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Exclusive Content: 5 Farms Making 6 Figures
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With a variety of best practices and techniques for how to create a successful Farm business, it can get overwhelming knowing which tactics actually work. At Barn2Door, we analyze data to know what works and what doesn’t. We’ve crunched the numbers and have found that top-performing Farms have created a blueprint for how to build a successful business model.
In this week’s episode, we are reading Barn2Door’s top performing eBook of all time – 5 Farms Making 6 Figures!
Download the eBook Today!
For more resources, including FREE eBooks, visit barn2door.com/resources
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Transcript
Introduction to Direct Farm Podcast
00:00:03
Speaker
Welcome to the Direct Farm podcast. The go-to resource for farms across the US looking to grow and manage their business. Tune in weekly to hear tips and tactics from our most successful farmers on how to increase sales, access more customers, and save time
Introduction to 'Five Farms Making Six Figures' Audiobook
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and money. We'll also speak with industry experts, business leaders, and partners to share the latest farm business trends selling direct to market. Welcome to the Direct Farm podcast. My name is James and I am the Chief Operating Officer at Barn to Door.
00:00:34
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We've got a great audiobook for you today. In fact, I'm going to be reading our top performing ebook of all time, Five Farms Making Six Figures.
Key Resources for Farm Growth
00:00:43
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This ebook covers the tactics used by five different farms, all of which make six-figure incomes and span a variety of farm types. This ebook serves as a great guide for tactics and best practices for your farm business.
00:00:57
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Whether you're an experienced farmer or just getting started as a new farmer, you're going to want to listen to this ebook and come back to it several times as a reference guide to build a thriving farm business. Let's get started. Introduction to five farms making six figures. There are numerous best practices and techniques to create a successful small business.
00:01:26
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And knowing which tactics could actually work for your farm could cause some trepidation. Farming is a unique industry with specific business needs, requirements, and seasonality. Therefore, it's essential that farmers access the right resources with farm-specific insights when looking to grow or manage their operations.
Boosting Sales with Simplified Pricing
00:01:48
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Serving thousands of farms across America, at Barnadore we analyzed data across millions of transactions to know what does and what does not work. We've crunched the numbers and have found that the top performing farms have created a blueprint for how to build a successful business model. This ebook is intended to share the tactics used by five different farms, all of which make six-figure incomes powered by Barnadore.
00:02:16
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Farmers can use this ebook as a guide to implement best practices to create their own six-figure business. Tactic number one, simplified pricing and packaging. Locally produced food is valuable, and how you price and package your products can dramatically impact your farm brand. Why?
00:02:40
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When farms try to compete with commodity prices at the local grocery store, the perception of their product disappears. That's why higher quality products are expected to be offered at a higher price.
Case Study: Dairy Farm Branding Strategy
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To differentiate your farm brand from others, how you package your products can determine how much inventory gets moved. For example, buyers convert at a higher rate when given fewer choices.
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Therefore, keeping a simplified product assortment will be easier to manage and actually increase your sales volume.
00:03:16
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At the core, packaging serves to protect the products inside. However, solely focusing on the function of packaging means that you could be missing out on the opportunity to build brand loyalty and delight your customers. As 70% of Americans have made a self-service purchase online, packaging has become an extension of your farm brand and can improve profitability. How?
00:03:44
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While as buyers prefer fewer touches when interacting with your farm online, you have fewer opportunities to create trust. Therefore, it's important to create a memorable experience through your packaging when they receive your farm products. Here's a great case study from a dairy farm. This dairy farm emphasizes its brand through its packaging.
00:04:08
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Using their logo and brand colors on their pickup boxes, their milk containers, and delivery vans easily drives product awareness in their community. With social media and email newsletter, this farmer also communicates their values, their commitment to sustainability, and serving their local community, which further establishes loyalty and trust.
Increasing Order Value Through Premium Pricing
00:04:30
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Coupled with a convenient purchasing experience, they're able to offer buyers access to their real-time inventory and satiate buyer expectations. Some specific tactics your farm can implement to improve pricing and packaging. Specific tactic number one, charge a premium price.
00:04:51
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When determining the right price, a good place to start is to identify how much a buyer is willing to pay. Remember, do not limit yourself to just product cost plus markup. Charging a higher price than the grocery store will actually improve brand value and lead to higher profit margins. Specific tactic number two, offer bundle boxes.
00:05:15
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Bundling your products means combining individual items into a single package to be sold as one unit. By catering to households at different sizes, bundles for one, two, or four people, assembling your products together will allow you to move more inventory and increase the average order value for your farm while building brand loyalty.
00:05:38
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Try including your most popular products, specialty items, or new products in pharma recommended bundles, sampler boxes, or subscription formats.
00:05:49
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Specific tactic number three, drive brand awareness. Your farm packaging should reflect your values. For instance, your commitment to sustainability or your local community. Remember to include your farm logo, branded stickers, or a handwritten note with all first time orders. Something as small as a quick thank you note will resonate with your buyers.
00:06:13
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Following up with regular communication on social media and through email will also help your farm stay top of mind and drive consistent sales. We work with thousands of farms and know that farms who implement a premium pricing strategy will create increased consumer confidence and more demand for their products. To build a resilient farm business and brand, your buyers need to keep coming back to make repeat purchases.
The Power of Subscription Models for Farms
00:06:42
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Investing in your product mix, how your buyers interact with your brand, and their perceived value of your farm products will make a huge difference. Tactic number two, subscriptions are your secret weapon. Which products do your customers consistently buy from your farm? If you don't offer subscriptions to these items, then you need to start today.
00:07:07
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Subscriptions are your farm's secret weapon to securing recurring revenue for your business and locking in consistent orders from your buyers. Offering convenient, ongoing access to your products will delight your customers and give your farm better, predictable income, enabling you to plan ahead for harvest or processing dates and better organize your pickup and delivery schedules.
00:07:32
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With more than $100 million in volume through Barn to Door, we know that more than 40% of all those transactions are driven by subscriptions to farm products. Your buyers already enjoy subscriptions with many of the other products and services in their lives. For instance, Netflix on TV, Spotify for music, or Verizon for their mobile service provider.
00:07:57
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The average buyer has nine subscriptions to products and services they love. Here's a great case study from a flower farmer. This flower farm uses the consistency of subscription revenue to streamline operations, delight customers, and save time.
00:08:15
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With weekly and monthly plower subscriptions, they cater to their buyer expectations of convenience by using a direct delivery service to get flowers on the doorsteps of local restaurants, businesses, and homes. Through a subscribe to save model, this farm has built a strong network of loyal customers, rewarding buyers with a small discount when they choose to subscribe. Some specific tactics your farm can implement to set up subscriptions.
00:08:46
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Specific tactic number one, offer flexible schedules and payment options. Give buyers the option to pay upfront with a small discount as an incentive or offer buyers pay as you go to pay for each fulfillment as they arrive. This will provide flexible purchase options and increase conversion for your farm.
00:09:10
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Also, remember, provide buyers with the opportunity to subscribe anytime during a seasonal subscription by offering late enrollment. Specific tactic number two, accept pre-orders. Be sure to secure buyer commitments months in advance of your harvest or processing dates by offering customers the ability to place pre-orders ahead of the next season.
00:09:36
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If you offer a summer produce CSA, a Griller's Delight Box, or a Berry Medley Bundle, advertise the next summer's bounty in the fall and winter, months ahead of time. Pre-orders are your golden ticket to give your farmers more cash flow in advance and give your buyers the security to know that they're going to get your products next season. Specific tactic number three, reward loyal customers.
00:10:04
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Entice customers to subscribe to your products by rewarding them with highly desirable products, for instance, bacon or huckleberries. With Barn to Door's gated item feature, farmers can automatically invite subscription customers to access unique specialty products as a reward for their loyalty. Specific tactic number four, offer convenience.
00:10:30
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Farms that offer subscriptions with a direct delivery service drive two times the monthly revenue versus farms that do not offer a delivery service. With convenient pickup locations and a delivery program one or two times a week, your farm will delight buyers with a convenient shopping experience.
00:10:50
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Nothing provides better certainty for your business than subscriptions. It's not a surprise that customers routinely ask farmers to subscribe to their products. Buyers who trust your brand and enjoy your farm products want regular, ongoing access to what you produce.
Engaging Customers Through Email Marketing
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Using bundle boxes, flexible payment options, and convenient schedules will be the key to creating a thriving subscription program for your farm.
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Tactic number three, stay top of mind with email marketing.
00:11:23
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Email is 40 times more effective than social media in helping your business spur new purchases and retain existing buyers. To stay top of mind and drive consistent sales, your farm must engage buyers regularly through email. The first step is to build an email list. If you have a list, it's essential to keep building your email list always. If you don't have an email list, get started today.
00:11:52
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Between the local farmer's markets, a church parking lot, school events, or a local business in town, farmers can use physical email collection forms and QR codes to capture emails wherever they may be. Farmers can also collect customer information through a pop-up form on their website, which allow customers to opt in to subscribe to the farm newsletter or claim a promotion.
00:12:18
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The most successful farms are always investing in collecting emails. This is a task that never stops. Some farms, in fact, pay their employees $1 for every authenticated email that is collected at the market to create an incentive for engaging prospective customers. Why? Because it works.
00:12:39
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The Barn to Door Plus MailChimp integration makes it easy to keep your email list in sync and to send automated email campaigns to targeted audiences. For instance, different campaigns to first-time buyers, loyal buyers, or legacy buyers who haven't purchased recently. Here's a great case study from a pasture proteins provider.
00:13:03
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This protein farmer keeps customers informed about their farm, product availability, seasonal promos, and upcoming events with regular email. They use an automated welcome stream to educate new customers, which they've found leads to quicker first-time orders. They also integrate Barn to Door with MailChimp to make it easy to send targeted emails, regular order reminders, and recommended products based on actual purchase history.
00:13:31
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Specific tactics your farm can implement to use email more effectively. Specific tactic number one, automate welcome emails. Farmers that send a welcome email generate four times as many opens and 10 times as many clicks than any other email type. Welcome emails serve as the gateway to your farm business, drawing in new subscribers to learn about your farm and hooking them on your farm products.
00:14:01
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On average, farmers that send an automated welcome email see first orders much quicker than farmers that do not. Specific tactic number two, recommend product add-ons. With the Barn to Door Plus MailChimp integration, farmers can send smart product recommendations and suggested product add-ons based on farmers' bestsellers or a buyer's previous purchase history. It is completely automated.
00:14:31
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Farmers enjoy up to a 30% increase in average order value with automated recommendations for each customer based on their purchase history. Specific tactic number three, utilize customer journeys.
00:14:46
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Whether you're looking to drive more orders from current customers or want to entice buyers who haven't purchased in a while, the Barn to Door Plus MailChimp integration makes it easy to send tailored emails to a group of buyers, known as a customer journey.
00:15:04
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On average, farmers that use customer journeys enjoy a 14% higher open rate and increase awareness about subscriptions or pre-orders that drive more income for your farm store. Consistently growing your email list and regularly engaging customers keeps buyers connected to your farm brand. Top performing farmers use email over social media to stay top of mind.
Balancing Wholesale and Retail for Cashflow
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generating on average a 30% increase in order size. A simple and effective email strategy has a power to transform your farm business, creating a strong and loyal network of buyers for your farm. Tactic number four, serve all buyers wholesale and retail.
00:15:53
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Your farm needs to offer an easy and convenient purchase experience to be successful in today's market. This holds true no matter who your farm sells to, retail, restaurants, wholesale, and consumers. This past year, more than 93% of American adults completed an online purchase. The convenience of online ordering is not going away, and buyers' expectations of how and when the order from your farm have simply increased.
00:16:22
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Selling to both consumers and wholesale buyers creates more diversity for your farm business and provides better security to consistent cashflow. By not relying 100% on any single segment of the market, your farm can enjoy better revenue predictability and buyer certainty. How do you serve two completely different buyer types without causing a headache for your farm? Well, you can simplify it with a streamlined order management system.
00:16:52
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Barn to Door makes it easy to serve different buyer types, consumers and wholesale buyers or private buying groups with separate pricing sheets, invoicing capabilities, and a variety of payment options. Having separate stores for each type of buyer makes it easier to manage your inventory, track your sales, and fulfill orders. Here's a great case study from a produce farmer.
00:17:19
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This produce farmer serves both consumers and wholesale businesses utilizing Barn to Door. They offer two different pricing sheets, which they're able to satisfy both groups of buyers with different products, a convenient delivery service, and multiple pickup options.
00:17:37
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Retail consumers can order directly from their farm store where they prefer to make payments via credit card at checkout. However, on the wholesale side, buyers can directly access inventory online, order in bull, but choose a preferred delivery date and checkout with cash, check, ACH, or credit card, or in fact be invoiced by the farmer. Here are some specific tactics your farm can implement to serve more buyers.
00:18:05
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Specific tactic number one, diversify your buyer pool. Cater to multiple buyer types and diversify your sales channels to move more inventory, generate additional sales, and build your farm brand. Be sure to offer different pricing and packaging for the different types of buyers based on their expectations. Specific tactic number two, leverage pick and pack list.
00:18:30
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Utilize a pick and pack list to gain more visibility into the order management process while planning upcoming deliveries and fulfillments. With Barn to Door, you can view or print the list of buyer types and use packing labels, receipts, and invoices to track orders ready to be fulfilled. Specific tactic number three, track your sales by buyer type. Gain insights into which buyers are driving your farm revenue
00:18:59
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Make informed decisions regarding inventory, deliveries, schedules, or pickup locations by understanding and analyzing your buyer trends.
00:19:09
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At Barn to Door, we know that top performing farms in America sell to both consumers and wholesale buyers to move more products, serve more channels, build more resiliency, and establish a stronger reputation within their community.
Enhancing Purchase Convenience for Customers
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With Barn to Door, your farm can use a streamlined solution, making access to your products easy for all types of buyers.
00:19:33
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With different store experiences, pricing sheets, and invoicing capabilities, your farm can collect payments promptly and save time in the process. Tactic number five, offer convenient access to your products. The concept of a convenient purchase experience has evolved where orders can be placed anytime, anywhere with expectation that items will simply arrive on the doorstep.
00:20:00
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The idea of a convenient purchasing experience can often become overwhelming to grasp for any business owner. However, it can be simple and it can be very profitable. There are three ways we see top performing farms in America offer convenience by pairing their ordering experience with a simple fulfillment solution, pickup, delivery, or shipping. Pickups
00:20:25
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Pickups are only convenient when farmers offer multiple days at multiple locations. It is important to understand where your buyers live and choose locations that are convenient for them to pick up their orders. For instance, local schools, churches, or businesses.
00:20:41
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While on-farm pickups can make it easy for the farmer, if you're located more than an hour away from the nearest metropolitan area, that may not be convenient for your buyers. Delivery A delivery service is the ultimate way to delight your buyers and convince them to order more often from your farm.
00:21:02
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When starting, you do not need to deliver too much or too far for it to be profitable. Try starting with just one to two zip codes and create a delivery corridor. So even when you're driving to your delivery zone, you're stopping at other pickup locations.
00:21:19
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Shipping Farmers should only consider shipping when they have a geographically unique product that is not commonly available. For instance, Alaskan king crab or Vermont maple syrup.
00:21:33
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Widely available commodity products, for instance, grass-fed beef, have higher competition and supply is available on a local level all across the country. Shipping shelf-stable products, easily shippable products, or products that offer very high margins will save you time and money in the long run. Commodity products like proteins, produce, and dairy should preferably be fulfilled through delivery or pickups.
00:22:04
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Here's a great case study of a seafood operation. This seafood operation offers a local direct delivery service and ships to most states in America. Shipping from Alaska can be expensive, but due to the high demand and high margins for their seafood, they're able to charge a shipping fee to cover their cost and make the venture worthwhile. Specific tactics your farms can implement to improve convenience.
00:22:32
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Specific tactic number one, use fulfillment apps to save time. If you want to create a profitable delivery or shipping service from the beginning, we recommend using the tools to help you. A route management or route optimization tool such as Routeific can help you streamline your delivery service. And a shipping service such as Shippo can take the manual work out of planning routes and tracking shipments and notifying customers when their orders have arrived.
00:23:02
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Specific tactic number two, charge delivery and shipping fees. The key to a profitable fulfillment service is to ensure that your costs are covered. Your customers value local food and are willing to pay for the convenience of having their orders arrive on their doorstep.
00:23:19
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On average, we see farms charge between $5 to $10 per delivery. Note, however, that Amazon charges $9.95 for grocery delivery from Whole Foods nationwide. Your farm should charge for delivery, too. When implementing a new process, it's a good idea to start small and measure the results. A shotgun approach can cause problems and will negatively impact your profit margins.
00:23:47
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Begin by understanding and analyzing where your customers are located and how you can increase sales and save time while implementing your fulfillment process. We see farmers completing five to eight deliveries per hour complimented by local pickups. And only high margin geographically unique or shelf stable products such as maple syrup can successfully ship all across the country.
00:24:16
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It will take time for your farm to ramp up and build a successful fulfillment program. But know that delivery and pickups are possible and can be profitable for your farm business.
Streamlining Operations for Farm Success
00:24:29
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Conclusion to five farms making six figures. The tactics outlined in this ebook are the core of a successful farm business in America.
00:24:40
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For your farm to make a six-figure income, you will need to have your processes in place to reduce the manual work and automate areas that will contribute to more sales for your farm business. Streamlining your operations, catering to buyers' expectations of convenience, and utilizing an all-in-one solution that makes it easy to grow and manage your farm business is the key to your success.
00:25:14
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I want to thank you so much as we read 5 farms making 6 figures. Here at Barn to Door, we are humbled to support thousands of farms all across the country, including providing free resources like this ebook. If you want to check out other free resources available to you, please visit barn2door.com backslash resources. Thank you for tuning in to the Direct Farm Podcast. We look forward to seeing you next time.
00:25:46
Speaker
Thanks for tuning in. For more free farm resources, tips, and tactics that are most successful farms use to grow and manage their business, visit barnadore.com slash resources. Also don't forget to subscribe to the Direct Farm podcast to automatically download our weekly episodes. Thanks for listening and we'll see you next week.