The Economic Benefits of Farm-to-Table Restaurants

Farm-to-table. Organic. Free-range. Non-GMO. Sustainable. You’ve heard it all before. 

These terms have been floating around for decades, but they have finally entered the vocabularies of average consumers. In a world where diners are far more conscious of what is on their plates, it is important for restaurants to understand what each one of these terms means and how they benefit restaurant owners. We’ll start with the economic benefits of farm-to-table restaurants.

What do we mean when we talk about farm-to-table?

This is where things get a little bit murky. We believe that farm-to-table means locally sourced food that is grown sustainably. Many diners and restaurateurs agree, but there is dissent in the restaurant industry and among diners in how the term should be applied. Some industry gatekeepers claim that farm-to-table is local food that must be non-GMO and completely organic. Critics of the movement argue that farm-to-table is nothing more than a fad or even food fraud, a public relations opportunity for restaurants.

We’re here to tell you that farm-to-table, when done right, is all about sustainable agricultural practices, feeding hungry customers food that is nutritious and delicious, and just smart business. There are many benefits of operating a farm-to-table restaurant. The short list includes reduced travel time resulting in fresher produce and lower carbon emissions, and greater transparency into the supply chain. Then there’s the thing we’re here to discuss, the economic benefits of farm-to-table.

What are the economic benefits of farm-to-table?

Benefits for the local economy

Farm-to-table simplifies the process of getting food from the farm to a diner’s plate, removing geographical distance and industry middle-men. A farm-to-table restaurant benefits the local economy by cutting out all of the extra fat in the supply chain and allows local restaurants to build relationships with local farmers. 

These relationships do more than create transparency that results in fresher food. After all, studies have shown that produce is consistently picked early to travel the average 1,500 miles that it takes to get to its destination restaurant. What we’re talking about is the increased profit for both partners and circulation of a single dollar in the local economy. Reducing the average 1,500-mile journey and overreliance on massive corporations to a 50-mile journey and local partnership means a customer’s dollar is spent in a restaurant, then to the farm it goes for food products, and then back in the area of the local farmer. The Farmers Market Coalition found that farmers receive only 17.4 cents from every dollar spent on food in America, but nearly 90 centers from every dollar spent on food at farmers markets. That’s a huge difference!

Today’s diners value sustainability, variety, and freshness above all else. If your farm-to-table restaurant chooses to transfer part of the added cost to your consumer, that’s your prerogative. If you use the moniker as a differentiator, you will certainly be perceived as a good neighbor and provider of fresh and nutritious seasonal food. Which brings us into the benefits for restaurants.

Benefits for the restaurant

There are two general types of farm-to-table restaurants: those that own the farm and those that source their food products from a local farm. There are important economic differences for the owners. 

Farm-to-table restaurateurs who also own a farm are forced to invest more capital into their business. With greater investment comes greater risk, especially if there is a lack of experience in the agricultural space. Of course, there are obvious benefits of owning the entire supply chain. A farm-to-table restaurant that has focused its efforts on vertical integration can cut costs associated with dealing with food distributors (many of whom are several states away, or even international) and can assure the quality and freshness of the ingredients used in their dishes.

Farm-to-table restaurants that choose to partner with local farms will also find that their food products are fresher and more varied. While higher costs can be a concern for restaurant owners, these depend on your relationships with your partner farms and might even be worth the added cost to guarantee the quality of your food.

We have already mentioned the most obvious benefit of a farm-to-table restaurant: happy customers. A restaurant that bills itself as farm-to-table, and walks the walk, shows local diners that they are passionate about quality ingredients, sustainable agricultural practices, and supporting the local economy.