Local sourcing in the supermarket industry is a complex, imperfect process. However, there are often happy endings that, unfortunately, don’t get publicized often enough. Take the story behind the local produce programs at two Virginia-based supermarkets, Ukrop’s and K-VA-T.

Both chains started sourcing locally nearly 10 years ago, and both grew by buying through a regional cooperative called Appalachian Harvest, which gathers products from farmers throughout southwest Virginia and northwest Tennessee. Working through intermediaries like this is nothing new to the supermarket industry, where the emphasis is on centralization as much as possible. But Appalachian Harvest’s story is a unique one. Started in 1995, the organization is largely comprised of former tobacco farmers who, seeing their subsidies dwindle throughout the ‘90s, decided it was high time they make a switch to food farming (federal subsidies for tobacco eventually ended altogether in 2004).

Partnering with retailers like Ukrop’s and K-VA-T was ideal. All three parties were looking to grow, and they were willing to think outside the box to do it. The former tobacco growers, like so many others in the region who found themselves out of work at the time, wanted desperately to stay in the farming business. In joining together, Appalachian Harvest’s farmers would become an authentic piece of the local movement, growing the tomatoes, lettuce, butter beans, squash, and more that Ukrop’s and K-VA-T customers wanted. Al Oliver, Ukrop’s produce manager, said he started out sourcing from five AH growers. Now, he buys from around 30. “It’s been a real success story with what they’ve done out there,” is how he puts it. K-VA-T CEO Steve Smith echoes that sentiment, crediting the health of his local produce program — which he says is almost 10% of the entire category — to tobacco country’s determined growers.

The interest in local products is booming right now. This is both an opportunity and something of a quandary for the supermarket industry. After all, these retailers want to take advantage of the trend, but it goes against their “buy it cheap, pile it high” business scheme. To operate a truly authentic local program requires supermarkets to adapt their business model to accommodate area farmers like those with Appalachian Harvest. While such changes might hurt short-term profits, the long-term benefit is better food, more robust relationships and a transparency that customers appreciate — and buy into. It becomes a different way of feeding the bottom line.

Who doesn’t love a friendly debate? Here, we’ve put Wal-Mart’s recently issued sustainability progress report up against that of a group calling itself the Big Box Collaborative, a consortium of watchdog groups. You may recall that in October 2005, Wal-Mart committed to three large sustainability goals: to be supplied 100% by renewable energy, to create zero waste and to sell products that sustain our resources and the environment. We’ve provided excerpts from each side as they summarize a couple of the big issues. Remember, we’re just the messenger:

On employee pay and benefits:

WM: At the global, national and regional levels, we pay Associates competitive wages and we find that the jobs we offer are truly needed

BBC: Wal-Mart’s CEO claims his vision for sustainability goes beyond green products to “people who live sustainable lives.” In reality, the company continues to squeeze workers and suppliers in a global “race to the bottom” in wages, benefits and working conditions.

On carbon neutrality:

WM: Ultimately, we see our carbon footprint as extending beyond our own buildings and trucks to include our suppliers and customers. By doing so, we could have a net negative effect on absolute carbon.

BBC: According to the Institute for Policy Studies and Friends of the Earth, the company’s supply chain creates more than 40 times the emissions the firm says it is aiming to eliminate. Combined with emissions from its retail operations, Wal-Mart’s greenhouse gases are the equivalent of about half the amount produced annually by France.

On the role of organics:

WM: Providing our customers with affordable access to items they want – such as organically grown produce and fair trade coffee – is another focus of our efforts.

BBC: The vast majority of all organic farmers and food marketers operate with high organic integrity. Wal-Mart’s interest in cashing in on organic’s stellar reputation—on the cheap—places ethical retailers, their suppliers, and organic farmers at a competitive disadvantage.

On Wal-Mart’s new packaging scorecard, which seeks to reduce packaging by 5% by the year 2013:

WM: With more than 60,000 suppliers around the world, the impact of this 5 percent reduction could be equal to removing 213,000 trucks from the road and preventing 66.7 million gallons of diesel fuel from being burned, per year. Not only will this benefit the environment, but it could save our supply chain more than $3.4 billion.

BBC: While we have seen improvements in Wal-Mart’s packaging designs, we have not yet seen how the new Packaging Scorecard will address fiber sourcing and how it will drive sustainable packaging down through the retailer to its suppliers and ultimately down to the forests of origin around the world.

On community impact:

WM: As we grow, we want to ensure that we do so in a way that is in tandem with the needs of our customers and communities. We want to work harder to ensure that our real estate process looks at both the quantity and quality of the stores we are developing and takes into account the desires of the community.

BBC: Wal-Mart’s massive scale undermines the small, independent businesses that form the fabric of healthy, sustainable communities. And despite the company’s claims to the contrary, numerous studies indicate that Wal-Mart destroys more jobs when it comes into a community than it creates.

Quick-service restaurants aren’t exempt from the health and wellness movement, even if their menu offerings are the antithesis of better-for-you foods. The Big Three — McDonald’s, Burger King and Wendy’s — have tried to include more healthful choices, with mixed results (you had only 10 months to try Wendy’s fruit salads before they were pulled).

The QSR segment rarely makes apologies for what it is; after all, not every consumer wants to eat better, all the time. But there are always new operators testing the waters, looking for a point of differentiation. In California — the birthplace of the modern fast food industry — there’s a new concept that sells only grass-fed organic beef hamburgers. Burger Lounge currently has two locations in Southern California, in La Jolla and San Diego. The menu notes that the benefits of grass-fed beef go beyond simple nutrition. There’s talk about how grass-fed helps to reduce global-warming, and balance soil fertility. Those who aren’t interested in beef can try the turkey burger, while those looking to avoid meat completely can sample the vegetarian “quinoa” burger. The menu also boasts fresh salads, hand-cut French fries and onion rings.