Financial success requires that production and profitable sales are reasonably balanced. Millions of small family farms have already disappeared because they failed to create enough of those sales with loyal customers.
Here is a fundamental truth. There are some excellent markets that are worth the effort, but there are many, many more that are not.
- They are VERY time consuming.
- They require harvesting produce without knowing if it will sell or not.
- They typically put farmers in competition with each other, or limit what each can sell.
- Most of all, the customers "belong" to the market, not you. If the market closes or you can't be there, your income evaporates. The customer relationship is fleeting.
Too many farm businesses are dependent on markets. The comfort of having ready weekly customers lulls farmers into complacency. The returns are typically too low to justify the time invested, but rather than seeking their own selling approaches, many return year after year.
All too often, markets are a sales treadmill for farmers. They feel they can't stop, but no forward progress is even possible. And time marches on.
In contrast, CSA's create a direct farmer-customer connection. However, in order to attract enough families, farmers often sacrifice their profitability.
At the end of the year, a lot of produce has been transferred. Yet, often times, when all the expenses are accounted for, the net wage proves to be far too low.
What's needed is a system where customers are happy, and farmers are well paid for their efforts. And that's where a Buy-Down CSA can feature as a centerpiece of a farm's business plan.
Choice Is Key!
Family food shoppers want choice. Any model that forces food on them every week, or defines what food they receive, inherently discourages them from signing up and returning year after year.
On the other hand, if their CSA pre-payment allows them to buy whatever they want when it's available, it becomes a lot easier to find subscribers and keep them happy.
So how can a farm prosper under such a system? Without question, a few changes in routine are necessary. However, the inexpensive software system we offer makes it quite workable.
Imagine The Following Example.
On a set day (Monday) each week during the season, you post by bedtime an online list of available products, and an estimate of the quantities of each.
The next day (Tuesday), CSA subscribers place online orders between set hours - say 5AM and 10PM. All products are first come, first served. When a product quantity reaches zero, it's sold out and can't be ordered.
The next day (Wednesday), the harvesting is done. The orders are packed and ready for pickup or delivery by late in the day, or the next day.
ALL PRODUCTS ARE CHARGED TO CUSTOMER ACCOUNTS AT THE RETAIL PRICES YOU SET. Customers get full choice on what they buy. You harvest only what they order and get fair payment for everything sold.
Our online software:
- has easy on/off checkboxes on your product master list
- makes updating available quantities simple from that same master list
- allows restricted ordering window times (example: Tuesdays 5 AM to 10 PM )
- creates a Pick List to cover harvesting for all orders
- creates a concise and printable Assembly List to make individual order fulfillment simple
- provides you and each customer with an automated ledger that shows past orders and $ balance
So once an assessment is made of the available products and their quantities, it's a simple matter to update your online masterlist.
The checkboxes on the left are "checked" for the products available, while the numbers on the right show the quantities you are making available for ordering.
WIth a click on the Save button, the available inventory is instantly updated on your EFF website. And as orders are placed, the available quantities drop, while the pick list builds.
Key Customer Points.
Customers are able to order just what they want in the quantities they want, based on availability. They can order one of these and two of those. If all they want is 200 pounds of tomatoes in season, they can do that as well.
They can skip weeks if they will be away or won't have much time to use the produce. There is no guilt about wasted products and wasted money.
They have 24 hour access to their account ledger, showing their past expenditures and current balance.
Key Farmer Points.
In promoting your CSA offering, a "full choice" system makes it easier to find subscribers and retain them from year to year.
You only harvest what is ordered and pre-sold.
And products are being purchased at retail price. (Our belief is that most small CSA's sell at sub-retail prices. The total yearly CSA income divided by the total weight of products sold is too low for a profitable operation unless there is sufficient scale to justify the lower pricing.)
Our farmer friendly software makes the process flow. Pre-season, you create your entire product list for the year, along with pricing and description. (Our Product Library really speeds up that process.) Then, as the year progresses, you turn on products as they become available, turning them off when they are done. And next year, you turn them on again!
Changes To Your Routine.
You will need to estimate quantities of the available products the day/night (Monday) before the order day.
You will need to pre-pack individual orders for customers. Our printable EFF Assembly List makes that packing process efficient. For each customer, it shows the products and quantities needed to complete their order.
You will need to click the Finalize button on each order in your EFF account. That does the bookkeeping to keep the ledger up to date.
So yes, it does involve a bit of computer or iPad work for someone, but it's highly organized and farmer friendly.
Our system includes a handy feature called "bundles".
A bundle sells at a preset price. It includes more than one inventory item. Each product is assigned a point total. The customer can choose any mixture of products offered in the bundle, up to the allowed point total.
In general, it's easiest to make each point equal one dollar. So a $2.25 product would be 2.25 points. If you have an overabundance of some items, you can put them in a bundle and offer savings to get a larger order.
And if you're set on offering a "box" option, you could create $18, $25 and $32 bundles with common products, allowing customers to select more or less of any items up to their point total.
There is no obligation to create bundles, but it a very useful feature offered in our system.
Q. Can the EFF software support more than one CSA group or location.
A. Yes. You can have as many as you want. For many farms, it makes sense to have two weekly harvests so that the produce can be picked at the peak of ripeness.
Q. I have 80 different products I sell. Can I have them all in the EFF system?
A. You can have as many as you want. That said, it's likely that any business consultant would tell you to reduce your number of products to the ones that sell best. As Ben Hartman says in his book "The Lean Farm", grow only what you know you have a market for, and can sell at a profit. It's less work, more results.
Q. It's not fair if someone buys all the strawberries. What can I do?
A. You can do what a grocery store does - say "Limit 2 per customer" at the beginning of the product description.
Q. Customers are used to being told what they can take, without seeing any costs per product. Will they object to seeing prices on the items they order?
A. Making pricing judgments is their trade off for having complete freedom to buy whatever they want. They will spend their money wisely in accordance with their values, just as they would at a supermarket.
Q. What if they end up with a balance at the end of the season?
A. Make it clear from the start that their balance does not carry over to next year. They'll spend the money!
Q. Can they add more money to their account if they run out before the season ends?
Q. What incentive does someone have to become a CSA member rather than just buying from us?
A. That depends on how else you make your products available to them. Clearly you can give a graduated bonus for larger sized pre-payments. Plus you can promise to give your CSA members your highest quality produce. Beyond that, most CSA members care about how their food was produced AND value the direct relationship with you. And they want your farm business to be successful.
So You Have More Questions...
Give George A Call.
Not THAT George!!
We are not an expensive consulting service looking to take over your business. We offer guidance, sometimes totally free, as well as some very economical tools and services to make your farm business work better.
Our EFF farmers are reaping benefits, but in each case, it started with a conversation about their farm business.
Simply call THIS George.
Now it's YOUR opportunity. Tell me about your farm and I'll explore the possibilities with you. If we can't help your business prosper, I'll tell you that. Otherwise, I'll make a proposal for your consideration.
Now is the time to consider alternatives for 2018 and beyond. Call me right now, even if it's 2:00 AM. If you put it off until "later", it's likely you'll never make the call. Don't make that mistake. Opportunity is knocking. Commit to investigating our EFF service AND our help by dialing 518-326-1638 now. You have nothing to lose and much to gain.
Eat From Farms
431 Old Best Road
West Sand Lake, NY 12196