In times of uncertainty, value-added products can add some stability for farmers.
As producers consider adding value to their dairy by diversifying into on-farm sales, Lolly Lesher, owner/partner in Way-Har Farms and Way-Har Farm Market in Bernville, Pennsylvania, recommended farmers consider several factors, including consumer preferences and the amount of time you are willing to spend on the business before jumping into a value-added enterprise.
Professional Dairy Producers of Wisconsin Executive Director Shelly Mayer said that since the onset of the coronavirus pandemic, she has been hearing from more dairy farmers interested in value-added opportunities.
“It’s not just this year with COVID that we’re thinking about some of the value-added and on-farm opportunities that we have to diversity our portfolio of income as well as engage more with our customers,” Mayer said during a Nov. 4 Dairy Signal webinar. “I have heard over and over from dairy farmers that are looking at value-added, if it’s selling flowers, selling beef, starting an on-farm store, getting more engaged with the customer.”
Lesher and her husband own and operate Way-Har Farms, where they have had an on-the-farm retail operation for 50 years. They milk 250 cows on the farm. They also process and manufacture ice cream, bottle their own milk, and make a fresh cream product and cheese curds. They are working on adding a sour cream that will be introduced in the coming months, she said.
“We’re trying very hard to expand our horizons and provide our customers even more fresh dairy products,” Lesher said.
Lesher said they put a priority on food quality and safety and recommended working with inspectors to stay on top of rules and regulations.
“Anybody that’s getting into retail has to like working with people, whether it’s employees, inspectors, customers,” she said. “You have to be a people person to get into this business and make it successful.”
Prior to the onset of the coronavirus pandemic, Way-Har Farm Market sold to about 70 restaurants, campsites and bakeries. They have two delivery trucks that were on the road four days a week making deliveries.
Once the pandemic hit, that customer base changed dramatically, Lesher said.
“I really struggle now with what our new customers are going to look like,” she said. “For a while, everybody was happy to come to the farm market and buy direct. April, May, June, it was a hay day, pure pandemonium in the middle of the pandemic here at Way-Har.
“But it’s really backed off now. Consumers, I think, are getting back into more cyclical buying. People who come into our farm market now are people who it’s convenient for who are driving by. Consumers were looking for a place that’s smaller where they felt their risks were lower, compared to going into a superstore where they would see hundreds of people whether they wanted to or not.”
Lesher said they decide on new products by following trends and taking suggestions from customers. She also said coffee has helped them move a lot of milk with products including a mocha-flavored milk.
“Coffee has been the greatest asset to the milk industry in the last five years,” she said. “Everybody has a suggestion.”
Kara Kasten-Olson, owner of Little Farmer Meats and ag program supervisor at the Wisconsin Department of Agriculture, Trade and Consumer Protection is newer to the value-added industry, having started Little Farmer Meats several years ago.
Little Farmer Meats is home to 90 pigs, 50 steers, 300 broiler chickens and 70 layers, Kasten-Olson said. Each year she and her husband bring in feeder pigs and steers and raise the animals, and they just moved the feeder animals onto a larger farm this year.
Kasten-Olson said she and her husband both grew up on dairy farms and had been selling meat to family and friends. About four years ago, they began direct marketing beef, pork and chicken to consumers.
“It’s definitely blossomed into a much bigger business,” Kasten-Olson said. “It still is technically my side job, night and weekends, but it definitely is taking up more time.”
Kasten-Olson said one of their biggest challenges has to balance growth of the farm and consumer demand with their ability to get their meat processed.
“We are limited by the appointments we can get at our butcher,” she said. “We’re booked through the end of 2021 and into 2022. It’s hard to balance growth and demand when we’re limited by a piece we can’t really control.”
Kasten-Olson said before jumping into the direct-to-consumer market, she and her husband took a look at what other direct-marketers were charging to set their prices, but they also wanted to be sure to keep prices reasonable for consumers.
“It’s very important for us to provide an affordable product for people,” she said. “We want to make a decent amount, but we want people to be able to afford our product as well.”