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Potomac Vegetable Farms
Basic Facts
 Northern Virginia (DC area)
 2 Farms
 3 owners: Ellen, Hana, Hiu via S-Corp structure
    4 FT permanent Managers
 Ecoganic Methods
 $900,000 gross sales
Crops/Acreages
Vegetables of all types (except sweet corn!) (15 acres
  total)
Culinary Herbs (one half acre)
Cut Flowers (one half acre)
Seedlings (24x96 greenhouse)
What we don’t grow
 No Sweet Corn
 No Tree fruit or berries
 No Fancy pants flowers
Diversified Marketing
                    Income


               1%

         20%
                        47%   CSA
                              Farmers Market
       32%                    Stands
                              Wholesale
Where we don’t market
  PVF has gone from 100% wholesale to 1% in 45 years

 Few Restaurants
 No Wholesale (other stands, stores)
 No PYO
 No Agritainment (beyond simple tours)
Major Decisions: Longstanding
  Becoming an S-Corporation
  Organic Certification or Not
  Marketing Mix – begin and grow CSA
  Major Equipment upgrade (spader, compost turner)
  Use black plastic
  I want to make MONEY
Why become a Corporation?
 To ensure continuity into the future
 To reward longevity of service
Certification, or not?
Begin and then Grow CSA
 Now our most profitable channel
 Innovations
    Split season
    Other products – some grown by us, some by others
    Market Style pick up
Major Equipment Upgrade
Use Black Plastic
I Want to Make Money $$$
Major Decisions - Newer
  Adopt Nordell style rotation
  Hire Managers
  Test and Balance Soils
  Play with microbials
Nordell Style rotation
advanced organic produce growing
Test and Balance Soil

Test and Balance Soils
 Pictures of MBA, rock phos, lime
Play with Microbials


                  Special Sauce:
                  Fish
                  Seacrop (sea weed/water)
                  Mycotonic (mycorrhyzal
                  fungi)
                  Pepzyme (enzymes)
                  Spectrum (bacterial inoculant)
Avenues to Improve Profits
 1. Reduce Overhead – not so easy…
 2. Reduce Operating Costs – labor is our biggest cost
 3. Increase revenue –
    Increase production
    Increase yield/efficiency
    Increase price
Cost of Production (variable only)
          Marketing
          w/out labor
             9%         Misc
                        9%

       Machinery
          8%

                               Labor
   Seed, fert, plant            62%
           s
         12%



                                       Jim Munsch, 2011
Labor Improvements
 Incentivize good pace/attitude through profit
 sharing, bonuses etc
Become a better manager – stop pretending this is less
 important than tillage or fertility


                            Individual Talk
                            Therapy




Seminars,
Continuing
Education,
Management Training
Pay better to hire better
people, and to keep the good ones
Provide housing to widen
the pool of applicants
Do Fun Things Together
Team PVF at local July 4th Parade
institutionalize FUN things
that show your people how
much you value them, and
build team spirit. Beer
O’clock and potluck
Labor Distribution on
         Successful Farms from
Market         Midwest
 10%




           Grow
           30%      Pick and
                      Pack       PVF Labor Distribution
                      60%


                                     Market
                                      25%
                                              Pick and
                                      Grow      Pack
                                      25%       50%
Knowing that pick, pack and wash is where you are
spending big labor dollars   …
 How to make picking, packing and washing more
  efficient?
    Streamline the harvest by being super organized and
     delegating the right person for the right task
Create and Maintain Systems:
Little Things Add Up
Harvest Aides
Pick sheet helps
your team stay
organized, and
can then be used
as data collection
for later analysis
Organize, Organize, Organize
Don’t waste time looking for things
Make it easy to keep veg from
           wilting
In-Field Wash/Pack
Any improvement in Wash/Pack
gets you closer to food safety regs
 How to use less labor in marketing? And is it a good
 trade off?
   Market style CSA?
   Special market staff?
   Stop trying to have a roadside stand?
1. Fun (high quality of life is a Must)
2. Make a Living
3. No or Low Debt
4. We like people
5. Keep investing in capital assets (the future!)
6. Machines are cool
7. Organic Practices – The Soil Comes First
Value #1 High Quality of Life
 9 month farm season
 no Sunday market (once did 2!)
 8 ish hour work days
 Long lunch experiment
 Hire plenty of people and use experts
 Ecoganic/organic
 Machines help my back
 Very few animals make me happy
 Avoiding debt = stress avoidance
Value #2 Make a Living
 Good wages to owners: $42,000/year
 Good wages to workers: $7-10/hour
 Health Insurance for permanent employees
 401-K for permanent employees
Value #3 Avoiding Debt
 Pay as you go – cash for capital improvements
 Work with what we have
 Blessed by previous generation
What are new economic goals?
 More pay for everyone
 Higher quality employee housing = more permanent
  employees
 Enough money to make major capital investment in
  additional housing and/or new washing station
Value #4 We Like People
 Team Management of tri-woman owned farm
 Hire lots of help
 All retail sales
 On-farm tours, limited PYO
 Hire experts to do some of our work for us:
   Mechanic, tax prep, waste management, fences
   Lani grows eggs
   Zach and Heinz grow early and late veggie
advanced organic produce growing
advanced organic produce growing
Ways we hide from people
Private homes for owners
Farm is generally not open to the public
Chefs are too ego-centric


Downside to Lots of People
Interpersonal stresses
Inefficiency – Management Intensive
Wages and benefits
Value #5 Continue to Invest
 Building worker housing
 Deer Fence
 Tractor modernization
 Roadside stand improvement
advanced organic produce growing
advanced organic produce growing
advanced organic produce growing
Value #6 Machines are Cool
 I like having and using equipment, it allows me to be
  bigger and better
 Save some back breaking labor (quality of life)
 Ecoganic principles achieved more easily
   Spader   and harrow
   Flail
   Compost turner and spreader
advanced organic produce growing
advanced organic produce growing
advanced organic produce growing
advanced organic produce growing
Drawbacks to Equipment
 Danger/Liability
 Noise, smell of fumes
 Isolation/Boredom of Operator
 Petroleum Dependence
 Expense
Value #7 Organic Practices
 Safe and Beautiful Work Environment
 Market Advantage
 Tasty nutritious food for all of us
 Long term land improvement to make life easier over
  time



            THERE ARE NO DRAWBACKS!!
Who Helps us Decide?
 Mostly other growers
    Neighbors
    Far flung farmer buds
 friends and family
 Experts (becoming an S-corp)
 Conference mania for inspiration and networking
CSA
                 pro and cons
 Good early money           Stress of the Promise
 Weatherproof income        Pushes you to increase
 Builds customer loyalty     variety even if it’s not
 Builds connections
                              your “best” crop
  w/other farms              Administration
 Spreads economic
                              headaches
  impact of any one crop     Recipe handholding
advanced organic produce growing
advanced organic produce growing
Farmers Market
                   Pros and Cons
 Fun to set up (for me!)    Bad weather = bad $
 Great customer rapport     Gone from farm
 No promise, no             Serious competition
 disappointment
advanced organic produce growing
advanced organic produce growing
advanced organic produce growing
advanced organic produce growing
advanced organic produce growing
advanced organic produce growing
Roadside Stand
                       Pros and Cons
 You are HOME!                Relentless hours
 Sell other farmers           Infrastructure cost
  product                      Zoning issues
 Total control
advanced organic produce growing
advanced organic produce growing
advanced organic produce growing
advanced organic produce growing
Closing
Thoughts
  Community

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advanced organic produce growing

  • 2. Basic Facts  Northern Virginia (DC area)  2 Farms  3 owners: Ellen, Hana, Hiu via S-Corp structure  4 FT permanent Managers  Ecoganic Methods  $900,000 gross sales
  • 3. Crops/Acreages Vegetables of all types (except sweet corn!) (15 acres total) Culinary Herbs (one half acre) Cut Flowers (one half acre) Seedlings (24x96 greenhouse)
  • 4. What we don’t grow  No Sweet Corn  No Tree fruit or berries  No Fancy pants flowers
  • 5. Diversified Marketing Income 1% 20% 47% CSA Farmers Market 32% Stands Wholesale
  • 6. Where we don’t market PVF has gone from 100% wholesale to 1% in 45 years  Few Restaurants  No Wholesale (other stands, stores)  No PYO  No Agritainment (beyond simple tours)
  • 7. Major Decisions: Longstanding  Becoming an S-Corporation  Organic Certification or Not  Marketing Mix – begin and grow CSA  Major Equipment upgrade (spader, compost turner)  Use black plastic  I want to make MONEY
  • 8. Why become a Corporation?  To ensure continuity into the future  To reward longevity of service
  • 10. Begin and then Grow CSA  Now our most profitable channel  Innovations  Split season  Other products – some grown by us, some by others  Market Style pick up
  • 13. I Want to Make Money $$$
  • 14. Major Decisions - Newer  Adopt Nordell style rotation  Hire Managers  Test and Balance Soils  Play with microbials
  • 17. Test and Balance Soil Test and Balance Soils  Pictures of MBA, rock phos, lime
  • 18. Play with Microbials Special Sauce: Fish Seacrop (sea weed/water) Mycotonic (mycorrhyzal fungi) Pepzyme (enzymes) Spectrum (bacterial inoculant)
  • 19. Avenues to Improve Profits  1. Reduce Overhead – not so easy…  2. Reduce Operating Costs – labor is our biggest cost  3. Increase revenue –  Increase production  Increase yield/efficiency  Increase price
  • 20. Cost of Production (variable only) Marketing w/out labor 9% Misc 9% Machinery 8% Labor Seed, fert, plant 62% s 12% Jim Munsch, 2011
  • 21. Labor Improvements  Incentivize good pace/attitude through profit sharing, bonuses etc
  • 22. Become a better manager – stop pretending this is less important than tillage or fertility Individual Talk Therapy Seminars, Continuing Education, Management Training
  • 23. Pay better to hire better people, and to keep the good ones
  • 24. Provide housing to widen the pool of applicants
  • 25. Do Fun Things Together Team PVF at local July 4th Parade
  • 26. institutionalize FUN things that show your people how much you value them, and build team spirit. Beer O’clock and potluck
  • 27. Labor Distribution on Successful Farms from Market Midwest 10% Grow 30% Pick and Pack PVF Labor Distribution 60% Market 25% Pick and Grow Pack 25% 50%
  • 28. Knowing that pick, pack and wash is where you are spending big labor dollars …  How to make picking, packing and washing more efficient?  Streamline the harvest by being super organized and delegating the right person for the right task
  • 29. Create and Maintain Systems: Little Things Add Up
  • 31. Pick sheet helps your team stay organized, and can then be used as data collection for later analysis
  • 33. Don’t waste time looking for things
  • 34. Make it easy to keep veg from wilting
  • 36. Any improvement in Wash/Pack gets you closer to food safety regs
  • 37.  How to use less labor in marketing? And is it a good trade off?  Market style CSA?  Special market staff?  Stop trying to have a roadside stand?
  • 38. 1. Fun (high quality of life is a Must) 2. Make a Living 3. No or Low Debt 4. We like people 5. Keep investing in capital assets (the future!) 6. Machines are cool 7. Organic Practices – The Soil Comes First
  • 39. Value #1 High Quality of Life  9 month farm season  no Sunday market (once did 2!)  8 ish hour work days  Long lunch experiment  Hire plenty of people and use experts  Ecoganic/organic  Machines help my back  Very few animals make me happy  Avoiding debt = stress avoidance
  • 40. Value #2 Make a Living  Good wages to owners: $42,000/year  Good wages to workers: $7-10/hour  Health Insurance for permanent employees  401-K for permanent employees
  • 41. Value #3 Avoiding Debt  Pay as you go – cash for capital improvements  Work with what we have  Blessed by previous generation
  • 42. What are new economic goals?  More pay for everyone  Higher quality employee housing = more permanent employees  Enough money to make major capital investment in additional housing and/or new washing station
  • 43. Value #4 We Like People  Team Management of tri-woman owned farm  Hire lots of help  All retail sales  On-farm tours, limited PYO  Hire experts to do some of our work for us:  Mechanic, tax prep, waste management, fences  Lani grows eggs  Zach and Heinz grow early and late veggie
  • 46. Ways we hide from people Private homes for owners Farm is generally not open to the public Chefs are too ego-centric Downside to Lots of People Interpersonal stresses Inefficiency – Management Intensive Wages and benefits
  • 47. Value #5 Continue to Invest  Building worker housing  Deer Fence  Tractor modernization  Roadside stand improvement
  • 51. Value #6 Machines are Cool  I like having and using equipment, it allows me to be bigger and better  Save some back breaking labor (quality of life)  Ecoganic principles achieved more easily  Spader and harrow  Flail  Compost turner and spreader
  • 56. Drawbacks to Equipment  Danger/Liability  Noise, smell of fumes  Isolation/Boredom of Operator  Petroleum Dependence  Expense
  • 57. Value #7 Organic Practices  Safe and Beautiful Work Environment  Market Advantage  Tasty nutritious food for all of us  Long term land improvement to make life easier over time THERE ARE NO DRAWBACKS!!
  • 58. Who Helps us Decide?  Mostly other growers  Neighbors  Far flung farmer buds  friends and family  Experts (becoming an S-corp)  Conference mania for inspiration and networking
  • 59. CSA pro and cons  Good early money  Stress of the Promise  Weatherproof income  Pushes you to increase  Builds customer loyalty variety even if it’s not  Builds connections your “best” crop w/other farms  Administration  Spreads economic headaches impact of any one crop  Recipe handholding
  • 62. Farmers Market Pros and Cons  Fun to set up (for me!)  Bad weather = bad $  Great customer rapport  Gone from farm  No promise, no  Serious competition disappointment
  • 69. Roadside Stand Pros and Cons  You are HOME!  Relentless hours  Sell other farmers  Infrastructure cost product  Zoning issues  Total control