What is Your Competitive Advantage?

A few weeks ago  I heard this quote from a colleague at a statewide farm business meeting, “It appears that the  market for seasonally available, high priced, high “values” [ attributes like humane, eco-friendly, family farm), mediocre quality livestock products has been met across the state.” Wow! This was a clear message that the “eat local” boom of the past several years has evolved into a tighter and more competitive marketplace for farm business managers. How is your business strategy evolving to keep up with the market? It is essential to identify what your own competitive advantage is. What do you do best? Here is a short list of potential advantages for a successful farm business:

1. Breeds/Genetics: certain varieties of crops and animal breeds outperform others. Increased production can result in lower costs per unit produced. Identify the most valuable traits for you and acquire those genetics through purchase or breeding.

2. Labor Efficiency: a major expense on every farm is labor from people. Your ability to develop systems to get the most out of every work hour will help control costs. Look into ways to streamline procedures, adopt technologies to mechanize operations and create the best environment for productive staff.

3. Promotion, Sales and Marketing: If you excel at promotion and sales you will likely be able to find higher priced buyers that can compensate for higher costs of production back at the farm. Look at the selling skills of your sales team (you might be looking in the mirror), your branding and market research to find the best customers for you.

4. Product Quality and Service: It is not about having the “highest quality” product. Your job is to identify the quality/service expectations of each buyer and to meet them. Each buyer or outlet will have different expectations.

Take a step back, make sure you can translate a clear outcome that results from your advantage. Try to measure that outcome. How much is it really worth? Move forward by aligning your farming and sales strategy with your most valuable advantages to remain competitive.


About Mark Cannella

Mark is a farm business management specialist with UVM Extension based in Berlin, VT. He specializes in business planning, farm financial analysis and agricultural economics.
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