Fifty years ago, large orchards focused on growing a single crop for the packing market. As orchard businesses were passed down through families, younger generations experimented with outlets such as simple roadside stands, or perhaps established an orchard crop that the family hadn’t grown in the past. More recently, the youngest members of multigenerational orchards have become interested in maintaining the family orchard business and are looking for ways to capitalize on fresh fruit.
For many family orchards, the addition of a new enterprise is an ideal way to ensure a stable income that will support multiple generations. When younger family members join the business, they may often come up with ideas for value-added enterprises. That’s a good thing, because these enterprises require hard work and creativity along with a strong desire to connect directly with consumers.
Venturing into a value-added enterprise requires extensive planning. First, take an honest look at the level of desire to undertake a new project, and whether there is time for you and/or your employees to devote to a separate enterprise.
Value-added enterprises often demand the addition of new products. This grower is taking advantage of unused space to grow tomatoes in a young orchard.
As you work through the production aspects of the new enterprise, include all family members and key employees who may be involved. Discuss the potential roles for each person, and make sure everyone is on board with the responsibilities they will be expected to fulfill.
Each individual’s role should be based on a combination of interests and strengths. Experience in a particular area isn’t critical, but it helps to have a network of contacts. Perhaps a family member who is interested in developing an on-farm bakery can work temporarily at an existing enterprise where they can learn what’s involved.
Some of the planning meetings should include your insurance carrier, tax preparer, loan officer and any others who are involved with the business. These professionals may present ideas that you hadn’t thought of. Even if older family members are preparing to phase themselves out of the operation, their input is still important, and they should be included.
Questions to Consider
If you’re contemplating the addition of a value-added enterprise at your farm, there are many things to consider, including:
Have you assessed whether or not the products you have in mind are desirable and profitable in your area?
If your orchard is out of the way, will people make the trip for the items you plan to offer?
Will you need to add more products to attract customers? If so, do you have adequate personnel and time?
If demand for your products grows, are you willing and able to grow with it?
Are you prepared to hire employees? If so, is there an available labor pool?
Familiarize yourself with all local, county, state and federal regulations that may impact your new enterprise if you plan to produce a food product in an on-farm kitchen.
If demand for your product grows, are you willing and able to grow with it? For example, if customers who purchase apples at your farmstand ask for non-orchard crops, such as pumpkins, do you have the space, desire and personnel to grow such a crop?
Consumers who purchase value-added products often do so because they believe the product represents the growing practices at the orchard. Is there at least one person in the enterprise who has strong public relations skills and is willing to deal directly and openly with customers to explain your practices?
For some value-added enterprises, the use of new technology is critical to help balance the workload.
When marketing your value-added products, the goal is to distinguish your offerings from those of competitors. Devote ample time to developing a marketing plan. Focus on fulfilling a need that is not currently being met by other growers. Determine what makes your product unique – the farm/orchard name, the fruit, and the process behind the end product are all important to consumers.
While the enterprise is in the planning stages, conduct research in product need, consumer preferences, competition, pricing, advertising, and how the value-added product will hold up over time. Although the enterprise should start with a strong plan that is agreed upon by all who will be involved, always be prepared to tweak the plan to meet the ever-changing desires and demands of consumers.
Sally Colby is a frequent contributor and freelance writer who farms and raises Great Pyrenees in south-central Pennsylvania. Comment or question? Visit http://www.farmingforumsite.com and join in the discussions.