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When you start out farming one of the things that you need to figure out ahead of time is how are you sell all of the product that you sell.
There’s no use growing it, if you can’t sell it.
Traditionally for vegetable farmers the common methods of distribution for farm product is CSA’s and farmers markets. Both methods which can be lucrative, yet both methods that have disadvantages.
Farmers markets give you cash sales, but they can be competitive and crowded. And that might force you to compete on price, something that you probably don’t want to do. CSA’s provide up front capital, but CSA’s can be hard for small farms to pull off. Small farms might have trouble filling CSA boxes with a diversity of products. Because you can only grow so many things on a small piece of land, and customers only want so many boxes filled with salad mix.
Like anything, and like everything, these market streams have their advantages and disadvantages – which mean you shouldn’t write off either option as a way to move product, but it also means you shouldn’t be solely reliant on either one of these market streams to move all of your product.
A heavy focus on one market stream means you are the mercy of that market. If something changes for the worse, then you risk having a big changes in sales.
To help insulate yourself from swings in the market you want to look to diversify your market streams. Ideally you want to have a variety of customers, in a variety of markets. By spreading out your sales you are less affected by changes that hit one market. This helps balance out shocks in the system because odds are lower that all markets get negatively hit at any one given time.
So what if you are already selling at farmers markets, but you don’t have enough of a diversity of products to design a CSA around?
If that’s the case one option might be create a collaborative CSA.
The collaborative CSA allows you to expand your crop variety with competing with other farms and without diluting down your efforts on your farm. You grow what you grow best in your context, and source everything else from other farmers who are better setup to grow those specific products. It creates a win/win situation for you and the other farmers. Everyone grows what they grow best, and in theory sales go up. It’s also a win for the consumer because they now have concentrated access to more local products, without having to sourcing these producing individually from each farmer.
Aggregators, collaborative CSA’s and food broker models, are these models perfect? No. But if they give you options. And if you are having issues moving product, then more options might be better than less options. You just need to look at everything and figure out which combination is the best fit for you and your market.
In today’s show we’ll look at some alternative market streams for selling your vegetables, so to help you start thinking outside the box, so you can sell more boxes, of vegetables.
Notes from this episode:
- Are there aggregators in your area that you could sell to?
- Curtis insulates against market risk by:
- Offering a diversity of crops.
- Offering crops can be mixed together to make different products.
- Have a diversity of customers.
- Different businesses.
- Direct and non-direct.
- Diversity of price point customers.
- Each farm needs to specialize in something.
- If you are in an populated location, if you have a network, and access to the market you have an advantage as an aggregator and can create a win/win for the farms further out.
- When you aggregate products you can apply a 25-35% mark up, but there are other benefits:
- Steady sales
- Big sales
- Saves you time on packaging.
- Easier to pack larger sizes.
- Better to come back with larger sizes unpacked, versus smaller units of that same quantity unpacked.
- More predictable.
- A collaborative CSA allows you to offer a diversity of products that you otherwise wouldn’t be able to offer.
- This then might allow you to get to a wider customer base and get more total sales.
- Does adding the low value product allow you to move more of your high value product? If so it might be worth aggregating.
- If you sell to an aggregator the product is sold BEFORE you pack it.
- An example of Curtis’s collaborative CSA brochure.
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