Exclusive Content: Biggest Farm Mistakes
This audiobook provides insights from successful Farms across the country who share lessons from their own errors, and how to avoid them. Learn best practices to build a thriving Farm business, while minimizing the impacts of potential mistakes your Farm encounters along the way.
For more Farm resources, visit: https://www.barn2door.com/resources
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[00:00:00] Hello and welcome to the Independent Farmer Podcast, the go to podcast for do it yourself farmers who are taking control of their own business, skipping the middleman and selling direct to local consumer and wholesale buyers. This podcast is hosted by Barn2Door, the number one business tool for independent farmers to manage their business, promote their brand and sell online and in person.
Let's dive in to today's Independent Farmer Podcast.
Will Guthormsen: Biggest Farm Mistakes. Introduction. Selling Farm products direct to market is not easy. You must have a strategy in place for your business to critically evaluate the outcomes of your efforts. Consider your target market. What are you [00:01:00] growing? Why your products are valuable? And how to attract and communicate with local buyers? You must organize all your processes from harvesting, sales, orders and fulfillment to ongoing marketing and communications.
With so many variables of operating a farm business, it is easy to make mistakes, some more costly than others. You can learn from other successful farmers who have been in your shoes and avoid mistakes they made or lessen their impact. Set a strong foundation for your direct to market farm business by preparing for the most common farm mistakes.
Will Guthormsen: Chapter 1. Go To Market Strategy.
Failing to Target Your Ideal Customer. When selling direct to market, you must have a clear idea of your target buyer. The person or persons who will purchase your products. Define the buyers you want to serve by age, socioeconomic status, household size, and location, for the sake of inventory and marketing purposes.
This may be done by researching your local area, [00:02:00] communicating with other neighboring businesses, or posting a survey to potential buyers for input.
Communicate your why to buyers. Why you farm, why your sustainable products are better than commodities, and why you charge a premium price for your products. When buyers understand your commitment, they will value paying more for your products versus market alternatives.
You will not meet the expectations of every buyer. Do not be afraid to say no to certain buyers and set boundaries to run your business more efficiently. Existing customers may demand a certain product or be unwilling to pay a premium price, but you can find buyers who appreciate your agricultural practices and are willing to support your farm.
Not capturing customer details. Too often, farmers fail to collect email addresses of their customers. It is crucial to collect buyer details to build an ongoing relationship with your buyers and increase loyalty. They may forget about your business if they make one purchase at a market and never hear from you again.
Collect emails in [00:03:00] person, through popup at checkout, using your POS device, QR codes or signup sheets and online, through website popups, links, and social profiles. The more emails you collect, the more sales you will attract.
Do not neglect branding or signage on all of your delivery vehicles, market materials, products, and packaging. Branding will increase your visibility in your community, especially when buyers share your products with neighbors, families, and friends. Add QR codes on packaging and business cards for easy website access in every purchase.
Always account for buyer attrition, whether it be to moving, job transfers, death, and divorce. You must always be attracting new potential buyers, online and in person, even if you believe you do not have room to grow. You never know when a current buyer may disappear, so your marketing efforts should always be at work.
Not setting boundaries. No farmer has [00:04:00] extra time on their hands. You must set boundaries to use your time wisely, ensure your business runs efficiently and maximize sales in every channel. Set specific pickup locations and times and strict store hours to ensure you are not working in excessive hours while protecting personal time with your family.
This will set expectations for buyers, build loyalty, and allow your business to operate more smoothly.
Do not drive too far to accommodate delivery or pickups for a small set of customers; there must always be return on investment for your efforts., Otherwise, your farm will quickly become unprofitable.
Encourage customers in far off locations to rally neighbors and friends to sign on for a pickup or deliveries to make it profitable for your farm. Or, encourage these buyers to meet in a closer location to acquire orders.
Taking orders via numerous avenues can result in error. If you attempt to track orders by phone, email, text, and socials 24/7, you will [00:05:00] inevitably miss something. This will encroach on your personal life, and as a farmer, your off time is precious. Do not feel compelled to answer every question from buyers. Navigate them to your FAQ section on your site or encourage newsletter signups for further farm information.
Know when to say no.
Will Guthormsen: A farm example from Tom at Bennett Farms in Michigan. Tom of Bennett Farms knows you cannot please every buyer. You always want to give customers, potential or existing, a good experience with your farm. But you must set boundaries.
You cannot give every buyer a discount or allow everyone to edit products within their bundles.
Not every customer is meant for you, and for every buyer you cannot please, you will make room for one that will consistently shop, and be happy with your products and packaging as is.
Tom says, "You have to learn to say no. In the beginning, I told every customer, Yes, we can do that. When you're a small hobby farm, perhaps, you can fulfill all of those promises. However, as your farm [00:06:00] business scales to over half a million in sales towards one million in annual revenue, you cannot be everybody's yes man."
Chapter 2. Products and Packaging.
Overwhelming Inventory. Many farmers overwhelm buyers with too many products, causing buyers to abandon your store altogether.
Avoid too many individual products in excess of 50 plus items as buyers will precipitate decision fatigue. For what it's worth, most buyers never go beyond the first few product listings anyways. In fact, 46 percent of online shoppers fail to complete a purchase online because there are too many options to choose from.
Pin your most popular in demand items to the top of your online store. On average, 60 percent of all sales come from your top 5-7 pinned items. These will quickly become your top sellers as they are the first products your buyers will see.
Ensure you have bundle box offerings pinned at the top of your store to move more products in one purchase and [00:07:00] increase your average order value. These should be highly marketable goods, such as seasonal protein, produce or dairy boxes, including high demand items, to attract prospective buyers.
Offer various bundle sizes for an array of household sizes. Do note that one third of Americans live alone, another third live in a household of two to three people, and 3 quarters live in a house with 4 or more people.
Failing to capture orders ahead of fulfillment. There is no reason for your farm to start at $0 in sales on day 1 of every month. You can secure revenue ahead of harvest with pre orders and ongoing subscriptions. You cannot simply rely on foot traffic for in person sales, which is weather dependent, or loyal buyers to shop consistently, absent any conflicts.
Offer pre orders for pickup or delivery at a later time, prior to your harvest and processing dates. You know your products best and can market bundle boxes and individual items for sale months in [00:08:00] advance, especially for high demand goods. As pre orders become more popular, you can deploy a sign up list for potential buyers who want the first opportunity to access your high demand products, and can be updated via email.
Subscriptions help lock in recurring orders and a stable base of revenue for your farm. You may choose to offer ongoing subscriptions without an end date, or seasonal subscriptions on a schedule, or both. Provide buyers with peace of mind, knowing they can expect a product delivery or pickup from your farm on a weekly, bi weekly, or a monthly basis.
Consistent cash flow from subscriptions to your farm products offer financial security and flexibility for your business.
Not offering multiple avenues to purchase. Buyers are active on every digital channel, email, mobile, websites, and social media. Each avenue represents a double digit increase in farm income. Too often, farms neglect one or more digital channels, which constrains [00:09:00] customer and sales growth.
Your farm must engage potential buyers where they expect to shop to capture more sales. This will give you a leg up against competition, who may only be available in one place.
Offer a one click purchase option online through your website, linked on social media and in your email newsletters. In person purchase options, via Point of Sale, helps build buyer relationships and simplify interactions at markets, pickups, and on delivery routes. The Barn2Door Point of Sale, or POS, is built for farmers supporting retail and wholesale price lists, sell by weight, or fixed price and real-time inventory sync.
Do not be dissuaded by credit card fees from accepting digital payment methods for your products. 98 percent of buyers prefer to use a credit card or mobile wallet, such as Apple Pay or Google Pay, when making a purchase.
On average, 1 in 4 farmers who utilize Barn2Door ultimately pay nothing for processing credit [00:10:00] cards.
Barn2Door's tipping feature allows farmers to alter tipping language to cover fees or support your farmer. Collecting tips at checkout will ensure you are giving buyers every opportunity to share their appreciation of local farmers and reduce or eliminate your credit card processing fees.
Use FOMO to fuel pre orders.
A farm example from Amy Campbell at Old Rich Valley Farm. Amy of Old Rich Valley Farm utilizes pre-orders and subscriptions to secure cash flow prior to harvest and to bring ease to order planning and organization. The farm goes to multiple farmer's markets to serve local buyers. Sometimes, Old Rich Valley will run out of certain products and buyers may miss out on a good that they wanted to purchase.
Amy is able to use that FOMO, or the fear of missing out, by encouraging buyers to place pre orders for their products so they do not miss out next time.
Amy says, I run out of chorizo almost every single week, and so I say, [00:11:00] I had a bunch this morning, but if you'd like to place a preorder, I'll bring you some next week. I think it's okay to run out of stuff at the farmer's market and say, Sorry, we don't have ribeyes. They're on our website, though, if you want to place a preorder for next week.
Chapter 3. Marketing Communications.
Sporadic Communications You must communicate with buyers on a regular basis to keep them informed and engaged with your farm. Most farms find success in weekly communications via email newsletters or social media posts. Entice buyers with welcome promos or exclusive product access in your weekly farm newsletters.
You can include farm updates, recipes, market and delivery schedules, pickup locations, and surveys to engage your buyers and receive feedback. Using software, such as MailChimp, you can employ automated email campaigns to send a series of communications regarding order reminders, loyalty emails, and re engagement [00:12:00] encouragement.
Craft campaigns for every buyer type to ensure you are effectively drawing them back into your store and providing necessary information.
Will Guthormsen: It is important to have a schedule for content writing, for emails and social media. Many successful farms recommend setting aside one hour each week to craft your weekly buyer communication plan. This will ensure you are including all relevant information and have a plan regarding marketing efforts.
To reduce the stress when it comes to ideation and creating photo assets and newsletter templates, Barn2Door's marketing toolkit includes monthly prompts for email and social content, to streamline your marketing efforts.
Overly generalized emails. It is important to segment your buyers into lists depending on their activity with your farm store.
New buyers may be anyone who has signed up in the past 30 days. Loyal buyers are those who have bought from you in the past 60 days, and lapsed buyers may be those who have not made a purchase in the past three months.
MailChimp [00:13:00] integrates seamlessly with your Barn2Door account and buyer purchase history to automatically segment your email audiences, allowing you to target communications and campaigns for each buyer type, whether they're new, loyal, or laggard buyer.
New buyers will want to learn about your farm story and your schedule for weekly farm deliveries, pickups, and market locations. While loyal buyers may be more interested in what's new and upcoming events.
Laggard buyers may be more interested in hearing why they should shop from your farm versus their local grocer.
Reevaluate your email templates every few months to make sure content is seasonally relevant and updated based on your upcoming harvest schedule.
You do not want an old market schedule to be sent out and confuse buyers. Limit the number of calls to action to 1 to 3.
Too many calls to action may result in decision fatigue, driving readers away, or reducing the click through rates. The link to your farm store should always be the most obvious call to action as this will drive purchases.
Use the Barn2Door + [00:14:00] MailChimp Customer Journey Builder to add automated email campaigns to segmented buyer audiences.
You will not have to spend time individually segmenting your buyers, or placing each one into an email campaign, as the Barn2Door MailChimp integration can do it for you effortlessly, and save time.
When communications are targeted, buyers will feel appreciated and gain the insights they need to complete a purchase.
Failing to set aside time to plan marketing efforts.
To make the most of your marketing efforts, your farm must have a calendar prepared with major events, market openings, seasonal subscriptions, and upcoming holidays. During the winter months, many farmers find success in planning a calendar for the upcoming year. This allows them to re evaluate their marketing efforts, such as what worked, what could be improved, and what to stop doing, all while planning upcoming sales.
You may need to re evaluate your calendar each month or quarter as market dates may change and subscription offerings may expire.
When posting to social media, it is [00:15:00] important that your content is engaging. If buyers become bored with your posts, they may choose to unfollow your farm. Posts should reflect a mix of entertainment, education, and e commerce, such as a call to action to shop.
Entertainment posts could show a day in the life on the farm, feature funny animal pictures, or photos of on farm events. Educational posts may show how you grow your product, explain why buyers should shop sustainable agriculture and compare nutritional facts to commodity products. E Commerce posts can share links to your store with pickup or delivery dates, testimonials from buyers, or recipes using your products.
Partner with other local businesses, churches, or schools to amplify your farm audience and reach. Tagging other organizations in your post can expand your brand into the view of their followers and build trust in the community.
Ensure you're setting aside time to interact 2-3 times per week on social media to engage buyers and make your brand personable. You can answer questions, link out to specific [00:16:00] products, and secure sales when you focus on buyer relationships.
Marketing's three E's. Entertain, Educate, and E Commerce.
A farm example from Josie at Dan and Debbie's Creamery in Iowa.
Josie of Dan and Debbie's Creamery in Iowa has garnered over 17, 000 followers on the farm's Facebook page.
She knows how to engage buyers using a mix of various posting tactics and topics. This ensures that her social media profiles do not become stagnant, leading buyers to unfollow their dairy. Posting entertaining content engages buyers, educational posts help customers value your products, and linking to your e commerce will make it easy to purchase.
Josie says, with good content comes a variety of content. You can't keep posting the same thing over and over, the same type of message over and over, and expect to gain engagement and followers. So the three E's, entertainment, education, and e commerce, really encourage me to keep a variety in what I post on social media.
[00:17:00] Chapter 4. Pricing Mistakes.
Charging too little for your product. Many farms make the mistake of comparing the price of their products to the local grocer. Do note that buyers understand that you are not selling grocery store grade products. Your Farm's sustainably raised and harvested products are more valuable, more nutritional, and better for the planet.
So buyers expect them to be priced higher. The most successful independent farmers selling directly use a value based pricing model to shore up their profits. If you try to win buyers with low prices, your farm will quickly be out of business.
Do not fear that customers will complain that your prices are too high. While there will always be Buyers looking for a bargain, have confidence that when you communicate the value of healthy sustainable food, your farm will attract customers that understand and are willing to pay a premium price. Price your products based on the value a buyer is willing to pay by communicating the value of the product you have cultivated.
Consistently evaluate your costs including production, [00:18:00] equipment, and labor. To run a viable business, you must be able to pay the bills. If your farm offers direct delivery, then collect a delivery fee. 80 percent of buyers are willing to pay 5 or more dollars for local farm food delivery. Many successful farms charge a delivery fee of $10 or more for regular, weekly deliveries. Your Buyers are happy to pay for convenience, and your farm can cover all your costs, such as vehicle, labor, gas, and insurance.
Falling for the hype. Many farmers get themselves into a pickle when they pursue trendy items or the latest grant program. You are the farmer, not your buyers, or the media.
When you begin to see the USDA or Farm Bureau push for trending niche products, consider the cost of those products and the corresponding market opportunity of buyers ready to purchase them. If you begin to change your farm business to please a few customers, real or prospective, with an appetite for a niche product, you will miss out on the market opportunity and consistent profits associated with staple [00:19:00] products.
Niche products will not drive a consistent demand. You are more likely to sell out of burger patties versus hemp. Offer consistent staple products that your buyers will consume regularly.
Whether you are a pastured protein, grass fed dairy, or produce farmer, there are products you can sell that buyers will return for weekly. Offer Bundle Boxes to move more products and increase your average order value.
Selling items individually will add more work on your end, result in smaller size buyer orders, and leave your farm with more leftover products for refrigerator, freezer, or compost pile.
Convenient fulfillment options, such as local pickup and delivery, will please buyers and further help your farm maintain relationships in the community.
Pickups at schools, gyms, churches, and other popular locations in your community will build exposure for your brand and make it easier for buyers to access your products.
Deliveries in local neighborhoods will encourage surrounding families to inquire about your products and potentially place their own order, since access is provided right there in their [00:20:00] neighborhood.
Some farmers believe that they must ship products to acquire more buyers. Truthfully, there are more than enough buyers in your local area that will pay a premium for sustainable products. You just have to market to them.
For perishable products, shipping is often more of a headache than it is worth in the long run. Instead, communicate convenient fulfillment offerings in your community and save time, stress, and money by serving local Buyers.
Will Guthormsen: Charge a delivery fee to cover costs. A farm example from Tagge's Famous Fruit and Veggie Farms in Utah.
Laci Tagge knows that buyers prefer convenience, especially in the midst of busy routines.
She makes more sales when deliveries are offered, but she has also found that buyers are willing to pay for this convenience.
Around 10 percent of her CSA members pay for the farm's direct delivery service to their doorstep. This builds relationships with buyers with face to face interactions. Charging extra for delivery is expected, especially when it comes to food delivery direct to your house. Do note that Amazon charges $9. 95 for grocery delivery [00:21:00] too.
There is value in food being delivered by the farmer who grew it, and many buyers are willing to pay extra for that service.
Laci Taggy says, if someone wants it just dropped off at their house, it is an extra $15 a week. That's the minimum. I had about 40 people that paid for home delivery this year, and they were all my busy people.
They're actually my most valuable customers, too, as they add on a lot. They're my biggest bulk orders.
They're people who want to share it and want to give it out. They really are that focus, local oriented people, and I made it convenient for them.
Business Execution. Strict Expectations and Unwillingness to Change. As a farm business owner, it is important to remain flexible within reason. However, it is also important to set boundaries when serving buyers in your area, such as delivery zones, product offerings, and order cutoffs. Not every buyer will have the time to drive out to your farm for pickups. It is important to position yourself within the community to make access to your products convenient for buyers. Pickups and direct delivery are [00:22:00] key avenues to make it easy for buyers to purchase your products.
Be willing to evolve to support local buyer expectations, while balancing the requirements for your business model.
Will Guthormsen: This includes product packaging and fulfillment options. Buyers may want individual cuts, but your farm is better off selling bundle boxes designed to serve their entire household. You may choose to offer pickups only at markets, but schools are more convenient for customers. Evolve your strategy to increase profits from pleased buyers.
Many farmers are adverse to social media for their personal life, but find that it can be a successful marketing avenue for their farm business. To raise brand awareness, your farm must be willing to pursue multiple strategies to attract and engage buyers.
Email marketing, word of mouth, and social media marketing have each contributed to double digit increases in sales revenue for the most successful farms. Offering convenient access to your products online will give buyers the opportunity to shop at their leisure and see your full inventory all in one place.
[00:23:00] Doing everything yourself. Many Farms fail to achieve their objectives when they attempt to do everything on their own. Successful farmers employ help, skilled and unskilled, to operate, run, and scale their business. There are only so many hours in the day, and willingness to delegate tasks will allow you to accomplish more than what you can do on your own.
Many successful farms will hire seasonal labor, family friends, and even attract volunteers to help on the farm.
Third party software can save your farm hours of time, streamline your operations, and expand your ability to serve a wider audience. Farmers who attempt to manage their business manually, such as capturing and preparing orders, tracking finances, and organizing fulfillments, constrain their ability to scale.
Working with farm software and outside experts, such as accountants, can reduce stress and enable you to focus on managing your farm business.
Use software built specifically for farmers to streamline and automate your efforts.
Barn2Door will capture your orders, both online and in person, track your inventory in real time, [00:24:00] automate pick and pack lists, and maintain all your buyer lists.
Neglecting a business plan.
Draft a business plan to effectively grow, manage, and measure the effectiveness of your farm business. Build a strong foundation to minimize the impacts of mistakes down the road.
If applicable, secure preferred tax exemption status prior to investing in your farm business.
Successful farmers evaluate actual outcomes versus their business plan to ensure they are profitable. If you do not have a passion for farming, the hard days make you question why you got into the business.
Be ready to change your strategy and execution to improve the trajectory of your business as the market changes.
Be willing to critically assess the profitability of different farm products. At the end of the day, you are running a business, so it is important to maintain healthy margins to protect your bottom line.
Be willing to grow to scale your farm.
A farm example from Shenk Family Farms in North Carolina. [00:25:00] Rachel, of Shenk Family Farm in North Carolina, scaled their family farm homestead into a legitimate six figure, full time business. She quickly learned that farming is not predictable, and you must set strict business expectations to succeed.
The family set goals and adapted when situations did not go as expected. Shenk Family Farm knew that they needed to have a business plan in place that worked for them, not simply copying what a farm down the road does. Every farm is different, and starting small and scaling on their own terms has allowed them to gain success as a pillar in their community. Rachel says, we could do all the right things and still mess up, but that's just part of the process. I had to get real comfortable failing. I like to be comfortable and only commit to things that I can achieve, but you'll surprise yourself. Sometimes I've been forced into situations and that compels me to grow due to the circumstances. Farming is not cookie cutter. I try to do what I saw other farmers doing, and it just never felt right or worked well. It takes time to figure out what's going to serve your customer [00:26:00] well. And then, seasons change, and you've got to change and be flexible again.
Conclusion. Every farm business is different and makes occasional mistakes. There is no success without taking risks, so don't become discouraged or give up when things do not go as planned. However, reflect on the advice given by other successful farmers to try and avoid or minimize potential mistakes.
To streamline your operations, save time, and increase orders for your farm business, use software to help automate tasks, maintain records, and simplify order and customer management.
At Barn2Door, we are delighted to support thousands of farm businesses on every step of their journey. In addition to software built for farmers, you can access one on one live assistance, ongoing support, and data insights to help support your business.
For more information, visit Barn2Door.com and see for yourself.
This has been Biggest Farm Mistakes, narrated by Will Guthormsen.
[00:27:00] Thank you for joining us on the Independent Farmer Podcast. At Barn2Door, we are passionate about empowering independent farmers to build a thriving business. To all the farmers out there, thank you for all you do to grow amazing food, care for the soil, and serve your local communities. You are the backbone of our country.
For free farm resources, or to listen to prior podcasts, go to Barn2Door.com/Resources. We hope you join us again and subscribe to the Independent Farmer Podcast wherever you stream your podcasts. Until next time.