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market-farming - RE: [Market-farming] discounts

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  • From: "Rick Williams" <mrfarm AT frontiernet.net>
  • To: <market-farming AT lists.ibiblio.org>
  • Subject: RE: [Market-farming] discounts
  • Date: Sat, 8 Feb 2003 13:17:25 -0600

Caryl Elzinga wrote:
> Do discounts work, or do they actually work against you?

Like most things, it depends. If you were fairly predictable with the sales,
then the customers might just wait. However, if you had to throw out steaks
that could otherwise be sold for some price, we figure we would rather take
something rather than nothing. The only reason we would ever do a sale is
only to get rid of old inventory.

> And if just use a discount to attract new customers on
> price, won't
> they drop you or feel cheated when you sell the next round at your normal
> price?

We plan to only use sales for our regular customers and NEVER for new
customers. Even if this flies in the face of conventional marketing, that is
our preference. The deal is that when you get to be a customer, we give you
specials that are not available to others. And we do point that out.

> my husband delivered a beef yesterday to the Co-op
> that carries
> our stuff year round and within an hour a woman came in (who had asked in
> advance to be called when we delivered) and bought every tenderloin).

Decent! However, how do you handle the tenderloins vs. the New York Strips?
Or do they both sell well? We do not do any tenderloins since we stay with
Porterhouse/T-Bones instead. We would have to charge way over $10/lb for
Tenderloin I would think. We have received a local e-mail on that and I
suggested the customer consider Porterhouse but they did not respond back:)

> Although our beef is selling really well at the co-op, since we whole-sale
> to them our net per animal isn't that great, and the coordination still
> requires a lot of time. We justify it in that it keeps our beef available
> year-round when the farmer's market is closed, and reaches additional
> clientele, but we'd really prefer to deal direct with people rather than
> through a store.

If we could, we would sell through outlets like coops, but they will never
be able to sell that much product compared to what we can sell. But every
little bit helps. We get full list price for our beef cuts that the coop
sells. But then again our price is close to regular store price. They have
to sell our $4.69 Sirloin for I think $6.99/lb in order to get their
standard 1/3 markup. We do give a slight discount on the ground beef and we
did not increase the price with our new level of quality so it still can be
sold in the store at $2.99/lb.

> We are not
> marketers,
> but surely there must be some other ideas to attract new customers other
> than discounts.

Our main marketing tool is the brochure that we developed in-house. We can
run off new ones on the laser printer and if we need to make some changes
can do it easily. We usually make short runs of 50 or so at a time. We
"replenish" several strategically located envelope holders on some local
bulletin boards. One of our best is at a local cheese factory. As you go up
the steps the BB is straight ahead and then you have to turn 90 degrees. So
it is one of those dream boards that are located in a very high traffic
location and we have gotten some customers from there.

We find that we get about 1 or maybe two customers per 100 brochures that we
distribute. And that is with selective distribution as we don't just hand
them out all over the place. The second marketing is of course when we are
at the Farmer's Markets. Most of our best customers seem to be from there or
if not, they are the same folks who would buy at a farmer's market.

And then we have a few who will buy split halves and halves and one lady
bought a whole steer and then she figured out the marketing to her friends.
We did give her a very good price even though we were selling in splits
because I feel that she earned the money for doing the work. The cost for a
whole steer as a split is about an extra $30 to the processor.

Our long term hope is that we will get some word of mouth advertising, which
is the best you can get:) But it is very slow in coming since even if you
told someone about the farm, it is another thing to actually stop off.

Sincerely,

Rick Williams
Misty Ridge Farm
Direct marketed dairy beef and produce
(also dairy heifers and beef stockers)
Viroqua, WI






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