Local Is The Key With Greenhouse Produce
Area grocery chains and restaurants are key markets for Banner Greenhouses' expansion into greenhouse vegetables.
July 19, 2012
Jeff Mast of Banner Greenhouses says he began looking at growing vegetables in the off-season about four years ago. "The whole locally grown movement has been big in Western North Carolina for a good period of time," he says. "It seemed like there might be opportunity in that realm that we could pursue if we could match up the time periods in the years with those opportunities. Our goal was to diversify our product, diversify our customers, open up a new sales channel and hopefully cover some overhead costs in the off-season."
Mast and his staff had a lot to learn. Banner Greenhouses is predominantly a wholesale contract grower for the mass market — two seasons of annuals in spring and fall, although they also sell plugs and liners and unrooted ipomoea cuttings. "We tried quite a few things — green beans, pak choi, cucumbers, bagged herbs, strawberries, mini cukes, mini squash and mini melons," Mast says. "We looked at what would fit nutrition-wise, what fits with our irrigation system and, of course, where the volume is. Tomatoes and peppers are where the big volume is, so we worked with those." Mast originally sold the produce under the Banner name. Now he is selling through a distributor, using its New Sprout Farm label.
Find The Right Market To Increase Efficiency
Mast has since backed away from tomatoes, saying he couldn't compete on price. "You're competing regionally during the season and with California and then with Mexico during the off-season. It's a high-volume product for those guys, and it all comes down to commodity pricing," he says. "In 2011 we really went after the tomato business. We had really good volume and a beautiful crop, but the price was horrible." The pepper crop he’s growing right now includes red, yellow and orange bell peppers, which will be harvested during the summer and fall.
Mast has found a profitable marketing outlet with Whole Foods as well as with a local grocery store chain and a local distributor who works with restaurants. He says having a restaurant distributor is important since restaurants want small, frequent deliveries, which were inefficient for his operation.
Banner's rural location is not suited for a retail outlet, but Mast acknowledges that would be ideal. He also stresses the importance of finding markets that value locally grown food. "Our product is local, it’s grown pesticide free, vine ripened and has a great flavor — those are the merits," he says. He’s considering the advantages of becoming certified organic, citing some possible opportunities that might open up. "You can get a better price if you’re certified, but there are some upfront costs. We’ve found in some of our sales channels if it’s local, vine-ripe and pesticide free, it has just as much merit as being organic. We haven’t decided yet," he says.
Last fall, Banner became Good Agricultural Practices (GAP) certified. It's a voluntary certification but will open doors for business opportunities. "In the future a lot of grocery store chains are going to require you to be GAP-certified to sell to them, and the local school systems as well," Mast says. "And as part of the GAP process, we've learned a lot more and changed our ideas on handling and harvesting."
Develop Partnerships To Reduce Packaging Issues
As Banner started to get involved in vegetables, Mast got support from two important sources: his seed supplier, Rogers Seed, and the Appalachian Sustainable Agriculture Project (ASAP), a non-profit organization with the mission of helping North Carolina farmers convert from a tobacco-based economy to other products. ASAP helped with marketing and setting up meetings with buyers, while Rogers assisted with production information. "The main differences [from ornamental plants] are that irrigation is critical — the volume and frequency impacts the fruit quality — and the nutrition is completely different. Managing temperature and light was similar," Mast says.
The marketing, sales and packaging sides of the business have their own unique challenges. "Packaging and handling have been the largest obstacles we've had to work through," Mast says. "It’s a perishable product — it's got to move. You don't harvest the same quantity every week. For example, you're used to 100 cases per week, now you have 225. Where are you going to go with those extra cases? It’s happened to us." In those cases, Mast says, it was vital to have multiple, good business partners who can work the extras through.