How small farms found new customers during the coronavirus pandemic

When the Covid-19 pandemic forced businesses to close and people to stay home, the way Americans obtained and consumed food changed drastically.

Grocery stores were selling out and food banks were overwhelmed, but many farmers who used to supply restaurants, schools and commercial enterprises found themselves stuck with tons of extra products. As the initial shock of this shift subsided, local farmers have pivoted to new business models and doubled down on their communities.

One defense is a closed-loop food system in which a farm controls an entire food chain.

“If you’re not growing it locally, and you’re not raising it locally, you’re susceptible to a disruption in the food chain,” said Jon McConaughy of Double Brook Farm in Hopewell, New Jersey.

Jon and his wife, Robin, already invested in a closed-loop food system before the pandemic. They started with the farm in 2003 and over time have added a slaughterhouse, butcher shop, bakery, market and restaurant. Everything is born, raised and harvested on the farm. What doesn’t get used in the restaurant or market also returns to the farm as food or fertilizer.

As a result, when the pandemic disrupted supply chains elsewhere, the McConaughys did not fear running out of food. Of course, they were not spared entirely — they had to close their dining area and shift their market to online ordering, pickup and delivery. Before getting a loan through the Paycheck Protection Program, they furloughed 75{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} of their staff, around 70 employees.

But the McConaughys have steady customers who appreciate the relative certainty of their offerings.

“I think there has been a real shift in the way people view us as a provider of local goods,” said Robin McConaughy. “Our customers have been so happy that we’ve been open. And it’s made them feel safe and sort of calm that we’ve been able to say we are always going to have eggs.”

The closed-loop food system does have a vulnerability: Covid-19.

“What we’ve built has insulated us … a lot of stuff can happen in the rest of the world, and it won’t affect our food system,” said Jon McConaughy. “Except if our employees get sick.”

Like other business owners, the McConaughys have taken precautions, such as wearing face masks and gloves and using hand sanitizer.

During the pandemic, the appeal of buying from local farmers is not just about values, it’s also about security.

“Local is not only about where your food comes from or the practices that the farmer’s using, but it’s also about the idea of security of a community,” said Jon McConaughy.

The closed-loop food system on a slightly larger scale is the closed-loop community food system. Double Brook had already developed mutually beneficial relationships with other farms in the area so that it could offer more products. It emphasized the value of community by partnering with nearby farmers who use sustainable best practices, such as Blue Moon Acres, which primarily supplies its tavern with specialty rice and microgreens. Double Brook also uses Zone 7, a local farm food distributor based in New Jersey, to supply its market and tavern.

As the pandemic reduced some types of demand but created others, these relationships became even more important and gave businesses a chance to pivot their operating models.

The shutdowns in March hit both of the latter businesses hard and fast. Zone 7, which primarily delivered to schools and restaurants, lost 80{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} of its sales overnight. Blue Moon Acres had nowhere to move many of its products because 90{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} of its customers were restaurants, including those of the world-renowned chefs Daniel Boulud and Jean-Georges Vongerichten.

“We literally dumped five greenhouses full of product in one day, on everyone’s last day at work,” said Blue Moon Acres co-owner Kathy Lyons.

Both businesses pivoted to meet the changing demand of their remaining customers and the different demands of new potential customers. Zone 7 expanded its home delivery service and sold more to retailers. It found new partners who were trying to get their products out, such as Blue Moon Acres.

The relationship “really kind of kept us going,” said co-owner Jim Lyons. Blue Moon Acres now sells more seedlings and containerized items to distributors, supermarkets and individual customers through its website. 

Blue Moon Acres also found customers were more willing to buy new types of products. As the only commercial rice growers in New Jersey, the Lyonses found the $100,000 worth of rice they had stored from last fall became one of their best-selling products during the hard times, and they are preparing to harvest a new crop in September.

Their local Giant supermarket has approached them about selling baby greens directly to consumers too, a sign of increased demand. Kathy Lyons said she believes this potential business opportunity arose because “people more than ever want to know where the food is coming from.”

It remains to be seen how deeply customers’ values and behavior will change as the panic about empty supermarkets has subsided and certain parts of the country reopen. As of July, the McConaughys have reopened their market for in-store shopping with a limit of eight customers at a time. They now offer outside table-service dining both on a great lawn and in a newly purchased 40-by-60-foot tent. With the help of the PPP loan, they have hired the majority of their staff back and switched around roles to meet the business’ changing needs.

Though Robin McConaughysays more people seem to be shopping at supermarkets and ordering takeout at restaurants again, their market business is “steadily returning.”

She also remains hopeful that “if there is even a minor blip in the food supply, our community will come straight back to the local mindset. The ‘sticky’ business has come from customers we did not have prior to the pandemic who found us and found value in the quality of our products.”

To follow more of these businesses’ stories, watch “Supermarket Shock: Crisis in America’s Food Supply.”