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"There is no mission without margin"

Posted 2/14/2013 12:28pm by Julie Hurst / Roy Brubaker.

There is no mission without margin”

    • Sally Jewell – REI exectutive and nominee for Secretary of the Interior,

 As farmers we are committed to producing a high qualitity product using practices that honor the life of the animals we raise, the landscapes and ecosystems in which we raise them, and the community of fellow humans with whom we interact : those we pay, those who pay us, and those we simply rub shoulders with in the various circles of our lives. Our choice to be farmers and our mission as farmers is rooted in a deeply held moral and ethical belief that the life that pulses in us is connected to the life that pulses in all organisms and we should approach it with curiosity and mindfulness.

 That said, on a more pragmatic note, our choice to be farmers inevitably makes us small business owners. And for small business owners to stay in business, there is at some point a rather sobering reckoning about what exactly the operating margins are for your business. Because neither of us have very sophisticated bookkeeping skills and we have always managed the farm around the margins of at least one full-time, off-farm job, this reckoning has been a long time in coming. But recognizing that our “little girls” are only a few years shy of high school and with our personal net worth almost entirely invested in “non-liquid” assets such as land, farm infrastructure, and animals (and still considerably leveraged with debt!), and our own 40+ year-old bodies beginning to begrudge some of the work we found “fun” as early thirty somethings; we found ourselves asking increasingly difficult questions about what exactly (beyond profound satisfaction) the marginal return on our farming efforts were.

 So beginning in 2013, we've been working hard to refine our bookkeeping skills in order to better assess what our operating margins have been over the past several years. And the results are indeed, sobering. Suffice it to say, it's good that farming gives us a sense of profound satisfaction, because at this point, that's about the only thing we've made from farming.

 We're still pretty early in what we expect to be at least a sixth month process of working closely with a consultant to improve our business management practices, but it's clear we need to make some changes if we want to continue farming; and we do.  In the short term, this means a rather significant price increase of our products. Here's some of what we've learned through our first few months of the sober reckoning. (If it doesn't ease your pain at the sticker shock of our new price lists, we hope you'll at least recognize it's not been a pleasant process for us either.)

 We have to base our prices on our costs rather than allowing grocery store prices to inform us. That's not to say we tried to compete with our local Weis store prices...we knew we couldn't. But we kind of started there and then built in a small premium for being “niche.” But we're not niche. We're a different species. A different dimension altogether from grocery store meats. You already know this and likely that's why you are our customer.

 As a small farm that operates on a set of principles beyond just profitability, our costs are going to be higher. We are small by choice and design. We do not have the benefit of economies of scale that the big feedlots and huge ranches out west have. We buy our hay and grain locally and in large enough quantities for our scale, but still, it is nowhere near what Tyson and Hatfield can buy their feed for. On the other hand, our purchases support our neighbor farmers and feed mills and they too deserve fair price for their labor. 

 We work with a small processors that only kill a dozen or so animals in a day and only one or two days a week and they dry-age their meat. Their shops are clean and inspected and the rate at which animals move through allows them be mindful of how animals are treated and how each carcass is handled.  They too are small, family-owned operations with slim profit margins and they cannot compete in price with the huge processing plants, but we don't want them to.  We don't want to send our animals to those vast plants nor do we want to eat the products that come out of them.

Raising lambs and beef on grass takes more time and management.  Raising pigs with space to root and  run around takes planning and pig-proof fencing. We have to pay labor to do the work, even if that labor is us. Like many farmers, we've gotten into the habit of not paying ourselves beyond covering immediate expenses and we cannot afford to continue this pattern. 

 This is already getting long...all this to say, now that we have better tools to see where our money is coming from and going too, we  are becoming empowered to make decisions that will help sustain our business for the long term. We know that for many of you, choosing to purchase food from us and farmers like us, is no small investment and we appreciate that.  We believe agree with the advice of Michael Pollan and Robert Lustig, “Eat real food.  Not too much. Mostly Plants.” And when you do eat meat – consider what the animals you are eating have eaten and how they have been raised. Yes, it costs more, but we think you and your body will find it is worth it.