Farmer to Eaters - Key Observations… •No matter to whom you sell in the supply chain you are selling a basket of goods and services. •Different baskets exist for each different type entity in Processing Packaging the supply chain. •Each good and service becomes part of your A Vegetable Logistics business, and must be managed to keep cost below market price. Basket of goods and services
Farmer to Eaters Eaters/Feeders Key Strategic Decisions: To whom do we sell? Retailer Meal Maker/Seller What do we sell? Wholesaler Wholesaler Subordinate Questions: What value statement is needed by Processor Processor each target customer group? Does it match Farmers our value statement? Farmers
What is YOUR Value Statement? Crops Heirloom, exotic, down-home, Methods Organic/ecoganic/pesticide-free/Biodynamic Free range, Cage free, non-GMO feed Ethics Cruelty free Worker respect Environmentally Friendly Family Friendly Timing/Season
What is YOUR Value Statement? Taste Freshness Reliability/consistency Packaging, post harvest practices (dirty, clean, clamshell, recyclable container) Intangibles: Reputation Stewardship Trustworthiness
PVF Value Statement: Local Ecoganic Fresh Tasty and nutritious Family farmed Happy, empowered workers
The Logic FlowFor a given customer or class of customers:•Determine the Basket of Goods & Services.•Define the value statement.•How you will differentiate your business from competitors?•Determine the price range possible•Determine the cost of creating the Basket with the value parameters.•Match cost to price and see if you can make money.•If you can’t - then go back and do it all over again withmodifications.•If you still can’t – then do grow it!
Why this isn’t easy? How to determine cost of production?
Farmers CSA U-Pick Farm Wholesale Markets StandReuseable plastic crates R X O R RCardboard boxes O O O O XTwist ties, packaging, X O NA R XCustomer shopping bags X O X X NAFarm signs X X X X NABuilding, tent, tables X X X X NACash register X NA X X NAPricing signs X NA X X NAMarket fees X NA NA NA NABrochures, flyers O R R O OAdvertising NA R R O NADelivery X NA NA NA XWashing, sorting equip O O NA O R
CSA pros and cons Good early money Stress of the Promise Weatherproof income Pushes you to increase Builds customer loyalty variety even if it’s not Buy from other growers profitable Administration Spreads economic impact of any one crop headaches Recipe/weird vegetable handholding
Farmers Market Pros and Cons Fun to set up (for me!) Bad weather = bad $ Great customer rapport Gone from farm – it’s a No promise, no long day disappointment Serious competition
Roadside Stand Pros and Cons You are HOME! Relentless hours Sell other farmers Infrastructure cost: product refrigeration, furniture Total control Zoning issues Build community support for farm
Balancing the Vegetable/Work Flow over the Week Tuesday Thursday Saturday• Pick for CSA • Pick for Small • Pick for • Stand open• Clear out • CSA day market • Stand open markets • Farmers • REST leftovers • Stand open • Stand open • FARMWORK • Stand open markets • Stand open Monday Wednesday Friday Sunday
Value #1 High Quality of Life 9 month farm season no Sunday market for Ellen (once did 2!) 8 (ish) hour work days Long lunch experiment Hire plenty of people and use experts Ecoganic/organic Machines help my back Very few animals make me happy Avoiding debt = stress avoidance
Value #4 We Like People Team Management of tri-woman owned farm Hire lots of help All retail sales On-farm tours, limited PYO Hire experts to do some of our work for us: Mechanic, tax prep, waste management, fences Lani grows eggs Zach and Heinz grow early and late veggie
Profit as % of Gross Sales908070605040302010 0 Wholesale U-Pick with Farmers Farm Stand CSA Farm Stand Market (unstaffed)