K Group's 'Thank the Producer' operating model gives consumers the chance to make value-based choices and buy Finnish products, while K Group also contributes its share. Consumers pay a slightly higher price for the products, thus enabling K Group to pay additional support to the food producers. Today, the 'Thank the Producer' product range includes more than 100 products.
The pandemic increased appreciation for local products
It is important for Finland to have vital, self-sufficient food production as the country adapts to climate change. The pandemic has caused Finns to appreciate self-sufficiency.
During the pandemic, people have spent a lot of time at home, often cooking. The pandemic has also increased consumers' appreciation for high-quality, clean Finnish food production. K Group's grocery stores sell €4.5 billion worth of Finnish food each year, and nearly 80% of all food products sold is made in Finland. In recent years, the sales of locally produced products have been growing at a 10% pace.
This trend has also seen the 'Thank the Producer' sum growing faster than before. In December 2019, the total sum stood at €3 million, while now it is close to €5.5 million.
'Thank the Producer' stipends to develop farming
K Group and the Finnish bakery company Vaasan have joined forces to grant 'Thank the Producer' stipends for the development and innovation of farming. The stipends were now awarded for the third time, to three important projects:
- Timo Walli and Laura Leppämäki, Söörmarkku, €10,000 for growing Finnish hop
- Jari Ruski, Kiukainen and Petri Linna, Tampere University, €10,000 to study water retention and underground irrigation of fields
- Eliisa and Mika Malin, Vihti, €10,000 for developing biodiversity on their farm
Producers can apply for the stipends again in autumn 2021.
The money raised with the 'Thank the Producer' operating model is paid in full to the product producers. In some cases, the payments are made via Kesko's suppliers based on customer purchases, in other cases Kesko pays the additional sum directly to the supplier when buying the products. In both cases, the suppliers allocate the sums in full to the product producers and report this to Kesko.
Suppliers are used in distributing the money as they have existing payment arrangements with the producers.
The sum obtained from the sales of 'Thank the Producer' breads made by Vaasan is paid to Finnish farmers twice a year as stipends.