By Kristen George

Whole Foods Market is launching a new loan program that aims to help local growers and producers expand their businesses. The Local Producer Loan Program is in its pilot stages and would offer long-term, low-interest loans to local farmers in order for them to grow their businesses. Such an expansion would then increase the availability of local products available to Whole Foods customers.

“At Whole Foods Market, one of our core values is that we care a lot about the local communities we are part of,” said Joey Herndon, vice president of purchasing and distribution for Whole Foods’ South region. “One way to support that is to work with local producers and farmers and get their products back into the economy.”

Whole Foods has designated up to $10 million annually to independent producers, with individual loan amounts ranging from $1,000 to $50,000. In order to qualify, the producer must meet Whole Foods’ quality standards, including the company’s “animal compassion” standards for dairy or meat producers. In addition, the applicant must use the funds for expansion or capital expenditures, not operating expenses. They must also have adequate cash flow to service debt and a viable business plan.

“For a grower to have a current relationship with Whole Foods Market is definitely a plus, but that’s not to say that we wouldn’t work with a new producer,” Herndon added. “Working with banks, dealing with capital, can sometimes be stringent. With our program, we’ll give you a loan and buy your product; it’s like we’ve got a shared fate with the producers.”

The first, and currently only, recipient of the local producers loan is David Rukin, a Florida beekeeper who is using the funds to purchase equipment and supplies to add crystallized honey to the product line of his company, Buzzn Bee Farm.

“I have been supplying honey and other bee products to Whole Foods Market for years, and I am excited about using these funds to expand my business,” Rukin said. “I appreciate Whole Foods Market’s willingness to partner with small-scale producers like me.”

Herndon said he also is working with a Georgia farmer to become the company’s second loan recipient.

Larry Boyleston , agribusiness development director for the S.C. Department of Agriculture, said that the new program would likely be of interest to many South Carolina growers and producers. He agrees with Herndon that sometimes working with banks can be difficult and said, depending on the terms of the Whole Foods loans, this type of program could be easier for many farmers. In addition, the loan would remove any market risk for the producers.

“When you contract with someone like Whole Foods, you’re taking out the market risk,” Boyleston said. “You know who your product is going to and what they want. This keeps the producers from having to seek buyers in the marketplace, thus removing the risk.”

Whole Foods Market in Mount Pleasant works with more than 40 local producers and growers with products including shrimp, fresh fruits and vegetables, honey, milk and rice. Nationwide, On a national level, Whole Foods works with more than 2,400 independent farms.

“Local products are definitely of a seasonal nature, especially produce,” said Darrah Horrigan, associate coordinator of public relations for Whole Foods Market. “For example, you can get a zucchini any time of year if you import it, but if you source it locally during the season, you’ll get a fresher product that is better for the local economy, better for the customer and the community overall.”