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Operating A Subscription System Farm

By Bob and Bonnie Gregson

Everything evolves. Your notions about what you want to grow, how to lay out the farm, and how you like to sell may change substantially over time. It is painful to think of the numerous “permanent” fencing changes we’ve made, for example, and even the “permanent” raised bed structures achieved with so much hand digging that have been levelled later. Likewise, the poor blueberries are in their third “permanent” home in as many years. They are set back with every move; so are our blueberry pancakes.

There is an issue at the other end of the “permanence” spectrum, and that concerns trees. They aren’t so moveable after several years; you must make some genuine long-term orchard/plantation plans early on, before you are probably ready, or you will seriously delay arrival of the fruits of those trees. Read one of Bill Mollison’s “Permaculture” books before making those decisions.

orchard
Trees aren’t easily moved after a few years, so be sure to have a long-term plan for your orchard!

Let us assume you have been through the start-up activity and have two or more years of experience selling at a farmer’s market. You will have some idea of how you do things, what you do best, what seems to grow best, and, in general, if you want to be serious about making a living on a small farm. If you have decided that this life is for you, then the next step is to develop your own medium-term farm plan.

The Basic Subscription Start-Up Questions

How many subscribers should we attempt the first year?

That varies by individual preference, experience and confidence. We know one two-person, part-time operation that started with only six customers; another took forty. Both survived and both expanded. We also know of failures, where the advance payments had to be refunded in mid-season because the farmer could not handle the demands of the business.

We believe twelve to twenty is a good starting point for those with minimal experience.

Should I begin with fewer customers than I really think I can grow for?

Sure. You can sell surpluses at your farmer’s market or at a farmstand on site. The issue usually is not how much you can grow, it is growing balanced amounts of a wide variety of crops to interestingly fill each bag each week.

What are the main problems the grower encounters with this system?

Growing so many different things for a prolonged period of time . . . which requires such good planning and timely execution . . . is both a curse and a blessing to the grower. The biggest complaint we hear about our system, or those of other subscription farms, is that there is too much of one thing for too long a time.

bunches of radishes
One customer claims that his farmer provided six bunches of radishes, and very little else, for three weeks in a row at the beginning of the season! Needless to say, that relationship did not endure.

We try to delay start of the weekly pickups into mid-May — even though the pressure mounts to get going earlier — to have an assured supply of diverse items. In fact, we use some items from the previous year, like nuts and dried beans, plus potted vegetables or herbs or flowers for customers to plant at home, to add variety in the early weeks of the season.

The other main problem from the grower’s perspective is that this is a season-long commitment. It is a good idea to schedule a one-week hiatus during the middle of the summer. That is OK from the customers’ perspective and a nice break for the farmers.

What is the best way to advertise for customers?

Word of mouth is the very best. Our first customers were friends or friends of friends, and only a few of the first twenty came from the various newspaper ads we ran. Tell your friends what you are about; prepare a good brochure and give copies to those friends; take copies to the farmer’s market and hand them to customers you have gotten to know a bit. The local newspapers and other media may be interested in publicizing your program if it is somewhat novel in the area. Develop a good logo early on and use it on a farm sign; visual advertising will reinforce your brochure and your own sense of professionalism.

Should the farmer deliver produce directly, or deliver to pickup points, or have people come to the farm every week?

In most cases, it is simplest for the farmer to have customers come to the farm. That way they can get to know the farmer and farm premises better, may want to purchase additional items if they see them for sale, and it saves the time and trouble of loading/delivering. There is an implication herein that the farm is neat, attractively maintained, is easily accessible along decent roads, has parking and a place to properly store the full produce bags or boxes on pickup day.

Some farmers prefer drop-off points at houses or businesses in town, where, in exchange for a share of free weekly produce, the residents will provide secure storage and availability so the other customers can pick up their bags or boxes without travelling out to the farm.

vegetables for delivery
Another option is for the farmer to deliver direct to each customer each week, for an extra charge.

Many of the larger operations have one or more coordinators who set up an entire pickup system, collect the money, and recruit new members. The coordinators would, of course, be remunerated for their services. That reportedly works for many farmers. We prefer not to do it that way because it gets back to the idea, however benign in this situation, of a middleman between the grower and the eater. It is also an extra cost to the farmer.

How much should we charge for a subscription?

This may be the biggest question of them all. And it has the most varied answers.

What is so dicey about the whole issue is that no one knows in advance exactly what will go out each week, and therefore what the value in wholesale or retail terms may be for the season. And every CSA/subscription farm sends out decidedly different quantities, different produce, and often prepares and packs it quite differently.

Some develop an annual farm budget

Allocate proportionate amounts of costs and gross income to the subscription program, and then divide that portion by the number of subscribers. Example: If the farmer determines from a well-prepared budget that serving 50 subscribers for 20 weeks requires $20,000 gross from the subscription portion to meet farm financial objectives, each subscription would cost $400.

Some go by total poundage

They plan to provide a certain number of pounds of produce per week to each customer. That seems a strange approach since a pound of salad mix is so much more valuable and time-consuming to prepare than a pound of winter squash, for example.

Our choice was to target the retail grocery store value of what seemed would be a typical bag we could fill in mid-season, then back off from that to give the subscriber some saving versus shopping at the local grocery store. That came out to about $15 per week the first year; we have increased prices about 4% each year based on higher costs of farm inputs, especially seeds and chicken feed. We realize, and mention to our subscribers, that the early season bags will contain less value, but we’ll make up for those later in the year.

With our system, we have a target value to achieve each week. That simplifies things a bit. We keep an eye on grocery store organic produce prices, and then fill the sacks to reach our desired value each week, adjusting for past underages as necessary.

man with bags
Our experience suggested it is far easier to obtain, store and handle used grocery bags than it is to work with more bulky boxes.

Notice we use bags. Most use boxes. We feel it is essential to keep most vine-ripened vegetables and fruits in cold storage until in the hands of the consumer, so cold storage space becomes critical. Our old beverage cooler makes a nice cold storage unit for customer pickup, but it will handle only a few boxes versus a maximum of 36 full grocery bags.

As a general rule for establishing seasonal pricing, look at what others are charging in your area. The least we know about, anywhere, is around $12 per week, and the most is around $25. Again, there is no consistency among weekly outputs of any of these, so it is impossible to directly compare them.

“I started out at a very low subscription price because I was new and didn’t know if this whole thing would work… now I realize I gave them about twice what they paid for, and for this next season must either cut way back on what they are used to getting, or substantially raise prices to make ends meet, but am very afraid I’ll alienate my existing customers.” This is a nearly verbatim comment from various new farmers we know or know about. Beware. Be scrupulously fair to everyone, including self, from the beginning.

How does the subscription program affect a typical farm weekly schedule?

There’s nothing unique about scheduling in this system. Any marketing method requires similar amounts of work and routine, including deadlines.

We have always spread the customer pickups/deliveries over two nonadjacent days. Thus if 18 are scheduled to get their sacks at 3 p.m. Wednesday, and 17 on Friday, we follow this routine:

Monday a.m.: Pick and wash 20 pounds of salad mix.

Tuesday a.m.: Same as Monday.

Wednesday: Pick and pack all other items for 18 subscribers, in the bags by 3 p.m.

Thursday: Pick salad mix for weekend sales.

Friday: Same as Wednesday.

That is the part that directly relates to subscriptions. In addition, we consider and harvest for farmstand and grocery store sales.

We pick salad again later in the week as needed for sale at the farmstand, and do the same with other produce as it ripens. Everything is picked fully vine-ripened and ready to eat to insure best flavor and highest quality for the farmstand. Grocery stores, on the other hand, want produce that is not yet ripe so it can last longer on the shelf and withstand more handling.

The rest of our schedule is quite variable. It depends on the time of the season and relates to all of the rest of the weeding, seeding, transplanting, watering, etc. Nothing unusual there.

A confession: everyone assumes farmers start work at the crack of dawn. Most farmers apparently do, and relish those early hours. Well . . . we don’t arise until after a half hour of classical music and the 7 a.m. news on the radio, including those always-gratifying traffic reports. Our systems simply work more happily with that routine. We do work until dark. And it is a seven day week, with Sunday being a more casual time of doing odd jobs and lesser things, including what we sometimes refer to as “recreational weeding” — weeding an area that is not crucial but will make us feel better when it looks better.

farmer planting seedlings
There is hope for even the early-morning-impaired.

How many people will one subscription share feed each week?

That is an utterly unanswerable question, though most CSA brochures include some comment about one share being enough for three people for a week, or whatever.

Bob’s 21-year-old son could probably consume one of our bags in two sittings. Alternately, some families of four might dabble at this assortment for a week. For reference, a typical 1995 July bag contained one-half pound of gourmet salad mix, one-half dozen eggs, a huge sweet onion, four or five small summer squash, several kohlrabi, four globe artichokes, a head of lettuce, a big bunch of New Zealand Spinach, and a pint of sweet cherries.

Other CSA farms often concentrate more on bulk and do less prep work — everything we put in the bag is clean and ready to eat, looking just like it came from a grocery store. Some farmers pick directly into the customers’ boxes, dirt and all. Their weekly fare might include several pounds of potatoes, several pounds of beets, several pounds of carrots, heads of lettuce, chard, and so on, perhaps up to 20 or more pounds. That might indeed provide plenty of certain kinds of vegetables to feed a four person family for a week.

Fortunately for all of us, there is no single answer. Some folks prefer lots of pounds of unprepped vegetables, and others prefer a broader mix of prepared foods. There is a huge market for each of those styles plus many more!

Is a weekly newsletter important to the CSA customer/subscriber?

Indeed it is. Our customers have said many times that they like to know what’s going on at the farm and with the farmers, and they especially like to have recipes for what’s in the bag.

Bonnie collects recipes all winter, so we have a repertoire ready to print as different items ripen. It usually requires 30 minutes to prepare the night before customer pickup day.

physical paper
Some farmers consider a newsletter an insignificant, unpleasant chore; we think of it as an important, integral part of our farm program.

Is it important to keep good records; and is a computer essential?

It is definitely important to keep good records. It goes without saying that customer payment schedules and records must be precise; other things like planting dates, harvest dates, quantities planted and picked, and costs are very valuable for future planning.

Perhaps less obvious, but equally important, is that keeping good records constantly reminds us that this farm is our job, not a hobby. It enhances the professionalism needed to be successful.

As for computers . . . we’ve kept financial records both by hand and on the computer. It seems like the computer takes more time and effort in the long run, even for very detailed records, unless using the computer is second nature.

The concepts associated with the Dominguez/Robin book Your Money or Your Life have been extremely important to us in this overall issue of records and tracking expenses. Anyone wanting a simpler, more basic and meaningful lifestyle will find immense value in this book. It has greatly aided us in reaching a debt-free farm situation, plus a savings program that is working.

When should subscribers pay?

There are once again many approaches to this. We want the bookkeeping essentially out of the way before the rush of the season overtakes us; our subscribers pay a deposit in December, then equal installments by the first of April, May and June.

budgeting
Our subscribers pay a deposit in December, then equal installments by the first of April, May and June.

What subscriber turnover rate should be expected?

Some farms report up to 60% turnover per year. Our experience has been in the 10-30% range. One must watch this closely and use year-end anonymous evaluation forms to determine what is causing turnover. There are plenty of reasons over which the farmer has no influence (moving, finally started own garden, etc.) but dissatisfactions must be discovered and addressed if one is to maintain a successful enterprise.

We realize this system is not for everyone and some will drop out every year. But most subscription farms have nice waiting lists filled out by the end of each season.

Source: Rebirth of the Small Family Farm

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