Any farmer who wants to increase their output and generate more revenue must find ways to scale their business. Going door-to-door just won't cut it if you want to increase your earnings in any significant way. If you want to earn more money as a farmer, you need to reach out to wholesale produce distributors.
This is the natural next step for any local farmer who wants to grow their business. There are countless opportunities to earn money with wholesale distribution today. Locally-grown produce is in high demand because consumers want to know where their produce comes from. In fact, when grocery stores use industrial producers, consumers are often disappointed when they find out their food isn't grown locally.
You can hop on this bandwagon and start earning immediately if you follow a few guidelines. With that in mind, here are tips for farmers to sell wholesale produce to distributors.
Understand the Five Rules for Successful Wholesaling
Farmers who transition into successful wholesalers generally follow five rules to get where they want to be. The first rule is to learn about the different wholesale distribution channels and what motivates wholesale retailers to sell local goods.
Next, you need to make sure you have a recognizable brand that lets consumers know that their food is from a local growing operation with a rich backstory and history. Then, you need to find the best wholesale vendor for your farm. Once you find your vendor, price your products competitively to be more attractive to consumers, but make sure that the price is still profitable.
Finally, pack up your produce and deliver it in a manner that is acceptable for wholesaling. Following these rules will guarantee that your business is on the right track towards success.
Learn About the Different Channels for Selling Local Wholesale Produce
Before you can start selling your produce to vendors, you need to research wholesale distribution channels that could work for your business. Some examples could include selling directly to local restaurants and chefs or finding a chain of grocery stores to sell your produce. Another popular method is working with a farm cooperative or a regional distributor.
Farm cooperatives work with numerous farms to sell their produce to wholesalers. Regional distribution companies will pick up produce directly from farmers and deliver it to wholesalers.
Whichever route you decide, understand that wholesaling will put a middleman between your farming and the consumer. This changes the relationship you have with your customers because you need to have excellent branding for consumers to identify your business.
The Importance of Branding Your Produce
Since you aren't selling your produce directly to consumers, branding is essential because it lets your customers know that their food comes from a local producer. Ultimately, wholesale distributors are only interested in what consumers demand, so you need to persuade customers to seek out your produce.
If consumers aren't aware that your food is local, they might see your products as just another industrial product. Instead of going with bland packaging, you should purchase mesh produce bags wholesale
and place an easily identifiable logo along with a company backstory on each bag. That way, consumers will feel that your brand is more relatable and trustworthy.
As for restaurants and chefs, they might not be interested in your family history, but they will want to know where their ingredients are coming from to ensure quality control and so they can put this information on their menus. As a farmer, you should invest some time and effort into increasing the quality of your packaging so that your brand stands out. In addition to a high-quality logo and backstory, you may want to include photos of your farm so people can get a better picture of where you make their food.
Search for the Best Wholesale Distributor
After finishing your research and developing a stronger brand for your farm, now it's time to choose the best wholesaler for your farm. The first thing you want to ask yourself before deciding on a wholesaler is if they can deliver your items. If so, see how often they can carry out deliveries.
These questions are important because many wholesale purchasers won’t work with you if you don’t have a refrigerated truck or delivery van. If this is the case, then you will want to work with a regional distributor or farm cooperative so that you can focus on growing fresh produce and not the nuances of supply chain management.
Distributors are usually interested in picking up inventory directly from a farm only if you grow enough produce to make it worth their while. However, other distributors will want you to deliver your produce to a warehouse on a particular timetable.
Cooperatives will collect produce from numerous farms and compile them at a local facility. Farm cooperatives have the lowest barriers to entry for wholesale distribution because they will deliver your produce, attract wholesale buyers, and store your produce in a refrigerated facility.
However, one disadvantage of working with a cooperative is that you will be competing with other farmers who might be growing the same types of produce as you. In addition, cooperatives charge a fee for their services, so you must consider that when budgeting.
Price Your Produce Competitively
Pricing your produce competitively is difficult as a farmer because when you enter the world of wholesale distribution, a lot more hands are taking from the pile of cash that used to go directly to you. Nonetheless, entering a profitable relationship with a wholesale distributor could lead to even more profit than you would earn during an entire season of farmer’s markets. The higher the sales volume, the higher the profit, but you will have to learn more about competitive pricing if you want to play ball.
First, you need to determine your cost of goods sold (COGS) so that your price will cover production costs. Then, you will want to survey the competition and see different price points for products that’re similar to yours. You can do this by checking the prices at your local market or requesting it from distributors.
You could also reach out to potential wholesale buyers and see which price points work for them. Consumers perceive the value of local products to be higher than non-local ones, so you can reflect this with your price. Also, certifications and labels that identify organic food will increase the value of your produce.
When all of this is said and done, you are ready to start shipping your produce to wholesalers! However, you must ensure that your packaging is appropriate for wholesale distribution because it is vastly different from selling produce at a local farmer's market. By following these tips for farmers to sell wholesale produce, you can be well on your way to having your most profitable farming season yet!