Thursday, March 17, 2011

Saturation Point ...

No not the ground ... in fact the ground is actually starting to dry up rather nicely and I have been able to move around without getting sucked into knee deep puddles of mud! What I'm talking about is more of a business saturation point. As I look at expanding the farm and adding new enterprises I often wonder just how many small-scale ... pasture based ... direct market ... meat farms that the local area can support. I will readily admit that my meat costs more than pretty much anything the local grocery store is selling, but I'm not ashamed of that because I know how much it costs me to produce it and I know how much I need to get in return. Also, I'm confident in the product that I have ... not propaganda ... I just really am proud of it.

Regardless of how proud I am though of the meat I'm raising I still wonder if there is a point of saturation for this local food market. Is there a point when you will hit the top of the ceiling when it comes to the group of people willing to pay for a quality pasture raised product from a local farm? While at the INCA conference a couple weekends ago someone mentioned that for the first time in a while some local CSA farmers were finding it more difficult to sell all of their shares. They had been used to a waiting list in the past, but now they were even going into the season with some open. Does that mean that the market is hitting a saturation point or that marketing and customer education needs to change?

I'm not exactly sure what I think on this topic, but I would love to hear your thoughts on whether or not we are hitting a saturation point? If nothing else the idea of hitting a saturation point reminds me that I need to have a niche for my farm and I need know my story in and out so that I can share it with everyone I meet. I need to know why I'm doing what I'm doing and I need to convey that in all of my farm conversations.


Kim said...

coming from a newbie (w/in the past yr) I think that the 'coolness' factor has worn off & now its turning into a life staple for those that are serious about it so it seems to have hit a lull in 'excitement'. In my opinion, this is just a calm before the next storm or excitement. I don't think there can be too many GOOD producers. When we are passionate about what we do, we get out & educate others on why what we do is great, there will always be a new audience to teach.

Rae said...

There's always going to be a market for farm grown meat and produce, and while the number of suppliers is growing, not all farms are alike. From what I've read, and what I've seen in my area, there does seem to be a glut of small-scale farms out there. I have a feeling though that many aren't going to last, and that the glut is somewhat temporary. The problem is that it's the "cool" thing to be doing right now. People are racing out to buy a bit of land and become farmers, thinking they're going to make a living from it. Many will learn it's not as easy as it seems, nor as profitable if you don't know what you're doing. I expect that the ones who ride it through will be farms like yours where there is a story, a passion, and working knowledge. Customer tastes will mature, and they'll learn the difference between "farm raised" and truly excellent farm raised. I would say continue to do what you're doing, make improvements as you find ways to do so, and you'll ride it through just fine.

Rich said...

The only thing that really matters is if you (as an individual farm) are hitting a saturation point, not if we (a collective of all farms) are hitting a saturation point.

Your success or failure isn't dependent on what happens to other farms.

Illoura said...

I don't raise any animals yet, but we are in a very conscious community of "local first" and "organic" crazed people (including ourselves to a great degree). Education is certainly part of that - but ignorance is bliss! Too few people have watched Food, Inc., right? Maybe they don't WANT to know.
[Once you watch that and taste the difference in organic meats you can't even go to McD's, and your stomach turns when you see Tyson chicken nuggets].
However if it costs $75. for 3 porterhouse steaks (albeit nice and thick), you aren't going to be able to afford that every week!
Organic chicken per pound is at minimum, 2x the cost of mainstream markets' tough, thawed, and slightly greenish -but huge, chicken breasts. There is no true comparison in quality- once familiar with the difference. However the price may be a huge factor driving people back to their old standbys. Whatever doesn't bring out the 'yuck' factor in cheap meat.
While I think both Kim and Rae have valid points, I seriously think it's the economy, rather than the number of competitors you may currently have. Only time will tell of course. and it never hurts to have more buyers.
But rather than thinking you've got to compete with what might be a glut- with more value-added products, or entering into another whole area of product, are there any local niche markets you could supply - like high-end restaurants, retirement communities, country clubs, etc., and would they necessarily need to be local? (Not sure of regulations, but maybe you could cultivate a known non-saturated area?)
Maybe a joint marketing/educational venture? The local college has some professor or students -or hospital culinary staff, might be interested in having a publicized BBQ featuring your organic meat kabobs vs 'regular' kabobs, and do taste-testing or reporting on it. (This might work at the Farmers' Market too).
Imagine the newspaper or even PBS, being invited. Imagine a youtube video of the whole process.
You could go viral! But for sure, you'd wind up with something not one of your competitors has - exposure.
I know college aged kids or Cub Scout troops aren't so likely to have extra $ in their pockets for organics/grass fed, but they have parents, and they are most likely to start up a Buzz on a good Cause.

Donna OShaughnessy said...

With less than 1% of all meat in the US coming from pasture operations I do beleive we are a long way from saturation point , however we too see customers come and go. Thus a variety of quality farm products are essential to keeping customers coming. Some months we sell more milk than meat, other months the restaurants are buying and the grocery stores are not, Stay accountable, reliable, consistent and dependable and so will your customers.

Walter Jeffries said...

There tends to be a glut in the fall but there is a dearth of small farms that produce all natural meats year round for the simple reason that the summer season is easy but the winter is very hard. Thus most of the year there is not enough local meat. This is our niche, year round weekly delivery of our fresh all natural pastured pork.

In the winter we provide hay to replace our pastures. It costs us more to produce pork in the winter because we must buy in winter hay and it is a lot more work but doing so means we keep our slot on the grocery store shelves and restaurant menus.

In addition to it being harder to grow the livestock in the winter it is also harder to farrow in the winter. To satisfy both our own farm's needs and the desires of people wanting spring piglets we have to farrow during the hardest months of the year as well as the easy times. Figuring out the details took years but it was well worth it. Because we can deliver year round and we can offer spring piglets we get that premium when the demand is high.

Since it is so hard to do I don't see we'll see market saturation. I've seen too many people come and go over the years. Hopefully though we can all share what works for us to help more people succeed because there is truly a tremendous demand out there. This is why we publish on our blog about how we do things including all the way up to building our own USDA/State inspected on-farm slaughterhouse and butcher shop.

Speaking of meat processing, this is something that limits the market. The availability of slaughterhouses and butchers puts constraints since farmers have a hard time getting processing slots in the schedule. Most farmers are raising during the warm season and slaughtering in the fall. This makes for problems at the butcher as they try to handle the rush. Additionally the butchering costs 30% to 50% of the total gross sales of the meat. These are some of the reasons why we're building our own facility.

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