Ready, Set, Grow

By SmallBusinessComputing Staff | Posted September 01, 2000
by Angela R. Garber

Many people still carry the misapprehension that farmers are staid, set in their ways, doing things exactly as the generations before them. And, just in any other sector of the economy, there are those who lament the good old days. But as dairy farmer Debbie Windecker says, "People have gotten into trouble running from technology. We can either ignore it or use it to our advantage for our business."

Today's technologically savvy and adventurous farmers are finding that they have advantages that their parents and grandparents never imagined. Farms are now wired to help with everything from soil irrigation, crop spacing, and fertilizer mixtures to determining the appropriate time to breed animals. The Internet is also playing an increasing role in the day-to-day operations of the farming industry. The National Agricultural Statistics Service reports that 29 percent of farmers had Internet access in 1999 (up from just 13 percent in 1997). Whether it's buying supplies and feed, marketing their goods, or getting the latest news and weather, farmers are signing on line to do business at an ever-increasing rate.

Windecker and her husband Dale took over the family dairy farm from her father-in-law eight years ago (they are now the fourth generation of Windeckers to work the farm). Situated in Frankfurt, N.Y., halfway between Syracuse and Albany, Windex Farms is relatively small. It has just 100 registered Holsteins, and until 1992 everything, including the books, was done the old-fashioned way.

"My father-in-law has never turned a computer on," she says of 69-year-old Leroy. "All the records were kept in this big ledger book. And that was just an IRS thing ­ it wasn't to see where we were with our business."

Purchasing a computer was Windecker's first goal as the business' new owner. She wanted to be able to compare production and expenses month-to-month and year-to-year so she could more easily look for ways of cutting expenses and increasing profits. Leroy is still very much an active part of the farm (he works 80-hour weeks), "but he leaves it up to us if there's something we can do to get a competitive edge," she says.

Windecker, like more than 600,000 farmers in the United States, has found that using the Internet is a great way to cut costs. She is increasingly turning to farming-specific Internet services to save herself both time and money. With a shortage of skilled labor willing to do the work, and milk prices at a 30-year low, that's never been more important.

STOCKING UP

The traditional way of purchasing goods on the American farm has been to meet with door-to-door salesmen. Streams of cars headed down the long drive, stopping by to give a glimpse of the latest farm equipment or checking in to see how supplies are holding up. But running a family farm is a sun up to sun down (and then some) proposition. There's little time to meet with salesmen.

"My husband really gets bothered by a lot of salesmen stopping by, driving up the driveway one after the other," Windecker says. "It really does tie you up." She now makes purchases through Internet services like Farmbid.com, a Web site that connects farmers to suppliers, agricultural news, and one another. "I can do the research and just buy it," she says. "It's just so much easier than having to call someone and having all the salesmen stopping in. We can bypass all of that and purchase it at midnight if that's what we need to do."

Windecker purchases her animal health products on line, and has cut cost on calcium, for example, by two-thirds from $6 per bottle to $2 per bottle. Windex Farms is too small to purchase raw commodities like soybeans and corn (feed for the cows) over the Internet, but Windecker researches the market value before purchasing locally.

"We purchase a lot of high-moisture corn to feed our cattle, but because of transportation costs, it's cheaper to purchase it locally," she says. Still, she has to keep an eye on prices to make sure she's getting a fair deal. "The price of corn is usually derived from the Midwest with transportation costs factored in, so I use the Internet to make sure that the local suppliers aren't over pricing it. Before I never really had a good feeling about what the going prices were."

BUYING THE FARM (EQUIPMENT)

Just as farmers like Windecker use the Internet to purchase vitamins and feed, many also go on line to buy fertilizer and even heavy equipment. Farmbid.com, DirectAg.com, Farms.com, and other sites give farmers access to everything they need to run their businesses. They also create virtual co-ops to give the little guys the same buying power as the largest commercial growers.

Jim Spencer has owned and operated 125-acre Pond Hill Farm in Harbor Springs, Mich., for about 20 years. Recently he, too, has turned to the Internet and e-mail to track down hard-to-find farm equipment.

"I'm too big to be small, but too small to be big," he says. While 125 acres is nothing to sneeze at, Spencer has his land subdivided into several smaller plots. He needed more than his small tractor to help him harvest his limited grain acreage, but he couldn't warrant purchasing a full-sized combine. He searched everywhere for a small tow-behind combine, but all the manufacturers he called told him they didn't make them any more. Frustrated, he finally posted an e-mail to several agricultural newsgroups. Responses came in from all over the world ­ all telling him he'd never be able to find it.

Finally an e-mail came from a farmer named Billy Scholtz in South Africa. It seemed that after the U.S. Congress embargoed trade to South Africa in 1986, the country had to start producing its own farm equipment ­ including these small combines ­ to maintain it's agricultural industry. Scholtz tracked down the equipment and had it flown to Pond Hill.

PUSHING THE PRODUCE

While Spencer was amazed by the response that he got from those news group postings and thrilled by the fast friendship he forged with Scholtz, he says the biggest boost he has gotten from the Internet has been in helping him market his business.

"I don't care how good your produce is," says Spencer, "if you don't market it, you won't sell it." One of the main structures on the farm is a 2,000 square foot farm store, and that's where Spencer sells all of his fresh produce, cut flowers, eggs, and baked goods. But, as he puts it, "my wife has a serious canning disorder." Pond Hill has an extensive list of canned good, preserves, chutneys, pickles, and syrups that it markets ­ primarily via electronic newsletter.

What started out as a handful of local customers asking for updates has turned into a list of people from across the country and around the world. These e-mail newsletters include the usual ­ recipes and lists of new products ­ but more often than not they are just invitations for customers to have a little fun.

"Balloon Wine," "Rhubarb Fool," "How to Gain 20 pounds in Q4," and "Wassail," catch the eye and supply readers with recipes, a little cultural information, and, obviously, humor. Readers were recently invited to name the latest additions to the farm family (a cow and her calf) and updated on the battle with the white tailed Deer. Each newsletter links the subscribers back to the Pond Hill Web site (www.pondhill.com), where they can then browse through recipes and the product list.

The newsletters have helped Spencer combat the Winter slump with the sale of canned goods, and his greenhouse helped him extend the seasons a bit, but he knew there had to be additional opportunities to boost off-season sales. Farming is seasonal, and most small farmers make the bulk of their money in the Spring, Summer, and Fall, then ride out their profits into the next year. It occurred to Spencer that wreaths and garlands made from the evergreens in his forest might be just the ticket to solve the winter slump. A newsletter went out, the orders came in, and the endeavor was a success from the very beginning. And not one dime was spent on advertising.

FINDING ROOM TO GROW

Spencer's newsletters work well for selling directly to consumers, but many farmers deal with much larger quantities. The effect of new technology is just beginning to be seen in these bulk deals. Two years ago, Nancy Matheson and two partners, Jonda Crosby and Max Milton, purchased 26 acres in Helena, Mont. Most of the land is currently dedicated to alfalfa, which is sold as hay in both organic and traditional markets. However, the partners plan to turn more over to high-profit herbs and spices. To do that, they need to find new sales outlets.

Matheson often roams around the health food store looking at product ingredient labels to see which companies are using the millet, buckwheat, coriander, milk thistle and other medicinal herbs, spices, and specialty grains that she and her partners are growing. She then goes home, launches a search on the Internet, and comes up with the company's home page. This process ­ while it takes advantage of the Internet ­ is not all that different than it was a few years ago.

"A lot of the companies have a whole listing of the things they are buying and selling," says Matheson. She pulls the contact information and places an initial phone call. "Then I can either sell them my herbs to use in their products or wholesale to them."

But Matheson has also found a new breed of Internet-based agricultural product traders that act as electronic versions of green markets. One such service, Foodtrader.com, brokers a wide selection of products including organic herbs.

Similar sites include Localharvest.org, which puts customers in touch with local farmers. "If there's a customer in Helena, Montana, that wants to buy their food and medicinal herbs locally, they can go on line and identify their local growers," Matheson says. "I think there are increasingly going to be consumers who want to put a face to their food and know where it's coming from, and who want to support local farmers."

With big players getting into the game to support small farmers, and the Internet making it all happen, things are looking up for small farms. In other words, the good old days are now.

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