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market-farming - Re: [Market-farming] Pricing produce

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  • From: Willie McKemie <mf AT austinfarm.org>
  • To: Market Farming <market-farming AT lists.ibiblio.org>
  • Subject: Re: [Market-farming] Pricing produce
  • Date: Mon, 15 Mar 2004 17:52:58 -0600

On Mon, Mar 15, 2004 at 03:53:36PM -0600, Matt Cheselka wrote:
> For now, I'm going to let my wholesaler set his price and I'll take
> whatever he gives me. This'll probably change once I get better at
> growin' things. I don't like much the idea of the wholesaler setting the
> prices. That's a recipe for disaster. I'm quickly learning that selling
> to wholesaler is all about volume. One needs to be able to deliver a
> given quantity on a regular basis. The "value" of the veggies, therefore,
> is very much connected to the delivery reliability factor.

I find that my grocery store customers care little about my price.
Most will take my product at whatever price I ask. Yes, the mark-up is
near 100%. However, if I price my product too high and my customer is
not able to sell to his customers in sufficient volume, then I have a
problem with repeat business or order size. My grocery store customers
are very straight forward in discussing prices. I may ask them what
they think is a reasonable price and I tell them what I think my costs
are.

The most important thing you must have a handle on is your costs. I
contend that no farmer really knows the cost of production on any
single crop. While seed, water, fuel, and similar costs are easy,
newbie farmers are likely not to understand some of their costs:
1) their own labor. A farmer should be paying himself for all the
time he spends on planning, production, selling, and delivering. To
those that say that they can not afford hired labor, I ask "are you
sure you're paying yourself?"
2) land. He should be paying himself or someone else rent on the land
he uses. It is an asset that could be put to other use.

--
Willie, ONWARD! Through the fog!
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