Growing and Selling Vegetables to a Hungry Market

Overview– Keewaydin Farms History

– In The Beginning– You Want to do What?– Dealing With Disaster

– The New Plan– Crop Selection and Season Extension– The Budget and The Business Plan– Marketing Options Pros and Cons

– Do as I say not as I have done (maybe)

Keewaydin Farm and Field Map

Keewaydin Farms History

• Established as a sheep ranch in the 1850’s by the Drake family

• Bought by Lynford Looker in 1948 and operated as a sheep ranch then dairy farm

Keewaydin Farms History

Farmed with horses until 1958

Keewaydin Farms History Bought by Richard and

Mary Haucke in 1976

Operated as a 60 cow Registered Holstein Dairy Farm until 1996

Keewaydin Farms History

• Became a second generation family farm operated by the Haucke’s in 2005.

Keewaydin Farms History• Operated as a multi enterprise farm

including Dairy, Vegetables, Row Crops, and pastured meats from 2007 thru 2010.

Keewaydin Farms History

• In 2010 Rufus Haucke took full ownership of family farm and changed operation to Annual Vegetable and Crop operation.

In the Beginning

Began reading publications about organic gardening and how to write a business plans

Spent a year or so dreaming about what it may be like to be a farmer

In the BeginningLets talk financing options– Yourself– Family and Friends– FSA– Bank– Other• Non profits• Venture capital• Slow Money

Your budget Year 1

Income ???????

Expense ???????

Other Income ???????

Other Expense ????????

Gross Loss or Gain ????????

Debt Service ???????

Funny Money aka Profits

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In the Beginning

• Got a job working for A 40 acre vegetable operation in Viroqua, WI area

• Spent the year working/learning.• Began working with the FSA to figure out how

to buy part of the family farm

In the Beginning• Bought 60 acres

and formed Keewaydin Family Farms and General Partnership between the Haucke siblings (Jessica, Rufus, Jacob)

• In 2005 began vegetable farming on ½ acre.

In the Beginning

Equipment Year one– Home made 12x20 Greenhouse

– Earthway seeder– Wheel hoe

– 2 stainless steal wash tanks– Rented Rototiller

– Computer and Printer– QuickBooks

In the Beginning

• Marketed through farmers market in Viroqua and wholesale to a few coop groceries in Minneapolis and Madison.

• Main Crops where Swiss Chard, and Brussels Sprouts and a few culinary herbs

In the Beginning

January

February

March

April MayJune

July

August

September

October

November

December

$0.00

$200.00

$400.00

$600.00

$800.00

$1,000.00

$1,200.00

$1,400.00

$1,600.00

Income Expense

• All three siblings worked off farm to support living expenses

In the Beginning

• Second season secured an operating loan from bank used to purchase Equipment and supplement cash flow

• Planted 3 acres of garden and made hay off of remaining crop ground

In the Beginning

• Marketed through farmers market in Madison and wholesale to a few coop groceries in Minneapolis and Madison.

• Main Crops where Swiss Chard, celery, Green Top Carrots, Brussels Sprouts, Garlic, Dill, and Cilantro

End of year financials Year Two

January

February

March

April MayJune

July

August

September

October

November

December

$0.00

$1,000.00

$2,000.00

$3,000.00

$4,000.00

$5,000.00

$6,000.00

IncomeExpense

• All sibling maintained off farm work. Rufus and Jessica move to part time off farm work

You Want to Do What?

• Working with the FSA the Haucke Siblings bought 80 more acres with the farm buildings, more equipment, a 40 cow dairy herd and received more operating capital.

• Built Swing 8 milk parlor, began renting neighboring land. Planted 4 acres of garden, milked 30 cows, raised several hundred acres of hay, 30 acres of corn and a couple acres of small grains

Adding Animals to Your Farm

Pro

• Adds diversity• Provides Manure for

compost• Can help to bring less

productive land into rotation

• Increases revenue stream

• Allows access to more markets

Con

• Requires constant attention

• Expenses Increase• Less Control of

market/pricing• Requires more land• Requires more

equipment/facilities

Equipment Year 3

• Massey 1100 Tractor• Massey 1135 Tractor• Massey 65 Tractor• Skid Steer• 9’ Grain Drill• 6’ Rotovator• 9’ Haybine• 30’ X 60’ Greenhouse

• 2 Self Unloading Wagons• Manure Spreader• 6’ Brush Hog• 8’ Disk• 4 Bottom Plow• Chopper• Round baler

You Want to Do What?• Marketed Vegetables through CSA in Madison

and wholesale to a few coop groceries in Minneapolis and Madison. Marketed Milk to Organic Valley

Year End Financials Year 3

January

February

March

April MayJune

July

August

September

October

November

December

$0.00

$2,000.00

$4,000.00

$6,000.00

$8,000.00

$10,000.00

$12,000.00

$14,000.00

$16,000.00

IncomeExpense

Rufus and Jacob work off farm part time. Jessica leaves operation and begins attending College

You Want to Do What?

• 2008 Rufus Haucke started another business called Keewaydin Organics and moved the vegetable enterprise to another farm

Dealing With Disaster

Dealing With Disaster

The Three D’s– Death• Wills, Life Insurance, Clearly defined rolls

– Disaster (Natural and Man Made)• Diversity, Insurance, Determination

– Divorce• Mediation, Operating Agreement, Kindness

You Want to Do What?

• 2008 through 2009 Jacob Haucke continued to operate Keewaydin Farms

• In 2010 Rufus Haucke took over management of operation then ownership of Keewaydin Farms

The New Plan

• Dairy Cows Sold in July of 2010• Focus placed on vegetable operation and

home farm.

The New PlanEquipment List

• Massey 1100 Tractor – 90 horse power

• Massey 65 Tractor – 60 horse power

• Cub B – Cultivating / Planting Tractor

• Assorted Cultivation Equipment– Lewiston, basket,

shovels, hilling discs, rotary hoes

• Flail Chopper• Manure spreader• Chisel• Disk • 4 Bottom Plow• 2 Self Unloading Wagons• Wash Line• Skid Steer• Rotovator• Brush Hog

The New Plan• Increase soil fertility• Expand annual production to 20 acres• Expand greenhouse production• Develop crop plan that keeps production going as long

as possible• Begin planting perennial crops– Asparagus– Hazelnuts– Chestnuts– Hardy Fruit Trees

Crop Selection and Season Extension

Crop Selection and Season Extension

Crop Selection• Continuous production• A diversity of plant

families• What do you like to

grow• Cover Crops• Perennials and annuals

Season Extension• Heated Greenhouses• Unheated Hoophouses• Storage Crops• Dried Crops• Mini Hoops• Hydroponics

The Budget and The Business Plan

Income ExpenseFarmers Market RentCSA FuelWholesale Vegetables

Labor

Government Payment

Fertilizers

Others….. Freight -meat Repairs and

Maintenance -milk Seeds -Eggs Insurance -Kitchen Others…..

• Use IRS SCHEDULE F• Plan out all 12 months• Continue to monitor

and adjust• Try to be realisticContacts

-Your Accountant-Neighboring Farmers-Your Bank

http://www.irs.gov/pub/irs-pdf/f1040sf.pdf

The Budget and The Business Plan

Cash Flow

January

February

March

AprilMay

JuneJuly

August

September

October

November

December

($10,000.00)

($5,000.00)

$0.00

$5,000.00

$10,000.00

$15,000.00

$20,000.00

Income ExpenseCash Flow

BalanceSheet

Balance Sheet As Of – Current DateShort term assets

Checking, Savings, Accts Receivable

Mid and Long Term Assets

Machinery, Animals, Land, Stocks, Bonds, Life Insurance

Total…………………$$$$$$$$Short Term Liabilities

Accts Payable, Operating Loans

Mid and Long Term Liabilities

Loans on Land, Machinery and Animals

Total…………………$$$$$$$$Equity

Owner Draws, Owner Equity (Assets – Liability), EarningsEquity and liability Total…………$$$$$$$$$ This is the net worth of the business Asset total and Equity/liability total need to match

The Budget and The Business Plan

• The Business Plan– Cover Page with owners names, Contact info and

Business Logo– Table of Contents– 2 to 4 page Narrative– Sections to include• Company description, Products, Markets, Competition,

Description of owners/managers skills and rolls, Use of Proceeds, 3 year growth projections

– Add Budget, Cash Flow and Balance Sheet– Total Page number 7 to 9 pages

CSA

Pro• Money early in the growing

season• Direct contact with

customers• Strong advocates• Allows for diversity on farm

Con• Complicated• Requires people skills• Requires strong planning

skills• High diversity• Lots of communication

Farmer’s Market

Pro• Direct connection with

customer• Social event• Encourages Diversity• Network with other farmers

Con• Unpredictable traffic flow• Prices unstable• Time away from farm• Competition• Equipment Requirement

Restaurants

Pro• Strong advocates• Popular• Utilize unusual items• Promote freshness• Can change menu with

season

Con

• Price sensitive• High employee turnover• Longer payout • Small orders• Require more time to

maintain relationship

Grocers

Pro• Can move good volume• Provides contact with

consumer through promotions and demos

• Good advocates• Anchors of neighborhoods

Con

• Have established relationships

Wholesale

Pro• Hungry market• Can move large volume• Provides infrastructure• Can contract crops

Con

• End customer is anonymous• Might not be loyal• Prices can fluctuate with

market

Institutions

Pro• Purchasing power• Ability to plan volumes• Reliable payment policy

Con• Demand uniformity• Require product insurance• Require Food Safety Plan

and inspections• Very price driven

Do as I say not as I have done (maybe)

• Use operating capital very carefully• Establish a strong working bond with

all members of operation. Clearly define rolls and stick to the script

• Focus on your soil. Make that #1 in any land purchase decision

• Plan on Making Money from the beginning

• Choose equipment carefully not carefree

• Make time for your self and family