Selling Online: Selling Vegetables with Shopify and Customer Pickups (FSFS207)

farm podcastIntroduction

This week we’re interviewing Ray Tyler, who’s doing online sales using Shopify. Unlike other farm-specific software, Shopify is a comprehensive eCommerce platform. The benefit of using Shopify is it’s an industry leader, so it has a lot of well-developed features. You can quickly post your products online with an appealing and easy to use visual display. There are tons of app integration, and everything works together seamlessly. They have excellent customer service, quick load speeds, and it’s managed on secure and reliable servers. In our interview, Ray Tyler is going to detail how he uses Shopify on his farm and why you might want to as well.

 

Why did you initially start selling online? (1:35)

We saw a change in West Tenessee in how customers were buying their food. There were fewer chefs interested in buying local. We saw a decline in farmers’ market attendance. And then we saw Jeff Bezos purchase Whole Foods. It was that week that we said we have to get an online store going. That was three years ago. 

 

What percentage of your sales are online right now? (3:15)

About ⅛ of our sales are online right now, but by the end of the year, we have the goal of making it ¼ to ⅓ of our sales. We’ve experimented with a lot of online platforms and landed on Shopify, so now we have most of the bugs worked out and are ready to push ahead with scaling online sales. The rest of our sales were restaurants, grocery stores, and farmers’ markets. We sold to a lot of restaurants but had a negative experience and decided to pull out of them. By the end of this year, we want to have ⅓ online, ⅓ grocery stores, and ⅓ farmers’ markets.

 

What are the negative aspects of online sales? (5:30)

The number one thing for me is computer work. The logistics can be complicated and more involved than you might imagine. My wife is better at it than me, but we both don’t love being on the computer. You also have to deal with the consumer digitally. A farmers’ market is much more straightforward. We are realistically spending about an hour in managing our online sales a week. When we grow this aspect of our business, we should be spending more like 2-5 hours online a week. 

There’s no end to it. There’s always more you can do. The more time you invest in development, the better the consumer experience. When you compare it to how many hours you have to invest in being at a farmers’ market each week, it’s more likely that even though you will have to grow your online sales slowly, it will be worth the time invested. 

What we’re finding is that once you have your online sales set up, you can target ads on Facebook to our surrounding counties. With 50 reliable clients, we can replace any heavy hitter large client who doesn’t pay their bills on time. There are a lot of advertising opportunities out there on sites like Facebook and Google. It is going to be work, but if you invest the time slowly but surely, it’ll be worth it.

What customers are you looking for? Converting farmers’ market customers or finding new ones? (15:40)

I’m looking for both. On our online store, we close the cart at midnight Sunday, and it opens up on Wednesday/Thursday, depending on what we have going on that week. Those people need to be reminded that the deadline is Sunday. We have a good-sized local email list and a good number of folks who follow us on social media. We’ll send out two emails a week, one on Sunday night with farm news and what’s for sale, and then I’ll run a farm ad on Facebook and Instagram. And then I’ll have another promotion that has targeted ads towards people who are interested in cooking, nutrition, and fitness. That’s been effective.

 

What visuals and details have you found grab new customers’ attention via your ads? (18:00)

I would say video works the best. One that has visuals of crops on the farm. I’ll pay for professionally produced videos and sometimes shoot one just from my phone. Depending on the time of the year, sometimes that video I shot will do better than one, I paid $500 to have done for me. Thanksgiving and Christmas are terrible times to do ads since the market is just saturated, and good local food isn’t that interesting to people at that time. Different times of the week have better conversion as well if you learn to pay attention to them.

 

How do you gather email addresses? (20:45)

In Jackson, we had a big poster at our farmers’ market that said we wouldn’t be coming there anymore next year, sign up to get on the mailing list, and that was effective. What helps is having some sort of incentive to get people to sign up. We’ve offered a discount if people order pickup at a market ahead of time, for example. We like that with these promotions on Shopify, there’s a great discount code option. You can offer it on specific items. One development that converts well is at the beginning of tomato season people can checkout with the offer code ‘spring’ and get 50% of their tomatoes. 

 

You have a reasonably large Instagram following – how much has that helped? (24:45)

The challenging thing about social media is that many of your followers won’t be local. We do much better with targeted local ads. We spend about $50/wk. We spend a bit more if we want to experiment with multiple ads to see which were the most popular, or when we have more product we want to move. 

 

What’s the best way to grow your online sales? (27:00)

First, know that you’re going to have to be committed. It’s going to take time unless, of course, you already have experience with operating a computer and an online presence. If you do, then in a couple of weeks you could be doing well. Our operation is complicated since we are delivering to a broad demographic across a lot of deliveries, but even though it took a couple of years to build, it’s going very well. 

The question is, what do you want this to do for you? If you are delivering over a large geographical area with a large variety of products, it’s going to require a lot more set up. But to set up deliveries to a couple of drop sites with only 5 product offerings, you could be set up in just one day. It might not look as pretty as you’d like it, but you can perfect that later. Be careful not to get analysis paralysis; it can be overwhelming trying to make it perfect. You simply need to be able to take the order, get paid, and deliver it. You can make changes to your site until the end of time, so start today to get it done and get paid.

 

Why did you choose Shopify? (34:15)

There are thousands of apps and plugins available to build your store any way you want it. The platform gets along with other platforms well, and you can set it up quickly. It has dependable customer service, which not only means you can solve problems by giving them a call, but they’ll even troubleshoot a website build with you to find a way to get you a feature implemented that you’re interested in. There’s nothing we’ve wanted to do that we haven’t been able to. There are lots of themes, and it’s quickly implemented. The pricing is also reasonable at just around $70 a month for the middle of the road feature package.

It works well for products that are sold by the piece. If you are selling something agricultural by the pound, such as meat, and don’t know how much it’s going to weigh until you process it, that will make things a bit more complicated. You would have to know your weights, and even then, it would be difficult to list. I have a friend who sells by the pound, and he just tells his customers that he’s going to get his weights as close as he can, but sometimes it may be under, and they’re okay with that.

People find it easy to use. There are going to be people who find it difficult to use no matter what, but that’s less than 5%. Sometimes people have a hard time finding what drop off site to select. 

 

The website only takes orders Thursday thru Sunday, why is it set up that way? (43:30)

Monday, we get together to know what we need to do for the week. We print out our pick list, and then on Tuesday, we pack all the orders. On Tuesday, we deliver to four cities, and on Thursday, we make our Memphis delivery run. There was a problem when we posted that deliveries we Wednesday and Thursday since we’d have people place an order on Tuesday thinking they’d get it that Wednesday. It didn’t matter how many pop-ups we put up to try and clarify it. We also didn’t want to be printing orders every day of the week, so for the quality of life, we only print orders on Monday, so we don’t need to spend much time behind a computer. 

 

How have you found using the drop off sites vs. residential delivery? (47:45)

At our drop-offs, we partnered with health food stores and the like. We don’t pay them a commission, but what they get out of it is foot traffic. The customer shows up and tells the cashier they’re here for their order, and the cashier gets it for them out of the walk-in cooler in the back. This is a win-win for all of us. 

We’ve played a lot with home deliveries. Some of our attempts at it haven’t worked out since the order amount people put in didn’t justify paying a driver. We have a good driver, though, and we’re going to try again. We are looking at making delivery free for people. Or what you could do is institute a minimum to make it worth it. 

 

What is your average online order value? (55:15)

My average is $38 vs. $17 at the farmers’ market. Even though more customers are buying at the market, if you get 100 orders online a week, that’s not bad. Getting people to pay that much for a CSA share a week was exhausting.

We’re at around 50% for repeat customers. I have some customers who order a significant amount every week. Shopify has analytics on your customers that give you details about who order the most and so you can implement rewards for these people. You can also offer perks based on the number of purchases and so forth, which Shopify helps you with. They give you advice on customer retention. 

 

Is there anything you’ve tried out with online sales that just hasn’t worked out? (1:00:00)

I would say packaging. We put our produce in plastic thank you grocery bags, thinking we could treat it like a farmers market. People were taking it home and throwing it in the fridge like that, and it was going bad. This means every vegetable has to be packaged individually. But we’re getting paid well for that work, so it’s worth it.

 

Conclusion

If you want to follow along with what Ray Tyler is doing on his farm, you can check him out online at Rosecreek Farms and see his farm store here

 

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