, monies are borrowed, and capital partners are taken on. The day-to-day manufacture of the product is now overseen by many staff and in-roads into suitable markets are now being explored. The small village in which the business started now employs most of the townsfolk and as a result other businesses have closed unable to hold onto staff.
Production ramps up. Money is coming in, smiles all round and everyone’s happy.
Then another one of those ominous Bell rings occurs, more change to come.
It seems the investors keen to see more margins squeezed from production costs enquire if the product could be, you know, made with cheaper or alternative ingredients? The rationale is if production costs are hacked into, it would make the product a very attractive acquirement to a big food player’s group.
The decision to cut costs is made after lengthy and impassioned negotiations.
Some of the staff are made redundant as a result, the product now has a list of ingredients that are no longer recognisable and some of them are shipped in from other parts of the world. The village contracts and goes on with unsteady but stoic steps. The desired outcome has been achieved, profits increase and investors are happy.
Finally the day dawns when an offer by a large multi-national to buy-out the product sits on the table.
After much hand wringing, and soul searching, the resolution is made to sell.
The original producers move on with fuller pockets to greener pastures.
Meanwhile, some signs of anti-consumer sentiment come to the attention of the multi. It seems that the product has lost some of its lustre since the merger and subsequent acquisition by a major food player.
Despite the rosy image of the countryside on the packaging and all of the spin at their disposal the company takes a few too many hits and decides to cut cost further by out sourcing more of the ingredients for the product and using offshore labour.
The factory in the village is closed and all its remaining workers are sacked. The prodcut now has no link to its origins nor its heritage, it has finally become a brand only.
With few prospects left in the area, most people move on. The village suffers years of neglect and economic depression until tree/sea changers eager to get way from the big cities, start buying properties in the area. Pretty soon the village is alive with people and hope. Then one day a couple decide to start a small artisan food business...