The exceptionally hot and dry summer in Finland saw the livelihood of many Finnish food producers in jeopardy.
"The impact varies from one region to another, but overall summer was exceptionally dry across Finland due to a long hot spell," explains Ari Akseli, President of K Group's grocery trade division.
Due to the dire situation, in early September K Group doubled the additional sum it pays directly to the producers of the 'Thank the Producer' products sold in K-food stores. At the beginning of October, K Group added new products to the range, tripling their number to 30.
"We have been employing the 'Thank the Producer' operating model for several years now, and so it was natural for us to build on that," explains Ari Akseli. "We take this acute and exceptional situation seriously, and wanted act and offer tangible support, not just sympathetic words."
"We wanted to offer tangible support, not just sympathetic words," says Ari Akseli, President of K Group's grocery trade division.
According to Akseli, the operating model was positively received even before the increase in support payments and products despite the fact that the support payments were fairly modest for the first few years.
"We have now increased both volume and power, and are taking efforts in our stores to make sure consumers can easily find the products."
Finns want to Finnish food
Finnish food producers play a crucial role in K Group's grocery trade: 80% of the food products sold in K Group stores are of Finnish origin, and the share of local food in store selections is growing.
"In K Group, each retailer chooses independently where they buy their products. This enables agile purchases directly from producers. If a local food producer has a good product, we provide the easiest channel for selling it," explains Akseli.
"Strong Finnish primary production is important to us."
Direct regional purchases by K-retailers increased by 24% last year, partly as a result of the trendiness of local food, partly due to efforts made at group level. K Group has been bringing local food producers and K-retailers together in regional events that have led to new purchase agreements.
"We encourage in every way K-retailers to include locally produced products in their selections, as this also helps in differentiation. I for one prefer to eat local rieska when I go to Lapland instead of bread brands sold nationwide," says Ari Akseli.
Other brands welcome to join the 'Thank the Producer' model
Ari Akseli promises that the 'Thank the Producer' operating model will continue to be implemented and expanded further. K Group hopes that consumers and other companies will join in on the effort. "We have challenged the food industry to join us so that products by other brands sold at K-food stores would also be included in the 'Thank the Producer' model."
"In the end, the key issue is whether consumers choose to buy the products. We want to help consumers make choices that are aligned with their values," says Akseli.
"K Group approaches this with a long-term, multi-year focus."