Editor’s Note: This is part of our Good on the Ground series, profiling entrepreneurial women who are addressing social issues in innovative and inspiring ways.
When Tatiana Garcia-Granados bought a fixer-upper in Philadelphia’s Strawberry Mansion neighborhood in 2002, she fell in love with the area’s historic homes, colorful murals and tight-knit family feel.
Less appealing was the state of decay that the neighborhood — once home to jazz musician John Coltrane — had fallen into. Not only was there crime and a lack of decent housing, but Strawberry Mansion had become unhealthy: Its residents, many of whom are working-class African-Americans and Latinos, suffered from diet-related diseases. The culprit? Lack of access to healthful food. The corner shops were more likely stocked with processed packaged food than fresh fruits and vegetables.
Restoring Access to Local Farm Food
Listen to our podcast episode for more of our interview with Tatiana Garcia-Granados.
Garcia-Granados, who was just finishing up her MBA at University of Pennsylvania’s elite Wharton School, decided to investigate the problem. “We’re relying so much on markets,” she says. “But when you have pockets of either low density or high poverty, there’s no incentive for people to create supermarkets” — think Whole Foods or Trader Joe’s — “or other interventions that would get healthy food into the communities.”
What frustrated her was the knowledge that just outside Philly, in Pennsylvania’s rolling countryside, family farms were producing beautiful, nutritious, organic produce. Yet those farmers were struggling and on the brink of disappearance themselves. “Our agricultural system has just become bigger and bigger,” she says. “It’s cheaper to get a truckload of food from California than it is to get a pallet from Upstate New York to New York City. It doesn’t make any sense.”
Her ambitious solution: rebuild the regional food infrastructure. In 2008, she and husband Haile Johnston partnered with Bob Pierson, a longtime advocate of farmers markets in Philadelphia, to launch The Common Market. As a wholesaler, the nonprofit connects about 80 local farms to public schools, hospitals and workplaces — essentially, supplying fresh produce, meat and dairy to “communities that need the food the most,” she says.
Building for Scale
A key to solving the distribution problem is scale. While Garcia-Granados would still like to see Strawberry Mansion’s corner shops filled with fresh food, it’s simply not cost-effective for local farmers to supply mini markets with small batches of produce. Instead, The Common Market strikes vendor deals with big food-service companies like Sodexo, Aramark and Compass Group, which supply the city’s institutional buyers. As a result, The Common Market now delivers fresh farm food to 26 charter schools, reaching 14,000 kids.
“The reason we work with the institutions is that they have the volume that makes sense for the farmers,” Garcia-Granados says. “The food is ultimately going to the kids.”
Starting such a capital-intensive business isn’t easy. A food distribution network requires refrigerated storage and a fleet of trucks — and profit margins are low. For that reason, the co-founders decided to structure The Common Market as a 501(c)(3) nonprofit. “We’re able to get grants for capital, and then we’re also able to tap into low-interest or ‘friendly’ loans,” Garcia-Granados says.
The business has received upwards of $1 million in grants from the W.K. Kellogg and Kresge foundations, and has worked with RSF Social Finance to fund the $1.2 million acquisition of a 50,000-square foot warehouse in North Philadelphia.
Growing for Impact
The Common Market also has earned revenue — certainly enough to prove its concept. The nonprofit buys food from farmers, then marks it up and sells it wholesale to buyers. In its first year, The Common Market made $100,000; after 5 years, it reached its break even point of $1.7 million. This year, the 35-employee business anticipates $4.5 million from its Philadelphia operations.
Based on this success, the co-founders have decided to expand. “We’re replicating our model to different regions in the country,” Garcia-Granados says. Last year, The Common Market opened in Atlanta, making $250,000 in revenue in just 9 months of 2016. The business expects $750,000 for 2017, and counts Emory and Georgia Tech universities and 12 hospitals as buyers. Meanwhile, Garcia-Granados currently is doing her due diligence, looking to expand to New York, Chicago and the Central Texas area.
The growth still surprises Garcia-Granados, who was merely thinking about bringing fresh food into Strawberry Mansion when she started. “When we went into it, we weren’t thinking of solving a national problem,” she says. Now, it’s The Common Market’s mission to bring together two marginalized groups: lower-income minority communities and small farmers. And in that sense, change can’t come fast enough, she says.
“On a day-to-day basis, things happen pretty slowly,” she says. But, “we’re playing for the long haul. We hope 50 years from now, the food system is totally different.”
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Tatiana Garcia-Granados – Co-Founder – The Common Market – Final Conformed Script
Tatiana: It’s cheaper to get a truckload of food from California than it is to get a pallet from Upstate New York to New York City. It doesn’t make any sense, but that’s just the way that our system has developed.
Tatiana: The Common Market is a non-profit distributor of local farm food. We make the connection between local farms in our region to the institutions and get the food into the communities that need the food the most.
TEXT: Tatiana Garcia-Granados – Co-Founder – The Common Market – Philadelphia, PA – USA
Tatiana
Tatiana: I was born in Guatemala and my father actually had a farm in Guatemala, a pretty big cattle farm. I just have really fond memories of being able to get coconuts from the trees and chopping open with a machete and getting a drink.
TEXT: In 1981, when Tatiana was 7, her family immigrated to Miami.
TEXT: After high school, she moved to Philadelphia to study International Relations at the University of Pennsylvania.
Tatiana: Right after college I actually went to, to work in Central Florida with migrant workers who are living in the US but who are just invisible in, you know, in our society. And I learned a lot about the food system.
TEXT: Tatiana planned to work in finance, and in 2001 she began her MBA at the University of Pennsylvania.
TEXT: There she met her husband, Haile Johnston.
Tatiana: When Haile and I discovered this amazing neighborhood in Philadelphia we were able to buy a house. And as we were spending more and more time there we also became aware of how much need there was and how much also opportunity there was for us to make a, a difference.
TEXT: Tatiana and Haile started a nonprofit organization called the East Park Revitalization Alliance.
Tatiana: We started with the goal of bringing resources into this community that had been, you know, really neglected for, for a long time. One of the most popular activities that we did with the, with the kids was healthy cooking classes. After doing it for a few months we realized, “If the kids wanna actually teach their parents or take what they’re learning home and prepare food for their families there’s no place in our neighborhood where they can buy this food.” And so that’s what, you know, kind of prompted our, our exploration into how do we get healthy food into the community itself.
TEXT: Tatiana and Haile realized that farmers’ markets couldn’t solve the problem.
Tatiana: Farmers, they’re low income, too, and they need to get a fair price for what they’re growing and it’s not gonna work if we have low-income farmers trying to serve low-income consumers. In order to make the food accessible and affordable it needs to be at a volume that can actually, you know, have efficiencies and start to bring some, the prices down.
TEXT: Tatiana and Haile wanted to buy food at fair prices from local farmers and sell it to institutions around the city.
TEXT: In 2008 they started a second nonprofit, The Common Market.
Tatiana: A non-profit structure would allow us to access the grants for capital, and then we’re also able to tap into kind of low interest loans for the capital that we needed to get started. Just to start up you need to have, you know, a refrigerated warehouse space. You need to have refrigerated trucks. You need very expensive assets in order to do this.
TEXT: The couple began by sourcing produce from just five farmers near Philadelphia.
Tatiana: Our farms are usually within the 75 mile range. It gives you an idea of how close the agriculture is to the city which makes it even more mind blowing that it’s so hard for the food to get here. We love working with institutions because a hospital or a public school is making a larger order.
SOT We made a salad out of that—
-Oh, I love (unintelligible).
-And tomatoes.
-This is amazing.
Tatiana: And then also they’re typically working with some of the more marginalized people in our society.
TEXT: The Common Market works with more than 80 local farmers.
TEXT: The organization makes 75% of its revenue selling an average of 250,000 pounds of food a month.
Tatiana: We started a national expansion about a year ago, replicating our model to different regions in the country. One of the big challenges right now is trying to go from being a pretty small, lean startup based in Philadelphia, in one location. And by going national, how do we also replicate the culture, the strong culture that we have here? Our motivation for starting the Common Market was never about, you know, generating a profit. We just want to make sure that our food is accessible to everyone.