Top crops for profitable wholesaling
publication date: Oct 1, 2018
Those of you who read my last article in the May 2018 Growing for Market remember that the method we use to evaluate the potential profitability of our crops is to calculate the “unit cost” for each crop - that is, the minimum price we would need to receive in order to pay all of our expenses and ourselves. Calculating unit cost also provides us with the ability to compare the relative profitability of each crop by comparing each crop’s net margin (Net margin = (Price received - unit cost) / price received).
This is especially important for growers who want to break away from dependence on the five typical mainstays of small farm marketing - farmers markets, farmstands, CSA’s, natural foods stores, and fine dining restaurants. These markets tend to be less price sensitive - that is, they tend to absorb increases in price with relatively little effect on volume. But, as these markets become saturated, small growers find themselves looking toward more mainstream markets, such as larger grocery chains or midpriced restaurants.
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