CSAs a direct-marketing strategy with benefits

May 10, 2013

Farmers´ markets are a mainstay of Saturday mornings around the country. Even if you don’t participate in one as a producer, you or someone close to you likely has frequented them and enjoyed the socializing and fresh produce.

With the popularity of farmers markets has come the growth of farmshares or CSAs. CSAs—the common shorthand for “Community Supported Agriculture”—are a form of direct marketing system. While CSAs are largely produce-oriented, there is a growing movement towards meat CSAs.

The unique nature of CSAs has the potential to not only connect consumers more directly with their food and the people who produce it, but also distributes the financial risk of a harvest. CSAs could be a valuable inroad for producers looking to diversify their operations and/or reach out to their local communities.

The exact nature of what a CSA is can be hard to pin down since they are so individual to the farms.

“It is an amorphous thing and people use [‘CSA’] to mean different things,” explained Emily Lancaster, Lead Farmer and Market Outreach Coordinator for Animal Welfare Approved. She explained that a farm or ranch would have a CSA, but it is also acceptable to use the phrase as a noun in and of itself.

“It’s also a marketing strategy or channel option for farms where consumers essentially share in the risk of marketing and of the farm’s production. The customer is buying a membership of the farm. They are paying up front at the beginning of the season for the products they will consume during that season.”

Most people might be familiar with produce CSAs. Very generally put—the specifics of each CSA differs wildly by the organizing farm or ranch— customers pay ahead of time in a lump sum for some share of the season’s harvest. Many produce CSAs will deliver portions of the harvest to customers on a weekly basis in a mixed box of in-season items to a central location.

Lancaster pointed out that a CSA is different from a buying club. In a buying club, members usually get first choice of produce and do not pay in advance. By contrast, “members [of CSAs] will buy in at the beginning of the season and get what the farmer provides.”

Beef CSAs

Meat CSAs work a little differently than the more well-known produce CSAs. Some of the difficulty comes from the legal requirements with selling meat.

Lancaster explained it is not legal to sell meat that isn’t inspected. This can be a problem for the extremely small scale some CSAs operate on.

Despite that, she offered several ways CSA-operators can manage the issue.

“There are three main ways to sell red meat. You can process it in a USDA-inspected plant and sell it to the customer. You can process it in a state-inspected plant and sell it to the customer. Or you can sell [the animal] to the customer and they can have it processed at a custom plant, where the consumer has the responsibility.”

Beyond the legality of selling beef directly to CSA customers, how a beef CSA is organized varies greatly from ranch to ranch. WLJ talked to a pair of beef CSA operators and the two perspectives gave a great example of the individuality of programs.

Schenker Family Farms of southeastern Kansas has a beef CSA that is relatively large and an addition to the birth-to-slaughter, direct-marketing system of this multi-generational ranch. They raise Angus, SimAngus, Balancer, and other Angus crosses. Cherie Schenker, who took over the ranch when her father wanted to retire, said that her children are the fifth generation of her family to work it.

“The way we do beef CSAs is similar to buying a share,” she said. CSA customers pay for specific beef bundles which include so many pounds of beef and divided up between different cuts according to the contract. Schenker said explaining that detail can be a difficult one to explain to customers.

“In the ag industry, a big part of the job is education. You have to explain that not all of it can be filets.”

She said the contents of a bundle can differ and often include what one might consider odd cuts. If a customer doesn’t like specific items, deviations can be written into the contract. Overall however, the contents of a bundle are determined based on the size of the consumer’s needs and the number of deliveries they want.

Along with their CSA, Schenker Family Farms does an electronic newsletter which keeps customers up-to-date with the goings on of the farm, various cut availabilities if there is an excess of something, and recipes.

While Schenker Family Farms is a relatively large operation, where the beef CSA is only one part of the business, the other beef CSA operator WLJ talked to represents the smaller side. Cricket Creek Farm of Williamstown, MA started out as a conventional dairy farm milking 300-head in its largest but was purchased and converted in the early 2000s to a small diversified farm.

Currently they milk a small herd of grass-fed Jerseys, maintain a small herd of whey-fed hogs, have some laying hens, make cheese on the farm, have an artisan bakery, and feed out some calves (some of their own and some beef calves from a neighboring beef ranch) for grassfed beef.

The way Cricket Creek Farm does their beef CSA is very different from how Schenker Family Farms does theirs. When asked about their system, Topher Sabot had this to say:

“The way our meat CSA works is, we define it as the member can take what they need for the week with a cap of three pounds a week. So if they need a pound that week, they can take a pound.”

Currently, Cricket Creek only does a ground beef CSA. Their goal is that their CSA customers get what they need when they need it rather than throwing it in the freezer.

Benefits and challenges

One of the key elements of CSAs is that risk is distributed between the farmer or rancher and the customer, who pays in advance for a share in the season’s harvest. This is one of the greatest benefits of the system.

“The beauty of the model is it shifts some of the risk to the customer,” explained Sabot. “Having known sales well in advance is very helpful for the business. We have that money guaranteed. That’s a helpful thing.”

Another of the benefits which both ranchers spoke of was the connection with their communities.

“CSAs are great,” said Schenker. “They put you in touch with the consumer. And the biggest thing is consumers want to know their food. They want to know their farmer.”

“It’s also a way to build community around the farm,” commented Sabot, noting that CSA customers had a feeling of connection to Cricket Creek. “People come to the farm to pick [their CSA bundle] up, and it’s really great. If they have questions, they can come and see for themselves. We know in the long run that if we support the community, they will support us.”

Another thing Sabot noted was that the dedication of Cricket Creek’s CSA customers has helped in terms of advertising, which he said was one of the more difficult elements.

“With the meat CSA the challenge is getting the initial marketing, getting people to try it. Especially around here when people think CSAs they think vegetables. I don’t think they´re used to thinking about meat and dairy. I think that’s been one of the biggest challenges, is educating people.”

Schenker, who said the incorporation of a CSA as a part of their direct-marketing efforts had benefited their business “tremendously,” also brought up marketing and education issues as the primary challenge of CSAs.

“If you want to sell direct to the consumer, you need to remember your product has value. Your product should be better than what consumers can get at Walmart and you should let the customers know that. And you have to have an online presence, whether it’s a website or social media, or even better, both.”

The Schenker Family Farms website has a full range of social media connections, direct purchasing through the website, and even an integrated chat feature which allows customers to interact with one of the Schenker family directly on the website.

Similarly, Cricket Creek Farm has a range of social media connections, as well as having a farm store on their site, regular blogs from the owners, managers, and others, and a large gallery of the livestock, the products, and the people behind the farm.

Schenker, Sabot and Lancaster all recommended that anyone interested in branching out into offering a beef CSA first investigate their area. Gauging interest and the potential CSAs or farmshare-like offerings in the area is essential to know if the effort would be worth it.

“I’d definitely do a business plan,” advised Lancaster. “Start with a manageable number of customers and get constant feedback from early customers to see what they need and like.”

Both Schenker and Sabot recommended joining local farmers co-operatives and/or seeing if existing CSAs would be interested in a partnership to add beef to the offerings.

“If someone is wanting to do this, it would behoove them to make sure they are a part of their local farmer group. Because that does nothing but help support you and networking, which can be critical,” explained Schenker.

“It’s not that hard to make work if you have a really great product and a community to support it,” added Sabot. “And it’s a good thing to talk to other CSAs about partnerships, then you have a readyto-go clientele right off the bat.” — Kerry Halladay, WLJ Editor