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Grown Here at Home: The changing business model of agriculture

Published: Aug. 10, 2020 at 7:50 AM EDT
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BLACKSBURG, Va. (WDBJ) - “One of the things is this COVID-19 is a black swan, an unusual event. It created a demand destruction. For example, our hotels, our universities, our airports went back to 50 percent of normal type of business,” said Virginia Tech Agriculture Economics Professor Dr. David Kohl.

And forcing farmers to change the way they do things.

“COVID-19 accelerated change. In other words, we were moving that way, but this put it in high gear,” he said.

Dr. Kohl believes this change requires thinking ahead.

“What’s going to be very important is producers have to stay one, two, or three products or services ahead of the competition. Because one of the things is competition tries to commoditize us,” he explained.

The connection with consumers is important. Dr. Kohl uses a creamery as an example.

“A number of consumers buy the product, but they also buy the experience. Instead of just selling the 2.5-gallon or the quart ice cream, they’re selling 4 ounces,” said Dr. Kohl.

Dr. Kohl explains this is good because it’s meeting the sweet spot for consumers to satisfy a craving. As business evolves, he says access to technology and broadband will be critical as more people are moving out of urban areas into rural areas, as well as local processing. And with the emphasis of consumers understanding where their food comes from, Dr. Kohl says soil and water health will be important.

“Because if you have a healthy soil, you have a healthy plant, a healthy animal, a healthy human being, and of course, a healthy environment. This is one of the things that I think needs to be stressed in Virginia agriculture and American agriculture,” said. Dr. Kohl.

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