Buyers' Groups

One of the biggest issues with sourcing from small ethical producers, is that these products come at a higher cost. This is mostly due to being grown in smaller volumes with more manual labour while paying higher wages. This means it is not possible to compete on price with huge supply chains buying in large volumes forcing farmers to accept prices often extremely low or sometimes even below the cost of production. If these smallholder products were to run the length of a standard supply chain, they would be unaffordable to most families by the time they got to your plate. And this is where we need to start rethinking how we source our food, which is where communal buying can come in as a potential solution.

To avoid a really expensive shopping bill for your ethical food, people have started buying groups so they can buy in bulk, at either wholesale or near wholesale prices. Somewhat obviously, the first thing to make this happen is to find a group of other like-minded people. Many groups also find they know a farmer or supplier willing to sell to their group at a reasonable price (if you don’t know someone, hit some growers up at the local farmers’ market). This can supplement the more general range of produce available from a larger wholesaler. Some groups even have some of their members providing food from their gardens or condiments they make themselves.

After you have the core group assembled and you have worked out the nuts and bolts, a few more people ordering is a good idea as all the wholesalers have a minimum order value usually around the $500 mark. This is due to the low margins in wholesale, which are made up for in volume. Further, a lot of the items, are around the 20kg mark and you need a few families to distribute that many potatoes (or in our case rice). Ways around that are to order greens weekly and hard veg fortnightly, but doing it this way may make it difficult to order the minimum value required by most suppliers.

It also may be around this time you may want to start talking to suppliers, there are dozens of wholesalers around Australia, some of which are happy to deal with buyers’ groups and some that will require an ABN. This is mainly because it can be a lot more work to deal with people out of the industry and partly because they don’t want to be seen cutting the final link in the supply chain as the retail shops are their bread and butter; they order well and often.

Another thing to consider is how you want to distribute the goods. For some groups a fixed box of F&V works, for others, they would like to choose what they want. The choice here will determine the level of administration involved. The fixed box means everyone shares the cost of the orders, whereas those that want to choose what they get will need to split the cost fairly. If someone in your team is adept at spreadsheets you can knock something up. But if you want a piece of software then you can look into co-operative software. Around Queensland, most of the groups we are involved with, use Lettuceshare. While it has a little bit of a learning curve, it is very affordable ($2 per active member per month capped at $50) and covers the basic operations. This software is quite customisable with options for ordering times and frequency, accounts system, price markups to cover additional costs and even payment reconciliation (so you know who paid what).

While a buyers’ group can be a tricky thing to navigate, we have had experience with quite a few that have been going for 10 + years. The main thing they have in common is a dedicated community that is keen to see a change in the current system. The current system is one where the people growing our food are the ones under the most pressure to drop their costs, while CEOs and shareholders see the profits from their hard work. Buyers’ groups allow people to take control of their own supply chain and offer a chance to facilitate the change they want to see. With a dedicated group of people, you can make that change.