Good practice:

Web- and social network based distribution channels - Local Food Nodes and REKO

Local Food Nodes is an open digital tool in the form of a web site and app where local food producers can market their products, customers place an order, and payments for the pre order go straight from consumer to producer. Deliveries and pickup take place at a predetermined place and time. The organization operates as a cooperation, and therefore own the sales channel and can develop it accordingly to how the model expands and grows. The other example REKO has the same aim but functions a bit different: REKO connects producers and customers in rural areas with long distances. Model shortens supply chain in selling of products. REKO groups give well targeted visibility to local producers and help them to connect with potential customers in very cost efficient way. REKO groups are operated in social media platform (Facebook closed group) that is easy to access both sellers and buyers. In group specified delivery days for products are announced wellbeforehand. Connected to these delivery days, producers can place products on sale and market products, members of group can place orders. Deliveries are executed in agreed (always same) place where products are picked up and paid. Model is not owned by any certain body or organization - in this way it is kind of “open-source” model for retailing. The main beneficiaries for both practicies are local food producers and inhabitants.Offers low-cost distribution and marketing channel and can reduce the marketing and packing costs

To place your orders on Local Food Nodes, the customer needs to become member and pay an annual fee to use the tool. It´s paid yearly and all consumers self-determine the size of the amount. As a social network based system, REKO does not require monetary resources and is operated volontary basis.

Local Food Nodes is available all over Sweden with 118 local nodes active right now and expanding for every year. In Söderhamn there are 32 producers using the tool and the number is growing for every season with high demand. The model is also expanding to other countries internationally. REKO system started in 2013 and since then spread nationwide but also internationally.In South Karelia region the demand for products is at the moment bigger than offering.The number of members are increasing

The challenge is to get enough crowd funding and members to use the tool to get enough funds for development of the platform. Facebook as a tool has many benefits for REKO, but it also creates challenges. As you don’t own the media, you can’t affect the platform development and changes made.

This type of sales channels can motivate producers that are just selling small amounts to increase their production due to the availability of a tool like this. The waist of product is more or less non-existing due to the fact you always know how much you have sold before you meet up with the customers. The idea is that Local Food Nodes can be set up in any country under this business model and crowd funding is becoming more and more popular. Customers are also becoming more aware and want to know the origin of the food they eat. With this tool, it makes it easy for the customer to purchase without having to drive around. If region has active producers, the REKO model is very easy to adopt in all retail, not only retail of food. This is proved by the popularity of the model internationally. The activity of producers is a key success factor to run REKO successfully. To maintain the interest of the members of the group, there has to be enough offering and group has to be active.