Identifying Markets for Hispanic Produce Growers

Penn State Extension is offering a new series of discussion groups in Spanish for next generation growers made possible by a Pennsylvania Department of Agriculture Specialty Crop Block Grant.
Identifying Markets for Hispanic Produce Growers - Articles

Updated: February 13, 2018

Identifying Markets for Hispanic Produce Growers

Penn State Extension is offering a new series of discussion groups in Spanish for next generation growers made possible by a Pennsylvania Department of Agriculture Specialty Crop Block Grant. A group of Hispanic growers are partnering in a production unit and plan to produce cilantro, jalapeño peppers, bell peppers, epazote, onions, tomatillos and lettuce. They expect to sell these items at local Mexican restaurants and stores in the 50 mile radius of their community.

Initially this “Study Circle” will discuss: How to find the right customer for your product? Who is your best customer? What will make them want to buy from you? Here we will describe what Mexican Restaurants and Markets are looking for in produce.

To obtain answers to these questions, managers of three Mexican restaurants and two Mexican grocery stores were initially interviewed. One of the restaurant managers indicated, “Customers tell me when our sauce has changed flavor; that’s why we need Roma tomatoes for our sauce with a fresh flavor, not too tart, not too sweet, and consistent year round.” “We look for fresh and juicy big tomatoes for slicing, cilantro and jalapeños to be chopped and mixed in the sauce, and tomatillos for the green tomatillo sauce used in carnitas and to cover enchiladas.”

Freshness, quality, price, consistency, reliability of supply and delivery were the main concerns indicated by area chefs. “I don’t usually have the time to shop for our produce and depend on big distributors such as U.S. Foods or Diaz Foods,” said one of the restaurant owners. ”They provide me with produce from Maryland, and during low produce season I use Herdez or Goya canned produce for convenience”. “I would be interested in buying produce from local growers if the freshness and quality is higher and the price lower.” Some upscale restaurant chefs often pay top-dollar for hard-to-find quality produce like large organic heirloom slicing tomatoes for salads, or for other specialty produce not carried by wholesalers.

Building client relationships constitutes a core value for business success. You want to be viewed as a partner, not just another vendor selling product. Growing produce for restaurants is an art if you’re getting product to where it is appreciated. When looking for prospective clients, start by making a list of area restaurants and stores; find them in the yellow pages or on the internet. Look at their menus and see what ingredients they use. Do your products fit their needs? Growers should first call for an appointment, or stop by with some samples and ask for 5 minutes of the chef’s time. The best time to visit them is the slow time, such as between lunch and dinner, or 2-4 p.m. Face to face conversation can help build a partnership, making it a more personable relationship.

Chefs look at quality first and then price. 10-20% over wholesale terminal prices is a good rule of thumb starting point for your negotiation. A higher percentage is applied to organic produce. Discuss payment up front. Most surveyed restaurant owners pay by check two weeks at the latest. Most chefs indicated that low volumes are paid in cash at delivery. Discuss delivery days and times, and find out who should sign off on your delivery. Growers need to know the quantity, grading and pack required by type of produce and buyer.

Packaging is one of the more important steps to ensure your produce reaches your customer as it looks and tastes when you harvested it. Many restaurants and grocers require produce be provided to them in a standard pack size for each type of produce. Information on standard pack sizes, post-harvest storage requirements and crisping and trimming produce to retain optimum freshness can be found through your local extension office. A few of my favorite resources are the Wholesale Success Guide and UC Davis Post Harvest Factsheets.

Consistent quantity is a determining factor for restaurants and grocers when they are considering buying your product. The restaurants interviewed use three to ten boxes of plum tomatoes in boxes of 20 pounds each, four to six 20-pound boxes of bell peppers, three to seven 10-pound mesh bags of medium yellow onions (red onions are used mostly to garnish dishes like Chicken Mole), two to three 10-pound boxes of fresh tomatillos, one 20-pound box of jalapenos and chilies, and one box of 30 count bunches of fresh-cut cilantro every week.

Chefs indicated that labeling the produce is becoming more common when purchasing from local growers. As chefs get most of their fresh products and ingredients from food distributors they deliver packages that identify and provide useful information about the produce. Universal Product Codes (UPC or bar codes) may contain information on the producer, field where it was produced, shipper, type of produce and size of package.

Food safety is an important issue when retailing produce for direct consumption. Most restaurant and grocery stores may want you to prove that you handle food in a safe manner. That may include that you are certified by a third-party food safety auditor for Good Agricultural Practices (GAP) such as the Pennsylvania Department of Agriculture and that you buy product liability insurance to protect them and their customers. Product Liability Insurance could cost farmers anywhere from $500 to $1,500 a year, depending on your farm income and what kind of coverage you want. Some farm organizations may help you join group product liability insurance at a reduced cost.

Some detailed answers from survey participants are shown in the following table:

PaymentProducts required1Boxes per weekProduct LiabilityPrice
Restaurant 1Cash at deliveryBP, C, DP, E, J, O, PP, TOTO: 10, BP: 6, O: 10 bagsMaybeCompetitive with distributors
Restaurant 2Check at deliveryBP, C, E, J, O, PP, TO, TTTO: 5, BP: 5, O: 8 bagsNo15-20% above terminal
Restaurant 3Check by 7 daysBP, C, E, J, O, PP, TO, TTTO: 3, BP: 4, O: 7 bagsNoLower price than distributors
Grocery Store 1Check at deliveryBP, C, DP, J, O, PP, TO, TTTO: 12, BP: 6, TT: 4 BoxesNoLower price than distributors
Grocery Store 2Check at deliveryBP, C, DP, E, J, O, PP, TOTO: 12, BP: 6, TT: 4 BoxesNoLower price than distributors

1Peppers (BP), Cilantro (C), Dry Peppers (DP), Epazote (E), Jalapeño (J), Onions (O), Poblano Peppers (PP), Tomatoes (TO), Tomatillo (TT)