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Bureau
of Markets - Farmstands
Marketing
Small Fruit
by
David Handley
University
of Maine Extension
I.
General Considerations
The importance of good marketing strategies is often overlooked by
small fruit growers, as even the very best production techniques will
not be profitable unless crops are properly
marketed. Three basic rules of marketing should be kept in mind
from the very start of establishing a commercial small fruit operation:
- 1) Think quality in every phase
of your operation.
- 2) All the fruit should be sold
before a single berry is picked.
- 3) Price your product fairly.
One factor stands above all others in establishing and maintaining
a profitable enterprise: quality. It is the quality
of your product and your operation that will bring about return
customers, and they are the people who bring about your highest
profits. High quality fruit from a neat, efficient farm,
sold in a friendly atmosphere will reap far more profit than poorly
handled, ungraded fruit from a badly organized grower. A
good reputation is the best publicity you can have. Selling
junk with the attitude of fooling the customer will guarantee
a short business life.
No matter what channel you choose to market your fruit, pick-your-own,
fresh market, or processing, customer contact should begin early,
well before the harvest season. Let buyers know what your
product is, and how much will be available. If selling via
pick-your-own, begin advertising well in advance of the picking
season. Promote the quality of the crop, and let them know
when you will be opening. Growers who invest the time in
advance marketing seldom suffer the frantic race to sell fruit
before it rots, or have to drop prices below the profit margin
to get fruit harvested.
What you charge for your produce must be fair to both you and
your customers. The price must be set high enough to bring
you a good profit, but not so high as to cheat the customer, or
be far above any competition. Proper pricing requires a
thorough knowledge of production costs. Be aware of how
much it costs you to produce your crop. Make sure to account
for labor, includingyour own. While overcharging is sure
to result in disgruntled customers, underpricing can cut deeply
into your profits. Reducing prices to undercut the competition
may seem like a good idea on the surface, but in reality is likely
to cause more harm to your operation than good.
First, by reducing your price you have reduced your profit.
It is probable than any resulting increase in customers will not
make up for the lower price, assuming you've already been doing
a good job of promoting your product. Second, your competitors
may lower their price in response, setting up a price war, in
which you may be reduced to selling your crop at break even prices
or lower! Finally, the customers may come to expect you
to drop prices during the season, and hold off buying until you
do so, once again reducing your profits.
II. Marketing Options
Small fruit are typically sold via one of three marketing channels:
customer harvest ("pick- your-own"), fresh market (retail
or wholesale), and processed (jams, jellies, etc.). Each
of these outlets presents certain advantages and disadvantages
which should be carefully considered by the grower. Most
growers utilize more than one marketing channel, and this can
be an advantage in itself, as the demand in one market can make
up for slack periods in
another.
A. Pick Your Own
The pick-your-own (PYO) market for small fruit crops has proven
successful for many growers, but can be highly
dependent upon a farm's location. In order to attract an
adequate number of customers to a PYO farm, it should be located
within at least 20 miles of a densely populated area, with little
or no competition. It should also be on or near a major
roadway, and easily accessible. Farm roads to the fields
must be adequate for customer vehicles, or transportation should
be supplied. Ample parking space should be available, as
well as toilet facilities, drinking water, shade, and some seating.
Although one of the major advantages of PYO marketing is reduced
harvest labor, field supervisors must be employed to direct and
help customers in parking, harvesting, and check out procedures.
These people should be courteous and friendly, and have a good
knowledge of the farm. Check outs should be neat and efficient.
Don't make customers wait in long lines to pay; open more
checkouts if necessary. It is generally best to charge by
weight of fruit, rather than by volume. This will curtail
the inevitable arguments as to what constitutes a "full"
pint, and guarantees a fair price to all. Electronic scales
can make weighing proceed very quickly. If you supply a
standard picking container to customers, then you can easily subtract
its weight before charging for the fruit. Otherwise, containers
must be preweighed before the customer goes into the field.
Post a set of rules in obvious sight for the customers, and be
sure supervisors are familiar with them. Most operations
allow children, as PYO farms are commonly a source of family recreation
(families tend to pick the most also), but make sure they are
supervised. It may be advisable to have alternative amusement
for children available, such as a playground. This brings
up an important point: insurance. You would be strongly
advised to consult an insurance agent regarding the potential
liabilities involved in a PYO operation, and purchase appropriate
coverage.
Experience has shown that raspberries may not be as popular for
PYO as other crops, such as strawberries; this is probably
due to their higher cost per pound, greater difficulty to harvest,
and later season. But in some locations these obstacles
may not deter customers, and PYO can be a viable part of an overall
marketing strategy.
B. Fresh market
Selling fresh fruit to retail or wholesale buyers is a viable
option for growers whose operation for some reason is not adapted
to customer harvest, e.g. location or grower preference.
Of
course, many growers who utilize PYO also sell to other markets.
This is fine, as long as one of the markets is not simply getting
the low quality leftovers of another, or if they are, there is
a clear understanding by the buyer, who pays accordingly.
Buyers must be contacted well in advance of the season to set
up orders and arrange shipping. Some outlets may demand
specialized handling or packaging. If this is the case,
they should be willing to pay for it.
Harvest labor is a major aspect of the fresh fruit market.
Depending upon location, there may be a shortage of willing and
capable workers. Some operations have recruited children
or senior citizens to harvest fruit. These can work well
if treated properly by the grower. It is best to start picking
as early as possible in the morning, provided the fruit is dry,
and quit before noon. This will assure the fruit is picked
at its best quality, and that pickers are not forced to work during
the hottest part of the day. Most growers pay pickers by
the pint.
Bonuses offered for a certain number of pints will provide more
incentive. Train pickers to harvest only fruit of good quality
at the proper stage of ripeness. Maintaining a good working
environment is crucial to keeping good labor. Make each
worker feel as part of the team. Generate enthusiasm for
your farm and your product. Your workers attitude will show
in the quality of your fruit. Contact your state department
of labor for regulations regarding the hiring of temporary farm
help.
Post harvest handling of the fruit is a critical part of dealing
with the fresh market. You must have the ability to deliver
a high quality crop with a maximum shelf life. This can
mean a considerable investment in packing, storage and transportation
facilities. Be sure to follow up your shipments to see that
they are properly handled in stores. Improper handling at
the store can ruin your efforts to deliver a good product.
Discuss proper procedures with the produce manager because it
is your reputation at stake.
C. Processing
Growing fruit for processing entails many of the same efforts
required for selling fresh fruit, such as contacting buyers, filling
orders, and delivery. If you intend to do the processing
yourself, you must adhere to your state's sanitation and labeling
regulations. This may involve regular inspections.
Contact your state department of agriculture for details.
Value-added products, such as jams and jellies, generally bring
about a higher profit than fresh fruit, but the inputs are much
greater. Labor costs will be higher, and appropriate cooking
tools will be needed, as well as a steady supply of ingredients,
jars, labels, shipping boxes, and so forth. There are mechanical
harvesters available for brambles and blueberries that do an adequate
job for fruit intended for processing.
III. Advertising
No matter which marketing outlets you use, advertising must be
a primary part of your operation. Advertising is the tool
by which potential customers are contacted and attracted to your
product. Without it, they'll never know you exist.
Your advertisements should represent your operation; they
should be tasteful and of high quality. Remember, this is
going to be the
customer's first impression by which they will judge you.
Develop an attractive logo and display it prominently in all your
ads and, if possible, on your products. Make sure it is
simple enough to be recognized easily. Check with your state
department of agriculture for lists of farms for consumers, and
get your address on them.
Who are your customers? If you don't know, then you
may be advertising to the wrong audience. Survey your customers
to ascertain their characteristics and location, and gear your
advertising accordingly. For example, if most of your customers
are homemakers or families, advertise where and when these people
are likely to see or hear it. Collect the names and addresses
of all your customers, and keep a mailing list. This is
one of your
most effective advertising tools. A direct mailing sent
out at the appropriate time, such as a post card indicating your
opening date, the high quality of your fruit, and your desire
to see the customer at your farm, gets better results than nearly
any other media. If you're selling processed goods, send
out a letter regarding your product with an order form.
Make the customer feel wanted; make them feel like part
of the farm.
Several types of media are available for advertising, aside from
direct mailings. Newspapers are probably the most popular
and effective. Ad space is usually sold by the column inch.
Large ads may be quite expensive, but depending on how many people
see it, it could be a lucrative investment. Keep the ads
short and simple, don't lose the customer's interest. Photos
grab a reader's attention and can increase the effectiveness of
your ad. Place the ad in the section where your clientele
is most likely to see it. You may want to offer coupons
as part of the ad.
Repetition is the key to radio advertising. It is
better to buy 20 spots on one station than one spot on 20 stations.
Costs of ads vary according to the station and time of day.
Pick
stations that your customers are most likely to listen to.
These may not be the major stations. You may consider sponsoring
morning weather reports.
Television advertising can be quite expensive. In addition
to air time costs, production expenses can be considerable.
Daytime ads are effective in reaching the family audience, and
they are much less expensive than prime time. Both television
and newspapers offer good opportunities for free publicity.
Reporters may welcome a public relations story on a strawberry
harvest or a local jam making operation. Encourage them
with an invitation to your farm or press release promising good
scenes for their cameras.
Signs are best used to direct people to your farm, rather than
attracting new customers. Some states have strict rules
regarding roadside signs. Contact your state department
of transportation\ for details. Signs should be attractive
and easy to read. At 50 mph, a motorist has only 3 to 5
seconds to read a sign. Thus, no more than 6-8 words should
be used. Use pictures or your logo, if possible. Road
signs are not the place to display your prices. It is more important
to catch the customers attention; let them know what you
have and how to get to it.
When designing your ads, think carefully about what to
say. Simply stating that you have raspberries available
at whatever price may not entice your potential customers.
Emphasize the benefits of your product, its quality, freshness,
flavor, and nutritional value. If you have a PYO operation,
be sure to advertise the fun and recreation a trip to your farm
provides.
Price is a relatively low priority among many of today's consumers.
Quality is far more important, and should therefore be the focus
of your advertising.
As a general rule advertising should be budgeted at 5% to 10%
of your sales income, but this should be adapted with experience.
Keep records of money spent on advertising vs. return (e.g.
number of new customers). Increase your advertising budget
if competition in your area is great, or your location is far
from the target audience. Don't overdo it. Too much
advertising brings diminished returns and possibly too many customers.
Overcrowding and inadequate supplies are sure ways to lose patrons.
Finally, the best form of advertising you can get is the word-of-mouth
advertising a satisfied customer passes on to others.
The potential for this advertising is immense; it
will generate lots of customers and many of your best patrons,
but it is not free. Making a customer satisfied and happy
enough to recommend you to other people requires that you maintain
a high quality product, and make purchasing that product a pleasure.
A good reputation involves a lot of work, but it will carry you
a long way. A bad reputation can ruin your business and
last forever. Advertising is the tool which brings customers
to your farm. Quality is what will bring them back for more.
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