The Grade Gap: Part 2

In part one, I advocated for sharing the wealth with less fortunate folks through donations of cull grade product. Now let’s look at a trend developing in the food service sector of specifying #2 product for contract business.

This is a particularly difficult proposition for a grower. The seeds are bred to produce fancy grade and minimize the culls. Financially, that is what keeps the grower in business. While they need a home for the less-than-perfect product, it is nearly impossible to determine the quantity that will be available from any given harvest.

The gap comes into play on several levels, most notably price and supply.

The contract user is looking for a stable supply at a low price. The grower aims for a steady supply at a reasonable price. To find a happy medium, we need to specify the range of acceptable defects allowed in exchange for the preferential price. Communication of the expectations of both sides is where a gap appears. Size, shape, quality, shelf-life, presentation, yield, etc. all affect the deal.

“Consistency costs more” is the central theme. A tight spec provides the end user with consistency but eliminates yield for the grower causing prices to climb. Widen the tolerance parameters and the cost decreases dramatically on the production side and but will increase on the usage side.

With proper communication, we can close these gaps for everyone’s benefit.