Growing crops and raising animals is hard. I struggle with a garden every summer. I enjoy doing it, but it also reminds me of how hard it is to grow a sustainable amount of food. The ability to turn a seed into a marketable crop requires a lot of skill, being able to do it profitably is even harder.
This week on The Grower and the Economist, Peter and I talk about "what to grow" and how that mix has changed because of the coronavirus. Many small and medium-sized growers sell to a restaurant or sell through a farmers' market. With those options offline, growers need to sell to different people which may require different produce.
Good vs Interesting
Peter starts the conversation by explaining that growers can either plant what they are good at or what they are interested in. Some growers are great at growing large, fragrant tomatoes, so they might only grow tomatoes. Others might try something new. Maybe the grower has been reading the news and sees that Arizona lettuce production is offline right now because of coronavirus, so if she grows a lot of lettuce, she can make a nice profit because of high demand and low supply.
That math makes sense. However, it's risky. If you only have lettuce and you can't move it, then you will lose a lot of money. Peter calls this "growing on speculation". You will learn during this episode that Peter is not a speculator, but his brother is. Instead of speculating, Peter likes to hedge his bets. He prefers many culture to monoculture. Grow a few things. Some that you are good at and others that are a challenge but might be very profitable.
Sell Out vs Grow Long
The next concept that Peter covers is the idea of selling out or growing long. If you sell out, you sell everything you grew and probably shorted a few customers along the way. If you grow long you meet the demand of all your customers and everyone got what they wanted.
I think about it in terms of a dinner party. Are you going to minimize food waste and only provide enough food for your guests or are you going to make sure that everyone gets exactly what they want and you discard the excess food that isn't eaten?
The answer might depend on who your client is. The answer you used last year, might not work this year because your clients are different. It's important to think through what you are considering growing and what your customers want. Crop selection is not done in a vacuum, ask the marketplace what they want!
Listen to the entire podcast here.