Cost of Doing Business

My ideal vision for the future of farming includes vibrant farms at all scales, in urban and rural areas. But the census data has shown over time that large farms (over $1M in sales) and very small farms (less than $10K in sales) are the only two segments of the farm demographic that are growing. Those “farms in the middle”—viable but small family farms–are disappearing. There are so many contributing factors that I can’t go into them all here, but I will describe to you my personal experience with one of them: “one size fits all” regulations that challenge innovation in farm businesses. Across all types of farming, from meat to produce to dairy, adding value to farm products is an important way for a farmer to make more money. But when regulations are developed for industrial-scale food processors, with no exemptions for smaller producers, the results favor massive businesses with deep pockets.

Our NY growing season is short and intense, with a massive abundance produced in a concentrated period of time. Preserving this harvest by making jams, ferments, candies, or syrups to sell is a way for farmers to add value to crops and extend the marketing season for them.

Last Summer I grew a surplus of baby ginger. I froze what I didn’t sell immediately, and decided to turn it into ginger syrup and candy to both extend the season and diversify our products. I made many batches of both, to give as gifts and for my family to enjoy. I began to research what it would take to turn it into a part of our farm’s product lines, and from the information I read (in the Guide to Farming in NY, a publication produced by my employer, the Cornell Small Farms Program), it seemed reasonable. How hard could it be? Maybe you’ve read enough of these articles by now to know that when I’m asking that question, I’m in for a wild ride.

I hope for your sake you aren’t familiar with federal or state food safety policy, because it does NOT make for stimulating reading. I will summarize for you here what the state and federal government required me to do in order to make and sell ginger syrup on a micro scale, mostly to neighbors and friends:

  • Write up my process for making this “acidified product”–I add lemon juice to it–and send the recipe with a sample to the Food Venture Center in Geneva. Pay $105 to have them write a “Scheduled Process”, which is basically a fancy version of a recipe, listing critical control points for producing a safe product.
  • Obtain a pH meter (since pH was listed as one of my “critical control points”) for $30 and pH calibration solutions for another $25.
  • Locate a commercial kitchen to rent since I’m not allowed to make an acidified product in my home kitchen – price per hour varies depending on the kitchen. I pay $50 for a 4-hour time slot.
  • Pay the NYS Dept of Ag and Markets $400 for a 2-year license to make processed foods.
  • Get inspected by NYS Ag and Markets while making the ginger syrup at a rented kitchen space. At least I don’t have to tip the inspector!
  • Pay another $400 to attend a full 2-day “Better Process Control School” to ensure I can safely make acidified foods. Thank you, FDA, for this extra step.

Are you still with me? I strongly considered bailing at the last point, except that I only learned of this requirement during my inspection (see step 5), for which I had already paid $400.

  • Purchase packaging for the product, and design labels with all legally required information – for another couple hundred $$
  • If you want to sell at the Ithaca Farmers Market, the product then has to be approved by 2 separate committees, and recommended to the full board for acceptance. Thankfully this doesn’t cost anything, and is only a requirement of the market’s Board (not of the government), but is a trick to get scheduled!
  • Modify recipe to include more honey from your own farm, to accommodate Ithaca Farmers Market requirements about the percentage of a product that must be grown on the farm. Go back to Step 1, submit a modified recipe to the Food Venture Center, and pay $37 for a new Scheduled Process.
  • And if your 9-year-old daughter wants to take your fully-approved ginger syrup and add fizzy water to it, to sell as ready-to-drink homemade ginger soda at the market, you must get separate approval from the County Dept of Health and pay $100 for the privilege. The price of the permit is high enough that it negates any money she would have made selling the sodas, sending her back to the drawing board for ways to earn money. So much for the old-fashioned kids’ lemonade stand!

The real kicker is that you must jump through all of these hoops BEFORE you are able to market test your product, so once you are legal to sell it, you just have to hope that people actually want it! Since I had already given away several batches of the candy and syrup to friends, I felt confident that people would like it, but unsure whether they would be willing to pay the prices I would need to charge to make it worthwhile.

Throughout this process I found myself asking often, “what’s the point of this step?” No one wants to cause harm to customers by producing an unsafe product. But why not have a middle ground of scale-appropriate regulations? It was only my sheer pigheadedness that got me through this expensive regulatory gauntlet to have a value-added product to sell on a micro-scale. When regulations are one-size-fits-all, they seriously discourage small entrepreneurs. Anyone want to take on the state Dept. of Ag to lobby for small farm exemptions? I’ll toast you with a refreshing glass of homemade, home-grown ginger soda.


2 thoughts on “Cost of Doing Business

  1. Wow, That is over a $1k just to sell a single product at a farmers market, CRAZY! Did it ended up being worth while selling it though (as in it was a hot seller)? Was your daughter ever able to sell her drink as well? Lots of questions but was one of the better articles I have read in a while about things most people don’t talk about at Farmers Markets, so thank you for that.

    Like

    1. Yes, the ginger syrup has been very popular, so I’m glad I made it through the whole licensing process. It was also very educational, and now I’m better set up to get more products approved, which is definitely a future direction for our farm. But I’m also advocating for policies that would simplify this process and even exempt the smallest producers from most of it. As for my daughter, she has only sold her ginger soda at 2 unofficial markets where the Dept of Health isn’t policing vendors.

      Like

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s