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Marketing and Economics for Small-acreage Properties

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					                    Overview of Module 7:
                 So You Want to Make a Buck?
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                 Cinda Williams and Kevin Laughlin
                               July 2008
                        LOL Training Bozeman, MT




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                  What we’ll learn today
                 Introduce new LOL module
                 Review highlights of each lesson in
                 module
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                 Reinforce student engagement as
                 part of LOL program
                 Identify keys to successful delivery
                 Identify resources for instructors
                 and students
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     Marketing and Economics for
      Small-acreage Properties




Developed by:
Cinda Williams, University of Idaho Extension
Bob Hamblen, Colorado State Cooperative Extension
Kevin Laughlin, University of Idaho Extension
Susan Donaldson, University of Nevada Cooperative Extension   UNCE, Reno, Nev.
            M7L1 allows participants to:
                 Re-examine property goals
                 Decide if they can make a go at a
                 farm business.
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                 Begin a comparative analysis of
                 three potential enterprises
                 Learn the basics of business plans
                 Explore direct marketing methods


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       Module 7 Lesson 1 - Lesson Plan
Time     Section                 Goal                                 Activity                         Instructor
10     Introductions   Answer any questions       Agenda                                         Depending on number of
min                    and address any             Re-examine your property goals                repeat participants and
                       concerns from the last      Do you want to make a buck?                   time between this and
                       lesson.                     Can you make a buck?                          the last lesson, an
                       Clearly delineate what      Business plans                                icebreaker may be
                       will be covered.            Marketing methods                             needed here.
                                                   Keys to success                               PowerPoint Slides 1-2
                                                   Resources
       Re-examine      Start the group thinking   Re-examine your property goals                 Personal Evaluation
       your property   about possible             Questions to ask                               Activity Sheet
       goals           enterprises for their      What are you going to sell                    Testing Possibilities
                       property. Focus on the     Are your physical resources adequate?         Activity Sheet
                       questions participants     You are a physical resource. Fill out the     PowerPoint Slides 3-15
                       need to ask themselves     Personal Evaluation Activity Sheet
                       to decide if the           Family issues
                       enterprise is right for    Time and money
30
                       them and their property.   External factors
min
                                                  How are you going to decide? Fill out the
                                                  Testing Possibilities Activity Sheet
                                                         Decision-making process
                                                         (brainstorming activity)
                                                         SWOT (strengths, weaknesses,
                                                         opportunities and strengths) analysis
                                                         activity


2/23/2012                                                                                                             5
  Legend                     Revisiting the Property Map
    Well     GH Greenhouses (high tunnels)
             --- Wildlife planting area
   Trees      Hot-wire fence                                       Acres = 25
  Weedy Animals = 2 cows, 1 horse, 10 dairy goats
  Bare    Grasses present = T. fescue, orchard, clover, bentgrass House
  ground Soils = sandy clay loam, silt
P Pasture
   Marshy                               New gravel road for access

                         Processing   GH   GH GH
    Stream               shed
   Water
                               GH
   trough
                               GH
   Gate
                                                        Barn




                                                                 Barn
   Fence
   Septic
   Manure compost area
C Cropping area
GC Groundcover planted
            Re-examine personal goals

                 Why do you want to sell a product?
                 Do you have the skills and resources?
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                 Why do you have to do this….is it going to
                 be FUN?
                    Personal Evaluation Activity Sheet
                         see pages 8-9 of M7L1



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                                  What to sell?




www.sustainablepoultry.ncat.org               http://blogs.venturacountystar.com




          www.eatapples.com                  http://blog.americanfeast.com
                     Determine if resources
                        are adequate…
                 Physical?
                 Human (self and family)?
                 Time?
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                 Financial?
                 External Factors

                 Testing Possibilities Activity Sheet
                         see M7L1 page 10
                                                               yourproduceman.com
             Brainstorm possibilities, conduct SWOT analysis




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                 Start the Business Plan by
                   knowing your product
                 Crops
                 Livestock
                 Value-added
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                 products

                 Proposed Enterprise
                 Development Sheet
                    M7L1 pages 11-14

                                                   NCSU




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             Custom
            livestock                                 Restaurants
                                                       or grocery
                                                         stores


                                                        Farmers’
                        Institutional                   markets
                         customers
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    Agritourism
                              Marketing
                              Strategies

                                        U-pick
     Community
                                        Value-added
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       supported
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  agriculture (CSA)
                                        processing           11
 The Business Plan as a Road Map
                           Introduction of
                          business plan as
                            a road map to
                               success




Includes basics of developing mission, goals
                statements.
                                  www.internest.com
                    Introduces importance
                        of planning for:
                 Production
                 Marketing
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                 Financial
                 Labor
                 Management
                 Contingency plans

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Peer resources
 and support

Agencies
Extension
Other producers




                  NRCS
                    Why buy my product?
                 “Tell your story” as a PRODUCER to
                 explain why someone would want to
                 buy your products.
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                 “Tell your story” as a CONSUMER to
                 explain why you would want to buy
                 the producer’s products.
                   Proposed Enterprise Development Sheet
                             M7L1 pages 11-14


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            Proposed Enterprise Development
                Activity Sheet M7L1 pages 11-14
             Examples of additional
             questions posed on this form
                                            Proposed Enterprise #1

             Describe the customers
             that you are targeting for
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             your product/service
             What is your production
             plan?
             How will you manage
             your enterprise? Who is
             responsible for which
             elements?

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                     Production:
               It’s All About Systems
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 Developed by:
 Bob Hamblen, Colorado State Cooperative Extension
 Cinda Williams, University of Idaho Extension


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 Kevin Laughlin, University of Idaho Extension
    2/23/2012
 Melody Hefner, University of Nevada Cooperative Extension   17
 USDA NRCS
            Module 7 Lesson 2 introduces:
                 Production systems
                  Traditional or conventional
                  Sustainable
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                  Certified organic
                 Certifications
                 Risk management



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                    Sustainable production
                           systems:
                 Address economic profitability, social
                 benefits to the farm family and community,
                 and environmental conservation.
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                 Depend on a whole-system approach
                 whose overall goal is the continuing health
                 of the land and people.
                 Concentrate on long-term solutions to
                 problems instead of short-term treatment of
                 symptoms.


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       An overview of some sustainable
             tools and practices




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   Univ. of Idaho Extension
                                     20
Add manure or compost


                                           Biological pest control
                                            Integrated pest
                                             management
Green                                            (IPM)
                        Mulches
manures                                      Cultural
                              Biological
and cover
crops                                                   Biorational
                              Chemical
                                           Mechanical
                                                        pesticides



              Planned
            crop rotation
                                         Integrating crops and
Physical barriers           Solarization       livestock
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            Organic production systems
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            The National Organic Standards
              Board defines organics as:
                 “An ecological production
                 management system that promotes
                 and enhances biodiversity, biological
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                 cycles and soil biological activity. It
                 is based on minimal use of off-farm
                 inputs and on management practices
                 that restore, maintain and enhance
                 ecological harmony.”


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             Certified organic production
                 The Organic Foods Production Act of 1990
                 mandated uniform organic standards
                 Use of the term ORGANIC is controlled,
                 versus ‘natural’, ‘pesticide-free’, ‘free-range’
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                 or other ‘marketing’ terms used by growers.
                 Growers must have an organic plan for their
                 farm and be certified organic.
                 Annual inspections are mandated after
                 certification

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                                      Organic handling or
 Organic crop production             processing operations
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                                Organic product labeling




Organic livestock
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production
  2/23/2012
http://chatham.ces.ncsu.edu
                              100%      95-100%   70-95%
                                                           25
                                                           0-70%
            What does a label really mean?
                       No Detected Pesticides Residues

             Made from milk from
             contented cows              Grass Fed
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                 No Artificial
                                 100% Natural
                 Ingredients
                                    Free Range
                 Cage Free
                                 Hormone and Antibiotic Free

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                 Other Certifications
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            Don’t forget risk management
                 Introduce government risk
                 management programs
                 Review types of risk and ways to
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                 prevent risks in all areas of business
                 Review risk management tools for
                 producers



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                           Activity for Lesson 2
                 Proposed Enterprise Development Sheet, see M7L2, pages 7-11

                        For each of the three enterprises
                             proposed in Lesson 1:
             Determine best production method based on
             personal goals.
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             List the pros and the cons of using the
             production system for each enterprise.
             List possibilities and steps required for third-
             party certifications.



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                 Can You Make It Work?
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                                                       Developed by:
                                                       Melody Hefner


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                                                    Susan Donaldson
     2/23/2012                                                   30
                           University of Nevada Cooperative Extension
                  Lesson 3 uses case study
                       examples to:
                 To compare and contrast some
                 success stories
                 Identify key factors that make a
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                 sustainable enterprise successful
                 Provide successful models for
                 learning how to make it work



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                   The “What If?” game
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                 What if…Activity Sheet and Instructions
                           see M7L3 pages 6-7



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            How have others made their
             enterprises successful?
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                                         USDA NRCS
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                     Case Study One:
                 Story Hill Farm, Montana
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                  Case Study Two
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                 Lauren and Ewell Culbertson

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                 Bear River Valley Beef,
                 California
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                      http://bestgrassfedbeef.com/index.htm



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                  Looking at some case studies…
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       NRCS                   St. Paul Farmer’s Market   NRCS




                      Case Study Presentation Activity Sheet
                                  M7L3 page 8

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      Food Alliance                                      NRCS   WSU
     2/23/2012                                                        37
                      Homework for M7L3
                 Participants analyze their own property
                 and/or enterprise by answering these
                 questions:
                 What were your original goals?
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                 How has your map changed?
                 How have your goals changed?
                 How has your property management
                 changed?
                 What does your to-do list look like?


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                 Resources for Instructors
                 Every lesson has an extensive list of
                 resources for both instructors and
                 students.
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                 Don’t forget to use as many local
                 resource publications as possible.
                 Consider using relevant small farming
                 videos or DVDs, if time allows.


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                 Summary and next steps
                 Quick review of Module 7
                 Introduction to the hands-on activities
                 Identification of resources
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                 Next steps for you:
                  Review the Lesson Plans
                  Read the notes section of slides
                  Identify partners in your area



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