The economics of conventional agriculture are simple: grow a lot of a popular crop as uniformly as possible, then compete on the basis of price. Smaller farms, however, are often threatened by this model, since they can rarely compete with large agribusiness operations on the basis of price alone. Further, growing uniform commodities is often contrary to the goals of small farms, who seek crop diversity, enrichment of soils, and a feeling that they are expressing their values and regional character through the food they grow.
What can independent growers do to increase their income while bringing more of their personality to the market? Here are examples of two farms — one that is nearly a century old with over 1,000 acres to manage, and the other that began as a tiny backyard start-up — who are succeeding financially by “adding value” and bringing a handmade aesthetic to the crops they nurture.
Since 1919, the Lafranchi family has operated a dairy ranch in California’s sheltered Nicasio Valley. The family is so deeply connected to the history of the area that local roads and even the town square — which doubles as the community’s little league field — bear their name.
But in 2009, the volatility of milk prices put the survival of the family’s farm into serious question. Small dairies like theirs were losing close to $100 per cow per month, and the Lafranchis had more than 400 cows.
Family members found a solution to this financial dilemma by returning to their ancestral roots. Cheese, made with heirloom recipes from their Swiss heritage, became a venture for the newly formed Nicasio Valley Cheese Company, an organic operation run by three Lafranchi brothers, Rick, Scott, and Randy.
“Our goal was to use all the milk that would go for a lower price,” Rick says. “We tried to position the ranch where it could consistently thrive instead of consistently be uncertain.”
“You might get $2 for a gallon of milk,” adds brother Scott, “But if you make cheese, you might get as much as $10.” Granted, the jump from $2 to $10 includes a lot of expenses and labor along the way, but value-added products — products that transform low-priced raw commodities into premium, handmade, branded offerings — might just be the key to boosting the economy of small agricultural businesses.
Today, only two years into its operation, the Nicasio Valley Cheese Company offers six cheese varieties, available in stores and from the creamery they converted from a former barn. There, they proudly display the two gold medals they won at the 2011 California State Fair.
Nearby is another value-added operation, AllStar Organics, a small specialty farm owned by the husband-and-wife team of Marty Jacobson and Janet Brown. “When we started about 20 years ago,” says Janet (who I should add is my big sister), “we wanted what a lot of people want — to work where we live. We had no business plan, and limited resources.”
Starting with a difficult backyard that was almost too steep to mow, the couple dug some terraces and planted tomatoes, herbs, and heirloom roses, three things that already grew in their home garden.
“For us, value-added production emerged entirely from our mistakes and failures,” says Janet. “It was all an attempt to salvage something out of what had gone wrong.”
“For example, I tried selling fresh rose bouquets, but the high-end florists I worked with were very particular and the flowers had a shelf life of only 24 hours. It was just too difficult. Then, someone suggested we try making an authentic rose water, so we found a fabricator who could build a still for us.” Through trial and error, Marty and Janet gradually developed a line of aromatic hydrosols and essential oils that are sold in stores and spas.
What today is a successful line of dried herbs and herbal products resulted from another “mistake.” “One day we picked 22 pounds of Thai basil to fill an order that turned out to be for only two pounds,” said Janet. “Rather than composting 20 pounds of ‘leftover’ organic herbs, I tried drying them by hand on sheets of newspaper with a house fan. Over time, we expanded the drying operation step by step until we built what we have today — a drying facility, a line of herbs, and an organic certification as a ‘simple on-farm post-harvest handler.’”
As AllStar grew, Janet joined with other farmers to form the region’s first organic marketing association, Marin Organic, a very select group of growers who met with sustainable agriculture advocate Prince Charles on his most recent trip to the U.S.
Allstar’s growth eventually required that it expand beyond a backyard operation. They now lease land from the Lafranchi dairy. The gate to their field is just steps away from the door of the Nicasio Valley Cheese Company’s tasting room!
Here are few of Janet’s ideas for anyone thinking of launching a value-added operation:
Be “too small to fail.” The first herb I ever sold was spearmint because I had a patch of it growing outside the kitchen door. In 15 minutes I could cut about a dozen bunches that sold for $2 each at a local market. A dozen bunches translates to $24 a week, or about $100 a month, or $1200 a year — for only 15 minutes of pleasant work. The mint didn’t cost anything to grow because I already had it. I was so small I couldn’t screw up. From there, we gradually added more herbs and more markets.
Capture sunlight in a jar. There is no business more solar-driven than a farm. Your highest production is when the days are the longest and financially your darkest days are literally your darkest days. How can you spread that sunlight prosperity throughout the year? We do that through drying and distilling so that we have products we can sell all year, especially during the winter holidays.
Remember that you are the value in value-added. Ultimately, it’s the time, energy and creativity that you put into something that people will pay for. Products where you can see the hand of a human being — that’s very attractive to me and I know from doing this for almost 20 years that people will pay for it.