The Neighbours Think We’re Crazy
|That was the question our neighbours asked after we quit grain farming and dove headlong into poultry, livestock and butchery. “Since when do you need to own a four-wheel-drive tractor to be a bona fide farmer?” we thought to ourselves. What constitutes a farmer?
A Farmer Is . . .
In agriculture, the debate continues about what constitutes a farmer. Revenue Canada and other government programs has its definitions, but for us, fitting CRA’s definitions has been like trying to fit a square peg in a round hole. As farm-to-fork farmers, we just don’t fit the mould. Nevertheless, we believe we are farmers, just adhering to a different business model. Instead of going in bulk on a truck to a processor, our oven-ready products go home in families’ shopping bags.
Most farms could be charactized as commodity producers. Commodity products are virtually indistinguishable from each other within a category. Their only differentiating factor is price. Therefore, the lowest price always wins.
Historically, as farms have grown bigger in order to remain economically viable, to their detriment, farmers have lost their connection with the end user i.e. the consumer. Typically, crops or livestock are shipped from the farm to an aggregator, then proccessr, distributor, retailer and finally to the consumer. The farmer’s share of the consumer’s food dollar is minimal at about 17 cents per retail dollar spent in the grocery store. Market power correlates directly to one’s ability to communicate with the end consumer. Thus, farmers’ market power are diminished. This makes sense given how many hands are in the money pot and how far removed the farmer is from the final transaction at the bottom of the supply chain.
Strategy
We decided to change the game with a two prong strategy. First, as a small farm without economies of scale, we knew we couldn’t compete in a commodity market. We differentiated ourselves from other meat companies by raising all our poultry and livestock according to our All Natural Protocol. Secondly, we knew that the one closest to the end customer in the supply chain has the most opportunity for profit. Hence, we chose to brand our meat and sell farm-direct, encapsulating the entire farm-to-fork distribution chain and capturing incremental margin along the way.
Looking back over our 19 years of business building, perhaps the most beautiful thing about PVF is our conversations with food eaters. Our market research happens in real time with real dollars on the table. People tell us what they’re looking for and what matters to them. We find ways to serve them. Rapid feedback allows us to adjust our farming practices and meet (or exceed) customers’ expectations.
Our authentic connection between farmer and eater brings the food conversation back to the table, right where it should be. And that’s worth a lot.
Do the neighbours still think we’re crazy? Maybe. That’s OK.