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November 10, 2005: As farmers we all know what
parts of our business we enjoy and what parts we try to avoid.
I think we all like working with the soil, the equipment, and
the animals on our farms--at least I do. That’s what attracted
most of us to this line of work. Being outdoors, working with
the seasons and being your our own boss are all part of the
job description we fell in love with.
But the reality is that
we can do the very best job of producing and growing the products
we wish to sell, but until we get them marketed we haven’t
made a penny. And let’s face it, it takes a lot of pennies
to make an operation of any size sustainable.
Here is where many of us slip up. Farming is something of
a loners' occupation, and marketing isn't always fun. Many
of us don’t like dealing with customers, selling our
products, or inviting folks to our farms. But it can be profitable,
and that is fun.
Whether you're growing grains, vegetables, fruits or livestock,
marketing directly to the end user can net you more profit
than selling wholesale. Sure, it requires some extra effort,
but maybe not as much as you fear.
Consider this example from our farm here at the Institute:
We raise soft red winter wheat. Several years ago a guy called
me and asked what I knew about wheat grass. I had to admit
to him and myself that the correct answer was, "Not much."
He was the owner of a small but thriving bagel bar. He wanted
to expand into selling wheat grass juice but realized, as
he said, that “it needs to be organic.” I told
him we could try growing some wheat grass in flats for him.
That was over five years ago, and we are still selling him
wheat grass to the tune of about $3,500 a year.
Now, that may not sound like much money, but if you figure
the amount of wheat seed I plant, minus the greenhouse cost,
labor and soil I’m getting around $45/bushel for that
portion of my wheat crop. And we never even tried to start
this enterprise, let alone expand it. Obviously we don’t
sell all our wheat through this channel but it does point
out how value-added marketing and a willingness to be creative
can play a role in the success of your farm.
As we all begin to wrap up the 2005 harvest it’s the
perfect time to begin planning for next season’s market.
Here are some important questions we could all ask ourselves
about marketing:
- How can my family re-think our marketing strategy?
- Are we selling our products at the highest value?
- Or are we just moving commodities through the farm gate
at a discounted price?
I’m all in favor of finding ways to take a small portion
of a crop I already produce and marketing it up the scale.
Another example that's worked for us is roasting soybeans
prior to sale. Last year we roasted our beans and got $18.75/bushel
for them. It cost about $1.26/bu to roast and chill them,
not bad money when you’re selling them by the trailer
load. We've also used leftover pumpkins from Halloween sales
to make high-value pumpkin butter.
You don’t necessarily need to completely change your
operation to benefit from a good marketing plan, just re-think
things a bit. Selling your livestock to a packing house or
having it custom butchered and selling it directly to your
customers can make a huge difference to the bottom line.
You may want to completely change your farm enterprise or
just tweak your marketing plan. But, whatever you do, don’t
sit back and take what someone else will give you for whatever
it is you grow. Figure out how to be pro-active in the market.
You may even find out you enjoy this marketing stuff as much
as you enjoy the production end of things. And if not you
can console yourself with some extra cash.
From One Farm to Another
Jeff
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