It’s difficult for many small businesses to get a loan in our current economy, but small, local producers of natural and organic foods have an ally outside of the banks – Whole Foods. GreenBiz reports that the organic grocer’s Whole Foods Market Local Producer Loan Program has loaned $2.5 million to 40 recipients so far and hopes to loan up to $10 million total.
Jenny Brown, the administrator for the loan program explains the program.
"Our local producers is part of what customers say they value a lot; and they are very valuable to us, too."
While the terms of the loan are negotiated with the companies individually, the interest rates vary from five to nine percent; an average interest rate is approximately 6 percent, Brown said. And unlike traditional loans, there are no closing fees, no fees for repaying the loan early, and no application fees, she said. The maximum loan amount is $100,000, but Brown said there is no minimum amount. In addition, even though the terms of the loan agreement vary based on the amount and the individual, in general the maximum repayment time is 10 years or less, Brown said.
"We don’t require any purchasing amounts from our local producers that receive the loans," Brown continued, nor does the company require exclusivity to supply products to Whole Foods Markets. A total of 40 recipients have received these low-interest loans, which in many cases, have helped small producers expand to regional markets.
- An organic ice cream maker
- A glutten-free, vegan snack maker
- A Florida bee-keeper
- A pasta sauce maker
- Grass-fed beef ranchers
The loan application for Whole Foods Market Local Producer Loan Program can be downloaded directly from their website, making it easy for local producers to apply.
Image: Whole Foods