Virtual Library

Create new value for specific rural areas

BUSINESS MODEL

Background

Rural areas are subject to continuous and progressive depopulation, and in some areas, many rural businesses cannot be economically sustainable. To reverse this trend, it is important that rural areas increase their value in the eyes of people living there or that might move there. New products that are linked to the rural area can help market both itself and the rural area by using the unique characteristics of the area and its history as selling points. For example, producing a product made from locally sourced materials that will be influenced by the local environmental and climate characteristics. Or a product that uses or is linked to the local tradition, history or culture of the rural area. The link between the product and the rural area can also increase the success of the product itself. Thus, both product and rural area benefits, as the value of the rural area enhances the brand of the product, and the existence of these linked products in turn enhances the brand of the rural area.  

Developing this type of activity requires knowledge and the ability to develop new products, new supply-value chains, the ability to communicate and consequently involve rural entrepreneurs in the project (including farmers). Hence, it requires a lot of collaboration between key stakeholders. It is essential to have partners with product development knowledge and project management skills. Primary producers are inevitably key partners as they supply raw materials needed for products. It is also necessary to have the ability to communicate the product to consumers. In addition, it is necessary to have all the resources needed to distribute the product and transmit the value proposition to the consumer. Depending on the product to be developed and processed, funds may also be needed to purchase material goods such as buildings and machinery needed for production, storage, and processing.

Any entity, public or private, that implements such a business contributes to the creation of new sources of income for companies operating in rural areas, new jobs and the creation of new networks that inevitably have a positive impact on local communities and rural areas. Products linked to the rural area can also set up a positive feed-back loop as the strengthened rural area brand results in more unique products linked to it, which strengthens the rural area brand even further. 

One of the main challenges for those involved in processing and/or marketing the new product is to convince rural stakeholders of the feasibility, sustainability, and validity of the project. In addition to the producers, who become not only suppliers but also partners, it is also necessary to convince stakeholders who could invest in the project and provide all the resources needed to start the business. Public actors can also be potential stakeholders and calls for public funds could be an opportunity to find such resources.

A new product or the rediscovery of an old one also requires the ability to communicate this to the consumer. Often a new product may be similar to an existing one and therefore may not catch the attention of the potential consumer. Therefore, it may be necessary to consider all those resources, human and non-human, to enable the communication and dissemination of the product to the consumer. This might represent a challenge for the success of the project. An important step in meeting this challenge is to identify the characteristics that make the rural area distinct so that the combination of product and rural area brand results in an effective marketing message.


  • DIVERSIFOOD is an international project funded under the European Union’s Horizon 2020 Programme. By integrating existing networks across Europe, the project will strengthen the “food culture” to achieve local high quality food systems. 
  • The CHIC project looked at chicory as a multipurpose crop for the production of high-value consumer products, in line with societal needs and concerns
  • RURITAGE studied cases where the local cultural and natural heritage in rural area were a strong driver to the regeneration of rural areas

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