It’s a trend sweeping the culinary world. Local restaurants are making a big deal about using ingredients farmed in the immediate area and supporting local growers and producers. Even formerly greasy spoon divers are hyping the “locally sourced” trend to show support for small agricultural businesses, butchers, bakers, and cheese makers. Yet what is the reality behind this trend that sheds light on issues between larger food businesses, the trucking industry, and national regulations?

Local Restaurants Need to Keep Costs Low

Unlike national chains and franchises, local restaurants do not have much of a profit margin. Most of the markup on prepared food goes back into restocking inventory and covering overhead expenses. Local restaurants have been able to operate by purchasing inventory and supplies from national distributors and companies, but recently, something has changed.

The Irony of the Current Economic Climate

The economy is strong. Unemployment is extremely low. Yet the price of eating at local restaurants is rising. Unfortunately, no one can place the cause on any single factor. Companies are producing more to meet customer demands. The trucking industry is strained to provide vehicles and drivers to transport goods. As a result, companies are paying more to secure drivers or build their own in-house fleets. Washington, DC has enacted legislation which reduces the number of hours truckers can be on the road, which places a big strain on supply chains. Gas prices are rising, and are slated to go up even higher next year. All of this culminates in a recipe for higher costs to restaurant owners who do not have the capital to get favorable contracts with national companies, so the cost gets passed on down the line until it reaches the menu. Additionally, the uncertainty of tariffs on imported foods from Canada, Mexico, and abroad result in higher market prices as well. So the economy is strong, there is not doubt about that. However, prices are also rising across the board, which is an anomaly.

Local Restaurants Make New Friends

Because of the increased costs, local restaurants have been forging partnerships with local farms and producers. Instead of giving into rising expenses which have jumped as high as 20 percent at other establishments, local restaurants can purchase from local farms and businesses, which reduces the costs for everyone involved. In the larger picture, this trend can negatively impact the national economy. Locally-sourced food and ingredients are great for smaller economies, but they also mean fewer sales for larger businesses. This results in breathing room for trucking companies but threatens to wrest control over contract agreements with clients. The fuel and gas industry will always remain unaffected by these trends, though it may force legislators to revise mandates for hours of service, allowing the trucking industry to operate more efficiently, and allow drivers to get more take-home pay from the miles covered.