How Farmers Can Reduce Risk and Increase Returns

Farmers are entrepreneurs at heart and, without a doubt, they’re a determined, hearty bunch. Many people wouldn’t get through the tribulations of trying to raise commercial amounts of crops amidst the hardships of weather, the uncertainties of market demands, and a fluctuating (though improving) economy – and most farmers wouldn’t do what they did if they didn’t love what they do. It’s a hard way to make a living, marked with uncertainty and narrow margins.

This is and continues to be the case for my own family – who have farmed since first settling in Australia three generations go. In the current marketplace, farmers are largely disadvantaged, but advances in technology can provide new solutions poised to turn modern commercial farming on its head. A big part of the reason I wanted to make this move to Iowa was to bring an idea that started off as a way to help my family. I saw great potential to connect consumers and the farming community, and knew what that does for all of the community.

A good farmer doesn’t just want to grow things. Farmers till the soil. They nurture the earth as if it were a child, devoting every ounce of energy to ensuring their crops grow up strong and fine, the apple of their eye. They work mainly with perishable products with little guarantee of prices, yield, or even if they’ll sell what they’ve grown.

Even after they’ve navigated the uncertainty of sowing amidst changing weather patterns or pests they are left with two choices:

Sell at rock-bottom prices to auction houses or wholesalers.

For instance, a pumpkin can go for $3 to a wholesaler. That same pumpkin goes for around $7 in your average grocery store. Between dedication of land, cultivation, crop loss, harvest, and delivery, that pumpkin probably cost the farmer approximately $3.

If the farmer had access to the consumer, they would have made a 28% profit. This dramatically impacts the margins with which they work, that are already razor thin.

2) Sell at farmers markets or at roadside stand.

Power to the farmer, right? Take the bull by its horns, and all that. Well, the sad reality of it is that whenever a farmer decided he/she is going to set up a stand, they have to harvest, they have to cut their crops, and that means that what they have now has a short shelf life. They have to guess if they can sell what they have, how much they have, and for how much.

If they can’t sell what they have, it goes bad. If they can’t connect with the people that want what they have, it’s the same. For the most part, they end up throwing out a lot of incredible, fresh, loved-for food because they cannot connect with the right consumers at the right time.

Technology has made it easier than ever to connect with each other, to have access to new things, to be able to tell people what we need. All of this was not possible not so long ago. Even when, around 60 years ago, people bought directly from farms, and not from big box grocery stores, they were limited to what was immediately available to them through those local farms.

Today, we can book a hotel from across the world. We can order a private car service instantly from our phones. We can stay connected with friends and family without being anywhere near them.

Not much of that has been very helpful to farmers, up until now. We have the ability to communicate, to make transactions, to request items, to cut out the middle man and get high quality food to consumers and a higher yield to farmers, allowing them to produce better food in greater variety, which they then pass onto consumers. In a situation like that, we all win.

With the advent of industrial/commercial farming and big box groceries, however, our options as consumers have shrunk, we’ve spent more on lower quality food, and farmers are forced to make difficult decisions that don’t necessarily work out for them.

At ProduceRun we’re in love with the idea that having access to good food is not a privilege; it’s the way things should be. We think that having access to good food means a better quality of life. It means better communities, closer communities, stronger communities. We want to bridge the distance between consumers and farmers. We want consumers to have better, fresher, and tastier food, and live healthier, more satisfied lives as a result. We want to connect consumers with farmers and nurture the sense of community that exists around food.

So how do we make it work for the farmers? What if we provided a platform through which a farmer could post up bulk quantities of goods? You, your friends and family or community order what you want. When there’s enough demand for this particular item, the farmer schedules a run from their farm into town. It’s that simple. You can even suggest what the next ProduceRun will be. Been dying to make some fresh butternut squash soup? Want some uncured, applewood-smoked bacon? Suggest it! Others can vote on it. If there’s enough interest, we’ll reach out to our partner farmers and make it happen. You can even schedule a recurring ProduceRun.

How awesome would it be to get high-quality food that you wanted, farm-fresh? We think it’d be about this awesome (we’re holding our arms out as wide as they’ll go… it hurts a little). That’s pretty great, if you ask us.


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