Locational Advantage and the Impact of Scale: Comparing Local and Conventional Fruit and Vegetable Transportation Efficiencies

Abstract

Some have suggested that in order for local foods to reach broader consumer segments and become price-competitive with foods sold in mainstream market channels, local farmers need to scale up their production and distribution operations to match the efficiencies of the conventional food system. In this study, we take a first step in evaluating how scaling up production and distribution could make locally produced foods more competitive with the conventional food system. We compare the transportation efficiencies of the conventional and local fruit and vegetable transportation networks in Knoxville, Tennessee, and determine the Knoxville-area food system's competitive transportation zones, defined as the region in which local farmers' shorter travel distances to market give them a locational advantage in transportation over their long distance, conventional food supply chain competitors. We analyze the extent to which local farmers' scales of production and distribution affect their transportation efficiencies, and we investigate factors that could improve their competitiveness with conventional distribution networks. We find that farms located within 25 miles (40 km) of the downtown market tended to deliver their produce to market at least as efficiently as conventionally distributed foods from California. More distant farms needed to scale up their production and distribution operations to remain within the competitive transportation zones. Investigating travel distance thresholds could provide policy-makers with useful information in planning land use and infrastructure investment projects for local food systems and in designating sustainable geographic boundaries for foodsheds and local food economies.