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Discussion Starter #1
We just got our steer back from the butchers and have some friends and family wanting to buy some beef from us. He was a year old Guernsey steer raised purely on hay, pasture, and nursed until the day he left. We got the standard cuts of roasts, steaks, and ground.

How do you figure out pricing per pound? We don't want to charge something no one is willing to pay, but don't want to undersell what we have either.

Claire
 

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I start by figuring what I want for the animal on the hoof (usually $1/lb). Then I add in processing, transportation costs, freezer costs, etc. That gives me a average cost per pound of meat.

I have a spreadsheet I made where I list all the different cuts, the weights of each cut, the price I'm thinking of asking for it, how much profit/loss I will make on that particular cut and how much I will make when I sell it all at that price.

I like my spread sheet because if something is not moving, I can change the price, punch it in my spreadsheet and see how it will affect the whole picture. I do not worry about a cut selling at a loss, as long as the entire animal works out to a profit that I like. If I tried to make a profit on soup bones, they would sit in my freezer forever! I also have my hamburger priced at a slight loss, but it moves it out fast. That allows me to get more steers done, so I have more steaks, which are a very high profit item.

I went to the two grocery stores in town, got all their prices and started with that in figuring mine. You can go up from there, if it suits you.

I am real close to the stores on many things. I am still making $200-300 more per animal than I would at the sale barn (even considering the processing,etc), with prices as high as they are now. When sale barn prices drop, I do not plan to lower my prices and my profits will increase. The whole idea for me was to have a more predictable income...not be dependent on the commodity prices. Selling my own gives me more control of my income.

It is tempting right now to price myself very high and I've had some people suggest I do so. I have 100 calves. I'd rather make $200-300 more on each of them than make an extra $1000 on one! I need to sell VOLUME!

Plus, the beef brings customers who are more likely to buy other meat from me. My profit is greater on pork and chickens.

This is probably more than you wanted to know, but that's how I do it.

Jena
 

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Discussion Starter #3
Thanks Jena, that helps a lot. I found two farms in our area with similar products, checked prices against the grocery store, and then came up with prices I thought worked.

All the steaks are between $4-$10 per lb.
Roasts are between $4-5 per lb.
Ground is $3 per pack, in one pound packs, cheaper then what is in the grocery store this week!

We don't want to sell all of it, but need that freezer space and some money would be nice to help pay for the winters hay for our milk cow.

Claire
 

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Jena, dealing in volume as you do, do you have a formal store on your farm? If so, what hours do you keep, and why? We're selling dairy off our farm, by appointment, its a pain in the ***, and I'd like to move to something more structured.

Thanks,
 

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shelbynteg said:
Jena, dealing in volume as you do, do you have a formal store on your farm? If so, what hours do you keep, and why? We're selling dairy off our farm, by appointment, its a pain in the ***, and I'd like to move to something more structured.

Thanks,
I started going to farmer's markets this year and sales zoomed. Those will be over soon, so I've decided to make my own. I arranged to sell from a vacant lot on the main drag of town on Saturdays and Thursday evenings. I'm working on doing the same thing in some neighboring towns. I think it will work, but time will tell.

I chose those hours to get the Saturday shoppers and the "won't go near wal-mart on the weekend" folks. My Thursday hours will be 3-7 to catch people getting off of work, coming into town to get kids at school, etc.

I've been doing the "by appointment" thing (call me and I'll meet you at the house), but I agree it's troublesome.

I considered building a store on the farm, but the vacant lot thing is cheaper (by far). Also it's more convenient for customers. They don't have to drive to the country and with retail...location can be everything! I don't want the overhead of renting/buying a shop in town. If I did, I'd probably keep varying hours, but limited to 4 hours a day (like 8-12am on Mon/Wed, 3-7pm on Tues/Thurs...something like that).

You could set hours for pick-ups and just take orders over the phone to fill on that day.

Jena
 

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Jena said:
I considered building a store on the farm, but the vacant lot thing is cheaper (by far). Also it's more convenient for customers. They don't have to drive to the country and with retail...location can be everything!
By law, raw dairy has to be picked up at the farm here in Tx., so for now, I'm required to have the customers driving to us. I encourage them to contact one another, to share driving, etc.

I realize that I'm afraid -- if I set hours, then I'll lose sales, because it won't be convenient. Any feedback on this?

I have wondered about leasing some roadside pasture much closer to town, throwing some animals in it, and calling it a part of the farm, regulators would fight with me, no doubt, but it might hold up in court...
 

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MacCurmudgeon
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We are toying with the idea of constructing a small building here at Wolf Cairn Moor with a couple of refridgerators in it for egg and milk customers.

We have quite a waiting list of folks wanting raw milk and it is inconvenient to wait around the house when customers are late showing up for their milk. I can't imagine what a hassle it would be to wait around for an increased number of folks after more of our cows freshen.

We would just put a can in the small building for milk and egg money. Everyone has their own glass jars and return their washed empties so we don't really need to talk a whole heap at every purchase.
 

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The "honor" system is a good one, if it will work in your area. I'm pretty sure it would work here, but since I have a tenant at the farm, I didn't want him to have to deal with all the people coming and going.

Setting hours might result in less sales, but you have to do what you can. One thing I am really bad about is over-doing customer service to my own detriment. It's good to meet customer needs, but your needs have to be considered as well.

If your product is quality, in demand and hard to find....your customers will adapt. You could lose some, but who knows.

Whenever I am going to make a big change, I ask the people who matter...the customers! Call a few and ask them what they think. They can also help you set the hours or other parameters according to what would work for them.

Jena
 

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MacCurmudgeon
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You already know that this selling milk is new for us, my family always had milk cows when I was growing up, Herself and I have kept milk goats, but we have never sold milk or eggs. Our family was large and ate all we could glean from our various homesteads.

I like selling milk and eggs, and we are fortunate in that we don't need the money; though it does help defer the cost of feed. Herself teaches, I have a good retirement, we don't owe any debts; but we do like being able to provide wholesome farm produce to those who don't have the wherewithal to do these things for themselves, and it gives this retired old curmudgeon something to do to keep from rusting away.

I think the honor system would work here at Wolf Cairn Moor. I don't leave the farm more than once every month or two, and then just for the few minutes it takes to run to town to see a doctor or sign some paperwork.

I does depend a lot on one's customers, but 99.999% of people are honest, and the other .001% want to be.

We hope that selling milk and eggs will lead to an customer base for the little beef we will have for sale once the cows start producing.
 

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Dutch Highlands Farm
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Lots of good information here, but I don't think it pertains all that much to the question. Here is the price scheme I used to sell off a 1/4 beef I didn't need for my own use. Ground beef $3/lb (which is what I charge for whole 1/4's or 1/2's plus slaughter, cut and wrap) Forequarter cuts $4/lb, Hindquarter cuts $5/lb. If I were ever to sell the tenderloin or rib steaks they would probably go for $7/lb.
I find these prices are fair to both sides, I get a good return on my animal and the customer gets a good price for grass fed beef which sells in Seattle for about twice what I charge.
 
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