Today we’re interviewing two farmers, Max Becker and Mike Roberts, of Farmivore, who sell their products and those of other farmers on their webstore via Shopify. Their store is unique because they sell a la cart, just like on Amazon, and they also sell via a weekly subscription box, which can be edited. We’ll discuss how each of those is performing, and we dig into how they host all this on Shopify, including utilizing their app.
What was the initial thought process behind starting the online store? (1:30)
I was looking into becoming a farmer myself and had read Joel Salatin, who says a lot of farmers grow before they know where they’re going to sell, and I wanted to get that right and have my marketing figured out first. I had seen videos by Joel, where he spoke about electronic aggregation, and he felt like it was a promising model for the future. I started with five customers and went from there, beginning in 2013.
Has it become easier to get customers to shop online over the last seven years? (2:45)
With the advent of Amazon Fresh, it’s become a little more mainstream. There are more grocery chains and apps delivering more and more, so yes, I believe people are becoming more familiar with online shopping. We feel like, for the most part, our market customers and online customers are two different groups, and there isn’t much overlap.
Over the last two years you’ve had consistent sales of about 100 per week, how did you grow to this number of customers? (5:00)
It started with family and friends. We’ve pushed promotions over the years, and our most significant increase in customers was right after the Thomas fire. We made a massive Facebook campaign. I made a list of everyone I could think of and prepared for it for several weeks before launch. We even got sales up to 150 orders per week, and it dwindled after that.
We ended up going through a lot of transitions after that, moving off the farm and then out of state, and then forming the business as a partnership. That took a significant amount of our energy, so that’s not to say we wouldn’t want sales to grow more than that.
Now you’re living in Maine, but the operations in S. California are managed by Mike Roberts. How has managing the logistics been for you, Mike? (6:40)
It’s been a fun ride. I’ve always admired how Max customized his CSA box, where we had static boxes each week with 100 members that slowly died, losing customers every year. When he approached our team for a partnership when he was moving, I jumped at the opportunity. With the global crisis right now, local food that’s being handled less has been pushed to the forefront. It’s been a dream come true.
Tell us about the logistics of the store – is it just like Amazon where I can order as much or as little as I want whenever I want? (8:30)
It is just 100% customizable within our inventory restraints. It’s an online store model they are familiar with. They certainly have the option to buy within a box model, but most of our customers make customized orders.
You mix about 50% of your product with that of other farms, what’s been the advantage of that model? (9:45)
We are proud to support farmers in our area, and it eliminates the need to produce everything ourselves. That’s one of the big problems with CSAs when one farm has to deliver enough variety for the customer. With this model, we get more orders, and they’re larger overall. We see the ebb and flow with our orders as the season changes. During winter months, when there are naturally less available people, see that flat delivery fee, and they are more likely to shop somewhere else where they can get everything they want.
One concern farmers have aggregating from other farmers is when they put their name on products they don’t have much control over. How do you vet who you’re sourcing from? (11:30)
Full transparency is number one. We’re actually putting the farmer behind the product out there and elevating them, Farmivore is primarily a conduit. We don’t need the farmer to be certified organic, but even then, they should be producing with organic practices. We do screen the product carefully. If it comes packaged poorly, the heads are too small or wilting; we won’t buy from them anymore. It can be a challenge with some less professional growers.
Over the years you’ve changed from using Farmigo to Shopify, why the change? (13:40)
I still think Farmigo is great software, but it’s meant to be CSA management centered. They do have a customizable option online, but it caries that CSA stamp across its platform. For example, a customer can only put in one order per week. Another big one is a customer needs to fill out a membership form before they check out for the first time, which is somewhat different than that online Amazon experience we were looking for. I know we were losing customers since some of them even told me they couldn’t figure out how to sign up. We wanted to be able to offer sales 24/7, which was challenging on Farmigo since there was only a specific window they could order in each week. Lastly, you also can’t have the store on your site or subdomain with Farmigo, and we wanted to be able to host the store.
Shopify is really a leader in the online shopping world, and especially because of the optionality provided by their apps, they are a powerful way to go. Shopify is traditionally positioned to sell non-perishable items worldwide, so we did have to make some modifications and tweaks to customize it to fit our needs, but since they’re so big now, they’ve served many customers doing just that. It didn’t take much to accomplish.
What were you looking to accomplish via these online platforms? (19:15)
We wanted people to be able to offer deliveries twice a week, on Tuesdays and Fridays. We tried to get rid of the sign-up process. We were curious about what other functionalities Shopify was going to be able to offer, and it’s turned out to be quite a bit. There is more automation we’ve been able to set up; the list goes on and on.
If you are looking for a CSA specific platform, Farmigo has more particular tools to help accommodate that model. With Shopify, the basic plan is a lot more affordable monthly, as it starts at $30/mo vs. $150/mo for Farmigo. Over time we’ve wound up paying more for Shopify than we were for Farmigo as we now have their middle plan and are paying for some apps we’re using, plus 2% of gross sales.
Farmigo did allow us to automatically add a certain number of products to the customers’ cart each week, which as a nice feature, and it even allowed the customers to come back in and tweak what they ordered after it had been placed up until delivery. To mimic this on Shopify, you can make bundle order, or use an app that allows the customer to select items up to a specific total number, such as 12 CSA items. We are playing around with all of those now and finding individual customers prefer certain things.
Right now, we have about 80% who order a la carte, and 20% order a customizable box.
How have you managed to balance a la cart orders with perishable inventory on hand? (27:30)
Max has put together a tight system of managing inventory. That’s why we wanted to go to a 24/7 ordering system since it allowed us to manage inventory better on the back end. Often Max will give us a breakdown in the morning of what orders have been placed, and we’re picking it all for delivery tomorrow. That’s also why we went to two deliveries a week, because if that product doesn’t move you need to make it last until next week or deal with the waste.
We even have to offer a refund for about 5% of our products. We make sure to tell our customers about this in an automatic email and on checkout. We say we’re sorry; we’re trying to keep things as fresh as possible, so we’re selling stuff out of the field instead of out of the cooler. If we could move to three deliveries a week we might be able to roll over a lot more product to the next delivery, say if it was on a MWF schedule. Right now, we’re doing that from Tuesday to Friday but can’t do it from Friday to Tuesday. If you only delivered one day a week, you wouldn’t even have to store any product.
How much order lead time do you need for fulfillment? (31:30)
We need two days’ lead time, at least. We make midnight the cutoff. If you order between Monday and Wednesday, your order comes the following Friday, and if you order between Thursday and Sunday, your order comes on Tuesday. It can be a little confusing for customers when they order on Thursday, and they think it’ll arrive on Friday. We try and make it as clear as possible by posting when the next delivery will be posting it on the home page, putting it in FAQ, and their introductory email. There’s a customizable email that I’m working on, so it’ll tell them the specific day of their delivery.
We’ve been able to hit that two-day window well even as these orders have become a significant part of some of our farmers’ sales. Our goal is to go to three days a week delivery, and eventually even to once a day delivery down the road. Right now, we are doing all our deliveries ourselves, but the technology is changing so much that eventually, we’ll be able to partner with a Grub Hub or Door Dash.
What are the logistical concerns of adding another delivery day? (37:45)
Mike: The pressure of needing to figure out the problem would be incentive enough for me. If Max said this is what he wants to do, we’d get on board since we’re motivated to spread this model.
Max: The most crucial logistic to manage is the density of the route. You look at 100 orders over two different delivery days; it theoretically splits in half you are still driving the same distance for half as many orders. The hope is that people will order more often. The risk is that you’ll water down your routes too much, and so the hope is by offering more options, people will order more frequently, and more people overall will order.
How have you set up your delivery sites and radius? (41:00)
We charge a flat rate delivery fee of $5. For us, that’s covered the cost of the driver, the vehicle, and even the boxes we shipped things in. I like the flat fee because it discourages small orders, but it doesn’t prohibit them.
To limit orders to our delivery area, we’ve done it manually up until now, since we haven’t had to do much more than a post where we deliver to, and we’ve only had to issue a refund a few times to people ordering outside our route. We will be installing an app that asks for a customer zip code, which will let them know if they can place an order, and we could even charge different delivery fees for further zip codes and expand where we deliver to.
Every time we’ve expanded the delivery zone, there’s been growing pains, and we’ve learned something and made changes as needed. Right now, we deliver about thirty miles out.
Can you talk about the app that you’ve been working on with Shopify? (45:10)
It’s still experimental at this point. It’s a third-party app that syncs with your store. We pay a monthly subscription fee, and the customer can now make orders in the app on their device. Right now, we’re paying $200/mo, and it’s important to us that this app syncs up with many of the customizations we’ve made to our site, so we had to choose it carefully. I’m interested in seeing if it makes a difference for our customer’s shopping experience, so I’m monitoring it closely to what people have to say about it. We have about 15% of our orders coming in from the app right now, but Shopify also has a customer-friendly device interface that they could use as well, so we’ll see how it plays out.
How would you expand your customer base via marketing? (53:15)
We’ve done very little marketing at this point – it’s mostly been word of mouth. We have wonderful stories to tell about our producers, so that’s what we’ll focus on when we expand our marketing. We’ve wanted to build a strong foundation first before developing that part of our business. Now that we’ve made the switch to Shopify, we’re ready to scale. We’re currently working on a suite of apps from Shopify to incentivize word of mouth referrals. We just started an Instagram page, and have only used Facebook a little.
How do you focus on customer retention? (59:30)
We have worked on developing correlated business alongside the produce delivery. We talk about value-added offering, such as farm tours. We are also looking to offer consultation to others trying to implement this offer. We can eventually expand our product offerings as well, which can include other local products such as crafts. We’re also looking to open an account with United National Food Inc., which is the largest food distributor on the West Coast.
Where do you draw the line for what product you’ll aggregate? (1:09:40)
We consider the companies mission and integrity, along with the demand for their products. There are not a lot of set rules. If it can fit in the box and it’s not too perishable or breakable, we’ll deliver it. We’re not going to deliver cheap potatoes because they are a large, heavy thing. Glass bottles are fragile. Meat is perishable if left out on a doorstep for a few hours.
Do you feel like the aggregation has helped sales? (1:12:00)
Yes – for some producers, like microgreens, if that’s the only thing you produce, it’s not likely you’re going to be able to use direct marketing by selling online. Aggregating can be a win-win for everyone. A lot of farmers just want to farm, and they don’t want to develop a distribution network. Small high-risk farmers need to diversify to manage their risk. What one person hates to do another will love, and you should get together.
You can connect with Mike and Max and learn more about what they are doing by checking out their website at Farmivore.Farm and on Instagram @Farmivore.Farm. If you’ve enjoyed this series, be sure and drop us a line at firstname.lastname@example.org.
Listen to the Episode:
Listen to more episodes of Farm Small Farm Smart
Subscribe to Farm Small Farm Smart in your favorite podcast player:
Diego: [00:00:00] Today, you're going to hear from two farmers who sell their products online using Shopify, but they don't just sell their products. They also aggregate products from other farmers and sell those as part of their online store. And it's working spectacularly find out what they're doing and how they're doing it.
Coming up. Welcome to farm small farm smart. I'm your host Diego Dai ego. The online sales series continues today. As we talked to two farmers who aggregate product and sell that as part of a web store online using Shopify, their story's unique for a few reasons. One, they sell a LA carte. Just if you went on to Amazon, you could just buy whatever you wanted.
And they also sell a weekly subscription box that is editable. You're going to find out. Which one of those works better and how they manage both of those. They've also dug deep and used a lot of the Shopify features including having their own app. The two farmers you're going to hear from today are max Becker and Mike Roberts, two farmers who teamed up to help manage the store.
Each having different roles. They're looking to continue to grow the store. Reach more customers do more sales and sell more product, not just for themselves, but for other farmers. So let's jump right into it. With the team at pharma of war max, if you go back to the beginning, what was your initial thought process behind starting the online store for your farm?
Max Becher: [00:01:38] I was motivated by the fact that I wanted to start a farm myself and I had been reading a lot of Joel solace and books. And he's very big on marketing and marketing before you grow. you says lots of people can grow things, but then they go to sell it and they don't have a market and it doesn't really do much good.
So I really try to think about it the other way around. I. Had seen other videos from Joel, where he talked about what he was calling electronic aggregation, and he seemed to indicate that was a promising model for the future. And it just seems so doable, selling online, aggregating in one place and delivering to customers.
It seemed like something you can do with. Five customers or 500. And so I decided to start with five and went from there. And we're talking
Diego: [00:02:25] Now in March of 2020, how long ago did you start doing this?
Max Becher: [00:02:29] Coming up on seven years ago, I started in 2013.
Diego: [00:02:33] It's a seven years. So you have a lot of experience over that time with online sales. How have you seen. Customers buying vegetables online, like that landscape change over those past seven years. Is it becoming an easier idea for customers to accept? I imagine we go back to 2013, probably a little more foreign for people to do that. Does it seem easier now or have you seen any sort of trend?
Max Becher: [00:03:04] yeah, with the advent of Amazon fresh, I think it's becoming a little more mainstream. a 2013, grocery stores were definitely doing delivery. I know Vaughn's is a big grocery chain near where we were, they were doing home deliveries. but I certainly think, particularly with Amazon's buying whole foods and, pushing Amazon fresh, you also have things like Instacart and, door dash and Uber eats.
And so it might not be groceries. It might be restaurant orders, but I think. For sure more people are comfortable, and used to the idea of buying food online and having it delivered.
Diego: [00:03:43] When you had your farm out here in California, at that time you had farmer's market sales and then you also ran the online store itself. Did you find it difficult to move customers from the farmer's market, physically just buying from you online?
Max Becher: [00:04:00] Yeah, we didn't actually see a whole lot of overlap in general. Our customers at the farmer's market had made a habit out of coming to the market. They enjoyed it. It was a social thing for them.
And I think it was just working for them. And, they weren't really interested in doing something different. That being said, I had some customers that did both and we delivered midweek and our local market was on the weekends. So for them, it worked out really well. And they would order from us midweek and then pick up from us at the market. But by and large, it was two different groups of customers.
Diego: [00:04:30] Past few years, you've had pretty consistent sales through the web store, about a hundred sales a week. Has that been something you've tried to grow over that period of time? I'm thinking there's a lot of people now who. They don't have online stores.
They're going to want to start an online store. How do you get customers? So when you look at yourself as an operating store, how did you add to your customer base?
Max Becher: [00:05:00] initially it was literally just friends and family and word of mouth. I printed up postcards and went door to door. I started using Facebook.
I got some referrals through other customers and I always offered a credit for that to incentivize people to spread the word. our biggest w our biggest increase of customers was right after the Thomas fire. I think we had a conversation about this earlier, where we ran a massive Facebook campaign.
I made an email list of everyone I could possibly think of from personal contacts to, people from the farmer's market and prepared for it for two or three weeks beforehand. And we did actually get sales up to 150 orders a week at that point. It dwindled after that. And, I know when you recorded that video, we were doing about a hundred.
So we had dwindled at that point and. to grow, but we were going through a lot of transitions ourselves. we ended up moving off our farm. Then we ended up moving out of the state, and then actually forming the business as a partnership. So for a little over a year that took most of the energy of the business, such that we weren't really in a position to grow significantly. But, that's not to say we wouldn't have liked more sales
Diego: [00:06:15] and now you're living in Maine. The farm store still exists online. The logistics of the farm store in terms of produce in the deliveries. The customer base is out here in Southern California. And that's managed by Mike Roberts, a friend, your business partner, Mike, how's it been for you managing the logistics of the business on the ground over the past year that you've partnered with max.
It's been a, it's been a fun ride for sure. I've had max and I were pals from the farmer's market days and I always admired what he had built. It was from my perspective, the Holy grail of CSA boxes, where it was fully customizable delivered. It had removed a lot of the objections of a traditional CSA box that we had.
And, that I watched painfully just die where we had a couple of hundred members and it just kept going down and down. So it was something we had hit pause it, the farm I'm with, and, here max had developed a. really, impressive system. So when he approached, our team, we have a really strong team of young farmers, there, and he said he was moving to rural Maine and, moving, moving his family there.
but he had this business that he didn't want to let go of. I absolutely jumped at the opportunity to partner with him and, So I saw what it was. I knew the potential that it had, and I knew if we built a strong foundation together, we can really grow it. And the current, global circumstances that are going on right now has really, pushed it forward, pushed local, into the forefront and delivery into the forefront.
less people in the food chain handling their food growing, closer to them. these kinds of things. So for, from my perspective, it's been, it's been a dream come true, because we're so mission-based, and, what max developed was a very special, it's very special for the online store that you guys, Ron, can you talk a little bit about what it actually is?
How it functions? Is it a store just like Amazon would be, I can go in, I can buy whatever I want as much of it, or as little of it as I want. And that's how it works or is it. You have to buy a certain amount. You have to buy within a CSA box structure. How are you guys set up?
Max Becher: [00:08:24] It's really pretty much like Amazon. I'm really, I'm proud to say that it is, pretty much literally 100% customizable within our inventory constraints. I will set an inventory cap based on what we know is available. If we have it in the walk-in we know exactly what we have. If it's coming from the field, we have a good idea.
but within those inventory limits, there's no order minimum. people really select what they want. it's non-line store experience really familiar to customers. they don't have to have a box subscription. We certainly have that option, but most of our customers do order straight from the store, filling their cart with what they want, how much they want and checking out.
Diego: [00:09:08] You guys have a unique model in the sense of you source some product from other farms, you also grow some product on your farm in California. It's about a 50 50 mix. What are the benefits of aggregating beyond just product that you grow?
Max Becher: [00:09:29] So a couple of the benefits are we're supporting other local farmers in our area, which we're really proud to do. They're very happy that when we reach out to them with these large orders, another thing is it doesn't put all the pressure on us to have to grow everything, which is one of the big problems with a traditional CSA is one farm has to deliver on enough diversity to satisfy the customer. And in this case, we don't have to, we can lean on.
Our neighbor, neighboring farmer and our farmer friends, locally and regionally. So just a couple of the advantages, more, selection for the customer and less pressure on the farmer. More are a few of the things that I can think of off the top of my head. Max, anything else you can think of there?
Max Becher: [00:10:05] I would absolutely affirm what you said. It's definitely better for the customer cause they have better selection and way less pressure on us, but I really emphasize the selection. if there are more products to choose from in the store, orders are bigger and more orders come in and that's just, I've seen that again and again, we have weeks where inventory is lower.
it happens more in the winter than in the summer. And of course all my friends here in Maine, but laugh to hear me say that because we still have a lot of available in California, but as the inventory shrinks, it just makes sense, a customer logs in, they're probably going to be looking at what we have available if they don't see enough of what they want.
Because we charge a flat rate delivery fee. it's not going to be worth the order. If they, if there's only two or three things they won't want, they'll probably just go somewhere else. They're going to have to go to the grocery store anyways. And we end up losing that order so far in a way I'd say the biggest advantage is just being able to offer more products to customers.
Diego: [00:11:03] A lot of farmers worry about when they aggregate from other farms is. Putting their name behind it, stamping off it on it, essentially. How do you vet out the farms that you aggregate from to ensure that your reputation doesn't get tarnished by product that they're supplying? Cause at the end of the day, the customer sees you not necessarily the farm that produced it.
Max Becher: Full transparency. Number one, the growing practices of the farmer are, explained and highlighted and we're actually uplifting the farmer. So we put the farmer out there PharmaVOICE is a conduit to get the farmer in front of people and get their food in front of people. that's one of the roles that we play.
We have a, a floor of organic practices, not all the farmers, because some of them are very smaller, certified organic because of the cost and the red tape that come along with that. But at the very least they're using organic practices and many are using regenerative or, even, and more advanced, environmental practices on top of that. we're definitely looking out for the quality of the partnerships that we have.
Max Becher: [00:12:10] Yeah, and it is an issue, particularly with a smaller and newer growers. I find some really are conscientious and really give you their best quality stuff. Others. I've just stopped buying from some people because either the.
the heads are too small or, they're too old. They didn't pack it. they're wilting. it really is a challenge with some of these less professional operations. Sometimes that, I don't know what their thought process is. Maybe they just see it as an easy channel and they've sold it and they can forget about it.
Diego: [00:12:46] But, you do have to be careful you buy from, so pharma of is what you guys call your online store. It's a mix of products that you grow a products that you aggregate over the years. Max you've evolved the system. You started on a system called Farmigo and now you've ended up on Shopify. What was the reason for migrating from Farmigo to Shopify?
Max Becher: [00:13:06] Yeah, I actually, I, there was a third one I used in there in the mix too called a small farm central. I used that even before Farmigo, but, there were a number of reasons why I switched from Farmigo and, yeah, I still think from egos great software. it's very farmer oriented. It's very CSA oriented too.
And honestly, I think the intent behind that software was originally to be CSA management. So it bears the stamp of CSA all over it. And they do have a, a customizable store option where you can have a store that people select items in Allah cart. And, those customers do not have to have a CSA, but when I say it bears the CSA stamp, it's things like a customer can only order once per week.
So the weekly sale is ingrained in their model. that's really the most obvious one actually. Oh no. Another big one is. There's a whole CSA sign up form that customers have to fill out before they can place their first order. And you can shorten that process if you want people to be able to check out as a guest, but it's not that familiar online shopping experience that you were referring to earlier, like on Amazon, it's a little different, and I know we were losing customers who would see that sign up page.
Not feel like filling it out and that, we never even see them. I knew that cause some told me, people would see at the farmer's market or whatever it would tell me that they couldn't figure out how to sign up. So that was a barrier. I'm not trying to say bad things about Farmigo.
I think it's a great program. I would actually. depending on what people want to do with the web store, they're starting, I would, I would definitely recommend Farmigo as a strong viable option, but, Shopify is simply one of the leading. Know, e-commerce providers on the web, they're some of the other big ones are woo commerce, big commerce.
there are some others, but Shopify is really a leader in the e-commerce world. They built a very powerful platform with tons of functionality. And almost more importantly, their platform has a large number of third-party apps, which can add additional functionality over and above the basic store.
I could go through some of the features that we wanted. That Shopify had that from Hugo didn't, but, basically we were trying to break even a little further away from the traditional CSA model and offer more of that Amazon type shopping experience with shopping.
Diego: [00:15:46] So literally here's what we sell, pick what you want. You can order it.
Max Becher: [00:15:51] pretty much. Oh, another thing too, with, with Farmigo. No, I take it back. You did have the option with Farmigo to leave the store open 24 seven, but, the way we were using it, at least we would close the store for a certain period of time. And if you want to do that, if you want to close your store for a few days in the week to manage your inventory and get started for the next round of weekly sales for Migo, makes it really easy to do that.
You can do it with Shopify by pausing your store, but it's a little. it can be done. it's a little messy, but, that was one thing we wanted to do. We wanted to move to offer and sales 24 seven with Farmigo. There was a window of sales that we were offering for a couple of days, and that was your window to order.
And if you missed it. And, you'd have to check back in a few days. So I know we lost customers there too, who would log in to the store, see that things are unavailable and it's, it's a good chance. They won't come back in three days. When the store opens.
Diego: [00:16:46] You found Shopify works, selling produce, it's traditionally known for selling stuff that people don't eat for companies that ship stuff. How do you find it? For what you're trying to do, sell produce, and then deliver it locally.
Max Becher: [00:17:02] Ah, that's a good question because, the internet e-commerce world is really built around shipping non-perishable products across the country and even across the world. So that is how Shopify is set up.
However, because they've reached the size that they are as a company and they're serving so many thousands of stores, there are a number of other. less traditional type e-commerce businesses, like one's offering food or doing local delivery that, with a combination of, manual tweaks or adding an app, a third-party app, we've been able to make it work quite well.
Diego: [00:17:40] Sought out Shopify coming from Farmigo. What are some things you specifically wanted when you looked for a new platform?
Max Becher: [00:17:48] one of the main ones was the ability to offer sales. To a particular customer or more than once a week. that was a huge one because we wanted to move to doing deliveries. two days per week, we were delivering one day a week on Tuesdays. We wanted to move to Tuesdays and Fridays so people could get things, more at the beginning of the week and then closer to the weekend. That was huge. we wanted to get rid of the signup process before they placed their first order.
we wanted people to go to the store. Start selecting items right away, put it in their cart and then be presented with the checkout process, which is more what they're used to. those were probably the two biggest, I was curious to see what other functionality Shopify would add. there it's ended up being quite a bit and I'm actually continuing to discover, new functionalities to this day. There are a lot of automations that we can set up, the list goes on and on it's it's more feature rich.
Diego: [00:18:46] Would you recommend Shopify to somebody just starting out? the thing I like about Shopify as somebody who's familiar with e-commerce platforms is it's an all in one solution Shopify controls that are apps, Shopify controls, the web hosting customer support all flows through one point.
They're large. They've been around for a while, which usually means stability and good service. What are your thoughts on recommending that for people want to
Max Becher: [00:19:15] start it? it does depend on what the person has in mind, but, I could go either way recommending Shopify or Farmigo to, someone new to a beginner.
I'd really say if you want more of a. More of a CSA type model where you're expecting a little more of your customers. You're expecting them to sign up, you're expecting them to be on a weekly cycle. Farmigo makes it pretty easy. They, they give you a demo at the beginning. it's a complete all-in-one package.
you have to be okay with sending your customers to a farm, The Farmigo subdomain. So you can't have the store on your site if you also have a website, which you're probably gonna want to. That was another, a huge draw for me with Shopify, but if you're okay with that, for me go is a very functional, pretty easy to use powerful software that can generate weekly sales, with a good set of features it, with Shopify on the other hand, if you do their basic plan, which is really all you need to start out to do a very basic store is much more affordable.
The, Shopify basic plan is about 30 bucks a month for Migos starts at one 50, and then they continue to take 2% of your gross sales as you, as you grow. I mean that could, we're paying more for shop find now than we were for me to go before, just because we've added a number of apps and, we're on their middle plan, not the lowest plan.
if you want to offer more that total selection, Amazon type experience, or you think that's the direction you might want to go in, I'd probably start with Shopify as basic plan. And there's just a few little tweaks you need to know about to make it work. For example, if you want to have a day or two of downtime to take care of your inventory, you can pause your store or you can protect it with a password so that you can display a message to customers saying that, there'll be able to get into the store in a couple of days.
Diego: [00:21:14] So to make it clear, Farmigo was good at creating a CSA style box. You would go in and say this week, the boxes one, two, three, four, five, six items. Here's what's in them. And I'm trying to remember back to our conversation before I think you had it set, so you could, it would, pre-populate their order for that box. And then they could go in and add or delete stuff at will. Is that right?
Max Becher: [00:21:39] Yeah, that's right. And actually, that's one very interesting feature that Farmigo has that I have literally not found anywhere else in e-commerce software anywhere is this ability to create a template. choose seven items.
For example, if 50 people are subscribed to, CSA box number one, and you want those seven items in it, you can literally blast those seven items that you create as a template into their shopping carts. And here's the interesting thing. They sit in the cart, unfulfilled for the customer to go edit it with Shopify.
And when you, if you think of Amazon and normal, e-commerce. You put items into your cart and then once you check out, you've paid and the transaction is done with Farmigo. Customers can go into their cart and they can change it any number of times. And when they're clicking checkout, the software actually waits for your order deadline to finalize it.
So the customer could go in and log in a few times and they could change their order without having to place another order. yeah, the cool thing about that is that you can have some control over the items that go into people's boxes and yet still leave the final decision totally up to them. So that I'll be honest.
That was a feature that we missed in Farmigo that being said, it's a little tricky because if you're trying to figure out how much, how many items to source, and you have to order a little bit ahead of time to get the orders into the farmers before your order deadline. Some of the items people might pull out of their cart at the last minute.
So you might end up ordering too much. They pull it out of their cart and then, you're stuck with extra product until next week.
Diego: [00:23:24] Really wait a mimic that through Shopify and this wouldn't be a true mimic. If somebody did want to offer a CSA style, you'd have to create one product. That's essentially a bundle and you'd add that bundled to your cart. And it wouldn't be editable.
Max Becher: [00:23:40] no, actually there are a couple apps that come close to what Farmigo does. And, I could just tell you real briefly what the differences are there. There's one subscription box, which lets you set a certain number of items, which goes in the box. So right now we're doing 12 for a large box.
You can specify which items are available to choose from as a pool of available items and the customer can choose. from that pool to add up to 12 products. So unlike Farmigo where you could literally take your 12 products and pair it down to five, if you wanted to, you still have to take 12 products with the new app, you can take three of this, two of those, as long as it adds up to 12 items, there's another app which I have not used yet, but I've been eyeing it.
And it allows you to put a link to a prefilled cart in an email. So you would send an email to your customers and you could say, here are my three CSA selections of the week. And when they click on one of those three links, they would be taken to our site to the cart. And, 10 items or whatever I had put in there would show up in their cart, then they could edit that cart and check out from there.
So the problem is they have to click the link with Farmigo. You can literally put it into their cart and then if they don't change it by the deadline, that order gets charged to them. you're capturing that subscription order. we do have other subscription options with Shopify, as such as, like you're saying, creating a bundle, making that available either as a one-time purchase or as a subscription. And we're playing around with all of those now and different customers seem to like different things.
Diego: [00:25:23] You look at a hundred orders as say a sample set. How many of those hundred are all a cart orders versus a bundle?
Max Becher: [00:25:32] would you include the customizable subscriptions in the bundle category or the Allah cart category?
Diego: [00:25:39] I would say those are in the bundle category.
Max Becher: [00:25:43] Okay. it's probably about 80 20, I'd say about 80% are Alcart
Diego: [00:25:48] managing the logistics of all a cart. Mike, how do you balance inventory on hand with what's being ordered? It's not like you have a bunch of shelf stable product that can just sit there. So how are you making sure that you have enough lettuce to potentially fulfill all our cart lettuce orders or is it we're going to get in this much lettuce based upon past experience, and then we're going to set a hard inventory number in Shopify.
And once it's gone in Shopify. It's out of stock. Max had, put together a pretty tight system before we even came on board as far as keeping a really tight of inventory. And that was one of the big reasons we wanted to go to the 24 seven, availability. it allowed us to, better control the inventory on the back end.
oftentimes. Because max, for example, will give us, he'll let us know what, how many orders we have, what he'll give us a breakdown of what we need to source or pick. And we pick it to order in many cases, the way the system is structured. So he'll give us, this morning, he'll give us the rundown on what we need to do.
And we're picking that, right away picking that and ordering it and picking up from other farmers all today for tomorrow delivery. So the way the system. Is set up. It allows us to pick, to order most of the time and anything that we have that's hardier. We just keep a really tight eye on that inventory.
And as he mentioned, that power of suggestion with these boxes very important, because we want to make sure that we keep fresh produce going out and we move it as soon as we can, with some of the heartier things.
Max Becher: [00:27:36] If I could add to that is, I think Mike was getting at this a minute ago. That's why we wanted more than one delivery day per week, because if you only deliver once a week, and you buy an perishable product, most of that product is not going to make it to the next week.
So you either have to pick the order or you have to put up with a certain amount of waste or you have to try to cap your inventory so that it lines up exactly what the farmer's case size and. I have to say, for a warehouse manager, who's used to dealing with shelf stable products who sees the product in his warehouse before it goes out, he would probably look at our operation and just had a heart attack because we were selling stuff that we don't have in the warehouse, but we don't have in the cooler we're selling stuff.
That's growing in someone's field and. there is just a certain amount of, 5% of items. We just have to refund and that's just part of the game. And we explain that very carefully to customers, it goes out and automatic email. When we do a refund, we explain, we're sorry, but we're trying to keep this as fresh as possible.
So we're selling it out of the field instead of out of the cooler. Thanks for your understanding. But honestly, if we could move to three delivery days per week, at some point, that would allow us to roll over that inventory more often. So if you don't sell something on, say Monday, You could sell it on Wednesday, it's still fresh enough.
You might even be able to still sell it on Friday, depending what it is, but you're probably not going to save it till Monday. Right now we're doing that between Tuesday and Friday, whatever we buy in on Tuesday, if there's leftover. And there very often is we just keep an inventory spreadsheet that the crew updates on the ground.
I input that the next day into the computer and that's the start of the next inventory.
Diego: [00:29:13] So really, if you were just a farm that didn't source from other farms, Going to a one delivery day would be doable because you could just harvest to order as needed. Like you're not having to store stuff.
Max Becher: [00:29:29] that's what I did for the first couple of years. I had no storage. I had no fridge, no walk in. I just collected orders. went out, order the items, packed them up, deliver them. And then the whole process started again for the next week
Diego: [00:29:42] with two delivery dates a week. How do you set order deadlines? Because you obviously need some lead time to prep an order before it's delivered.
Max Becher: [00:29:54] Definitely. Yeah. We need two days lead time, at least. So what we do is, we just make midnight, the cutoff. If you order between Monday and Wednesday at midnight, your order comes the following Friday. And if you ordered it between Thursday and Sunday at midnight, it comes the following Tuesday. So it's a little confusing sometimes for customers, because if they order on Thursday, they might think they're getting their order the next day, because we do have a delivery day on Friday, but because they didn't get it in two days in advance, that's why it gets bumped ahead to the next Tuesday.
And Shopify has reporting software. It makes it very easy to do this because, midnight is there cutoff for a particular date. So when you're going to your orders and you're trying to sort what you need for a particular delivery date, you might've had more orders come in like on Monday, Monday is right after our Sunday midnight deadline.
People might've already placed an order Monday morning, but I can go and sort the orders by date and just stop at Sunday. And those are the items that I know we're processing for Tuesday.
Diego: [00:30:53] How do you communicate that to customers? I was talking to somebody earlier. They said that's why they didn't do multiple delivery dates because there was just so much confusion around just what you said.
I'm going to order Thursday. Oh, they deliver Fridays. I think I'm going to get it Friday. How do you clearly communicate to somebody? Those windows.
Max Becher: [00:31:14] we just, put it everywhere we can on the front page, on the FAQ page, it's in their introductory email. I actually just this afternoon, through an automation app, found that I think I could send a custom email based on when they place their order.
So I can set up an if then statement that, if their order comes in on Wednesday, they would get. A Friday delivery email. And if their order comes in on Thursday, they would get the Tuesday delivery email. there are ways to do it. And every now and then we do get a confused customer and we send them an email or send them to the FAQ page.
Diego: [00:31:51] and Mike for you, how do you find that window? For packing and fulfillment. Is that enough time or?
Max Becher: [00:32:03] Yeah, plenty of time for us. for example, today we're harvesting for farm divorce tomorrow delivery, and it's incorporated into our, harvesting schedule. Same for all the other farmers. they, the size of the orders as they're growing are enough to, for these, for pharma board to be a big part of some of these farmers, sales now.
And it, it is for us as well as, as McGrath farmers. So you definitely, one day is plenty of lead time. and, from my perspective, on the operation side two days, we've, it's been a lot of hard work to get to two days, but it's only the beginning. We'll go to three days and eventually seven days, because every barrier to entry to getting local food from local farmers to local people, we're going to drop.
And there's so much technology out there available. as far as the delivery partnering with the existing delivery companies, right now, we're doing all the deliveries ourselves. We have our own trucks with our own farmers that are jumping in the trucks, picking it and delivering it. But, the technology is such where we'll be able to partner up very soon with a grub hub or a door dash, if.
If they can go and sit at a restaurant to take one meal to one home, they can come to the farm and pick up 10, 12, 20 boxes and take them along a GPS route. So we know it's there. And, one delivery was not enough to is better, but, we're going to get to seven days a week and get people, their food as quickly and as possible.
Max Becher: [00:33:14] And honestly, if I could add to that, there's no reason that we couldn't order, that we couldn't deliver every day. And it looks like this, the order deadline would be something like 2:00 PM, maybe 3:00 PM. and then. Yeah. After 3:00 PM, we would, process all our, get all the orders together, process the paperwork, get ready to pack the orders early the next morning.
And then they'd go out mid day for delivery. If you were doing that. You could roll over your inventory every day. So you could just be ordering fresh produce and maybe two to three times a week. And in that case, you actually could sell your product out of a walk-in and that would make my life so much easier because you stopped speculating about what's going to be available in the field.
And if you don't have three or four backup growers, all growing carrots, when your care guy calls you up and says, Oh, sorry, just kidding. I can make more money selling them at the farmer's market. He's not going to tell me that, he just told me he doesn't have enough. Then I have nowhere to go if I was buying product in and selling it only once I see it in the walk-in.
that would just, that would pretty much cut out having to give customers refunds unless there was something actually wrong with the product. So the real barrier is delivery and we w we can't have a truck on the road delivering five days a week, six days a week, seven days a week. so I think correct me if I'm wrong, but I think that's the real barrier now to actually offering that. Delivery every day. Yeah.
Diego: [00:34:42] It's something that we could do. it's but it's not something that we're that interested in having a fleet of vehicles and we're farmers. We don't want to be delivery drivers, professional delivery drivers, or other outfits that do that kind of thing. And I think, it would be a mutually beneficial partnership and, and it's something that is going to happen for sure.
How do you analyze adding a delivery day? Say you went to three days a week. What do you need to look at in terms of order flow and how that could potentially change? So you could say, if we go to three days a week, we could potentially pick up more customers because it's more convenient. It there's some intangible benefits, like you mentioned about inventory.
It might simplify some of our inventory concerns. But logistically we're going to have another day on the road. So when you guys look at that as a business, if you wanted to add another day of delivery, what are the real logistical financial concerns that you need to answer to yourselves before doing that?
Max knows me very well at this point. I'm very much a ready fire aim. I'll go. And, and we'll give it our best shot. the, if the business is not set up in such a way where we can't, we can scale, then we've made fundamental mistakes. It should be able to, it should be built where we can, intelligently scale.
we just, for example, last night we talked about opening up. The one-on-one corridor, headed southbound from where the farm is located. This would be cities along that one-on-one passageway and we made decision at least a preliminary decision of let's go. And for me, I liked that pressure on an operational side, we have a lot of, young farmers, a lot of young talent, a lot of people that are, in many ways, committed their life to local food movement and growing food.
To me if max suggested it, he said, it feels like it's time. I'll say yes, max, you could get from a more, data, perspective on it. But, he knows this is the work we're committed to. And, so analytics wise, max, what might you look at there?
Max Becher: [00:36:47] I very much appreciate it. everything you said and that mentality of, pushing ourselves and even letting the pressure spur us on a little bit.
But what you'd want to keep in mind primarily is just the density of the route. if you're doing one route a week of 100 orders, and then you split that out over two different delivery days, say just theoretically it splits in half, You're still driving the same distance and you're doing it now twice a week.
if you don't get more orders, you're going to do twice the driving for the same amount of orders. If that makes sense. the hope is that by offering two different days, you get people to order more often and it's. Interesting. Cause we've seen that in some cases, some customers ordered twice a week and, it also gives flexibility because someone might not want their food to come on Tuesday.
They might be accustomed to doing their shopping on the weekend. And they'd rather have it come on Friday or maybe they want it for a weekend party, whatever, it just gives more options to people which I think does increase sales overall. But the risk would be that you water down your routes too much such that your. Driving more distance in between stops.
Diego: [00:37:57] I guess the one thing you could do is trial at, during a period like we're in now, where you say, as long as California's on lockdown, we've moved to three days a week. We're delivering Monday, Wednesday, Friday, and you could see how that goes and stringing out a little bit. Once this is over and if it's not working, you can just walk it back. You're never. Committed to doing that.
Max Becher: [00:38:22] No, that's true. and, maybe we'll do that
Diego: [00:38:24] is handled delivery in terms of where you'll deliver to a radius. Do you use drop points? Do you deliver to a house specific house? Do you charge for delivery? Is there a minimum order? He has walked through that whole logistical process.
Max Becher: [00:38:42] A lot of questions in there. we charge for delivery. we charge a flat rate, $5 delivery fee. that number was arbitrary in the beginning, but we've been monitored monitoring it over time and it does seem, with our particular route, in our particular situation, it does seem to cover the cost of paying the driver of the cost of the vehicle.
And even I have to recalculate this more recently, but. for most of the history of the business, it was also paying for the boxes that we ship stuff into. So we just stopped with $5. I really liked the flat rate because it discourages smaller orders, but it doesn't prohibit them. So if someone really wants to buy one bunch of carrots, they can do that. They're just still gonna pay $5 because that's what it costs us to get it out to them.
Diego: [00:39:29] $5 delivery fee that effectively forces a minimum order of what somebody is willing to pay. Do you have a range that is somehow geographically or deal sinks into Shopify where somebody outside of a certain zip code just can't place an order.
How do you manage where you can actually take an order from, because maybe somebody is in. South Santa Barbara and you guys just don't deliver there. How do you stop that person from doing it?
Max Becher: [00:40:00] at the moment it's been, since we started the Shopify store, it's been very manual. we just, we say on the checkout page that we only delivered to certain cities. There are five cities in Ventura County that we deliver to currently. And, if someone orders from outside that zone, we just send a, an apology, email and refund the order. It's only happened a couple of times. it's not that much of an issue. So the manual thing works and I think it's important for that to be made clear, because especially for starting out, you don't need to buy all the apps upfront.
That being said, there is an app that I'm working on installing right now, which can actually put a widget on the front page, which the customer puts their zip code into. And it will tell you whether we'll deliver or not. And it could also tell you whether a minimum order is required. Cause we were considering going into a couple of LA cities, some of the Northern ones that we can reach closer to Ventura County and there.
We were thinking, we would ask for a minimum $50 order and we can do different things. We could charge $10 to deliver there instead of five. the app would enable you to do that, and that would all be based on zip code. whether you want to do a minimum order or a different rate, it would handle all that.
So that's one example of where Shopify does provide some pretty professional and functional options, which allow you to do what some of the bigger stores do.
Diego: [00:41:18] Population dense, where you're at in along that one Oh one corridor. How do you determine. This is how far I'm willing to go for an order given that $5 charge,
Max Becher: [00:41:33] really just trial and error. the business started in Ojai in Northern Ventura County, originally delivered only in OHI. Eventually, I thought I could branch out to the two neighboring cities, neither direction I gave it a try, like Mike was saying, you let that pressure spur you on to get more customers and those deliveries zones.
there's just growing pains along the way. And any time you add a new zone or a new delivery day, we, with every change we've made, we just brace ourselves for something to go wrong or something to be difficult. And it always is, and you learn something and you get through it and make the system stronger.
Diego: [00:42:06] What is that distance? Now, if you had to guess, like what's the furthest you'll draw
Max Becher: [00:42:10] 30 miles, would you say Mike?
Diego: [00:42:13] Yeah. Upper ally probably is the furthest out 30 miles. So you guys are making it happen with deliveries, looking to expand one tool that I think might be really helpful in you guys growing is the app that you guys have.
Can you talk about. The app that customers can use to buy produce from an and how it integrates with Shopify.
Max Becher: [00:42:38] So it's still an experiment at this point. it's one of those third-party apps that Shopify offers. there are several companies. That basically have a template or a few different templates for a mobile app, which can sync with your store.
I know it can be a little confusing cause we're using the word app in two different senses here, but, right now we're referring to what a customer would go into the Apple store or the Google play store and download for their phone. So just like Amazon has a website that you can go and order from.
They also have an app you can download, which kind of streamlines the ordering process. it's installed on your phone. So it's not using an internet connection for basic functions, like the pushing of buttons. So the response time is very quick. there's a certain loyalty that you get from customers when they download an app onto their phone.
one thing that really drew me to want to pursue this was you can send push notifications to customers via the app. So you can get a very quick message to them, very short, quick message in order, a reminder to order or something like that. so basically we pay this company monthly to, create an app for us and we don't have to pay a developer 25,000, $50,000, whatever it would cost to design an app from scratch.
Because they know Shopify stores, they know a lot of the functionality they have. They've built a framework for an app that they just import all your store data from Shopify. And then they have a module where you can do some basic edits and customers like where you placed photos in the app and the text that's in there.
And things like that. the reason I say it's an experiment is that. the more you start multiplying all these different applications from third parties, instead of Shopify, they don't all play nicely together. And sometimes they'll offer a functionality that would be available in your online store, but the mobile app that the customer is using doesn't necessarily communicate with it.
So for example, if a customer's already placed an order for a particular delivery date and they place a second order through the online store, I'm able to waive their shipping fee automatically because it's all coming on the same delivery. They don't have to pay it twice with the mobile app. I can't integrate that.
So it's a little. It w we're going to talk to customers in a few months, especially those who are using the app and just ask them, how much does this enhance your ordering experience? Is it helpful? are you ordering more often because of it? cause it's, far and away the most expensive third-party application that we're paying for now.
And I would just want to know that it's actually helping the customer to order if we're paying all that money for it.
Diego: [00:45:33] And what's that cost a month.
Max Becher: [00:45:34] there are different plans. there's different companies and different plans. The company that we chose has far and away, the most integrations built into it.
So they actually do communicate with some of those third party apps we're using, which is pretty crucial for us. they have a $100 per month plan, 200 and 400 we're current early on the $200 per month plan. And, that's over and above every other monthly fee from Shopify and the other app. So it's certainly not cheap and I'm keeping a close eye on whether that's actually a good investment for us.
Diego: [00:46:09] Do you have a sense out of a hundred orders? How many are coming from
Max Becher: [00:46:12] the app? Probably 15% at this point. I could find out exactly through the Shopify reports, but it's, it's few enough that it makes me wonder.
Would those 15% just order from the store because Shopify has a very mobile friendly, interface on their website. I'm trying to ask myself that and we haven't had the app for too long, I'm going to give customers a chance to discover it and, play around with it. And really it'll be up to the customer in the end.
Diego: [00:46:41] Yeah, really. I guess if you round that up to 20 orders a month are coming a month, not a week, a month are coming. So it's five a week are coming from the app. You need to make $10 in order to cover the cost of that app.
Max Becher: [00:46:58] Yeah. our, basically our sales to the app would have to increase. in order to, to really be a good investment. it's one of those things where, the app might be paying for itself now, my hope is that it could be one more way to make it just irresistibly easy. And, we just want to remove barriers to ordering and if having an app on someone's phone does that, we want to do it.
So time will tell in three to six months, I think we'll have a much better idea of whether we really even try to pay for some customization to our particular app. Cause we could pay this third-party company, money to make some custom developments for it. Know, if it looks promising, we'll probably do that.
if it looks like customers don't really value it too much, I think we'll just pull out and push hard with the online store. It's tricky
Diego: [00:47:46] because I think the first thought is, Ooh, an app. That's cool. It can add, but like you said, if it doesn't work, doesn't pay for itself, it doesn't help you scale.
What's the point. It's just another thing to manage. It's just another cost. It's just another layer of confusion. And if it is providing some clunkiness, it's also providing a little bit of clutter within a system where, what you said is your Shopify, very nice storefront. That's mobile friendly. Is it that much harder to go to a bookmark on a web browser than it is to go to an app?
Max Becher: [00:48:23] Exactly. So Tom, also
Diego: [00:48:25] for people that want to check out your app, they can actually do it. Just go to the app store, go to Google play type in farm, or F a R M I V O R E. And they can see your actual app that you're using now. Overall, what's an average online sale for you.
Max Becher: [00:48:42] it'd be about 30 bucks.
Diego: [00:48:43] How does that compare Mike to farmer's market sales?
What's the average sale at a farmer's market. It's much less, I would say at a farmer's market, it's probably closer to a $20, I would say on average at a farmer's market, significantly higher online, but you're probably not going to do the volume online that you would do at some of those LA farmer's markets.
Max Becher: [00:49:04] one interesting comment about the models is that at a farmer's market. You're sharing that market with 50 other vendors, in our store, we are the market. they're getting everything from our store. that's, I think that's one reason the orders tend to be a little higher because of the farmer's market.
they might buy spinach and arugula from Mike and then go next door to the other vendor and buy something from them. And, they might end up buying from 10 people by the time they get out of the car, but in our store, within the parameters of that store, Everything we're selling, at least we're getting a margin on you become their brand. Like they support you versus splitting that support.
Max Becher: [00:49:43] Yeah. Basically. I've even referred to it many times as an online farmer's market. So it's, it's like all the sales that happen within the quote unquote farmer's market somehow, come to us.
Diego: [00:49:55] If you guys wanted to expand out, try and get more customers. What would be the way you would do that? How do you go about adding brand new customers to this platform? We've done very little marketing, actually. it's mostly word of mouth. We haven't put any, I don't want to say any effort, but, when we put a direct focus on storytelling is going to be a big part.
Max Becher: [00:50:17] There's so many wonderful stories of these farmers, and we want to highlight them. I think as we begin to dive deeper into marketing, and again, the stories that come along with that is it's going to grow. We've removed a lot of the barriers to entry with the 24 seven availability. The twice a week delivery.
The pricing is very competitive. to me, those are, the marketing piece, the storytelling piece. We haven't even, we've barely touched that. but what we, why we haven't touched is because we needed to build a strong foundation, a strong enough foundation to be able to be, have the courage, to take a big leap, to take on new cities, to take on, thousands of customers and tens of thousands.
And, we definitely want this to spread all over the country, all over the world. Whether we franchise, it's not something we're interested in, we've talked about, but we want to support other. Farmers and other aggregators and other cities and places.
Diego: [00:51:14] Perhaps consultation could be something that we could offer to scale. it doesn't have to be us that scale. it just, this movement has to scale of going from global dominated, food system, just shifting the scales towards local.
Max Becher: [00:51:29] We can still have wonderful things from all over the world. Just. Why not get the majority of them, if possible from, the farmers that are growing closest to you. It's an exciting time right now because we have been putting so much energy into building the platform and then shifting the platform to Shopify, ironing out the partnership and the remote management, with me being in Maine and Mike on the ground in California. And. You know that, so the Shopify store was created in October. We're now almost six months into that. And I think we're just in the Nick of time, with everyone wanting local food. Now they're staying at home with the Corona virus. I think we're really poised to grow at this point where we wouldn't have been a year ago. Nation is strong.
Diego: [00:52:17] We're ready to scale. I want to see what we can do. So it's been steady numbers, even dipped as we've made these. corrections in the system, but, you'll see. Now we're going to, it's going to grow exponentially, I believe.
Max Becher: [00:52:29] And we're ready for that. And, Diego in answer to your question about exactly how we would do that. There are multiple ways, but one that I wanted to mention, is. Another suite of apps that's available from the Shopify app store, which help you with affiliate marketing, where you can give an incentive to your customers to actually go out and spread the word of mouth. So we're doing that.
Now we have one where a customer can sign up, get a unique coupon code, give that code to a friend and the friend gets a discount and the customer gets, in this case it would just be a cash payment. We could do credit, but we're just doing cash payments. so that is new. We're going to see how effective that is. We also have, sorry, go ahead.
Diego: [00:53:15] Sorry to interject. But I was saying we really want to incentivize neighbor to recommend neighbor for the logistical reasons of, we want to have close delivery routes. So whatever we can do to stimulate that is key.
Max Becher: [00:53:30] Exactly. You get three stops on the same block and suddenly you're really getting paid to drive to that block.
Diego: [00:53:36] That's right. You were doing about a hundred sales a week prior. To COVID-19. Now you're doing a lot more. How are people finding out about it now they're spreading the word themselves, which is what's very interesting. People are telling other people, Hey, this service is here. It's local. you're stuck at home.you want to eat local, fresh vegetables, build up that immune system or just
Max Becher: [00:53:58] make sure you're staying healthy.
Diego: [00:54:00] So it's people are telling other people and we're of course, now, putting out some content and really trying to let people know, Hey, we're here and I'm here to help.
Max Becher: [00:54:10] Yeah, we just created an Instagram page a few days ago.
For example, we're a little behind the curve on a social media promotion. We've had a Facebook page for a couple of years, which, and we've done some paid Facebook ads. And I did them back after the Thomas fire for that campaign too.
Diego: [00:54:26] We haven't done so much. It's been word of mouth because of the external situations happening.
People are, Whoa, this is there. This is a local. A delivery service from local farmers and I can get it brought right to me while I'm, staying at home during this time. It's been people talking about it and, and which is very, it's a great for us to see that without much marketing efforts, some, but without much it's spreading, that means it's a service that people want.
Max Becher: [00:54:54] And what's interesting is I've been talking to customers whenever I have to call someone for a customer service issue and they're new. I've just been asking them, Hey, how'd you hear about us? And a good number have actually heard about us for a while. they had seen it on Facebook. Their friend had told them their friend might even have been nagging them, four or five times. And this is just what made them decide to do it, maintain the increased level of sales when. The situation around us passes. There's probably a lot of people, loading up now because there's a lot of fear outside of providing good customer service, good pricing, convenience. What do you do to try and keep customers sticky for the longterm?
Oh, I'll take this one next. as far as, from my perspective, it's very important that we diversify and we have correlated businesses to run alongside. Of the delivery service. So a couple of things that we talk about, our value added offerings, such as farm tours, again, as we highlight these farmers are going to become well-known to these customers and people want to be out on farms.
They want to spend a day, you pick and, visiting the animals and, learning, taking a gardening class so we can offer that kind of thing, which helps out. a farmer to have people on their farm. Again, it's another value added item, a correlated item that we can have. I think consultation is going to be huge.
As more farmers want to do this, they can go through all the pain that, max went through and we're going through now for the better part of seven years, or they can, we can help them out, I think is another way we can, diversify ourselves and help spread the local food movement. We talk about going beyond.
Vegetable fruits and vegetables. Where, why do we have to stop there if Amazon is global?
Diego: [00:56:45] why don't we have farmers on.com and we'd be a hyper-local so we can offer art and clothing and crafts that are made locally. So it's unlimited. We need to diversify to, for safety to mitigate risk. But at the same time, it's also going to enhance the local movement.
And, and with pharma, for being that conduit, from the producer to the customer, it's, it's, there's many opportunities there for us.
Max Becher: [00:57:12] Yeah, I think, I think we'll definitely see, the growth that we're seeing now is obviously going to taper off and presumably we'll see a dip, some people will try it for.
for a few weeks and maybe the crisis will die down and they'll stop ordering. but that's to be expected. every growth burst we've seen. Yeah, there's always a certain percentage of people that try it and don't like it. But, as Mike was saying, diversifying our offerings, eh, even within the realm that we're currently selling, like food items, being able to do verify that and offer more things to the customer could help retain them. one thing we're actually pursuing right now is opening up an account with. United natural foods incorporated, which is, basically the premier organic distributor for the West coast.
And we might offer items that you'd see in other health food stores, because when you think about it, even the little farm store in OHI that was connected to the farm, I started on, he sells his own produce. But he's got several shelves of groceries where he's selling pasta and beans and rice and sea salt and herbs and teas and things like that.
There's no reason we couldn't do the same thing. And, I think diversifying the offerings there and doing so know as we're experiencing this growth, I think will help us retain a lot of those customers. Particularly if they have a good experience with us now. And one other one other thing I'm trying to take advantage of.
I don't say that, I don't say that lightly. I'm not trying to belittle the tragedy of the situation here, but I think one good thing that might come out of it is that the whole national global distribution system, which we take for granted on such a regular basis is being seen for the fragility that it has, that.
It's not immune to the kinds of hiccups that we're seeing now. And maybe if our economy was structured with more local centric businesses that had more localized distribution networks, when one goes down all the rest, won't go down because that's what we're seeing now across the country and across the world.
And so I think we have an opportunity. To really say, Hey, we've been building this model for years because we believe this is a better way to do business and it's actually more sustainable and more resilient, more economically resilient. So I think we have an opportunity to tell that story and it's a true story and it might not be quite so apparent because we're very much entrenched in that whole, national economic distribution scene.
if we can't buy more boxes from Amazon, for example, We don't have boxes to get to the customers. it affects us too. We're not totally immune from it, but I think people can begin to see that there might be a better way and that buying local has more to do with just feeling good. It's actually a better way to do business.
Diego: [01:00:08] I'm totally with you. I think it's just the way that we were headed anyway, with all of these boxes out there. And moving it local makes a lot of sense. Given the recency scares that a lot of people have had. I think the challenge for farmers coming out of this is it's growth. It's just, how do you get in front of more people when you are such a small startup, I'll call it.
How do you go against an Amazon or some of these other boxes? And I know you're not meat, but like butcher box that has a lot of backing. That's spending lots of money on advertising and get out there and establish yourselves. I think that's going to be the struggle point, setting up the online store, doing the distribution.
I think that's all we've established that's doable. It's easy. there's work involved, but it's not too complicated, but it's really going beyond the low hanging fruit, the people that are just familiar with your farm and hear about you from word of mouth. And how do you take that to the next level, if that's what you want to do.
And I think that's where the challenge lies. You do what they can. Yeah. And do.
In terms of these larger companies, you are local, you're truly local. You're a farmer that's entrenched in that community or a community member. And global can never do that. So you don't try to be global. you are what you are, you're local and you highlight that and you tell the story and you invite them out to the farms and you connect the community together.
And they, a larger entity can offer amazing things, but they can never be local. So the reason this works max and I have talked many times, many of these services have come and gone. It's because in some ways they don't have a real connection to the community. Our roots run deep here, and that's an important piece.
any other farmer who's aspiring to do this, they have to be a real member of their community and really care about their community is a big part of them, their success. And there's no, as long as they keep going, there's no such thing as failure. They're going to just keep there's many failures along the way, but as long as they truly are local and care about their community, it'll happen.
Max Becher: [01:02:29] Yeah, I agree. The community aspect is a huge asset that the small guy has over the big companies. And, it's interesting. Cause there is a certain tipping point that these big companies are as efficient as they are because of economies of scale is because they've scaled to such a size that, they make their overhead really count for example.
But on the other hand, They require so much more overhead than a smaller company like we do. And where I think, Diego, you were referring to that sort of, barrier point where you go beyond the low hanging fruit. I think it's easy to do something very small because, you have so little overhead and so low, a little risk.
It, there's just, there's not much at stake there. Once you get to those economies of scale, then you can be profitable at that scale because, just because of the nature of scaling, but. To get between that small and that big and to do it in a slightly less conventional way. Like for example, keeping your distribution chain local instead of national, which is the way it's been set up.
That's where I think, if we're going to talk about this as a movement, that's going to reach more than 2% or 5% of consumers. It's going to be that kind of entrepreneur who steps up and really pushes into that middle range, or even, a fairly highly scaled business, but staying within a certain locality for the most part, I think that's going to be the real frontier that needs to be pushed forward on.
Diego: [01:04:06] Yeah. When I think about where you guys are at and with Santa Barbara, not too far away, how far is Santa Barbara from you guys? Might 30 miles, 30 miles. So not too far away. Pretty affluent area. there's essentially the, sky's the limit there. If you wanted to push into there, it's just, how do you do that? How do you get in there?
Max Becher: [01:04:26] Exactly. we are, Ventura County alone is 850,000. People in the County and that's not even dipping into LA County or up into Santa Barbara County. we are situated in such a densely populated, wealthy area of the country. That, having affluent customers as our asset, that's a huge asset for us.
and we're also situated in a very agricultural County. I mean that's a unique advantage that we have that being said, I would not let that discourage others from doing this in other areas. you don't need to have a million affluent, customers in your County in order to get a hundred, but that is certainly an advantage that we have aggregators.
Diego: [01:05:11] Where do you draw the line in terms of what product you'll aggregate right across from where our paper pot warehouses, there's a kombucha company. That's local. So many local producers around Southern California, doing everything from liquor to kombucha, to crowds and ferments.
Where do you where's the barrier to that? Because a lot of those businesses, I think, would potentially be open to somebody getting a direct link to the customer base. Like you have the advantage of, we can go to you. As a business and give you a customer base to sell it to. So really your job is to build up the biggest customer base that you can.
And then you can just drop businesses in there because a lot of them aren't necessarily delivering to customers. They might sell to a sprouts or some of the local grocery stores, or they might have a tasting room, but they're not doing the delivery and they don't might not want to touch that. You have that pipeline. Where's the limit there. and how do you view that? I look at it from is the company a good partner for us?
Is there integrity? There? Is there transparency there? Is there, care for the community there. And, and then is there demand for the product? Of course. so to me, there's not a lot of set rules if, if it's, a company that we can help out, that the customer has a demand for in there, running a business with integrity and transparency in the way they do things. we would definitely look at it, I think, and we have plenty of discussions and, healthy debates back and forth, but, I don't getting a product from a local artisan or farmer or a craftsman to the community using us as a conduit, is, is what we do.
Max Becher: [01:06:59] Yeah. My answer's not going to be so lofty as my ex I would just say, can it fit in the box basically, if we can fit it in the box.
we'll deliver it. If it's not perishable, it fits in the box. It's not too breakable, with kombucha, glass bottles. That's, that would be a challenge. we don't deliver meat. We don't deliver dairy. We have done eggs. I've experimented with meat, asking people to put a cooler out on their porch, but really one of the biggest parameters is really delivery logistics.
And, that determines our prices to a certain extent, too. we're not going to sell cheap potatoes because. Potatoes are heavy and they're big. And if someone wants 99 cent per pound potatoes, they're going to have to go drive their own car to the grocery store and buy them. we just can't be shipping large, heavy things the way we're operating at least.
Diego: [01:07:50] here's another way of looking at this for some farms out there they might not want to aggregate. Do you think the aggregation. Has helped sales. If you only could sell what you grew, would you have as many sales as you have today?
Max Becher: [01:08:07] no, I don't think so. I think, like I was saying earlier, the selection really pulls in more customers. But that being said, if I was selling only my own products, you know what, I still sell online quite possibly. it's just, basically I was thinking about this the other day, really all we're doing is we're streamlining the collection of information.
it's all about information. You're finding out all the information about what these different people want. And they're submitting that in a very, a very time efficient way for me. I don't need to sit there and write it down. I don't need to call them. I just put it out there on a form that they can access in the cloud on their own time and fill out.
And then that comes to me in the form of an order slip. I don't know if that's where you were getting with that question, Diego, but, if I was selling only my own products, I would still very much consider selling a line simply because it's an efficient way to collect information
Diego: [01:09:04] because one constraint I see some potentially being in right now and you're familiar with this.
You grew microgreens and you started out actually, I think in Mike ruins. You had a lot of producers that were microgreen only producers, they were selling to restaurants that switch got flipped off overnight and they have zero customer base. if you're a microgreen producer and you try and open up an online store, is that really that attractive to the general public?
Maybe for some hardcore health conscious people that you're gonna have to, or maybe. Yeah, you're going to have to diversify and maybe you don't have the infrastructure, the knowledge, the time, the space to do that now on your land base. So you go to approach other farmers who are maybe stuck in this situation.
If you can have the initiative to start the online presence, they don't want to, they might not want to deal with that. Or you go to other businesses that could still produce like a. Kombucha company, somebody, a bakery, a meat company, whatever, but you now make your limited selection, product being micro reigns, part of a greater box and your curating that box really with what you want to do is sell more microgreens but you need these other products to sell more micro greens.
Max Becher: [01:10:33] Yeah, I think there's really power in numbers here. And honestly, if you look at the industry, this is how the industry functions, no one's producing their own products and exclusively selling their own products, all retailers, even if they have their own, store brand products that they're producing or commissioning, they're buying other products and that's what leads to their success.
So I really think this is something the small farm movement could learn from because. The small farm movement has very much from powered by farmer direct sales, which is absolutely awesome. And I think for customers who will go to a farmer loyally and buy his products, even setting foot on his farm, th those customers are the a plus customers and we love them.
But yeah, I think the movement can get bogged down there and direct marketing can actually be really inefficient. it can be very inefficient for the customer. especially if you were to live in a more rural area and you have to drive to, seven different farms to buy your food, that might work for some, it might not for others.
So I think coming together as a, as, farmers, either as a co-op or maybe one person is starting a business and, buy wholesale from them, some type of aggregation like that, I think is really a win-win for all involved early stage. Can be
Diego: [01:11:48] in Mike, do you find that the farms you're aggregating from, they just wouldn't have an interest in doing this anyway, actually a lot of farmers just want to farm.
They don't want to involve themselves with, the complications that come along with developing and growing. A distribution network. But having said that me as a farmer myself, I'm a, I put a lot of stock in this because we need to make sure we have diversified sales outlets when, global catastrophes hit when weather conditions hit, when market fluctuations hit
Max Becher: [01:12:19] one very important thing for newer farmers or beginning farmers, small farmers, they need to be diversified to some degree, farming's all risk and they need to spread that risk out. So if they have the skillset, if they have the will to do it, they should do. If they don't, they should partner with somebody who is doing that and, and, send some of their product that way and send some to their farmer's market and some to their restaurant customers.
Diego: [01:12:44] And I think it's just smart business and farmers have to be masters of risk assessment and management or else, many times, the struggle is great and we won't make it. So if they have the capability, they should do it. No doubt about it. if not, then somebody else has the capability in their area and they should partner with them. And, that's a very Joel solace and thing to say, he is so big. one person hates to do someone else loves to do. And why don't you just get together?
Diego: [01:13:15] I love the vision that you guys have. I love where you guys are going with it all. To start to close this out in max, for somebody who wants to start. An online store, knowing what you know about Shopify, would you just recommend starting there?
Max Becher: [01:13:29] for 30 bucks a month, there's not much to be lost. I would encourage people to call Farmigo up. If they want to look at another option, they can take you through a free demo. no harm in doing that. But, 30 bucks a month for a functional online store that basically once you get started, there's not much to be lost there
Diego: [01:13:49] right on. I want to thank you guys, both for coming on and sharing today. You mentioned before people can check out your app farm of or worlds.
Can they go to find out about everything you guys are doing here in Southern California, farm of lord.farm there you have it. The team at farm of war, Mike Roberts and max Becker. If you want to learn more about them, check them out on Instagram or their web page, using the link below and be sure to check out their app farm of war. Wherever you get apps from your phones these days, that's all for this one. If you're enjoying this series, or if you run an online store and you've run it for a while and it's been successful for you and you want to be a part of this series, then reach out and let me know, shoot me an email or message me on Instagram at Diego footer.
I'd love to talk to more people. Who are doing really well, selling their products online. Thanks for listening to this one today until next time. Be nice. Be thankful and do the work.
Sign up to receive email updates
Enter your name and email address below and I'll send you periodic updates about the podcast.