Processing and Distribution

The demand for locally sourced food is rising in our increasingly interconnected food system. While farmers' markets and direct-to-consumer sales are vital avenues for many farms, they often can't fully meet the growing public appetite for local produce. To reach broader markets, farmers are increasingly relying on developing and integrating into local food supply chains.

This expansion is taking place against a challenging backdrop: less available farmland, an aging farmer population, and mounting pressure from increased input and market costs. Farmers are compelled to grow their operations to satisfy these market demands, yet many, especially small or beginning farmers, face significant barriers in access to capital and essential infrastructure.

Processing and distribution are key components that add significant value to farm products. By incorporating these steps, producers can sell their goods in a wider variety of forms and through more diverse outlets. For instance, a farm's product could be sold fresh at a farmers' market and in a processed form at a retail grocer like Weaver Street Market (headquartered in Orange County).

Taking a regional perspective on processing and distribution is particularly sensible. These functions inherently increase the geographic range over which products can be sold and frequently extend the shelf life of the goods, making it possible for local food to move beyond hyper-local sales and into larger commercial networks.

Developing Infrastructure

Orange County’s local food scene thrives thanks to several established and emerging cornerstones that strengthen the local food system. The success story often begins with efficiency, perfectly illustrated by Weaver Street Market. This local cooperative manages to centralize food processing and packaging for all four of its stores by running a sophisticated commissary kitchen in Hillsborough, providing a crucial model for streamlined preparation and distribution.

Beyond efficiency, the system fosters innovation through the Piedmont Food Processing Center (PFPC). This center isn't just a building; it's a dynamic business incubator dedicated to supporting North Carolina's food entrepreneurs and farmers. By helping them add significant value to their raw farm products—turning peaches into jam or vegetables into specialty meals—the PFPC has become a vital engine. It currently supports over 67 active food businesses, collectively generating a remarkable $3.7 million in annual revenue, proving its essential role in growing small, local food-related enterprises.

Looking ahead, the region is preparing for its next potential major leap. Eric Hallman, the former director of the PFPC, is championing a bold concept: a new regional food campus. A 2023 feasibility study by NCGrowth confirmed the potential for this campus to act as a central hub—not only for food entrepreneurs but also as a large-scale regional produce aggregator and a home for other aligned businesses. While this ambitious project is still in the concept stage, it holds the promise of significantly boosting the entire region's food preparation and distribution capacity. Progress on this exciting vision can be tracked at www.ncfoodways.org.

Ultimately, maximizing Orange County's food preparation capacity requires targeted investment. The key needs for future growth center on increasing access to storage, distribution, and essential equipment. There is also one particularly critical bottleneck that must be addressed: the pressing need for more processing facilities, especially those designed to support local meat producers, to complete the value chain for the county’s farmers.

As demand for locally sourced food continues to grow, there is a growing recognition that farmers’ markets and direct sales alone can no longer meet the increased demand for local food. Researchers increasingly identify a need for local food supply chains to serve broader markets. In order to meet this growing level of demand, food production needs to increase. In addition, small producers need to have access to infrastructure that may not exist yet. Often this means either introducing or increasing processing or packaging. Distribution will need to have a farther or deeper reach, since there is more food to sell.

Processing and distribution add value to products produced on a farm. Producers can sell their products in more forms (such as milk becoming ice cream and cheese, which earns higher profits for the farmer) and in more places. For example, the products may be sold at the farmers’ market as well as retail stores such as Weaver Street Market, headquartered in Orange County. This is an area of the food system where taking a regional perspective makes sense because processing and distribution increase the geographic range where products can be sold and frequently increases the shelf life of products.

Orange County has some food processing and food distribution for local food; for example, Weaver Street Market uses a commissary kitchen to consolidate processing and packaging in one location for all three of its stores. However, it is an area that could continue to grow to further support local food systems. This could be by increasing access to storage, distribution, and equipment. Additional processing, specifically to meat producers, could be helpful, too.

Piedmont Food Processing Center (PFPC)

Located in Hillsborough, Piedmont Food Processing Center (PFPC) has become a quiet engine for Orange County’s local food economy. Part commercial kitchen, part business incubator, PFPC gives emerging food entrepreneurs—including food trucks, caterers, and packaged food makers—access to certified production space, shared equipment, and the kind of nuts-and-bolts guidance that can make or break a young business. PFPC’s model is simple: lower the barriers to entry by replacing high upfront costs with hourly kitchen time and tailored support. That support ranges from food safety and labeling compliance to packaging, shelf-life testing, and wholesale readiness. The result is a pipeline that moves founders from recipe to retail—or truck to festival—more quickly and with fewer costly missteps.

Beyond packaged products, PFPC is a lifeline for mobile food operators and caterers, many of whom lack affordable access to the certified facilities required by state health codes. By providing that space, PFPC allows food trucks and caterers to expand their menus, prepare safely for large events, and meet licensing requirements that open the door to high-traffic venues, corporate accounts, and festivals across North Carolina.

The center’s reach extends throughout the food ecosystem. By helping local chefs and caterers thrive, PFPC indirectly supports event venues, breweries, and farmers’ markets, all of which rely on high-quality food vendors to attract customers. These mobile businesses, in turn, often source ingredients from local farms, creating a multiplier effect that strengthens the agricultural base while bringing fresh, regional foods directly to the public.

PFPC’s producers sell through cooperatives, specialty grocers, and local markets, while food trucks and caterers bring diverse cuisines to events, breweries, and community gatherings. Workforce development is another throughline: many operators hire part-time and seasonal workers, offering valuable entry-level jobs and training in food safety and production standards.

PFPC has also become more than a kitchen; it’s a convening point for workshops, networking, and peer-to-peer problem solving. Food truck owners swap advice on scheduling and permits. Caterers learn about cost control and packaging for large events. Packaged food producers

gain insight into scaling up, pricing, and distribution. By knitting together these diverse operators—trucks, caterers, and packaged goods brands—PFPC strengthens Orange County’s entire food supply chain. More homegrown products hit the shelves, more creative menus roll out of local trucks, and more businesses find a foothold in a competitive industry.

Policy Supporting Food System Infrastructure Development

In 2011, Orange County Voters approved the Article 46 One-Quarter Cent (1/4 cent) County Sales and Use Tax. The initial ten-year commitment by the Board of County Commissioners allocated 50% of the generated funds to the County’s two school systems and the remaining 50% to Orange County Economic Development initiatives. Those economic initiatives included infrastructure improvements to help recruit and expand businesses, and also funding to retain and expand businesses—including farm operations—in the County. Two grant programs created and currently available are the Business Investment Grant and the Agriculture Economic Development Grant.

A variety of non-farm businesses, including food system businesses, have benefitted from the Business Investment Grant. Priority for the Business Investment Grant is given to ventures demonstrating a clear need for grant funds to grow their business, hire additional staff, grow the commercial tax base, and/or create a significant social and economic impact in the County.

The Agricultural Economic Development Grant—initially funded at $60,000 per fiscal year and currently funded at $150,000 per fiscal year—has been very successful in supporting farms in the County. In the ten years since its inception in 2015, 142 awards totaling $1,161,257 have been mobilized in the agricultural community. The per-award limit is $10,000 and the average award has been about $8,000. The grant funds have been used by Orange County producers to acquire farm equipment and other infrastructure that directly impacts their ability to increase and diversify production. All recipients have been highly appreciative of the program and can point to direct benefits to their farming operations. This model has been emulated by other counties in the Triangle as well as Statewide. The vast majority of the recipients over the nine years of the grant are not only still in business but have grown as a result of the grant. This has resulted in increased income and additional jobs for the farm as well as more farm production—primarily directly consumable food products—in Orange County and the region.

Learn more about the Orange County Business Investment Grant and the Agricultural Economic Development Grant at https://www.orangecountync.gov/3304/Funding-Opportunities.

Municipalities may have resources available as well to help businesses start and grow. The Town of Carrboro, for example, has a revolving business loan fund that has helped over 30 new or existing businesses start or expand capacity in Carrboro.