[Market-farming] market pricing
kampy at grm.net
Thu Sep 23 23:05:15 EDT 2004
Thanks for this post - very informative.
I wish I could be your apprentice for a while.
How many people are hand harvesting to get 25-40 lbs an hour?
What are the other two market lists?
Marie in Missouri
All three market farming lists I received today were dominated by market
pricing. I have responded once and must respond again. Another grower in
my area is complaining loudly around town That my mesclun price to
restaurants is only $4.00/pound while he has to charge $7.00/ pound. My
price has been $4.00/pound for 10 years, dropping from the original
$8.00/pound. How do I do it? Am I just buying and reselling? No, I can
buy a decent mesclun from California for $2.20/pound, which at
$4.00/pound is only a 45% gross profit margin and I don't like anything
less than 50 % gross profit margin or, stated another way, doubling my
money. My production costs from planting the seed through harvest,
packing and delivery is only $1.20/pound with hand harvesting being the
majority of the cost. That is a healthy 70% gross profit margin.
I have been able to reduce my price from $8.00/pound to $4.00/pound and
maintain that price for ten years by becoming a better, more efficient
grower every year. I now make more money at $4.00/pound than I ever made
at $8.00/pound! A CSA grower in my neighborhood called me an elitist one
day saying that my prices are so high that only my high-end restaurant
customers can afford my product. Last year she branched out into selling
to restaurants and complained to one of my chef's that she doesn't
understand how I can possibly be growing my own product and selling it
at $4.00/pound. One year, i was an elitist for selling mesclun at
$4.00/pound, now that she's trying to compete with me I must be
cheating-it's all a matter of perspective.
The fact is the cost of production for the large California growers is
on the order of $.60-.75/pound so I still have a lot of room to improve
my operation's efficiency and therefore my profit margin. My current
production is 500lbs/week, 52 weeks/year. I never have less than 2 acres
planted in mixed greens and am always harvesting from a minmum of 1/2
acre. Last year I harvested 15-25lbs/hour, now I harvest 25-40lbs/hour.
This year I have already used 15lbs of lettuce seed, over 6 pounds of
other salad greens seeds, 6 pounds of beet seed, four pounds of chard
seed and I am going to plant another 4 pounds of lettuce/other greens
seed next Tuesday. In three years my goal is to purchase the type of
machines used by the large Cali growers to eliminate hand harvesting,
hand washing/drying/packaging and at that point lower my costs to
$.75/pound and increase my production to 2,000 pounds/week while
maintaining my $4.00/pound price. If that bothers other growers, I say
that if they
are willing to do the things I do they will reap the rewards I do.
Steve Rogers, owner/operator, Singing Pig Farm, Portland Ore
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