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As you plant the seeds for this season’s produce, are you considering how you’re going to keep it all cool in the heat of the summer?

Chris Callahan, UVM Extension Ag Engineer, has been fielding a lot of questions recently about CoolBots(TM), a DIY system for cooling farm products.  He compiled his information into a blog post which you can access here– http://blog.uvm.edu/cwcallah/2013/03/20/coolbotstm-inexpensive-cold-storage/.

If you want to keep up to date with the latest engineering innovations for VT scale and diversified farms, subscribe to the UVM Extension Ag Engineering Blog!  Check out other Ag Engineering resources and links on the UVM Extension Ag Engineering webpage.

Grants for Farm Record Keeping Systems : Part 1

UVM Farm Viability is pleased to announce current work on a special round of mini-grants for improving farm record keeping systems. With funding provided by the Northeast Center for Risk Management Education (RME) and the United States Department of Agriculture, 10 VT farms are receiving $200 – $400 to work with private consultants to improve their records systems.

Here is a short list of the projects underway. By fall 2013, UVM Extension will be coordinating workshops and webinars to show-and-tell how these projects went and what other interested farm owners can learn.

1.     A diversified farm is setting up their Quick Books accounting system to organize the income and expenses for the 3 core enterprises on the farm: beef, honey and maple. When the project is done, in addition to producing the regular whole farm profit and loss statement, they will be able to click a button and see how all 3 enterprises performed side by side. This will tell them which enterprise is making the most money and how it compares to the others.

2.     A beef farm is working with a processor to set up the  scale system at the processing facility to create an inventory sheet of the specific amounts and cuts that were produced, packed and labeled there at the facility. This project will provide detailed information on carcass yields and it is going to greatly simplify inventory management of all that beef.

Follow this link to the UVM Extension Farm Viability Blog, it takes you to the full length audio clip from a local radio broadcast about this grant program.

http://blog.uvm.edu/mcannell/resource-library/

Outdoor Farmers Market Season is coming!

Spring is in the air, which signals the return of the outdoor farmers market season!  I know I am excited to take my daughter to our local farmers market and enjoy the great products and people there, (and the warmer weather!) If you are a food producer or processor, farmers markets are a great way to connect directly with customers, increase sales and get feedback from your customers on products.

WAgN and the Vermont New Farmer Project provide excellent resource materials and training opportunities that can help you to assess various market opportunities and to price and promote your products in venues such as farmers markets.

In addition to pricing and promotion of your products, you also need to follow food safety best practices and produce and process your food products according to the rules and regulations set by the Vermont Department of Health and the Vermont Agency of Agriculture, Food and Markets. Not only will this guarantee that products are as safe as possible, it also will assure your customers that your business, as well as the entire farmers market, has product quality and safety in mind.

UVM Extension has published a series of “Food Safety for Farmers Market Vendors” factsheets, which help to clarify the various regulatory requirements, and also list the recommended best practices to ensure the safety of the various types of food offered at farmers markets. A webinar presenting much of this information, as well as additional resources is also available.

Some of the key best practices for food vendors selling at farmers markets include the following:

–Cook, transport and hold foods at the proper temperatures to prevent rapid bacterial growth. Hot prepared foods must be held at 135 F or higher, cold perishable foods from 32 to 40 F and frozen foods at less than 15 F.

–Reduce possible cross-contamination, which can transfer bacteria from one food to another. For example, be sure that raw meat does not contact ready-to-eat food or fresh produce.

–Practice good personal hygiene such as clean clothes and hands to prevent transferring bacteria to your food.

Vermont does not currently have any regulations for offering product samples. However, if you do hand out samples, be sure to do so in a sanitary manner. Only put out small amounts at a time and always keep perishable foods hot or cold, as appropriate.

In addition to following the practices listed above, farmers market vendors must comply with certain key regulations including that all products sold must follow proper labeling and temperature requirements. In addition, ingredients or foods used to prepare food for market must be from safe sources.

You also might be required to have a license, depending on the products you plan to sell, your annual sales or where you prepare the food.

Following these best practices and recommendations will help to protect this valuable outlet for Vermont’s local products and ensure that everyone has a pleasant and safe farmers market season.

Information on upcoming food safety training courses, webinars, fact sheets and resources on this and other food safety topics is available from the UVM Extension Food Safety website.

Enjoy Farmers Market season!

Five Things Your Customer May Never Tell You

You see her every week. A great customer, loyal and regular. Then a couple weeks go by and you realize that you haven’t seen her at your stall recently. Or you glance across the isle and notice her at someone else’s stall and carrying some bags. Or you notice that she comes by often and looks around but never quite gets around to purchasing anything. Hmmm…what could these behaviors mean?

While some customers are very good at communicating, most of us prefer to avoid awkward, uncomfortable and/or confrontational situations whenever possible. So you might find yourself in the position of having to read minds.

Here are 5 things customers might be reluctant to share:

• 

  If a customer is unfamiliar with a product they may be reluctant to buy it.

  I don’t know what this is! No one wants to appear ignorant so most customers will never bring the celeriac (or kohlrabi or blood sausage or ??) over and say ‘what in the world is this?’ If you want to sell these items you need to have a label stating the name clearly (a guide to pronunciation helps too) and a short description of what to use it for, what it tastes like and what other foods pair well with it.

• I found a better product somewhere else. Quality always matters and customers generally do not like to give you bad news. What you are likely to observe is reduced repeat sales. What can you do? Post a ‘money-back guarantee prominently so customers know that you want to hear when a product is not meeting their expectations. Remind customers that you want to hear feedback. And when you do get feedback resist the temptation to be defensive. Provide a suggestion box so people can comment anonymously.
• Your product tasted/smelled/looked funny when I finally got around to trying it.
  

  The more you communicate about what a product should look, smell and taste like the more likely they will be to have a positive experience.

This is another tricky situation. Some customers will return a product and try to get a refund but other customers will just throw the product away and say nothing. You may never know there was a problem. A bad experience could be the result of spoilage or it could be that the customer was not prepared for what to expect.  The best strategy is to provide use and care instructions. Have a binder available that provides basic information like how to store the product, what parts are edible and how long it will keep.

• I can’t spend money on an expensive item for just one recipe. Many people are living on reduced incomes and they may have less disposable income to spend on food. If they perceive that an item is a specialty item they may choose to pass it by. As the vendor it will serve you well to try to promote multiple uses for your products. For example if you are selling sausage, a package may contain more servings than the customer needs so it’s a good idea to offer some tips on how to use leftovers. For example, ‘after breakfast brown up the remainder and freeze as a pizza topping or add to pasta sauce’.

• My financial situation has changed and I’m embarrassed. Be tactful and observant. If a regular customer suddenly changes their buying habits it is fine to ask if they have experienced some problem with the product. If their answer is vague or they don’t respond just let it go. You provided an opportunity and the rest is up to them. Chances are that if sales stay strong among other customers it is not a product issue.

It is costing me quite a bit of money to get my farm started; can I claim some of these expenses as a business deduction?

Yes!
If you look at IRS Publication 225, Farmer’s Tax Guide, you can read the details. Chapter 4 describes Farm Business Expenses, one section of the chapter describes Capital Expenses (in the 2012 version of Pub 255, this is on page 25). In this chapter are instructions about how to deduct up to $5,000 of start-up costs in your first year of business. In addition, you can deduct up to $5,000 of organizational costs. If your start-up costs are over $50,000 you begin reducing the amount that you can deduct in the first year, and if your start-up costs are over $55,000 you cannot deduct any start-up costs.

Any start-up costs that you cannot deduct in your first year of business, you must amortize. IRS tells us (in Chapter 7 of Pub 225, page 47) ‘amortization is a method of recovering (deducting) certain capital costs over a fixed period of time. It is similar to the straight line method of depreciation.’ IRS says that start-up costs must be amortized over 180 months, 15 years. So you would divide your total by 15, and add this amount onto your depreciation using Form 4562.

Please study these 2 sections of the Farmer’s Tax Guide in order to account for these costs properly. IRS Publication 535, Business Expenses, Chapter 8 Amortization, describes this in further detail.

The Tax Topic article, Start-Up Costs, on www.ruraltax.org goes into the unusual question of ‘when did your farm actually begin?’ This sounds obvious, until you start to think about it some. An easy date to pick is the date you registered with the Secretary of State, or received an Employer Identification Number. But it is not always quite that easy.

New Spirit Farmland Partnerships Branches Into New England

As agricultural service providers, we are always intrigued by innovative models enabling farmers to acquire farms.  Farmland investment is one intriguing emerging option.   A new entity, called Northeast Farm Access, has formed to facilitate farm investment partnerships and farm access in the Northeast:

New Spirit Farmland Partnerships and Northeast Farm Access are currently seeking organic farmers in New England and the Hudson Valley who need access to additional land to sustain or grow their current operations. Our social investors will purchase the land you need and provide you with a long term lease and right of first refusal if the farm comes up for sale. An option to purchase will be available under certain circumstances. If you are an established farmer or grower with a good track record we encourage you to apply. If you are a farm owner selling a farm to a farmer with an established business, this may assist you as well.

 

Key criteria for farmers include:

5 years or more track record as a farm business;

Need additional land, but generally not a home farm;

Able to pay a rent roughly equivalent to 4% of the purchase price of the land.

 

In you are interested please provide your information at https://www.surveymonkey.com/s/FarmlandAccessApplication, also on the New Spirit Farmland Partnerships website at www.newspiritfp.com.

 

If you would like to discuss the program by phone, please call Michelle Russell any Monday –Thursday between 2:00 p.m. and 5:00 p.m at 603-547-0893.




     New Spirit Farmland Partnerships has been pioneering these types of arrangements in the Midwest for the past couple of years.  Many other entities have been pursuing farmland investment as well.  According to this article, TIAA-CREF, one of the largest pension funds and money managers in the world, holds $4 billion in agricultural assets around the world, and recently established a Center for Farmland Research at University of Illinois to focus on farmland investment.

     New Spirit points out on their website that its approach is different:  “Other farmland finance companies, even those with an interest in organic farming, are  often focused on and driven primarily by investor priorities. We instead seek people who desire to have a social impact with their capital and align their interests with farmers and rural communities.”

     It remains to be seen whether large investment firms like TIAA-CREF will buy up farmland in the Northeast like they have been in the Midwest.   Many analysts believe land prices in the midwest could be near a bubble ready to pop, in which case investors would scatter, land values could plummet, and farmers could see their debt relative to the equity they hold skyrocket.    This recent NY Times article, “As Crop Prices Surge, Investment Firms and Farmers Vie For Land” points to potential negative ramifications.

     The typical farmland investment arrangement involves an investment entity holding land, and the farmer leasing, paying annual cash rent to the investment entity.  But variations of the model exist.  Some provide farmers a secure path to land ownership in a way that conventional credit might not do.  For example, the Northeast Farm Access announcement posted above mentions, “ An option to purchase will be available under certain circumstances.”   As this quick article from U. of Missouri Extension explains, the lease-option can present a unique opportunity for eventual transfer of ownership.

     We published the Guide to Financing the Community Supported Farm last year for farmers.  For more background on farmland investing, and considerations for dealing with farmland investors, see Chapter 4.  More is sure to come on this subject, as more entities like New Spirit make their way east.  We anticipate farmers will welcome them, as long as their true needs and those of the land are taken to heart.

From Greece to Grains

Elizabeth Theriault, Community Engagement Coordinator for the Rutland Area Farm and Food Link (RAFFL) recently visited Gleason’s Grains. Here’s what she learned.

From Greece to Grains.