Become a Creator today!Start creating today - Share your story with the world!
Start for free
00:00:00
00:00:01
Keeping up with Demand by Doubling Sales (Again) with Tom Bennett
201 Plays5 years ago
In this episode of the Direct Farm Podcast, we're delighted to host Tom Bennett, owner of Bennett Farms. Listen as Tom shares the performance of his poultry and pork operation as demand keeps soaring as well as offering price insights for Farms just starting out.
Show Notes:
https://www.bennettfarmsmichigan.com/
https://www.barn2door.com/resources
Recommended
Transcript
Introduction to Farm Success Strategies
00:00:02
Speaker
Welcome to the Direct Farm podcast, the weekly listen for farm selling direct. We'll talk about the four levers for farm success, which are quality, brand, price, and convenience. We'll hear from outside industry experts and producers like you to delight your customers, save time, and to increase your direct farm sales and business. We're glad you're here.
00:00:25
Speaker
Welcome to the Direct Farm podcast.
Tom Bennett's Farming Journey
00:00:28
Speaker
We've got a great conversation for you today with one of our farm advisors, Tom Bennett from Bennett Farms. Welcome, Tom. Hey, Holly. Thanks for having me. Thank you so much for joining us today. Well, to get things started, why don't you just take a moment to introduce yourself, how you got into farming and selling direct online.
00:00:48
Speaker
Yeah, my name's Tom Bennett, got into farming upon separation from the Marine Corps. I started doing it more as a side hobby, just kind of to feed our family, you know, good, high quality food. And from that, it kind of organically grew through demand from some of our friends and other people we knew that were, started asking us to raise meat for them.
00:01:07
Speaker
And then we said to ourselves, like, maybe there's something here, you know, let's look into this as like a side business thing. And then it just grew legs and took off pretty fast. So I'd say we did this, you know, more of as like a side job type deal while I still had off-farm employment for the first five
Transition to Full-Time Farming
00:01:25
Speaker
years. And then it got to the point to where I had to make a decision that it's either I continue farming
00:01:32
Speaker
and quit my day job and go all in, or I got to scale back to farming because I couldn't do both. You know, you'd end up not sleeping for two days because you're doing so much stuff. And so we decided that the farming looked pretty promising and went all in on that. And it's been a success in my opinion since then.
00:01:51
Speaker
That's great to see how much growth and demand there was on the farming side for you to be able to make that decision. And also, first and foremost, thank you so much for your service to this country and for having
00:02:07
Speaker
coming back and realizing that, you know, farming was an area of interest for you as well and a passion project about how it evolved into a full blown business. So maybe walk us through a little bit more after the first five years of kind of having farming as
Specialization and Market Demand
00:02:20
Speaker
a side project. But once you realize that this was a passion of yours, you want to move forward full time, what are some of the products that you sell and how has that growth taken place?
00:02:31
Speaker
So we're still just focusing on pork and poultry. We do pasture-raised pork and pasture-raised meat birds.
00:02:39
Speaker
We haven't went past that into beef yet. We get asked for beef every week, but we're just, the pork and poultry has been growing so much that we don't have time to do beef at this point. And we haven't tapped out our reach on what we can sell with the pork and poultry. So we basically focus on that. We also do Turkey for Thanksgiving, and then we do eggs as well, but those sell out every week. There's like a waiting list. So it's, we don't really advertise those that much.
00:03:05
Speaker
So the last conversation that we had with you, you were just starting to explore selling direct market. How have you grown over this past year since the last time we chatted with you? And you also presented at our direct farm conference. We had you as a guest on the webinar series. So maybe share a little bit more about how your business has grown this past year.
Sales Growth and Market Strategies
00:03:24
Speaker
It doubled again. So since the last time we spoke, we've doubled our annual sales again. And we've done that every year for the past multiple years. In the early years, it's easy to double because it's not hard to go from, you know.
00:03:37
Speaker
100 to 200 or whatever your starting numbers are small, but then, then as it gets bigger, the numbers get big really fast. So that's another obstacle that people will face. I think as it becomes a legitimate lifestyle income, you're working for yourself, the numbers get really big.
00:03:56
Speaker
that becomes a whole new fun thing and will probably almost double again next year. The growth is amazing like I kind of thought it was possible when I started this but to actually see it happen. I noticed too this year that the with the COVID so you initially had the bump in the online sales when COVID hit like it was just
00:04:15
Speaker
10 times your normal sales, you know, in a given month. And then it kind of tapered off a little bit. And then it went back up again. But also I feel like the online, everybody and their mom like developed an online consolidation store this year. So it's so saturated out there right now that if you go to Google farm direct to my door, you're going to get 20 hits from all of these smaller marketing hubs in local regions. And so it's good to have
00:04:42
Speaker
relationships with your customers with an email list like we have where we can reach them directly. I think building a strong brand which you have done being able to expand in a very short amount of time to know that you've doubled this past year you're looking to double again this year. Tell us more about convenience and what that means to you not only as a farm so you're trying to save time you're trying to create efficient processes in your business operations but how do you also focus
00:05:10
Speaker
on convenience for your buyers. So whether that's offering subscriptions or delivery and other convenient pickup locations. Yeah. So we meet our buyers anywhere they want to find us. Like we, they can get us at their local independent grocery stores. We do delivery from our online store market pickup. So we do 13 farmers markets a week during the summer. Um, during the winter, there's not as many. So we only have three in the winter that we're at weekly.
00:05:38
Speaker
But during the summer, all of those farmers markets, they can go online up until we set it for six o'clock the previous day in order for pickup at the market. So that way when they get there, it's already been paid for. We just hand them their order out of the cooler, you know, in a box and they can go on their way. We also, with the subscriptions, that's been great. That grew really rapidly and it stayed consistent.
00:05:59
Speaker
So that's a nice chunk of our business every month. No matter how the customer wants to find us or get our stuff, we try and make sure we're there. So that way they have the option to purchase from us. We just want to be everywhere that they want us to be. And we
Winter Cash Flow Management
00:06:13
Speaker
think we're accomplishing that. And thinking from a recurring cash flow standpoint as well, how subscriptions probably helps you. Like you mentioned, you know, farmers markets aren't as prevalent during the winter time.
00:06:25
Speaker
So being able to have that recurring cash flow, I'm sure subscriptions probably helps with that throughout the year as well. Yeah, it does. The subscriptions and the online sales during the winter, I don't think we could be in business the way that we are today without our online store in the winter, because we have the cash flow. All of our production for the summer, still during the winter, but you've got, you know, only 30% of your monthly
00:06:49
Speaker
sales that you would have in the summer normally during the busiest times of the year. So having all of those online sales in the subscriptions, that helps bankroll your production going into summer because usually coming into summer,
00:07:03
Speaker
You're spending a lot of money on animals and feed and things like that and butchering bills to have everything ready to go on, you know, April or May 1st, when all of the big rush comes for grilling season and all of those things. You don't want to be out of product. We right now in our walk-ins, we have a hundred thousand dollars worth of pork and poultry ready to go, you know, May 1st. So that way we don't have a shortage like we have in years past because we've in years past within two months of going into the summer.
00:07:32
Speaker
we're already starting to run out of stuff and we lose out on sales that way. So we try and put up a lot of product before the summer starts. But without the online store, with all of the sales coming in, that would be more of a challenge. And strategically, in terms of pricing, I'm sure that you have researched, you know your buyers, you know
00:07:50
Speaker
they're willing to pay for convenience but on top of that quality.
Pricing and Market Challenges
00:07:53
Speaker
So maybe tell us a little bit more about how you make those decisions in terms of how you price your products, what are some of the best practices that you have learned as you've added in delivery, you've added in subscriptions, and how are you able to communicate that to your buyers? We review our pricing every January. During the winter we'll go through and we'll look at
00:08:14
Speaker
at our pricing and adjust it as needed. We were able to from early on kind of get our pricing right to start with. We see a lot of farms, they're new, they're just getting into this and I'll see them pop up here and there and for what they're selling their product for per pound like they're trying to like compete with Walmart or something like it's crazy how cheap it is and I'm glad that they're trying to do that but I also know that like their pricing is wrong and they don't realize it yet but they will
00:08:40
Speaker
in two years when they go out of business because they didn't study the numbers hard enough to realize that they were undervaluing their product. That's a big mistake. I see a lot of people make our pricing. We go about that just based on the return that we need to make for our investment in time and like a whole hog. So we'll break down the cuts into the most valuable, least valuable boat.
00:09:04
Speaker
all in all by the time that whole pig is sold you're going to have a total number for that unit that you need to get out of it. It's just up to you how you kind of work that out but it's basically on a per unit basis you need to recover x amount of cost and then that makes your math easy.
00:09:21
Speaker
and understanding your buyers too. If your buyers are coming to you, they want quality products. They're paying for convenience too, so understanding that you have the opportunity to charge a little bit more because you're not only providing them a quality product that's local, it's raised by a family farm, but also you are providing a convenient option for them through the delivery, through the subscriptions too, to not count yourself out.
00:09:48
Speaker
And it is a little bit more of a premium price on the product. And it's gotta be because we're not Tyson or Swift. We're not making two cents on a pound of meat. It doesn't work for this model. It will not work. It's not for everybody. If you're shopping for the best deal that you can find in the world on pork and chicken, like I'm not your guy and I'm sorry, I can't be.
00:10:07
Speaker
but it's not for everyone. But if you do the math, if you could sell your product to one in a thousand people, if you could pitch what you're selling to a thousand people, do you think that one of those thousand would say, yes, I'll buy it and I'll buy it every week? I think yes. Like if I could line up and talk to a thousand people, that would easily, I could sell it to one in a thousand. Well, now take your population and your surrounding area, maybe go 70 miles out each direction, you might have five or 6 million people in that region.
00:10:34
Speaker
So do the math. Like you don't need everyone to be your customer. You just need the customers that love your product. So don't try and target it towards everyone. Cause you you'll just be spinning your wheels and raising product.
00:10:47
Speaker
You know, for free, basically you'll be working for free, but there's no shortage in demand for high quality farm direct products like non GMO, antibiotic free pasture raised. As long as your product is something that can differentiate itself from what they're getting at their local grocery store. We've never found ourselves sitting on product that we couldn't sell. Ever since the day we started, it's always been, we're behind two steps on having enough to meet the demand.
00:11:16
Speaker
And I think a lot of that too is we don't loaf on advertising and we do try and build a good brand. If you're a farmer that's out there and you don't already have a Google business account, like you need to get one of those set up and you should have done that a long time ago, because when people Google Bennett farms, that's what pops up is just like when you're searching for a restaurant, you know, you're getting ready to go out to eat. You'll come up on that page and we get a ton of traffic from the Google business page.
00:11:45
Speaker
And that's a free page that doesn't cost anything. Just make sure that when somebody puts into a computer, they're looking for local meats or whatever product it is you're selling that your name's the one that's coming up. You won't have any problem moving the product, you know, and this doesn't go for everybody. There could be somebody in the middle of New Mexico. That's 200 miles from a town. I don't know how that would work. That would be hard. But if you have a major metropolitan area within an hour and a half of you.
00:12:09
Speaker
you're going to be just fine as far as trying to sell that product. Yeah, brand awareness is so important because you can make sure that your process is quality process and that you have those convenient options. But if you're not marketing yourself as a farm, you're not marketing the products that you sell and you offer, how are people going to find out about
Farmer Veteran Coalition Membership
00:12:28
Speaker
you? So kind of transitioning a little bit here, earlier you touched on how
00:12:33
Speaker
you served in the military. And I understand that you are a member as well of the Farmer Veteran Coalition. So maybe share a little bit more about when you decided to become a member and what decision led you to join FEC.
00:12:47
Speaker
So when I first found out that the organization existed, it was kind of a no-brainer for me. I was excited to see that there was an organization like that out there. So I signed up right away. It's an organization that anyone can actually become a member. Like, so if you just want to support military veterans, you're free to sign up. You can become a member of the Armored Veterans Coalition, but to get the
00:13:11
Speaker
certification to run the Homegrown by Heroes logo which like we run on all of our products. You do have to be a veteran serving in the military for that logo and there's a certification process that they'll run through with you for that so you can get qualified to run their logo on your products and advertising and things like that. And that helps you stand out a little bit you know on your packages and some of your advertising. It's just another thing that
00:13:37
Speaker
you know, can set you apart from maybe the guy right next to you that's selling the same stuff. And it's a great organization. The first annual meeting I went down to, it was great to see all of these veterans again. It kind of brought back a lot of the camaraderie and
00:13:53
Speaker
the brotherhood from in the military. And I think a lot of us that are there at those meetings are kind of missing that because that's something that you don't get outside of the military service is just that that closeness. You know, being in a room full of people that you know would die for you is a pretty cool feeling like to experience in your life and to be back around those types of people. It's just enjoyable.
00:14:15
Speaker
So I always look forward to that meeting and they do a lot of great things with the grants and things of that nature for veterans that are getting out of the military or have been out for a while to help you get started with farming. They awarded us a grant a few years back for farrowing cuts on pasture, which was nice when we were starting out. It was just one less thing that we had to worry about buying and they provided to us.
00:14:39
Speaker
That's great to hear. And FEC is one of our partners as well. So knowing that there is an organization like FEC that supports veteran farmers specifically and gives you, like you said, that opportunity to not only differentiate yourself in the market, but to also focus on a brotherhood, a community. What would you say would be the most enjoyable aspect about being a member of FEC?
00:15:05
Speaker
probably the knowledge you can gain from the annual meeting that they have. Those are really well ran and there's a lot you can learn at those. So that was a pretty valuable experience. They do a lot of stuff there that I haven't myself taken advantage of. Like they can do mentorships and things like that. They kind of partner returning vets with other veteran farmers to kind of do like internships. So there's a lot of networking opportunities there.
00:15:34
Speaker
that I haven't fully utilized. But if anyone would go to the Farmer Veterans Coalition website, it'll show you a full layout of everything that they do for the veterans in the community. That's great. And to know that there's a Homegrown by Heroes label as well, you kind of talked about how it differentiates you in the market. Maybe touch a little bit more on that. How so? Like what have you noticed within the past years of being an FVC member and having that label, how has that been able to differentiate you?
00:16:04
Speaker
the market.
00:16:05
Speaker
So if you're in the market, like in person, it's a conversation starter because people will see the logo. Maybe they have some signs and things like that that you can get as well. Not just the logo that goes on your labeling and the USDA does approve that logo for your labeling. So you can run that on your, each package of meat has, you know, you can put that homegrown by heroes logo on it. They will approve that. And so a lot of times people will come up and say, Oh, what's the homegrown by heroes about? And we'll explain what the farmer veterans coalition is and kind of what they do and that we're a member of it.
00:16:35
Speaker
Depending on who's working sometimes when I'm working a market, they'll say, Oh, were you in the service? And yeah, I'll explain to them my service history. And they're really happy to shake my hand over it. But a lot of times it'll be one of our employees working at the market and that sign's still up. And so they'll explain to the customer just kind of what's going on with that.
00:16:53
Speaker
and having it on the products that you sell, but in addition to that signage and then like you said, conversation starter too. So it's beyond just the product itself, but it's your story. It's your farm story as well. And that transcends and you're able to share that. So what would you say would be your final piece of advice for farmers looking to sell direct or maybe they just started and they're looking to scale their business?
00:17:17
Speaker
I guess I kind of tapped on this earlier, but I would say don't undervalue your products because I've seen that lately, especially this year. I don't know why it's been such a common thing this year, but I've seen a lot of other farms trying to get going out there and they're selling.
00:17:31
Speaker
ground sausage at three 25 a pound. And I know for a fact that's not going to work because you've got a dollar in butchering costs and you've got another $2 in your seed stock and your feed. So they're losing money. And I feel bad for them because like you can only do that for so long before you've dug yourself a hole. So.
00:17:49
Speaker
Make sure your pricing is right. That's one thing and you need to get yourself out there in all media channels. Social media is not the best thing in the world to waste your advertising budget on. You could blow $400 a month on Facebook ads and get zero return. That's not the way to go. So for advertising, I would say Google is probably going to be your best return on investment as far as pay-per-click ads with Google.
00:18:11
Speaker
For farms coming in, they're starting a business, maybe they see an immediate benefit to discounting their products. But long term, that is going to have an adverse effect. So starting now with, okay, we are a premium product, we understand how we want to differentiate ourselves in the market through the quality, through the convenience that we offer. Long term, you're going to have a stronger buyer loyalty.
00:18:35
Speaker
versus trying to be all things to all people. So I love how you touched on that multiple times throughout this conversation, because I think that is super important for all farmers, but especially for those just now starting out. Another thing that was helpful for us this year was we changed the pay structure of the way we were paying our workers that run our farmers markets, our salespeople. So prior to this year, they were all hourly based and we gave them a decent hourly wage. But
00:19:04
Speaker
I wanted to incentivize them more to actually have some skin in the game when it comes to the sales that they're doing. So that way when they're selling a hundred dollars for the stuff, they get excited about it. And it's not just an inconvenience. They have to check someone else out, you know, but they're not like that. They're all really good people and they want to see us sell a lot of stuff too. But we wanted to give everyone a raise and I didn't want it to be hourly because.
00:19:28
Speaker
Like I said, I want them to be able to be excited when they're having a really good day in sales. So we kind of connected their raise in a commission style so they get a percentage of the gross sales that they do for the day. And probably all of our future raises will just increase that percentage on top of their hourly wage. So.
00:19:45
Speaker
They have a base hourly and then a commission that they earn on sales and that's been great. We've seen a lot of results with that and we should have done it sooner. Also, we implemented an email collection incentive so we've always for the past few years had a clipboard at all of our farmers market stands and where
Employee Incentives and Future Plans
00:20:04
Speaker
whoever is working the booth will just say, hey, if you'd like to sign up for our email list, you'll receive a coupon in your first order. You'll get an email about once a month just with updates from what's going on around the farm, new products, things like that. And we would get enough of those coming in. We collected quite a few every week, but we added an incentive to where
00:20:24
Speaker
Our employees, they'll get a dollar per email that they collect the markets. It has to be a valid email. So when we go and we punch all those emails in, if one pops out as like already being in the system, they don't get paid for that one. But that did boost our email collection quite a bit and a dollar per email. I'm glad to pay that all day. Cause those are high quality emails that are going to return easily on that investment over time. So, and that gives the people we have working for us to more incentive to collect emails because you can make
00:20:53
Speaker
40 or 50 bucks in a day. If you just collect 40 or 50 emails, you're standing there anyways. Why not ask for the email? So that works out good. Thank you so much for sharing. I think it's so important to also think about your employees and your staff and how you can motivate them too, especially when you're not at the farmer's market every day. What's next for Bennett Farms?
00:21:15
Speaker
I would just keep chasing our sales goals. I mean, right now we kind of have a growth curve in mind that we want it to follow. We're on track to surpass our first one that we set for ourselves for 2022. And so we're just going to set a new one for 2025. We're going to keep doubling. We'd like to have a no growth year, possibly in 2023, just to kind of catch our breath. Because a lot of people, they don't realize too.
00:21:44
Speaker
explaining this to some people who asked but when you double every year that takes all of your profit from the previous year and you have to reinvest that into so if you say if you did a half million in sales last year okay and now you're going to double for next year the amount of sales you did if you did a half million dollars in sales you probably had about 250,000 just in animal cost with between feed butchering and so
00:22:10
Speaker
If you're going to double next year, that means that you're going to have 500,000 in input costs. Well, that was your gross number from the previous year. So growing has a lot of pains to it and it can be hard and you've got to kind of be prepared for that. There are some things that we haven't taken advantage of like USDA operating loans, things like that, that I highly recommend people look into once they're going to be doing this as legit.
00:22:36
Speaker
thing. So it'll be nice to I think in 2023, we're probably going to not grow that year, just to be able to have a nice break for a year of the stress of growth because it is it is a lot of work. Thank you so much, Tom, for the conversation. Truly enjoyed chatting with you today. Here at Bartshedore, we are delighted to support thousands of farms across the country, including veteran farmers and farmer veteran coalition members like Tom.
00:23:02
Speaker
So on behalf of the entire Barn to Door team, thank you Tom and all of our veterans for your service. For more information on Bennett Farms, you can visit their website, bennettfarmsmichigan.com. And to learn more about Barn to Door, including access to numerous free resources and best practices for your farm, you can go to barn to door.com slash resources. Thank you for tuning in and we will see you next time.