An Analysis of Vegetable Farms’ Direct Marketing …publications.dyson.cornell.edu/research/researchpdf/rb/...W.L. Uva i Farm retail marketing or farmer-to-consumer direct marketing

March 2002 RB 2002-03

An Analysis of Vegetable Farms’An Analysis of Vegetable Farms’An Analysis of Vegetable Farms’An Analysis of Vegetable Farms’An Analysis of Vegetable Farms’Direct Marketing ActivitiesDirect Marketing ActivitiesDirect Marketing ActivitiesDirect Marketing ActivitiesDirect Marketing Activities

in New York Statein New York Statein New York Statein New York Statein New York State

Wen-fei L. Uva

Department of Applied Economics and ManagementCollege of Agriculture and Life Sciences

Cornell UniversityIthaca, NY 14853-7801

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Wen-fei UvaSr. Extension Associate

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W.L. Uva i

Farm retail marketing or farmer-to-consumerdirect marketing is an important outlet for many NewYork vegetable products. Marketing direct to consum-ers takes special skills and abilities on the part of mar-keters, and also requires a favorable location with re-spect to land resources and local markets. Since manyfarmers and direct market managers lack the resourcesand experience to compete with supermarkets, it isimportant for direct marketing operators to differenti-ate themselves from the mass marketers. The goal ofthis study was to analyze the effectiveness of directmarketing activities and marketing strategies used byNew York vegetable farms. A survey designed to col-lect information on farm retail marketing practicesfrom New York vegetable farms was conducted dur-ing the winter of 2000-20001. Results were analyzedbased on business profiles of New York vegetablefarms with direct marketing activities, marketing chan-nels used, retail seasonality, product mix, importanceof different direct marketing activities, effectivenessof different marketing and business management tools,and future plans for various marketing activities.

The surveyed vegetable farms had averagetotal farm sales of $274,311 and average retail sales of$123,612. Direct marketing to consumers was an im-portant source of farm income for a majority of thesurveyed New York vegetable farms with retail mar-

keting activities. Sixty-nine percent of the respondentsreceived more than half of their farm gross income fromdirect sales to consumers. However, vegetable farmswith direct marketing activities generally did not relyon retail alone. Farms with higher gross sales utilizedmore marketing channels and depended more heavilyon wholesale. May through October is the most im-portant sales season for farmer-to-consumer directmarketing activities. The surveyed farms retailed morethan just the items they produced. Purchased items forresale were an important avenue to expand productline and increase the volume of products available forretail. Three most commonly used direct marketingmethods were roadside markets, farmers’ markets andpick-your-own. Among all the direct marketing com-ponents, fresh farm products – including fresh veg-etables, fruits, and meat products - were rated as mostimportant to the operation by most surveyed farms(83 percent). Ice cream stand had the second highestrating but was only rated by 3 percent of the surveyedfarms. Ornamental plants and holiday crops were ratednumber three by 43 percent and 54 percent of farms,respectively. The most commonly used promotion toolswere “word-of-mouth” and “newspapers”, and “la-bor related challenges” and “competition in the mar-kets” were the two major concerns among survey re-spondents.

ABSTRACT

ii Analysis of Vegetable Farms’ Direct Marketing Activities in NYS

This survey was conducted by the CornellHorticulture Business Management and MarketingProgram in the Department of Applied Economicsand Management at Cornell University. Sincereappreciation goes to the New York State VegetableGrowers Association for providing funding for thisstudy. The author thanks Diane Eggert of New YorkState Farmers’ Direct Marketing Association and BobLewis of New York State Department of Agriculture& Markets for identifying vegetable farms withdirect marketing activities in the state to participatein the survey. Special appreciation also goes to Dr.

ACKNOWLEDGEMENTS

Anu Rangarajan in the Department of Horticultureand Dr. Nelson Bills in the Department of AppliedEconomics and Management at Cornell University,Monika Roth and Brian Caldwell of Cornell Coop-erative Extension, and Diane Eggert of New YorkState Farmers’ Direct Marketing Association forproviding assistance in developing the surveyquestionnaire and reviewing the report. Finally,special thanks are extended to New York Statevegetable operators for providing valuable com-ments and participating in the study.

W.L. Uva iii

TABLE OF CONTENTS

Page

Abstract ................................................................................................................................................................... iAcknowledgements ............................................................................................................................................... iiExecutive Summary............................................................................................................................................... v

I. INTRODUCTION ........................................................................................................................................... 1

II. STUDY APPROACH AND DEFINITIONS ................................................................................................ 2

III. RESULTS .......................................................................................................................................................... 4Surveyed Respondent Profile ....................................................................................................................... 5The Role of Direct Market Sales to Farm Income ....................................................................................... 7Marketing Channels Used by Vegetable Farms with Direct Marketing Activities ............................... 7Direct Marketing Seasonality ........................................................................................................................ 9Direct Marketing Methods ............................................................................................................................ 12Direct Marketing Product Enterprises ......................................................................................................... 12 Product Mix ................................................................................................................................................. 12 Items Purchased for Resale ........................................................................................................................... 15 Entertainment Activities .............................................................................................................................. 16 Organic Product Offerings .......................................................................................................................... 16 Restaurant/Cafe/Deli .................................................................................................................................... 16Future Plans ..................................................................................................................................................... 17Marketing Tools .............................................................................................................................................. 18Business Management Strategies Used to Improve Profitability ............................................................ 21Direct Marketers’ Views on Barriers, Opportunities and Training Needs ............................................. 23

IV. CONCLUSION ............................................................................................................................................... 28

REFERENCES ................................................................................................................................................. 28

V. APPENDIX A .................................................................................................................................................. 31

VI. APPENDIX B -- SURVEY INSTRUMENT................................................................................................... 49

LIST OF TABLES

Table III-1. Direct Marketer Profile Classified by Retail Sales, NY (2000), PA (1996) and NJ (1992) ........ 5Table III-2. Descriptive Statistics of the Surveyed Direct Marketing Vegetable Farms’ Direct

Marketing (Retail) Sales, by Size of Retail Sales ........................................................................................ 5Table III-3. Comparison of Annual Total Farm Gross Sales and Direct Marketing (Retail) Sales, by

Total Farm Sales .............................................................................................................................................. 8Table III-4. Marketing Channels Used by NY Direct Marketing Vegetable Farms ...................................... 9Table III-5. Average Annual Direct Marketing (Retail) Sales for Different Direct Marketing Methods,

by Retail Sales ................................................................................................................................................. 13Table III-6. Frequency of Selling at Farmers’ Markets and Sales, by Retail Sales ........................................ 13Table III-7. Percentage of Sales and Businesses by Product Line ................................................................... 14Table III-8. Items Purchased for Resale by Product: Urban vs. Rural Retail Locations ............................. 15Table III-9. Organic Product Marketing by Retail Sales .................................................................................. 17Table III-10. Ranking of Top Barriers Facing Direct Marketing Operations, by Retail Location ............... 25Table III-11. Ranking of Top Opportunities Facing Direct Marketing Operations, by Retail Location .... 26

iv Analysis of Vegetable Farms’ Direct Marketing Activities in NYS

Page

Table III-12. Ranking of Top Training Needs for Direct Marketing Operations, by Retail Location ......... 27Table V-1. Areas of Crop Produced, by Total Farm Receipts .......................................................................... 31Table V-2. Crops Produced by New York Direct Marketing Vegetable Farms, by Total Farm Receipts ... 31Table V-3. Marketing Outlet Used by New York Vegetable Farms with Direct Marketing Outlets,

by Size of Businesses ...................................................................................................................................... 32Table V-4. Average Percentage of Retail Income Generated in Each Month, by Retail Sales ..................... 33Table V-5. Direct Marketing Methods Used by New York Vegetable Farms and Retail Sales

Generated by Each Marketing Method ....................................................................................................... 34Table V-6. Average Retail Sales and Percentage of Respondents Offering Each Product Line, by

Retail Sales ....................................................................................................................................................... 35Table V-7. Items Purchased for Resale for Each Product Line, by Retail Sales ............................................ 36Table V-8. On-farm Entertainment Activity Offerings and Charges, by Retail Sales .................................. 37Table V-9. Future Plans for Different Direct Marketing Components, by Retail Sales ............................... 38Table V-10. Ranking of Top Barriers Facing Direct Marketing Operations, by Retail Business ................. 39Table V-11. Ranking of Top Opportunities for Direct Marketing Operations, by Retail Business ............. 40Table V-12. Ranking of Top Training Needs for the Direct Marketing Operations, by Retail

Businesses ........................................................................................................................................................ 41

LIST OF FIGURES

Figure III-1. Distribution of Survey Respondents from New York Counties ............................................... 4Figure III-2. Distribution of Respondents by Retail Sales: Urban vs. Rural Retail Locations ................... 6Figure III-3. Years Involved in Direct Marketing, by Retail Sales .................................................................. 7Figure III-4. Percentage of Total Annual Farm Sales from Direct Marketing (Retail) Sales:

Urban vs. Rural Retail Locations .................................................................................................................. 8Figure III-5. Averge Number of Marketing Channels Used by Survey Respondents ................................. 10Figure III-6. Average Months of Retail Operation by Retail Sales: Urban vs. Rural Retail Locations ..... 10Figure III-7. Sales Generated in each Month as Percentage of Total Surveyed Retail Sales:

Urban vs. Rural Retail Locations .................................................................................................................. 11Figure III-8. Direct Marketing Methods Used by Respondents and Percentage ......................................... 12Figure III-9. Average Number of Product Lines by Retail Sales: Urban vs. Rural Retail Locations ........ 14Figure III-10. Incidence of On-Farm Entertainment Activities and Charges: Urban vs. Rural

Retail Locations ............................................................................................................................................... 16Figure III-11. Average Revenue from Restaurant, Cafe, and Deli Operations, by Retail Sales .................. 17Figure III-12. Future Plans for Different Direct Marketing Enterprises ........................................................ 18Figure III-13. Respondents’ Utilization of Different Marketing Tools, by Retail Location ......................... 19Figure III-14. Effectiveness Rating of Different Marketing Tools, by Retail Location ................................. 19Figure III-15. Annual Marketing Budget as Percentage of Retail Sales ........................................................ 20Figure III-16. Respondents’ Utilization of Different Business Management Tools, by Retail Sales .......... 21Figure III-17. Effectiveness Rating of Different Business Management Tools, by Retail Location ............ 22Figure V-1. Effectiveness of Different Marketing Tools, by Retail Sales ....................................................... 42Figure V-2. Effectiveness of Different Marketing Tools, by Retail Sales (cont.) ........................................... 43Figure V-3. Effectiveness of Different Marketing Tools, by Retail Sales (cont.) ........................................... 44Figure V-4. Effectiveness of Business Management Strategies, by Retail Sales ........................................... 45Figure V-5. Effectiveness of Business Management Strategies, by Retail Sales (cont.) ............................... 46Figure V-6. Effectiveness of Business Management Strategies, by Retail Sales (cont.) ............................... 47

LIST OF BOXES

Box 1. Definition of Farmer-to-Consumer Direct Marketing Methods Used in This Study ...................... 3

W.L. Uva v

EXECUTIVE SUMMARY

Farmer-to-consumer direct marketing orfarm retailing is an important outlet for many NewYork vegetable products. This marketing channelexperienced a resurgence of interest in recentdecades. Some contributing factors include de-pressed wholesale farm prices and consolidation inthe produce industry in recent years. Many mediumand small size farms have adopted direct marketingto consumers as an alternative to sustain businessvitality. In addition, growing consumer interest innutrition and food quality, combined with increasedattention in the sustainable agriculture movementand in local community development, further fueledconsumer interest in direct purchasing from farmers.

Marketing direct to consumers takes specialskills and abilities on the part of marketers, and alsorequires a favorable location with respect to landresources and local markets. Since many farmersand direct marketing managers lack the resourcesand experience to compete with supermarkets, it isimportant for direct marketing operators to differen-tiate themselves from mass marketers. This reportsummarizes results of a survey designed to collectinformation on farmer-to-consumer direct marketing(retail) practices used by New York vegetable farms.

Objectives of this study are to:

Determine the economic dimension offarmer-to-consumer direct marketingactivities on New York vegetable farms.Analyze effectiveness of different marketingactivities and strategies used by New Yorkfarmer-to-consumer direct marketing veg-etable farms.Identify industry concerns and research ques-tions for future in-depth direct marketing stud-ies.

The direct marketing sales in this study referto farms selling their products (food and non-food)and services directly to consumers using variousretail outlets (roadside markets, farmers’ markets,pick-your-own, community supported agriculture,catalog, internet, etc.). The products sold couldinclude products grown on the farm as well asagricultural and non-agricultural products pur-chased for resale. A mail survey was developed tocollect information on farm direct marketing prac-tices, as defined above, from New York vegetable

farms with direct marketing sales in 2000.

Results from 122 completed surveys aresummarized in the analysis. The survey respon-dents’ average total annual gross sales were $274,311in 2000. Although the overall average retail sales ofthe surveyed respondents were $123,196 in 2000(including products grown on the farm and pur-chased for resale as well as services and entertain-ment activities), one-half of the respondents had lessthan $30,000 (median) annual retail sales. Themajority of surveyed farms produced more thanvegetables. Among the surveyed direct marketingvegetable farms, 46 percent also produced fruits andberries, and 45 percent also produced ornamentalcrops.

Direct marketing to consumers was animportant source of farm income for a majority ofthe surveyed direct marketing vegetable farms. Ofthe farms surveyed, 45 percent of total farm sales in2000 were from retail business. Sixty-nine percent ofthe respondents received more than half of theirfarm’s gross income from direct sales to consumers.Moreover, for 44 percent of the respondents, retailsales accounted for more than 90 percent of theirtotal farm receipts, compared with 7 percent of therespondents who attributed less than 10 percent offarm receipts to retail. Among respondents, theaverage percentage of sales from direct sales toconsumers was 72 percent.

The surveyed direct marketing vegetablefarms generally did not depend on retail alone.Among the five marketing channels identified in thissurvey – ‘wholesale to supermarkets’, ‘wholesale toother retail farm markets’, ‘wholesale to foodserviceoutlets’, ‘wholesale through other wholesale outlets’(wholesalers, brokers, processors, auction, etc.), and‘direct marketing to consumers’ - respondents usedan average of 2.3 marketing channels to sell theirproducts. ‘Wholesale to other retail farm markets’ isthe most commonly utilized wholesale outlet, whilefoodservice outlets was the least utilized wholesalechannel. Although only 29 percent of the respon-dents wholesaled through ‘other wholesale outlets’,this marketing channel is important to farm income.Twenty-nine percent of total surveyed farm saleswere generated from this wholesale channel, com-pared to 14 percent from ‘wholesale to other retailfarm markets’.

vi Analysis of Vegetable Farms’ Direct Marketing Activities in NYS

New York direct marketing vegetable farmsgenerally only retail seasonally. The surveyedrespondents retailed an average of 6.4 months in2000. About one-quarter (24 percent) of respondentsretailed less than four months of the year, and only 8percent retailed year-round. Operations with higherretail sales operated longer retail seasons, andoperations with urban locations also had longerretail seasons. May through October is the mostimportant sales season for farmer-to-consumer directmarketing sales. Fall sales were very significant forNew York direct marketers, and December is amonth with potential to generate high sales.

Fresh vegetables, ornamental plants andfresh fruits were the top three retail product catego-ries for New York direct marketing vegetable farms.Other product categories sold by surveyed respon-dents included processed products, holiday crops(pumpkins and Christmas trees), gifts and accesso-ries, baked goods, ice cream, meat products, milkand cheese products, and other products (maplesyrup, mushrooms, entertainment activities, furni-ture, firewood and wool). Larger retail operationshad a broader product mix. New York direct mar-keting vegetable farms also retailed more than justitems that they produced on the farm. They pur-chased items for resale to expand the product line,increase variety, and supplement the volume ofproducts available for retail. The surveyed farms areleast likely to purchase vegetables and pumpkins toresell. On the other hand, for all other product linesidentified in this study, more than 50 percent offarms purchased some items in those product linesto resell.

Among the direct marketing methodsidentified in this study (roadside markets, farmers’markets, pick-your-own (PYO), community sup-ported agriculture (CSA), catalog sales, internetsales, and other methods (including direct order/custom sales)), New York direct marketing vegetablefarms with direct marketing activities generally used

one to two marketing methods to retail their prod-ucts. Three most commonly used direct marketingmethods were roadside markets, farmers’ marketsand pick-your-own (PYO). Roadside marketing wasused by three-quarters of respondents to markettheir products and generated three quarters of thedirect marketing sales surveyed.

Competition and labor related challengesare the top barriers to success in many direct market-ing operators’ minds. Identified competition in-cludes supermarkets, international trades and otherfarm markets. Labor related challenges mentionedinclude lack of labor pool and hard-to-find seasonalhelp, difficulty in finding good labor and keepingqualified labor, and high costs of labor. Other topbarriers were location, limited resources (capital,time and land), regulations, and marketing relatedissues (advertising, display, attracting new custom-ers, etc.).

While the top opportunity identified by therespondents was definitely diversification andexpansion, many farms have different plans on howthey want to expand and diversify their retailbusinesses. The expansion plans include on-farmentertainment/agri-tourism, product lines/crop mix,greenhouse/ornamental plant sales, farmers’markets, value-added products, internet/mail ordersales, diversification, longer season, and larger farmsize and longer operating hours. Respondents alsostrive to provide ‘farm fresh’, high quality and freshproducts, as well as good service. Expandingmarketing is another important opportunity identi-fied by respondents.

Direct marketing is an important source ofincome for New York vegetable farms with directmarketing activities. Many New York direct market-ing farms are considering expansion; therefore, moreattention to marketing and business managementwill be necessary to ensure future profitability andsuccess.

W.L. Uva vii

W.L. Uva 1

Farmer-to-consumer direct marketing orfarm retailing is an important outlet for many NewYork vegetable products. During the Depression ofthe 1930s, many farmers turned to roadside market-ing (Bond, 1941). Favorable wholesale prices duringand following World War II provided better alterna-tives, and interest in direct marketing to consumersdeclined. In the late 1950s, mechanization and otherproduction technologies changed price and costrelationships, and the larger volumes required tomarket through traditional wholesale channels againencouraged renewed interest in direct marketingamong many growers (How, 1980). This marketingchannel experienced a resurgence of interest thatbegan in the 1970s. Some contributing factorsinclude depressed wholesale farm prices andconsolidation in the produce industry in recentyears. While some growers are striving for econo-mies of scale in search of lower costs and higherefficiency to meet the needs of large buyers, manymedium and small size farms have adopted directmarketing to consumers as an alternative to sustainbusiness vitality, obtain higher prices, and maintaina competitive edge in the market. In addition,growing consumer interest in nutrition and foodquality, combined with increased attention in thesustainable agriculture movement and local commu-nity development, further fueled consumer interestin direct purchasing from farmers.

A USDA study showed that pressing issuesfacing farmer-to-consumer direct marketers areuncertainty of cost and returns, availability oftechnical assistance, and the overall regulatoryenvironment (Bills, et al. 2000). Marketing direct toconsumers takes special skills and abilities on thepart of marketers, and often requires a favorablelocation with respect to land resources and localmarkets. Since many farmers and direct marketingmanagers lack the resources and experience tocompete with supermarkets, it is important for directmarketing operators to differentiate themselves frommass marketers. Cornell researchers conductedseveral studies in the 1970s to obtain information onthe characteristics of direct marketing businesses inNew York and the customers who patronize them(Stuhlmiller and How, 1978; Stuhlmiller, et al. 1976;and Eiler and Rosenfeld, 1973). While there aresome recent studies on consumer preferences andshopping habits at farmers’ direct marketing outlets,there is a need for information on effective market-

ing activities and their economic feasibility, targetingthe needs of New York growers.

Direct marketing to consumers is an impor-tant marketing channel to New York vegetablefarms. According to the 1997 Census of Agriculture(USDA, 1999), 55 percent of the 1,585 vegetablefarms in New York conducted some direct market-ing activities, and about $13.2 million (or 5 percent)of total sales generated by these New York vegetablefarms traced to direct marketing activities. However,the direct sales definition used by the Census ofAgriculture is more narrowly defined than farmers’actual practices. The Census of Agriculture defineddirect sales as sales of crops, livestock, poultry, orother products sold directly to consumers for theirown consumption from roadside stands, farmers’markets, pick your own, door-to-door, etc. It onlyincluded sales of agricultural commodities solddirectly for human consumption, such as vegetables,fruit, eggs, milk, cattle, chickens, hogs, turkeys, etc.,and only commodities grown or raised on the farm.Nevertheless, in order to maintain their competitiveedge in the market, many farmers with direct-to-consumer sales have adopted various marketingstrategies to enhance the value of their products andservices. They often also sell nonfood products, i.e.ornamental plants and gift items, and productspurchased for resale, and receive income fromservices they provide. Therefore, the magnitude ofvegetable farms’ direct marketing activities is muchgreater than the census figures demonstrated. Thisstudy attempts to examine a comprehensive pictureof retail practices used by vegetable farms in NewYork and the impacts of those practices on farmprofitability.

Objectives of this study are to:

• Investigate the dynamics of farmer-to-consumer direct marketing activities onNew York vegetable farms.

• Analyze the effectiveness of different market-ing activities and strategies used by New Yorkfarmer-to-consumer direct marketing veg-etable farms.

• Identify industry concerns and research ques-tions for future study.

I. INTRODUCTION

2 Analysis of Vegetable Farms’ Direct Marketing Activities in NYS

This report summarizes the results of asurvey designed to collect information on farmer-to-

II. STUDY APPROACH AND DEFINITIONS

Various definitions are used for farm directmarketing studies. Although it often stands forfarmer-to-consumer direct sales – retail, sometimes itcould also include direct sales to food services andother specific outlets – wholesale (NY AgriculturalStatistics Service, 1988). This study only considersretail practices used by vegetable farms in New Yorkand the impacts of those practices on farm profitabil-ity. Therefore, “direct marketing sales” in this studyinclude sales generated by farms selling theirproducts (food and nonfood) and services directly toindividual consumers using various retail outlets.Direct sales to institutional customers, i.e.foodservice, are not included in this study. Theproducts sold could encompass products grown orprocessed on the farm as well as products purchasedfor resale, and the services provided also includedentertainment activities. This definition is differentfrom the one used by the Census of Agriculture;therefore, it is very important to note that manyresults in this report cannot be directly comparedwith the figures of direct sales in the Census ofAgriculture.

The direct marketing product and servicecategories included in this survey were:

♦ Fresh vegetables and melons♦ Fresh fruits and berries♦ Nursery and greenhouse crops (bedding

and potted plants, flowers, trees, etc.)♦ Holiday crops (pumpkins and Christ-

mas trees)♦ Meat products♦ Milk and chess products♦ Value-added/processing products♦ Baked goods♦ Ice cream♦ Gifts and gardening accessories♦ Entertainment activities♦ Other products (i.e. maple syrup, honey,

furniture, etc.)

The types of direct marketing retail outletsincluded in this survey were (see Box 1 for defini-tion):

♦ Roadside markets♦ Farmers’ markets♦ Pick-your-own (PYO)♦ Community supported agriculture

(CSA)♦ Catalogue and internet sales♦ Other direct sales (i.e. direct order, craft

show, etc.)

A mail survey was developed to collectinformation from New York vegetable farms onfarm direct marketing practices, as defined above.The survey questionnaire is included in Appendix B.A random sample of 500 vegetable farms with directmarketing sales were identified from two sources –the New York State Farmer’s Direct MarketingAssociation list and the “New York State Guide toFarm Fresh Products” published by New York StateDepartment of Agriculture and Markets. Therefore,only vegetable farms that reported direct marketingsales were selected to participate in the survey.

In November 2000, a draft of the question-naire was pre-tested by four farms that were not inthe sample list. The questionnaire was revised basedon input from the growers. In January 2001, thefinal questionnaire, along with a cover letter explain-ing the purpose of this study, was mailed to the listof 500 direct marketing vegetable farms in New YorkState. A postcard reminder was mailed to thesample list six weeks after the first mailing. In total,163 questionnaires (33 percent) were returned. Forvarious reasons, some of these were unusable (i.e.,incomplete, no longer in business, or had no veg-etable production to report.) A total of 122 surveyswere completed and included in this analysis.

Survey results were statistically tested to

consumer marketing (retail) practices used by NewYork vegetable farms in 2000.

W.L. Uva 3

examine possible relationships among farm charac-teristics, specifically, retail sales, retail locations anddirect marketing practices. Retail locations of thesurveyed vegetable farms were classified as being inurban or rural areas, based on the Census Bureau’sdefinition of urbanized and rural areas. Accordingto the Census Bureau, urbanized areas are placeswith populations of at least 50,000, and they usuallyconsist of a central city and the surrounding area

that has close social and economic ties to the centralcity with a density of at least 1,000 people per squaremile; and rural areas are everywhere that is noturban. Based on Census 2000 data, New Yorkcounties meeting the urban definition include Bronx,Erie, Kings, Monroe, Nassau, New York, Queens,Suffolk and Westchester. Therefore, surveyedrespondents with retail locations in these countiesare categorized as urban retail locations.

Box 1. Definition of Farmer-to-Consumer Direct Marketing Methods Used inThis Study

• Roadside Market: a temporary or permanent structure, located along a public road and used for selling farmproducts directly to consumers by an individual farm operation. A roadside market can vary from an open standin front of the farm offering limited products to elaborate buildings equipped with refrigerated display cases,lighting, shopping carts, and multiple checkout systems, operating year-round.

• Farmers’ Market: a building, structure, or place used by two or more agricultural producers for retailing farmproducts. Each marketer operates independently. Farmers’ market facilities may range from an open lot wherefarmers park their vehicles and display products to enclosed buildings with display counters and other accommo-dations. The farmer usually pays a fee for the occupied space to cover maintenance and advertising.

• Pick-Your-Own (PYO) Operation: permits customers to come to the farm and harvest farm products directlyfrom the field. These operations may also sell already harvested products from a roadside market in conjunctionwith the PYO operation. In such a case, the farm is considered using more than one direct marketing method.

• Community-Supported-Agriculture (CSA) Operation: requires customers to subscribe or purchase member-ship, where people buy “shares” at the beginning of the production season in exchange for a season’s worth ofproducts produced on the farm.

• Catalog and Internet Sales: does not involve a physical retail facility. Farm products are marketed to customersby catalogs or over the internet, and sales are conducted via phone, mail or internet. Products are generallydelivered to customers’ homes.

• Other Methods: includes direct custom orders, fairs, craft shows and clubs.


III. RESULTS

The survey respondents were spatially dis-tributed throughout New York State. As shown inFigure III-1, direct marketing vegetable farms from44 of the 62 counties in New York are represented inthis survey, and the responses were distributedacross the four regions of the state as follows:

♦ Western NY 37 responses♦ Central NY 31 responses♦ Northeastern NY 25 responses♦ Hudson Valley 21 responses♦ New York City and

Long Island 8 responses

Table III-1 shows that the surveyed respon-dents’ retail sales pattern is similar to the surveys offruit and vegetable direct marketing farms in Penn-sylvania (Pennsylvania Dept. of Agriculture, 1997)and direct marketing operations in New Jersey(Nayga et al., 1995). A chi-square goodness-of-fit testshowed that the three direct marketer profiles arenot statistically different (DF = 10, P-value = 0.438).

Figure III-1. Distribution of Survey Respondents from New York Counties

NY City/Long Island

W.L. Uva 5

Surveyed Respondent ProfileThe 122 direct marketing vegetable farms

surveyed had an overall average of $123,612 in di-rect retail sales in 2000; however, one-half had lessthan $30,000 (median) in retail sales. About a quar-ter (24 percent) of respondents had annual retailsales of less than $10,000, and 20 percent rangedfrom $10,000-24,999 and $100,000-249,999 in annualretail sales (Table III-2).

Thirty-one percent of farms in this study hadretail locations in urban areas (as defined in the pre-vious section), and 69 percent of surveyed farms hadretail locations in rural areas only. It should benoted that some surveyed farms had more than oneretail location, and they could have both urban andrural retail locations.

Direct marketing vegetable farms with ur-ban retail locations were more likely to have higher

Survey respondents NY PA NJ by retail sales (N = 122) (N = 406) (N = 409)

% of survey respondentsUnder $10,000 24 28 31

$10,000-24,999 20 19 14

$25,000-49,999 13 17 12

$50,000-99,999 14 14 10

$100,000-249,999 20 13 15

$250,000 and over 9 9 18

All Farms 100 100 100* A chi-square goodness-of-fit test showed that the NY, PA, NJ direct marketerprofiles are not statistically different (DF = 10, P-value = 0.438).

Sources: Pennsylvania Dept. of Agriculture (1997) and Nayga et al. (1995).

Table III-1. Direct Marketer Profile Classified byRetail Sales, NY (2000), PA (1996) and NJ (1992)*

Respondents by % of Average Standard retail sales Farms retail sales Median Min. Max. deviation

(%) -------------- ($) --------------

Under $10,000 (N=29) 24 4,944 5,000 850 9,800 2,783

$10,000-24,999 (N=24) 20 15,587 15,000 10,000 24,000 4,868

$25,000-49,999 (N=16) 13 32,660 30,000 25,000 45,500 6,888

$50,000-99,999 (N=17) 14 70,147 65,500 50,000 92,000 13,354

$100,000-249,999 (N=24) 20 158,413 145,000 100,000 240,000 44,594

$250,000 and over (N=12) 9 781,010 650,000 325,000 1,641,612 143,065

All Farms (N=122) 100 123,196 30,000 850 1,641,612 262,332a “Direct marketing (or retail) sales” refers to farms selling their products and services directly to individual consumers using various re-

tail outlets. The products sold could include food and non-food items and encompass products grown or processed on the farm aswell as products purchased for resale.

Table III-2. Descriptive Statistics of the Surveyed Direct Marketing VegetableFarms’ Direct Marketing (Retail) Sales, by Size of Retail Salesa


retail sales than direct marketers with only rural re-tail locations. The surveyed farms with retail loca-tions in urban areas had average annual retail salesof $248,523, of which 50 percent had $105,000 (me-dian) or more in retail sales, and farms with retaillocations only in rural areas had average annual re-tail sales of $69,703, and a median of $21,900. FigureIII-2 shows that more than half (52 percent) of re-spondents with only rural retail locations had lessthan $25,000 in retail sales in 2000, whereas, only 24percent of respondents using urban retail locationsfell into that category. By contrast, while only 21percent of respondents with rural retail locationsgenerated more than $100,000 in retail sales in 2000,almost half of the respondents (47 percent) with ur-ban retail locations were in that sales category.

The surveyed farms had an average of 21.4years of direct marketing experience. Thirty-sevenpercent of respondents had less than ten years of re-tailing experience, 22 percent had 11 to 20 years, 27percent had 21 to 40 years, and 14 percent had morethan 40 years of retailing experience. Farms with

higher retail sales had longer average direct market-ing histories, except for businesses with $50,000-99,999 annual retail sales (Figure III-3).

The majority of surveyed direct marketingvegetable farms produced additional products otherthan vegetables. Among the surveyed vegetablefarms, 46 percent also produced fruits and berries,45 percent also produced ornamental plants, and 17percent of the businesses also produced other prod-ucts, including Christmas trees, field crops, maplesyrup, animal products, mushrooms, and honey.The direct marketing vegetable farms are equallylikely to combine fruit or ornamental crops into theirproduction. Twenty-eight percent of the respon-dents grew only vegetable crops in 2000, 26 percentgrew vegetable and fruit crops, 26 percent grew veg-etable and ornamental crops, and 20 percent grew allthree major types of crops. Larger farms are morelikely to diversify and grow a larger acreage of mul-tiple types of crops for sale. In Appendix A, TablesV-1 and V-2 show the acreage and combination ofcrops (fruits, vegetables and ornamental plants) pro-duced by different sized operations.

��

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16%

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<$10,000 $10,000-24,999

$25,000-49,999

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$100,000-249,999

>=$250,000

Respondents by retail sales

% o

f res

pond

ents

Urban (N = 38)��Rural (N = 84)

Figure III-2. Distribution of Respondents by Retail Sales:Urban vs. Rural Retail Locations

W.L. Uva 7

�� 21.4

32.3 d

23.3 bc

29.1 cd

17.3 ab

16.1 ab

14.0 a

0 5 10 15 20 25 30 35

Less than $10,000

$10,000-24.999

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$100,000-249,999

$250,000 and over

All FarmsR

espo

nden

ts b

y R

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es

Average Years in Retailing

Figure III-3. Years Involved in Direct Marketing, by RetailSales*

*Average number of retailing years identified by different letters are significantly different from eachother. Means are separated by LSD multiple comparison analysis (α=0.05).

The Role of Direct Market Sales to FarmIncome

For a majority of the surveyed direct mar-keting vegetable farms, direct marketing to consum-ers was an important source of farm income. Of thefarms surveyed, the average total annual gross farmsales were $274,311 in 2000 (Table III-3). Forty-fivepercent of total 2000 surveyed farm sales were fromdirect sales to consumers; however, large vegetableoperations were less dependent on direct marketingsales for their farm income. The other marketingchannels used by the surveyed farms will be dis-cussed in the next section.

For 44 percent of the respondents, retailsales accounted for more than 90 percent of their to-tal farm sales, compared with 7 percent of the re-spondents who attributed less than 10 percent offarm sales to retail. Figure III-4 shows that 69 per-cent of the respondents received more than half oftheir farm’s gross sales from direct marketing to con-sumers. Retailing in urban or rural locations did not

affect the degree of reliance on retail sales to gener-ate farm income.

Marketing Channels Used by VegetableFarms with Direct Marketing Activities

Although direct marketing was an impor-tant source of income, direct marketing vegetablefarms generally did not depend on retail alone. Fivemarketing channels were identified in this survey:

Wholesale to supermarketsWholesale to other farm marketsWholesale to foodservice outletsWholesale through other wholesale out-lets (wholesalers, brokers, processors,auction, etc.)Direct marketing to consumers

The surveyed respondents used an averageof 2.3 marketing channels to sell their products. Thechannel most commonly utilized by respondents to


Respondents by % of Average total Average % of retail contributiontotal farm sales farms gross sales retail sales to total farm sales

% --- $/year --- $Under $10,000 (N=25) 20 5,225 5,010 96

$10,000-49,999 (N=32) 26 23,037 18,255 79

$50,000-99,999 (N=11) 9 76,551 56,700 74

$100,000-249,999 (N=25) 21 154,057 97,521 63

$250,000-499,999 (N=7) 6 352,540 162,429 46

$500,000-749,999 (N=7) 6 602,998 253,171 42

$750,000-999,999 (N=4) 3 855,107 385,833 45

Over $1,000,000 (N=11) 9 1,587,657 607,601 38

All Farms (N=122) 100 274,311 123,612 45a “Direct marketing (or retail) sales” refers to farms selling their products and services directly to individual consumers using various

retail outlets. The products sold could include food and nonfood items and encompass products grown or processed on the farm aswell as products purchased for resale.

Table III-3. Comparison of Annual Total Farm Gross Sales and Direct Market-ing (Retail) Sales, by Total Farm Sales

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18% 18%

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<= 25% 25 - 50% 51 - 75% > 75%% of total farm sales from retail

% o

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Urban (N = 38)��

Rural (N = 84) All Respondents (N = 122)

Figure III-4. Percentage of Total Annual Farm Sales fromDirect Marketing (Retail) Sales: Urban vs. Rural RetailLocations

W.L. Uva 9

wholesale their products was ‘wholesale to otherfarm markets’ (48 percent), while the wholesalechannel utilized the least by respondents was‘foodservice outlets’ (only 22 percent). Amongwholesale outlets, sales to ‘other wholesale outlets’generated the highest sales volume. Although only29 percent of the respondents wholesaled through‘other wholesale outlets’, 29 percent of total sur-veyed farm sales were generated from this whole-sale channel, compared with 14 percent from ‘whole-sale to other farm markets’ reported by 48 percent ofrespondents (Table III-4).

Farms with higher gross sales depend lesson retail for income (Table III-4). Figure III-5 showsthat large farms also tend to utilize more marketingchannels. However, the average number of market-ing channels used by farms with total gross sales be-tween $100,000 to 999,999 are not statistically differ-ent. As farm size increases, although most farmsstill wholesaled to other farm markets, sales to su-permarkets and other wholesale outlets becamemore important to farm income. Small to mediumsize farms – farms with total gross sales of less than$500,000 – tend to focus on a combination of two tothree outlets to wholesale their products. Largefarm operations – farms with total gross sales ofmore than $500,000 - tend to concentrate a majorityof their wholesale efforts on one type of wholesaleoutlet (often on other wholesale outlets) and supple-ment it by additional wholesale outlets (supermar-kets and other farm markets). Detailed informationcomparing marketing outlets used by different size

farms is presented in Table V-3 in Appendix A.

Direct Marketing Seasonality

New York vegetable farms with direct mar-keting activities generally only retail seasonally.About one quarter (24 percent) of respondents re-tailed less than 4 months of the year, 55 percent re-tailed between 5 to 8 months, and the remaining 21percent retailed 9-12 months. Only 8 percent of thesurveyed farms retailed all-year-round.

The average number of months of retailingwas 6.4 months in 2000. Operations with urban re-tail locations had a statistically longer direct market-ing season (an average of 7.2 months) than opera-tions with only rural retail locations (an average of 6months). As seen in Figure III-6, operations withhigher retail sales generally had a longer direct mar-keting season. This observation also applied to re-spondents within the urban and rural groups.

Figure III-7 shows that May through Octo-ber is the most important sales season for farmer-to-consumer direct marketing activities. More than 80percent of the total retail sales from the surveyedvegetable farms was generated during these sixmonths. Fall sales were very important for NewYork direct marketers. October sales accounted for17 percent of retail sales generated by surveyedfarms in 2000, followed by May (16 percent). Whilethe seasonal pattern is similar for operations with

Table III-4. Marketing Channels Used by NY Direct Marketing VegetableFarmsMarketing channel % of respondents % of total surveyed farm

sales from this channel

Wholesale to supermarkets 36 8.3

Wholesale to other farm markets 48 13.7

Wholesale to foodservice outlets 22 4.1

Wholesale to other wholesale outletsa 29 29.1

Direct retail to consumersb 100 44.8a Other wholesale outlets include wholesalers, brokers, processors, auction, etc.b “Direct marketing (or retail) sales” refers to farms selling their products and services directly to individual consumers using

various retail outlets. The products sold could include food and nonfood items and encompass products grown or pro-cessed on the farm as well as products purchased for resale.


Figure III-6. Average Months of Retail Operation by RetailSales: Urban vs. Rural Retail Locations

*Average number of months of operation identified by different letters are significantly different from each other within eachlocation category. Means are separated by LSD multiple comparison analysis (α=0.05).

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Urban Rural All respondentsRespondents by retail Locations

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<$10,000 $10,000-24,999 $25,000-49,999��$50,000-99,999

��$100,000-249,999

��>=$250,000

Figure III-5. Average Number of Marketing Channels Usedby Survey Respondents

*Average number of months of operation identified by different letters are significantly different from each other within eachlocation category. Means are separated by LSD multiple comparison analysis (α=0.05).

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W.L. Uva 11

urban and rural retail locations, respondents withurban retail locations had earlier and stronger springsales than respondents with only rural retail loca-tions.

Businesses generally had 15 to 20 percent oftheir retail sales generated in each month betweenMay and October. The average monthly retail salesfor all respondents was the highest in May ($38,055),followed by October ($26,785). However, mediumand large direct marketing farms (groups with$25,000 or more retail sales) had their highest aver-age monthly sales value in October. Moreover, morefarms in this survey retailed in October than in May,regardless of size and location. Table V-4 in Appen-dix A shows the percentage of farms retailing ineach month by retail sales and locations.

December is a month with high sales poten-tial. Although only 6 percent of the total surveyedretail sales was generated in December, the 41 per-cent of businesses who retailed in December in 2000generated an average of 14 percent of their retailsales in this month. While Table V-4 in Appendix A

shows farms with urban retail locations are morelikely to retail in December, December presents amarketing opportunity for farms with only rural re-tail locations as well. Fifty-four percent of respon-dents with urban retail locations operated in Decem-ber and generated 4 percent of this group’s total re-tail sales in this month. By contrast, 35 percent offarms with only rural retail locations operated in De-cember, and their December sales accounted for 6percent of total retail sales of this group.

Direct marketers tend to expand their seasonto November and December, not January and Febru-ary. Few respondents operated their retail outlets inJanuary (14 percent) and February (15 percent). Forthose who operated in these two months, they onlygenerated an average of 4 and 5 percent of their re-tail sales in each of these two months. Smaller directmarketing farms (under $50,000 retail sales) withonly rural retail locations are more likely than theirurban counterparts to operate in January and Febru-ary. However, the situation is reversed for largerdirect marketing farms ($100,000 or more retailsales) in this survey.

Figure III-7. Sales Generated in Each Month as Percentage of TotalSurveyed Retail Sales: Urban vs. Rural Retail Locations

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Direct Marketing Methods

New York direct marketing farms usuallyused multiple methods to retail their products. Di-rect marketing methods identified in this study in-clude roadside markets, farmers’ markets, pick-your-own (PYO), community supported agriculture(CSA), catalog sales, internet sales, and others – di-rect order, custom sales, fairs, and shows, etc.Among these, the surveyed farms used an averageof 1.7 methods to retail their products. The numberof methods utilized by different size direct market-ing operations was not statistically different.

The three most commonly used methodswere roadside markets, farmers’ markets and PYO.Roadside markets were used by 77 percent of therespondents and generated 77 percent of the totalsurveyed retail sales. However, 40 percent of the re-spondents retailed at farmers’ markets but generatedonly 8 percent of the total surveyed retail sales, and38 percent retailed through PYO but generated only9 percent of the total surveyed retail sales (Figure III-8). Table III-5 shows that roadside markets, PYOand farmers’ markets had the highest average an-nual sales of $123,787, $27,717 and $25,528, respec-tively. Larger retail operations had higher averagesales for all marketing methods except for CSA.

Table V-5 in Appendix A presents directmarketing methods used by different size retailfarms. Medium and large direct marketing veg-

etable farms (more than $50,000 retail sales) dependmostly on roadside markets for retail revenue. Forsmaller retail farms (less than $50,000 retail sales),farmers’ markets are more important for retail in-come . By contrast, none of the respondents withmore than $500,000 in retail sales operated in farm-ers’ markets. As seen in Table III-6, respondentswho retailed in farmers’ markets sell at farmers’markets an average of 2.3 times a week and gener-ated an average of $390 per farmers’ market visit.Larger businesses ($100,000-249,999 and $250,000-499,999 retail sales) generated more than double thesales per farmers’ market visit compared withsmaller businesses. This could be because largerbusinesses sold more days at farmers’ markets perweek and had a more diversified product mix to ex-pand sales and season. PYO is important to the re-tail revenue for small and medium farms (less than$100,000 retail sales); however, larger size retailfarms ($100,000 and over retail sales) also often usePYO in conjunction with their roadside market op-erations. CSA was utilized more by smaller retailoperations.

Direct Marketing Product Enterprises

The direct marketing product enterprisesincluded in this survey are fresh vegetables, freshfruits, pumpkins, Christmas trees, processed prod-ucts, gift and garden accessories, baked goods, icecream, meat products, milk and cheese products,

and other products (i.e. maplesyrup, mushrooms, entertain-ment activities, furniture, wool,etc.). In addition to analyzingthe tangible product lines, wealso investigate the intangibleand service aspects of directmarketing enterprises – enter-tainment activities, organicproduct offerings, and restau-rant/café/deli.

• Product Mix

Fresh vegetables, orna-mental plants and fresh fruitswere the top three items retailedby the surveyed farms. About30 percent of total surveyed re-tail revenue was from sale offresh vegetable products by 96

Figure III-8. Direct Marketing Methods Used byRespondents and Percentage

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W.L. Uva 13

percent of the respondents. Fifty-one percent of therespondents marketed ornamental plants directly toconsumers and accounted for 25 percent of total sur-veyed retail sales, and 65 percent of the respondentsmarketed fresh fruits, accounting for 17 percent ofthe total surveyed retail sales (Table III-7). Based onthe product lines identified in Table III-6, the sur-veyed farms had an average of 4.8 product lines.

Although not statistically different, respon-dents with urban retail locations had a slightlyhigher number of product lines (5.4) than respon-dents with only rural retail locations (4.6). FigureIII-9 demonstrates that larger operations had abroader product mix, and increasing product lines iscrucial as farms expand their direct marketing op-erations in rural locations. Larger direct marketing

Table III-5. Average Annual Direct Marketing (Retail) Sales for Different DirectMarketing Methods, by Retail Salesa

Direct marketing methodsRespondents by Roadside Farmers’ Catalog Internet retail sales markets markets PYO sales sales CSA Othersb

--------------- $ ---------------Less than $10,000 3,456 3,222 3,382 750 475 600 1,300$10,000-24.999 11,856 12,050 13,500 1,000 500 9,800 N/A$25,000-49,999 21,483 20,980 11,067 N/A 200 1,000 N/A$50,000-99,999 47,719 18,500 23,375 N/A N/A N/A 3,000$100,000-249,999 125,625 74,333 25,250 33,500 2,333 2,000 10,000$250,000 and over 672,909 80,000 81,436 12,000 3,000 N/A N/ATotal 123,787 25,528 27,717 16,150 1,456 3,350 2,456a “Direct marketing (or retail) sales” refers to farms selling their products and services directly to individual consumers using various

retail outlets. The products sold could include food and nonfood items and encompass products grown or processed on the farm aswell as products purchased for resale.

b Others include direct order and custom sales.

Table III-6. Frequency of Selling at Farmers’ Markets and Sales, byRetail Sales

Avg. sales Avg. selling Avg. months of sellingRespondents by retail sales per daya days per week at farmers’ markets

$ # of days months

Under $10,000 (N=29) 110 1.7 5.3

$10,000-24,999 (N=24) 381 1.8 5.0

$25,000-49,999 (N=16) 370 2.7 5.1

$50,000-99,999 (N=17) 259 3.2 5.8

$100,000-249,999 (N=24) 878 2.8 6.9

$250,000 and over (N=12) 1,111 3.0 6.0

Total (N=122) 390 2.3 5.6a Includes sales from marketing products and services directly to individual consumers. The products sold could in-

clude food and nonfood items and encompass products grown or processed on the farm as well as products pur-chased for resale.


Table III-7. Percentage of Sales and Businesses by Product LineProduct % of Respondents % of Total Surveyed Retail Sales

Fresh vegetables 96 29.7Ornamentals 51 24.6Fresh fruits 65 16.6Pumpkins 59 6.7Christmas trees 29 4.7Processed products 44 4.3Gifts and accessories 18 3.8Entertainment activities 38 3.4Baked goods 31 2.8Other productsa 11 1.2Ice cream 5 0.9Meat products 21 0.4Milk and cheese products 11 0.3a Others include maple syrup, mushrooms, entertainment activities, furniture, and wool.

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Urban Rural All respondentsRespondents by retail location

Aver

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duct

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< $10,000 $10,000 - 24,999 $25,000 - 49,999��$50,000 - 99,999

�� $100,000 - 249,999

��>= $250,000

Figure III-9. Average Number of Product Lines by Retail Sales:Urban vs. Rural Retail Locations

* Average number of product lines identified by different letters are signficantly different from each otherwithin category. Means are separated by LSD multiple comparison analysis (α=0.05).

W.L. Uva 15

farms with only rural retail locations ($50,000 ormore retail sales) had higher average numbers ofproduct lines than their counterparts with urban re-tail locations. Table V-6 in Appendix A shows thepercentage of farms involved in each product lineand the average sales from each product line for dif-ferent sizes of direct marketing operations.

• Items Purchased for Resale

The surveyed farms retailed more itemsthan those they produced. They purchased items forresale to expand the product line, increase variety,and supplement the volume of products for retail.Table III-8 illustrates that the surveyed farms wereleast likely to purchase fresh vegetables and pump-kins for resale. Among farms that retailed fresh veg-etables (60 percent of surveyed respondents), 39 per-

cent also purchased fresh vegetables for resale, andthey purchased an average of 16 percent of theirfresh vegetables for resale. Only 35 percent of farmsthat retailed pumpkins purchased pumpkins to re-sell, and an average of 18 percent of their pumpkinsales were from items bought for resale. On theother hand, more than 50 percent of farms that re-tailed all other product lines identified in this studypurchased some items in those product lines to re-sell. Over 90 percent of farms that retailed milk andcheese products and gift and accessory items pur-chased more than three-quarters of their products(77 percent) to resell.

For all product lines except baked goods,respondents with urban retail locations are morelikely to purchase items for resale than farms withonly rural retail locations. Larger farms are morelikely to purchase more items for resale. Appendix

Table III-8. Items Purchased for Resale by Product: Urban vs. Rural Retail Locations

Respondents by retail locationsUrban Rural All respondents

Avg. % of Avg. % of Avg. % ofPropensity of sales generated Propensity of sales generated Propensity of sales generated

respondents to from items resondents to from items respondents to from itemspurchase this purchased purchase this purchased purchase this purchased

product for resalea for resaleb product for resalea for resalea product for resalea for resaleb

--------------- % ----------- --------------- % ----------- --------------- % -----------

Fresh vegetables 45 14 36 16 39 16Ornamentals 60 26 60 25 60 25Fresh fruits 61 41 52 26 53 31Pumpkins 39 17 37 19 37 18Christmas trees 92 85 62 49 74 63Processed products 88 83 72 53 75 62Gifts and accessories 100 100 93 66 95 77Baked goods 35 59 62 44 55 50Ice cream 100 100 80 61 83 68Otherc 75 63 50 30 55 44Meat products 86 72 41 35 58 46

Milk and cheese 100 100 90 70 92 77a The propensity of respondents to purchase this product for resale for each product line was calculated by respondents purchased

items of a product line for resale as a percentage of respondents direct marketing that product line to consumers.b Averages were calculated by averaging the percentage of sales generated from items purchased for resale for each farm and not

weighted based on size of businesses.c Other includes maple syrup, mushrooms, entertainment activities, furniture, and wool.


A Table V-5 summarizes the pattern of purchasingitems for resale by product line for different size di-rect marketing operations.

• Entertainment Activities

More than one-third (38 percent) of the re-spondents offered on-farm entertainment activities,such as farm tours, hay rides, petting zoos, seasonalfestivals, events, and parties, and generated 3.4 per-cent of total surveyed direct marketing sales. None-theless, half of the farms offering entertainment ac-tivities offered them for free. Farms with urban andrural retail locations had similar marketing patterns(Figure III-10). The surveyed farms had averagesales of $11,236 from entertainment activities in2000. Although not statistically different, farms withurban retail locations had higher average sales fromentertainment activities ($15,389) than farms withonly rural retail locations ($9,494). The surveyedfarms offered an average of three months of enter-tainment activities in 2000, most commonly in Sep-tember and October.

Table V-8 in Appendix A summarizes theon-farm entertainment activities offered by differentsize direct marketing vegetable farms. Larger farmswere more likely to offer entertainment activitiesand charge for them. Seventy-five percent of farms

with $250,000 or more retail sales offered entertain-ment activities. Although one-quarter of these farmsdid not charge for patronage of these activities, theiraverage revenue from entertainment activities ex-ceeded $31,000 ($31,652) in 2000. By contrast, almostof half (46 percent) of farms with annual retail salesbetween $10,000-24,999 offered entertainment activi-ties, but only 27 percent of them charged for theirofferings and had an average revenue from enter-tainment activities of $155 in 2000, the lowest amongall direct marketing groups. The surveyed farmsgenerally offered entertainment activities in two tothree months, except for farms with $250,000 ormore retail sales which offered an average of 4.2months of entertainment activities.

• Organic Product Offerings

Twenty-two percent of the surveyed directmarketing vegetable farms offered organic productsto their retail customers with an average of fouryears’ organic product direct marketing experience(Table III-9). Smaller retail operations were morelikely to be involved in retailing organic productsand had longer experience with organic productmarketing. None of the surveyed respondents in thelargest retail operation category (more than $250,000retail sales) was involved in marketing organic prod-ucts. Retail location did not affect the marketingpattern.

• Restaurant/Café/Deli

Only 9 percent of the sur-veyed farms operated a restau-rant, café or deli in 2000. Theyoperated an average of 4.3months in 2000 and had aver-age annual sales of $18,900.The average revenue from res-taurant, café and deli opera-tions is not significantly differ-ent between farms with urbanretail locations ($21,000) andfarms with only rural retail lo-cations ($18,000). Nonetheless,farms with urban retail loca-tions had a shorter operatingseason – an average of 2.3months in 2000, mostly in thefall – compared with 5.1months for farms with only ru-ral retail locations. Large retail

18 20 19

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Urban (N=38) Rural (N=84) All respondents (N=122)Retail locations

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Charge for entertainment activities Offer entertainment activities for free

Figure III-10. Incidence of On-Farm Entertain-ment Activities and Charges: Urban vs. RuralRetail Locations

W.L. Uva 17

operations are more likely to operate a restaurant,café or deli and had higher average sales (Figure III-11).

Future Plans

The surveyed New York direct marketingvegetable farms were asked to identify changes theyforesee for different direct marketing components intheir operation in the next five years. Figure III-12shows that most of the respondents were planning toexpand one or more direct marketing components.

The components identified by most respondents forfuture expansion are holiday crops (pumpkins andChristmas trees) and fresh farm markets (40 per-cent), followed by entertainment activities (30 per-cent), ornamental plants (29 percent), and processedproducts (28 percent). Some potential growth trendsto watch for include CSA, internet sales, ice creamstands and catalog sales. Although only relativelyfew respondents foresaw changes in these directmarketing components in the near future, the major-ity of them were planning for expansion.

Table V-9 in Appendix A shows future plans

Table III-9. Organic Product Marketing by Retail SalesAverage years involved in

Respondents by retail sales % of respondents retailing organic products% years

Under $10,000 (N=29) 43 4.2$10,000-24,999 (N=24) 26 6.5$25,000-49,999 (N=16) 19 4.5$50,000-99,999 (N=17) 12 3.5$100,000-249,999 (N=24) 22 1.5

$250,000 and over (N=12) 0 0.0Total (N=122) 22 4.0

500 400 750

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$250,000 andmore

Respondents by retail sales

Aver

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sale

s ($

)

Figure III-11. Average Revenue from Restaurant,Cafe, and Deli Operations, by Retail Sales


for different direct marketing components by differ-ent size surveyed farms. Farms with less than$10,000 retail sales were most likely to focus on ex-panding in fresh farm markets, farmers’ markets andentertainment activities. Farms with $10,000-24,999and $25,000-49,999 retail sales were most likely tocontinue to expand their fresh farm markets and en-tertainment activities, as well as holiday crop sales.For farms with $50,000-99,999 and $100,000-249,999retail sales, although many were still planning to ex-pand their farm fresh market sales, an increased per-centage of them expected no changes or even a re-duction in this component. The planned directionsfor expansion for farms in these two categories wereevenly spread over many areas based on individualmarketing strategies. The largest farms category($250,000 or more retail sales) are most likely to ex-pand into holiday crops, ornamental plants and en-tertainment activities.

Marketing Tools

The respondents were asked to identify mar-keting tools they used to promote retail sales andrate the effectiveness of these marketing tools on a 1to 5 scale, where 1 is not effective and 5 is very effec-tive (Figures III-13 and 14). The marketing toolsrated included newspaper advertising, TV advertis-ing, radio advertising, road signs (include bill-boards), direct mailing, sales promotion (coupons,special discounts, etc.), internet marketing, in-storepromotion (free samples, point-of-purchase displays,brochures, etc.), community relationships (sponsor-ing community events), participating in locally-grown promotion programs, participating in tourismprograms, and word-of-mouth. The most commonlyused marketing tools are “word-of-mouth” by 84percent of the respondents, followed by “newspa-pers” (73 percent), “road signs” (57 percent), and“community relations” (55 percent). Respondentswith urban retail locations were more likely to use

Figure III-12. Future Plans for Different Direct Marketing Enterprises

40 40

30 2928

1917

1412

11 10

5 5 5 4

15

30

6

15

19 18 19

811

2

7

1 1

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0

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02 1

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5

10

15

20

25

30

35

40

45

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crops*

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rm m

arkets

Entertai

nment a

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ies

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tal plan

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W.L. Uva 19

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rtising

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lations*

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romotion

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aper

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rtising*

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vertis

ing**

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n

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promotion

Yellow pag

es

ratin

g (1

=not

effe

ctiv

e , 5

=ver

y ef

fect

ive)

Urban��

Rural All respondents

Figure III-14. Effectiveness Rating of Different Mar-keting Tools, by Retail Location

*, ** Respondents with urban retail locations and respondents with only rural retail locationsare significantly different at P<0.1 or 0.05, respectively.

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26

3530

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28

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20

30

0

20

40

60

80

100

Word of mouth

Newsp

aper

adve

rtising

Road si

gns

Community re

lations

In-store

promotion

Direct

mailing

Regional

promotion

Tourism promotio

n*

Radio ad

vertis

ing

Yellow pag

es

Sales p

romotion**

Internet

TV adve

rtising

% o

f res

pond

ents

(%)

Urban (N=38)��

Rural (N=84) All respondents (N=122)

Figure III-13. Respondents’ Utilization of DifferentMarketing Tools, by Retail Location



regional promotion, yellow pages, sales promotion,and internet to market their businesses and productsthan respondents with only rural retail locations. Onthe other hand, respondents with only rural retaillocations were more likely to use newspapers, tour-ism, and radio promotion than their urban counter-parts. However, tourism promotion and sales pro-motion are the only two marketing techniques uti-lized significantly differently by the two groups.Additional marketing tools identified under “other”included attending trade shows and hosting tours.

The overall rating was the highest for word-of-mouth (4.5) which was also used by most farms(84 percent). The second highest rated marketingtool was TV advertising (4.2); however, it was onlyused by 7 percent of the respondents. The marketingtools receiving third and fourth highest ratings weredirect mailing (4.1) and community relations (4.0),used by 30 percent and 55 percent of respondents,respectively. Although newspaper advertising wasthe second most frequently used marketing tool, itonly received an average 3.2 effectiveness rating.Respondents with urban retail locations gave higherratings to TV advertising, direct mailing, sales pro-motion, and community relationships than respon-dents with only rural retail locations. By contrast,respondents with onlyrural retail locationsgave higher ratings toyellow pages, newspa-per advertising, radioadvertising, internet, in-store promotion, andtourism promotion.Only ratings for news-paper advertising, radioadvertising, and com-munity relations are sta-tistically different. Al-though businesses withurban locations weremore likely to useinternet promotion,businesses with onlyrural locations foundinternet promotion to bea more effective market-ing tool.

Figures V-1, V-2, and V-3 in AppendixA present the effective-ness of different mar-

keting tools rated by different size retail businesses.Word-of-mouth is rated as very effective by all farmcategories except the largest retail farms ($250,000 ormore). Most commonly used marketing tools areword-of-mouth, road signs and newspapers.Smaller farms (less than $10,000, $10,000-24,999 and$25,000-49,999) also stressed community relations.Larger farms ($10,000-249,999 and more than$250,000) utilized more marketing tools. In-storepromotion was used by more than half of the farmsin these two categories, and farms with more than$250,000 annual retail sales also frequently usedsales promotion, tourism promotion and TV adver-tising.

The surveyed farms spent an average of 3.1percent of retail sales on promoting their retail op-erations and products (Figure III-15). Respondentswith only rural retail locations generally spent ahigher percentage of their retail sales on marketingcompared with respondents with urban retail loca-tions, except businesses with $10,000-24,999 and$25,000-49,999 retail sales. Overall, respondentswith only rural retail locations spent an average of3.4 percent of their retail sales on marketing and re-spondents with urban retail locations spent an aver-age of 2.4 percent of retail sales on marketing.

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2

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< $10,000 $10,000 -24,999

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Mar

ketin

g bu

dget

as

% o

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al re

tail

sale

s

Urban (N=38)

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Figure III-15. Annual Marketing Budget as Percentageof Retail Sales

W.L. Uva 21

Business Management Strategies Used toImprove Profitability

Respondents were also asked to identifybusiness management strategies they used to im-prove the profitability of their retail operations andrate how effective those tools were on a 1 to 5 scale,where 1 is not effective and 5 is very effective. Busi-ness management strategies identified in the surveyinclude developing a business plan, developing amarketing plan, expanding product lines (value-added, organic, new products and varieties, etc.),adding services, competitive pricing, branding, uti-lizing loyal buyers’ programs, providing customereducation, maintaining a mailing list, promotingagri-tourism, collaborating with other marketers,promoting ‘buy local’, keeping financial records fordecision-making, and providing training for employ-ees. As seen in Figure III-16, keeping financialrecords for decision-making was utilized by mostrespondents (60 percent), followed by expandingproduct lines (59 percent), competitive pricing (48

percent), and promoting buy local (44 percent). Re-spondents with urban retail locations were morelikely to use many of the business management strat-egies than respondents with only rural retail loca-tions, especially keeping financial records and col-laborating with other marketers. On the other hand,respondents with only rural retail locations weremore likely to develop business and marketing plansthan their urban counterparts.

Figure III-17 shows that branding was ratedas most effective overall (4.5); however, it was usedby only 8 percent of the respondents. Keeping finan-cial records to support decisions had the secondhighest rating of 4.2 and used by most respondents(60 percent), followed by continuous employee edu-cation (4.1) and maintaining a mailing list (4.1) by 24percent and 34 percent of the respondents, respec-tively. Although competitive pricing was used by 48percent of the respondents, the effectiveness ratingcame in second to last (3.4), only higher than loyalbuyers’ programs. While respondents with urbanand rural locations generally had similar ratings for

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rs

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uyer's

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% o

f res

pond

ents

(%)

Urban (N=38)��Rural (N=84) All respondents (N=122)

Figure III-16. Respondents’ Utilization of Different BusinessManagement Tools, by Retail Sales

*Respondents with urban retail locations and respondents with only rural retail locations are signficantly dif-ferent at P<0.1.


business management tools identified in this survey,farms with urban retail locations rated competitivepricing as significantly more effective than did farmswith only rural retail locations, and they rated devel-oping marketing plans, developing business plansand expanding product lines as slightly more effec-tive than did farms with only rural retail locations.Other business management tools identified by re-spondents include minimizing costs, becoming moreefficient, diversifying investment, and hard workand long hours.

Figures V-5, V-6, and V-7 in Appendix Apresent the effectiveness of different business man-agement strategies rated by different size retailfarms. Continuous education was rated as more ef-fective (4.5 or greater) by small and medium sizefarms (less than $10,000, $25,000-49,999, and

$50,000-99,999) except farms with $10,000-24,999 an-nual retail sales. Collaborating with others is ratedas more effective (4.5 or greater) by medium andlarger farms ($25,000-49,999, $50,000-99,999, and$250,000 or more) except farms with $100,000-249,999 annual retail sales. Adding services wasrated the highest by most of the largest direct mar-keters ($250,000 or more).

Different size farms had different resourcesand management skills. They also focused on differ-ent management strategies. The most commonlyused strategy by farms with less than $10,000 annualretail sales to improve profitability was expandingproduct lines, identified by 50 percent of the farmsand rated only 3.2; no other strategies were ratedhigher than 50 percent by the farms in this category.The most commonly used strategies by farms with

Figure III-17. Effectiveness Rating of Different Business Management Tools,by Retail Location

**Respondents with urban retail locations and respondents with only rural retail locations are significantly different atP<0.05.

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W.L. Uva 23

$10,000 – 24,999 annual retail sales were keeping fi-nancial records (65 percent) and expanding productlines (61 percent), rated 4.3 and 4.4, respectively.The other strategies identified by more than half ofthe farms in this size category were developing amarketing plan (52 percent, rated 3.9) and develop-ing a business plan (52 percent, rated 3.8). The onlybusiness management strategy used by more than 50percent of the farms with $25,000 – 49,999 annualretail sales was promoting buy local (53 percent) andrated only 3.4.

As farms grew larger, the need for keepingfinancial records was recognized by more farm op-erators. Seventy-one percent of farms with $50,000-99,999 annual retail sales and 83 percent of farmswith $100,000-249,999 annual retail sales found thatkeeping financial records helped them improve prof-itability. The effectiveness was rated 4.3 and 4.4, re-spectively. Expanding product lines was the secondmost commonly used strategies by farms in thesetwo categories (65 percent and 74 percent), and itwas rated only 3.5 by farms with $50,000-99,999 an-nual retail sales and 4.3 by farms with $100,000-249,999 annual retail sales. The most commonlyused strategies by large farms ($250,000 or more an-nual retail sales) were adding services (73 percent)and developing a business plan (73 percent), and theeffectiveness on improving profitability was 5.0 and3.5, respectively. Additional strategies used by morethan half of the farms in this category included 73percent for maintaining a mailing list and 55 percentfor collaborating with others, promoting agri-tour-ism, branding, and expanding product lines.

Direct Marketers’ Views on Barriers,Opportunities and Training Needs

In their own words, respondents identifiedthe top three barriers or problems facing their directmarketing operations and the top three opportuni-ties for the future success of their direct marketingoperations. Table III-10 shows that competition in asaturated market and labor related challenges arethe top barriers to success in many direct marketingoperators’ minds. Concerns include competitionfrom supermarkets, discount stores, import goods,and other farm markets, and labor related challengesincluding lack of labor pool and hard-to-find sea-sonal help, difficulty in finding good labor and keep-ing qualified labor, and high costs of labor. Othertop barriers were location, limited resources (capital,land and products), changing market and consumer

demand (one-stop shopping and year-round sup-ply), and regulations and community developmentpressure. Limited resources and marketing skillswere bigger concerns for farms with only rural retaillocations, and farms with urban locations worriedmore about changing market demands. While directmarketing vegetable farms in most size categoriesidentified competition in the market as the numberone barrier, the farms with the smallest retail opera-tions (under $10,000 annual retail sales) saw limitedresources as their top barrier; moreover, the largestretail operations ($250,000 or more retail sales) per-ceived high operating costs as their topmost barrierto success (Appendix A Table V-10).

While the top opportunity identified by therespondents was definitely diversification and ex-pansion, farms have many different visions on howthey want to expand and diversify their retail busi-nesses. Their plans included expanding productlines, developing entertainment activities and agri-tourism, diversifying marketing outlets and methods(additional direct marketing methods and wholesaleoutlets), extending season, and increasing farm sizeand operating hours. Respondents also were striv-ing for farm fresh to provide high quality and freshproducts as well as good service to help future suc-cess. More marketing is another important opportu-nity identified by respondents. Other opportunitiesinclude good retail locations , market and consumertrends on eating more fresh fruits and vegetablesand desire to buy from local farmers. Direct market-ers with urban retail locations see more emphasis onmarketing as a greater opportunity than direct mar-keters with only rural retail locations. On the otherhand, direct marketers with only rural retail loca-tions see providing freshness and quality products,having a good retail location, maintaining a farm im-age, consumer trends on eating more fruits and veg-etables and buying from local farmers as greater op-portunities than their urban counterparts. Respon-dents in different retail size categories all felt thatexpanding and diversifying is the top opportunityfor their direct marketing operation (Appendix ATable V-11).

Respondents also identified the top threetraining or publications topics they would like to seeavailable to them or their employees to help theirdirect marketing operation success. The results weresummarized in Table III-12. Marketing strategy re-lated topics were identified by most respondents asincluding effective promotion strategies, sales strate-gies, store design and layout, differentiation strate-


gies, development of new products and markets,customer relations and services, and internet mar-keting. Production and post-harvesting topics camein second, including small scale harvesting and culti-vating techniques, product variety and seed selec-tion, and techniques to improve shelf-life. Customereducation is also on the top of direct marketers’minds. Topics requested in this category include in-formation on how to use seasonal vegetables, how totake care of products at home, sustainable agricul-ture and buying local. Information on the economicsenvironment and market trends, employee trainingand motivation, obtaining grants and funding sup-port, and government standards and regulations areother important education topics. Besides marketing

related training, respondents with urban retail loca-tions focused on information for customer educa-tion, and respondents with only rural retail locationslooked for production techniques related training.Respondents of different size operations generallyrequested marketing related topics as their top train-ing and education needs. Nonetheless, respondentswith $25,000-49,999 annual retail sales ranked infor-mation on customer education higher than market-ing related topics. Moreover, few of the respondentsin the largest direct marketing group ($250,000 ormore) identified any training or education needs,and the ones who did identified employee trainingand market analysis as the most important (Appen-dix A V-12).

W.L. Uva 25

Tabl

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Faci

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Dir

ect

Mar

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Tabl

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W.L. Uva 27

Tabl

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Nee

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t M

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tin

g O

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f res

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Mar

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rate

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76

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1711

786

2617

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Prod

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late

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11

35

41

245

52

27

Cus

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41

115

11

27

52

322

Mar

ket a

naly

sis

and

trend

info

rmat

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11

05

33

015

44

020

Empl

oyee

trai

ning

and

mot

ivia

tion

21

19

03

17

24

216

Gra

nts

and

fund

ing

assi

stan

ce--

----

--3

03

123

03

12

Reg

ulat

ions

10

03

20

28

30

211

Fina

ncia

l pla

nnin

g an

d m

anag

emen

t0

01

11

10

51

11

6

Net

wor

king

, col

labo

ratin

g0

10

21

03

61

13

8

Smal

l far

ms

10

03

20

00

10

03

Pric

ing

01

13

11

27

12

310

Succ

essi

on p

lann

ing

----

----

02

04

02

04

* W

eigh

ted

sum

was

cal

cula

ted

by 3

* n

umbe

r of r

ank

1 +

2 *

num

ber o

f ran

k 2

+ 1

* nu

mbe

r of r

ank

3.


IV. CONCLUSION

The results of this survey provide a profileof direct marketing vegetable farms in New Yorkand their direct marketing activities and strategies.The findings show that direct marketing is an effec-tive value-added strategy for vegetable farms inNew York, and an important source of income forthese farms. Moreover, it demonstrates that thescope of direct retail sales conducted by New Yorkvegetable farms is much greater than just food prod-ucts sold for human consumption and crops pro-duced on the farm as defined in the Census of Agri-culture.

According to the 1997 Census of Agricul-ture, 879 of 1,585 vegetable farms in New York gen-erated total sales of $13.2 million from selling agri-culture products directly to individuals for humanconsumption in 1997, which is an average of $15,017per farm. However, when using the broader defini-tion of direct farm-to-consumer marketing sales asdefined in this study, the average “direct marketingsales” of survey respondents in this study reached$123,000, and 50 percent of respondents had directmarketing sales more than $30,000 in 2000. There-fore, the total economic impact of direct marketingactivities performed by New York vegetable farms ismuch greater than demonstrated by the Census ofAgriculture data. This also implies that diversifyingto nonfood products and services and purchasingproducts to resell could potentially increase direct

marketing vegetable farms’ income significantly.Hence, farmer-to-consumer direct marketing activi-ties are becoming ever more diversified and sophis-ticated. Moreover, this study indicated that directmarketing vegetable farms in New York are also ex-panding to other marketing channels. As a result, itis important for direct marketers to enhance theirmarketing knowledge and skills as well as businessmanagement competency and access to qualitywholesale products to satisfy different sectors of cus-tomers and improve profitability.

While this study showed that New York’sdirect marketing vegetable farms face diverse chal-lenges in the market, they also enjoy many opportu-nities. Many of the direct marketing farms are con-sidering expansion and are optimistic about the mar-ket. However, collecting information and identify-ing opportunities alone will neither improve marketsnor answer all questions for direct marketers. Moreattention to marketing and business managementwill be necessary to ensure future profitability andsuccess. Results from this survey also showed thatvegetable farms with direct marketing are a very di-versified group, and the needs for each group to ex-pand, improve and succeed are different. Addi-tional marketing and business management researchor educational programs need to be developed andtailored to the specific needs of each group.

REFERENCES

Bills, N., M. Roth, and J. Maestro-Scherer. 2000. Di-rect Marketing Today: Challenges and Opportuni-ties. U.S. Department of Agriculture. NationalAgricultural Statistics Service. Washington, D.C.

Bond, M.C. 1941. Selling Farm Products ThroughRoadside Markets. Cornell Extension Bulletin 466,Cornell University, Ithaca, NY. June.

Bureau of Marketing Development, PennsylvaniaDept. of Agriculture. 1997. Results of the Penn-sylvania Direct Marketing Survey. Harrisburg,PA. June.

.Eiler, D.A. and D.G. Rosenfeld. 1973. Customers at

Selected New York State Roadside Markets. A.E.Res. 73-12, Dept. of Agricultural Economics,Cornell University, Ithaca, NY.

How, R.B. 1980. Developing Direct Programs for BothFarmers and Consumers. A.E. Staff Paper 80-24,Dept. of Agricultural Economics, Cornell Uni-versity, Ithaca, NY.

New York Agricultural Statistics Service. 1988. NewYork Direct Marketing Survey, 1988. New YorkDept. of Agriculture and Markets. Albany, NY.

W.L. Uva 29

Nayga, R.M., M.S. Fabian, D.W. Thatch, and M.N.Wanzala. 1995. “Farmer-to-Consumer DirectMarketing: Sales and Advertising Aspects ofNew Jersey Operations.” Journal of Food Distri-bution Research, 26(1): 38-52.

Stuhlmiller, E.M. and R.B. How. 1978. Selected Char-acteristics of Direct Marketing Businesses, Six Coun-ties, New York, 1976. A.E. Res. 78-7, Dept. of Ag-ricultural Economics, Cornell University, Ithaca,NY.

Stuhlmiller, E.M., R.B. How, and K.W. Stone. 1976.Consumer Use and Experience with Home Gardensand Produce Purchased Directly from Farmers. A.E.Res. 76-20, Dept. of Agricultural Economics,Cornell University, Ithaca, NY.

USDA. 1999. 1997 Census of Agriculture. U.S. De-partment of Agriculture, National AgriculturalStatistics Service, Washington, D.C.


W.L. Uva 31

V. APPENDIX A

Table V-1. Areas of Crop Produced, by Total Farm ReceiptsRespondents bytotal farm receipts Vegetables Fruits Ornamentals

Under $10,000 100 2.7 48 2.3 22 938

$10,000-49,999 100 13.3 29 3.5 39 17,500$50,000-99,999 100 20.2 30 17.2 40 29,479$100,000-249,999 100 27.2 61 37.3 65 30,962$250,000-499,999 100 84.1 57 77.8 43 18,520$500,000-749,999 100 116.0 71 6.6 43 30,733$750,000-999,999 100 101.7 50 23.5 50 29,000Over $1,000,000 100 131.0 64 29.9 65 54,765All farms 100 37.9 46 22.7 45 32,837

Table V-2. Crops Produced by New York Direct Marketing VegetableFarms, by Total Farm ReceiptsRespondents Vegetables,by total farm Vegetables Vegetables Vegetables fruits & receipts only & fruits & ornamentals ornamentals Total

------------- % of farms -----------

Under $10,000 39 39 13 9 100

$10,000-49,999 45 16 26 13 100$50,000-99,999 50 10 20 20 100$100,000-249,999 13 22 26 39 100$250,000-499,999 14 43 29 14 100$500,000-749,999 0 57 29 14 100$750,000-999,999 0 25 25 50 100Over $1,000,000 9 27 27 36 100All farms 28 26 26 20 100


Tabl

e V

-3. M

arke

tin

g O

utl

et U

sed

by N

Y V

eget

able

Far

ms

wit

h D

irec

t M

arke

tin

g O

utl

ets,

by

Size

of

Bu

sin

esse

sR

espo

nden

ts b

yO

ther

reta

ilFo

od s

ervi

ceO

ther

who

lesa

leto

tal f

arm

rece

ipts

Supe

rmar

ket

farm

mar

kets

outle

tsou

tlets

Ret

ail

% o

f%

of

% o

f%

of

% o

fAv

g. %

tota

lAv

g. %

tota

lAv

g. %

tota

lAv

g. %

tota

lAv

g. %

tota

l%

of

of fa

rmsu

rvey

ed%

of

of fa

rmsu

rvey

ed%

of

of fa

rmsu

rvey

ed%

of

of fa

rmsu

rvey

ed%

of

of fa

rmsu

rvey

edfa

rms

sale

ssa

les

farm

ssa

les

sale

sfa

rms

sale

ssa

les

farm

ssa

les

sale

sfa

rms

sale

ssa

les

Und

er $

10,0

0017

6.0

1.5

178.

82.

24

5.0

0.3

42.

00.

110

097

.195

.9$1

0,00

0-49

,999

2617

.35.

932

25.5

7.9

1915

.33.

713

20.0

3.4

100

81.8

79.2

$50,

000-

99,9

9945

18.4

10.0

5512

.57.

218

3.0

0.7

2726

.78.

010

077

.074

.1$1

00,0

00 -

249,

999

4228

.511

.958

15.3

9.2

2911

.02.

650

26.3

13.0

100

62.8

63.3

$250

,000

-499

,999

5738

.823

.071

21.6

16.6

4330

.711

.743

5.7

2.6

100

46.9

46.1

$500

,000

-749

,999

576.

53.

457

35.0

19.6

296.

01.

657

56.3

33.3

100

42.4

42.0

$750

,000

-999

,999

6740

.525

.710

028

.028

.633

2.0

0.6

00.

00.

010

044

.345

.1$1

,000

,000

& o

ver

3617

.84.

210

011

.211

.227

27.0

4.7

7353

.141

.710

036

.838

.3

All

farm

s36

20.6

8.3

4817

.513

.722

14.2

4.1

2932

.729

.110

071

.744

.8

W.L. Uva 33

Tabl

e V

-4. A

vera

ge P

erce

nta

ge o

f R

etai

l In

com

e G

ener

ated

in E

ach

Mon

th, b

y R

etai

l Sal

es

Res

pond

ents

by

Mon

th

reta

il sa

les

Jan.

Feb.

Mar

chAp

rilM

ayJu

neJu

lyAu

g.Se

pt.

Oct

.N

ov.

Dec

.

-----

-----

% o

f Res

pond

ents

-----

-----

Urb

an (N

=6)

4040

2020

4080

8080

8080

4040

Und

er $

10,0

00R

ural

(N=2

3)4

913

2239

6187

8374

6126

17Al

l (N

=29)

1114

1421

3964

8682

7564

2921

Urb

an (N

=3)

00

5050

5050

100

100

100

5010

050

$10,

000-

24,9

99R

ural

(N=2

1)24

1619

2929

4967

6771

6738

38Al

l (N

=24)

2217

2230

3048

7070

7465

4339

Urb

an (N

=5)

00

2020

4080

100

100

100

100

2020

$25,

000-

49,9

99R

ural

(N=1

1)10

1010

040

5080

100

100

8040

30Al

l (N

=15)

77

137

4060

8710

010

087

3327

Urb

an (N

=5)

00

00

8080

8080

100

100

4020

$50,

000-

99,9

99R

ural

(N=1

2)17

1733

4258

9292

9292

7533

33Al

l (N

=17)

1212

2435

6588

8888

9482

3529

Urb

an(N

=11)

2736

3645

6410

010

010

010

010

073

73$1

00,0

00-2

49,9

99R

ural

(N=1

2)8

88

5083

9210

010

010

010

075

58Al

l (N

=24)

1722

2248

7496

100

100

100

100

7465

Urb

an (N

=8)

1414

1471

100

100

100

100

100

100

8686

$250

,000

or m

ore

Rur

al (N

=4)

00

2550

100

100

100

100

100

100

7575

All (

N=1

2)9

918

5510

010

010

010

010

010

077

77U

rban

(N=3

8)17

2023

3771

9410

010

010

097

6054

All

farm

sR

ural

(N=8

4)12

1217

2950

6887

8887

7741

35A

ll (N

=122

)14

1519

3256

7691

9292

8347

41


Tabl

e V

-5. D

irec

t M

arke

tin

g M

eth

ods

Use

d by

New

Yor

k V

eget

able

Far

ms

and

Ret

ail S

ales

Gen

erat

ed b

yEa

ch M

arke

tin

g M

eth

odR

espo

nden

ts b

y R

etai

l Sal

es

Und

er $

10,0

00$1

0,00

0-24

,999

$25,

000-

49,9

99$5

0,00

0-99

,999

$100

,000

-249

,999

$250

,000

and

ove

r(N

=29)

(N=2

4)(N

=16)

(N=1

7)(N

=24)

(N=1

2)

% o

f%

of

% o

f%

of

% o

f%

of

surv

eyed

surv

eyed

surv

eyed

surv

eyed

surv

eyed

surv

eyed

% o

fre

tail

% o

fre

tail

% o

fre

tail

% o

fre

tail

% o

fre

tail

% o

fre

tail

farm

ssa

les

farm

ssa

les

farm

ssa

les

farm

ssa

les

farm

ssa

les

farm

ssa

les

Roa

dsid

e m

arke

ts57

4070

5675

4894

6687

7210

086

Farm

ers’

mar

kets

5435

2621

6339

359

3919

92

PYO

2115

2220

3812

7124

437

648

Cat

alog

sal

es4

14

0b0

00

09

29

1

Inte

rnet

sal

es7

14

0b6

0b0

013

0b9

2

CSA

40b

43

60b

00

40b

00

Oth

ersa

257

00

00

60b

40b

00

a Oth

ers

incl

ude

dire

ct o

rder

, cus

tom

sal

es, f

airs

, and

sho

ws.

b R

ound

ed to

zer

o du

e to

less

than

0.5

%

W.L. Uva 35

Tabl

e V

-6.

Ave

rage

Ret

ail S

ales

an

d P

erce

nta

ge o

f R

espo

nde

nts

Off

erin

g Ea

ch P

rodu

ct L

ine,

by

Ret

ail S

ales

Res

pond

ents

by

reta

il sa

les

$10,

000-

$25,

000-

$50,

000-

$100

,000

-$2

50,0

00-

Und

er $

10,0

0024

,999

49,0

0099

,999

249,

999

and

over

Tota

l(N

=29)

(N=2

4)(N

=16)

(N=1

7)(N

=24)

(N=1

2)(N

=122

)

% o

f A

vg.

% o

fAv

g. %

of

Avg.

% o

f

Avg.

% o

fAv

g. %

of

Avg.

% o

fA

vg.

farm

ssa

les

farm

ssa

les

farm

ssa

les

farm

s s

ales

farm

ssa

les

farm

ssa

les

farm

ssa

les

%$

%$

%$

%$

%$

%$

%$

Fres

h ve

geta

bles

100

2,20

796

7,44

496

18,5

3695

32,0

0096

56,3

5510

019

5,82

896

42,4

45O

rnam

enta

ls29

1,66

035

5,75

656

7,35

050

16,8

8374

38,8

9491

2614

1751

59,2

06

Fres

h fru

its43

2,23

443

4,87

063

12,7

6075

20,3

8591

27,6

2410

012

4,03

765

31,4

82

Pum

pkin

s21

675

483,

600

633,

260

567,

250

9115

,886

100

43,9

1759

13,9

92

Chr

istm

as tr

ees

112,

000

226,

680

1910

,733

131,

367

489,

909

8254

,889

2819

,962

Proc

esse

d

prod

ucts

251,

829

392,

667

311,

550

503,

131

6518

,740

8230

,300

4511

,987

Gift

& a

cces

sorie

s11

950

0N

/A6

2,00

025

4,18

817

16,2

5082

50,8

8918

25,9

33

Bake

d go

ods

71,

200

173,

500

192,

200

313,

075

5713

,932

8219

,948

3011

,161

Ice

Cre

am0

N/A

0N

/A0

N/A

63,

750

139,

000

1840

,000

518

,458

Oth

ers*

141,

225

93,

000

0N

/A13

8,50

013

25,2

6718

37,5

0011

13,7

46

Mea

t pro

duct

s14

1,76

326

2,05

06

2,00

013

900

261,

850

365,

625

202,

402

Milk

& c

hees

e

pro

duct

s0

N/A

460

00

N/A

1975

026

1,71

727

12,3

3311

3,85

8

* O

ther

s in

clud

e m

aple

syr

up, m

ushr

oom

s, e

nter

tain

men

t act

iviti

es, f

urni

ture

, and

woo

l.


Tabl

e V

-7.

Item

s P

urc

has

ed f

or R

esal

e fo

r Ea

ch P

rodu

ct L

ine,

by

Ret

ail S

ales

Res

pond

ents

by

reta

il sa

les

Und

er $

10,0

00$1

0,00

0-24

,999

$25,

000-

49,9

99$5

0,00

0-99

,999

$100

,000

-249

,999

$250

,000

and

ove

r(N

=29)

(N=2

4)(N

=16)

(N=1

7)(N

=24)

(N=1

2)

% fa

rms

% fa

rms

% fa

rms

% fa

rms

% fa

rms

% fa

rms

sell

the

Avg.

%se

ll th

eAv

g. %

sell

the

Avg.

%se

ll th

eAv

g. %

sell

the

Avg.

%se

ll th

eAv

g. %

item

sale

site

msa

les

item

sale

site

msa

les

item

sale

site

msa

les

also

from

also

from

also

from

also

from

also

from

also

from

resa

lere

sale

resa

lere

sale

resa

lere

sale

resa

lere

sale

resa

lere

sale

resa

lere

sale

Fres

h ve

geta

bles

96

3315

3116

5321

5518

8226

Orn

amen

tals

311

7543

131

7822

7640

8021

Fres

h fru

its3

840

2956

3477

3957

2591

63

Pum

pkin

s50

4036

3430

1340

1643

1227

12

Chr

istm

as tr

ees

3333

6041

6767

6734

8275

8978

Proc

esse

d

prod

ucts

5750

5650

5050

100

7380

6089

82

Gift

& a

cces

sorie

s67

50N

/AN

/A10

080

100

7410

049

100

100

Bake

d go

ods

00

7561

5035

6750

8539

8976

Ice

Cre

amN

/AN

/AN

/AN

/AN

/AN

/A10

05

6767

100

100

Oth

ers*

750

500

N/A

N/A

500

6750

100

95

Mea

t pro

duct

s0

050

340

010

067

6750

100

100

Milk

& c

hees

e

prod

ucts

N/A

N/A

100

100

N/A

N/A

100

6783

6710

010

0

* O

ther

s in

clud

e m

aple

syr

up, m

ushr

oom

s, e

nter

tain

men

t act

iviti

es, f

urni

ture

, and

woo

l.

W.L. Uva 37

Tabl

e V

-8.

On

-far

m E

nte

rtai

nm

ent

Act

ivit

y O

ffer

ings

an

d C

har

ges

by R

etai

l Sal

esAm

ong

resp

onde

nts

offe

ring

Res

pone

nts

offe

ring

ente

rtain

men

t act

iviti

es,

Aver

age

sale

s fro

mR

espo

nden

ts b

y re

tail

sale

sen

terta

inm

ent a

ctiv

ities

% c

harg

ing

fees

for t

hem

ente

rtain

men

t act

iviti

es

#(%

)%

$

Und

er $

10,0

00 (N

=29)

7(2

4%)

43%

371

$10,

000-

24,9

99 (

N=2

4)11

(46%

)27

%15

5

$25,

000-

49,9

99 (

N=1

6)3

(19%

)67

%1,

000

$50,

000-

99,9

99 (

N=1

7)5

(29%

)40

%3,

400

$100

,000

-249

,999

(N

=24)

9(3

8%)

56%

7,83

3

$250

,000

and

ove

r (N

=12)

9(7

5%)

75%

31,6

52

Tota

l (N

=122

) 3

850

%11

,236


Tabl

e V

-9.

Futu

re P

lan

s fo

r D

iffe

ren

t D

irec

t M

arke

tin

g C

ompo

nen

ts, b

y R

etai

l Sal

esR

espo

nden

ts b

y R

etai

l Sal

es

Und

er $

10,0

00

$

10,0

00-2

4,99

9

$

25,0

00-4

9,99

9D

irect

Mrk

tg. E

nter

pris

eEx

pand

No

Cha

nge

Dec

reas

eEx

pand

No

Cha

nge

Dec

reas

eEx

pand

No

Cha

nge

Dec

reas

e

-----

------

---- %

resp

onde

nts

------

------

----

Fres

h fa

rm m

arke

t32

*21

048

*17

1340

*33

13Pr

oces

sed

prod

ucts

1829

426

40

137

0O

rgan

ic p

rodu

cts

1421

013

40

70

0O

rnam

enta

l pla

nts

187

018

130

2027

0H

olid

ay c

rops

a18

114

3913

440

*20

7Ba

kery

110

04

130

013

0Ic

e cr

eam

sta

nd0

00

00

07

00

Gift

& a

cces

sorie

s15

00

80

00

00

Ente

rtain

men

t act

iviti

es25

00

349

027

70

PYO

1811

013

130

77

20R

esta

uran

t etc

.4

00

04

413

70

Cat

alog

sal

es4

40

80

00

00

Inte

rnet

sal

es11

40

180

07

00

CSA

40

08

00

70

0Fa

rmer

s’ m

arke

ts25

214

2213

020

400

$50

,000

- 99

,999

$

100,

000

– 24

9,99

9

$25

0,00

0 an

d ov

erEx

pand

No

Cha

nge

Dec

reas

eEx

pand

No

Cha

nge

Dec

reas

eEx

pand

No

Cha

nge

Dec

reas

e

-----

------

---- %

resp

onde

nts

------

------

---Fr

esh

farm

mar

ket

29*

596

5217

2227

649

Proc

esse

d pr

oduc

ts18

240

3922

027

360

Org

anic

pro

duct

s12

00

84

00

00

Orn

amen

tal p

lant

s24

240

4313

973

180

Hol

iday

cro

psa

2429

1257

*13

482

*9

0Ba

kery

618

039

00

3645

0Ic

e cr

eam

sta

nd0

00

134

018

00

Gift

& a

cces

sorie

s12

60

269

018

640

Ente

rtain

men

t act

iviti

es18

60

264

064

180

PYO

2435

1826

170

1845

0R

esta

uran

t etc

.0

60

40

09

270

Cat

alog

sal

es0

00

90

09

00

Inte

rnet

sal

es6

00

44

027

00

CSA

00

04

00

00

0Fa

rmer

s’ m

arke

ts30

012

930

00

00

a Hol

iday

cro

ps in

clud

e pu

mpk

ins

and

Chr

istm

as tr

ees.

* Th

e di

rect

mar

ketin

g co

mpo

nent

iden

tifie

d by

mos

t res

pond

ents

for e

xpan

sion

W.L. Uva 39

Tabl

e V

-10

. Ran

kin

g of

Top

Bar

rier

s Fa

cin

g D

irec

t M

arke

tin

g O

pera

tion

s, b

y R

etai

l Bu

sin

ess

Ran

king

Und

er $

10,0

00$1

0,00

0- 2

4,99

9$2

5,00

0-49

,999

$50,

000-

99,9

99$1

00,0

00-2

49,9

99$2

50,0

00 a

nd o

ver

Com

petit

ion

13

34

58

32

21

15

20

31

21

24

2W

eigh

ted

sum

1413

1527

3211

Labo

r cha

lleng

es1

32

23

42

23

33

03

33

00

00

01

Wei

ghte

d su

m15

1212

918

13R

etai

l loc

atio

ns1

43

12

30

22

02

12

03

01

10

00

Wei

ghte

d su

m16

108

813

0Li

mite

d re

sour

ces

16

21

10

02

22

10

11

31

11

10

0W

eigh

ted

sum

2311

64

22

Mar

ket d

eman

d, p

rices

10

11

23

2 a

nd c

onsu

mer

tren

ds2

11

04

20

31

10

12

0W

eigh

ted

sum

36

315

156

Reg

ulat

ions

and

11

30

01

1co

mm

unity

dev

elop

men

t2

01

02

03

pres

sure

31

10

10

0W

eigh

ted

sum

412

05

39

Hig

h op

erat

ing

cost

s1

20

00

04

23

20

33

13

11

11

12

Wei

ghte

d su

m13

51

77

16Pr

oduc

tion

chal

leng

es1

11

00

11

23

20

02

13

30

01

11

Wei

ghte

d su

m12

70

18

6Pe

rson

al ti

me

and

12

20

20

0 m

anag

emen

t ski

lls2

30

01

00

32

20

01

1W

eigh

ted

sum

148

08

11

Wea

ther

, sho

rt gr

owin

g1

01

00

10

seas

on2

11

10

00

31

31

26

4W

eigh

ted

sum

38

32

94

Busi

ness

tran

sitio

n1

02

00

10

20

20

00

03

00

00

21

Wei

ghte

d su

m0

100

05

1M

arke

ting

skills

11

21

01

02

12

00

20

31

01

10

0W

eigh

ted

sum

610

41

70

* W

eigh

ted

sum

was

cal

cula

ted

by 3

* n

umbe

r of r

ank

1 +

2 *

num

ber o

f ran

k 2

+ 1

* nu

mbe

r of r

ank

3.


Tabl

e V

-11

. R

anki

ng

of T

op O

ppor

tun

itie

s fo

r D

irec

t M

arke

tin

g O

pera

tion

s, b

y R

etai

l Bu

sin

ess

Ran

king

Und

er $

10,0

00$1

0,00

0- 2

4,99

9$2

5,00

0-49

,999

$50,

000-

99,9

99$1

00,0

00-2

49,9

99$2

50,0

00-a

nd o

ver

Expa

nsio

n an

d1

115

45

77

dive

rsifi

catio

n2

98

22

115

310

62

25

4W

eigh

ted

sum

6137

1821

4835

Prov

ide

serv

ice,

fres

h1

11

33

30

and

qua

lity

prod

ucts

20

32

04

13

02

01

00

Wei

ghte

d su

m3

1113

1017

2M

ore

mar

ketin

g1

43

10

41

22

10

00

03

00

10

10

Wei

ghte

d su

m16

114

013

3G

ood

reta

il lo

catio

ns1

24

02

01

22

10

10

03

10

00

00

Wei

ghte

d su

m11

140

80

3M

arke

t and

con

sum

er1

00

11

01

trend

s2

00

13

10

30

01

00

0W

eigh

ted

sum

00

69

23

Farm

imag

e, re

puta

tion

10

00

02

22

02

11

01

30

10

01

0W

eigh

ted

sum

05

22

78

Mor

e tim

e in

man

agin

g1

13

00

20

busi

ness

20

00

00

03

10

00

01

Wei

ghte

d su

m4

90

06

1C

usto

mer

loya

lty a

nd1

00

10

10

good

cus

tom

er re

latio

n2

00

01

00

30

12

00

1W

eigh

ted

sum

01

52

31

Bein

g co

mpe

titiv

e1

01

01

00

20

00

11

13

00

00

00

Wei

ghte

d su

m0

30

52

2Ag

ricul

tura

l edu

catio

n1

01

00

00

20

00

02

03

00

00

01

Wei

ghte

d su

m0

30

04

1O

ff-fa

rm e

mpl

oym

ent

10

00

00

02

00

00

00

30

00

01

0W

eigh

ted

sum

00

00

10

* W

eigh

ted

sum

was

cal

cula

ted

by 3

* n

umbe

r of r

ank

1 +

2 *

num

ber o

f ran

k 2

+ 1

* nu

mbe

r of r

ank

3.

W.L. Uva 41

Tabl

e V

-12

. R

anki

ng

of T

op T

rain

ing

Nee

ds f

or t

he

Dir

ect

Mar

keti

ng

Ope

rati

ons,

by

Ret

ail B

usi

nes

sR

anki

ngU

nder

$10

,000

$10,

000-

24,

999

$25,

000-

49,9

99$5

0,00

0-99

,999

$100

,000

-249

,999

$250

,000

-and

ove

rM

arke

ting

rela

ted

topi

cs1

94

25

70

28

30

35

03

42

11

50

Wei

ghte

d su

m47

207

2236

0Pr

oduc

tion

rela

ted

topi

cs1

33

00

00

21

30

01

03

11

00

00

Wei

ghte

d su

m12

160

02

0C

usto

mer

edu

catio

n1

01

20

20

21

01

00

03

10

11

00

Wei

ghte

d su

m3

39

16

0M

arke

t ana

lysi

s an

d1

11

01

01

trend

info

rmat

ion

21

00

11

13

00

00

00

Wei

ghte

d su

m5

30

52

5Em

ploy

ee tr

aini

ng1

00

00

02

20

01

20

13

01

00

10

Wei

ghte

d su

m0

12

41

8G

rant

& fu

ndin

g1

01

10

10

assi

stan

ce2

00

00

00

30

10

11

0W

eigh

ted

sum

04

31

40

Reg

ulat

ions

12

00

01

02

00

00

00

31

10

00

0W

eigh

ted

sum

71

00

30

Fina

ncia

l pla

nnin

g an

d1

00

00

10

man

agem

ent

20

10

00

03

10

00

00

Wei

ghte

d su

m1

20

03

0N

etw

orki

ng a

nd1

01

00

00

colla

bora

ting

with

oth

ers

21

00

00

03

10

00

20

Wei

ghte

d su

m3

30

02

0Sm

all f

arm

11

00

00

0m

anag

emen

t2

00

00

00

30

00

00

0W

eigh

ted

sum

30

00

00

Succ

essi

on p

lann

ing

10

00

00

02

10

00

10

30

00

00

0W

eigh

ted

sum

20

00

20

* W

eigh

ted

sum

was

cal

cula

ted

by 3

* n

umbe

r of r

ank

1 +

2 *

num

ber o

f ran

k 2

+ 1

* nu

mbe

r of r

ank

3.


Less than $10,000

5.0

4.0 4.0 3.83.5 3.4 3.3

3.0 3.0 2.92.6

2.0 2.0

1

2

3

4

5

TV (4

%)

Direct

Mailing (

32%)

Word-of-Mou

th (82

%)

Communit

y Rela

tions (

64%)

In-sto

re Prom

otion (

14%)

Road S

igns (

50%)

Intern

et (14

%)

Sales P

romoti

on (1

4%)

Region

al ID Prom

otion (

32%)

Touri

sm Promotio

n (18

%)

Newsp

apers

(54%

)

Yello

w Pages

(4%)

Radio

(4%)

$10,000 - 24,999

4.8

4.2 4.0 4.0 4.03.7 3.7 3.6 3.6 3.4 3.3

3.0

1.3

1

2

3

4

5

Word-of

-Mouth

(70%

)

Community

Relatio

ns (5

7%)

TV (9%)

Radio (1

7%)

Road Signs

(61%

)

Sales P

romotio

n (13

%)

In-store

Promotion

(39%

)

Direct

Mailing (

22%)

Touris

m Promoti

on (4

3%)

Newsp

apers

(78%

)

Interne

t (17%

)

Regiona

l ID Promoti

on (3

0%)

Yellow Pag

es (1

3%)

Figure V-1. Effectiveness of Different Marketing Tools*, by Retail Sales

*On a scale of 1 to 5, where 1 is not effective and 5 is very effective. Percentage of respondents in parentheses ( ).

W.L. Uva 43



$25,000 - 49,999

4.1 4.1 4.0 4.03.7 3.7 3.6

3.1 3.0 3.02.8

2.5

1

2

3

4

5

Communit

y Rela

tions

(53%

)

Word-of-M

outh

(93%)

Sales P

romotio

n (13%

)

In-sto

re Prom

otion

(13%

)

Radio

(20%)

Direct

Mailing

(20%

)

Road S

igns (

73%)

Newsp

apers

(53%

)

TV (7

%)

Region

al ID Promoti

on (1

3%)

Touri

sm Pro

motion (

27%)

Yello

w Pages

(13%

)

Intern

et (0%

)

$50,000 - 99,999

4.7 4.6 4.4

3.63.3 3.2 3.2

2.8 2.72.2

2.0

1

2

3

4

5

Direct

Mailing

(35%

)

Word-of

-Mouth

(82%

)

Road Sign

s (76

%)

Newsp

apers

(100

%)

In-store

Promotion (

35%)

Radio (2

9%)

Community

Relatio

ns (35

%)

Touris

m Promoti

on (2

4%)

Sales P

romoti

on (18

%)

Regiona

l ID Prom

otion (

29%)

Yello

w Pages

(6%)

TV (0

%)

Internet

(0%)




$100,000 - 249,999

5.04.6

4.44.0 3.9 3.8

3.3 3.3 3.3 3.1 3.02.6

2.3

1

2

3

4

5

TV (4

%)

Word-of

-Mouth

(91%

)

Commun

ity Rela

tions

(61%

)

Direct

Mailing

(22%

)

Road Sign

s (57

%)

In-store

Promotion (

57%)

Interne

t (13%

)

Region

al ID Prom

otion

(30%

)

Newsp

apers

(78%

)

Touri

sm Prom

otion (

30%)

Sales P

romoti

on (9

%)

Radio

(30%)

Yello

w Pages

(35%

)

$250,000 and more

4.94.7

4.3 4.2 4.1 4.03.6

3.3 3.2 3.1 3.02.6

2.3

1

2

3

4

5

Road Signs (

91%)

Radio (2

7%)

Community Rela

tions (

36%)

Internet

(55%)

In-store

Promotio

n (64%

)

Tourism Promotio

n (64%

)

Sales P

romotion (6

4%)

Yellow Pag

es (3

6%)

Word-of-M

outh (91%

)

TV (64%

)

Regional

ID Promotion (3

6%)

Direct

Mailing (7

3%)

Newsp

apers

(27%

)

W.L. Uva 45

$10,

000

- 24,

999

3.53.

83.83.83.9

3.94.

14.24.3

4.34.3

4.3

4.4

5.0

12

34

5

Loya

l buy

ers'

pro

gram

(9%

)

Dev

elop

a b

usin

ess

plan

(52%

)

Prom

ote

agri-

tour

ism

(39%

)

Con

tinuo

us e

duca

tion

(26%

)

Com

petit

ive

pric

ing

(48%

)

Dev

elop

a m

arke

ting

plan

(52%

)

Add

serv

ices

(30%

)

Col

labo

rate

with

oth

ers

(22%

)

Cus

tom

er e

duca

tion

(30%

)

Prom

ote

buy

loca

l (30

%)

Mai

ntai

n a

mai

ling

list (

26%

)

Kee

p fin

anci

al re

cord

s (6

5%)

Expa

nd p

rodu

ct li

nes

(61%

)

Bra

ndin

g (9

%)

Figu

re V

-4.

Effe

ctiv

enes

s of

Bu

sin

ess

Man

agem

ent

Stra

tegi

es, b

y R

etai

l Sal

es

*On

a sc

ale

of 1

to 5

, whe

re 1

is n

ot e

ffect

ive

and

5 is

ver

y ef

fect

ive.

Per

cent

age

of re

spon

dent

s in

par

enth

eses

( ).

Less

than

$10

,000

2.83.

03.2

3.23.23.33.

53.63.73.84.

0

4.5

12

23

34

45

5

Bran

ding

(0%

)

Loya

l buy

ers'

pro

gram

(2%

)

Cust

omer

edu

catio

n (3

2%)

Add

serv

ices

(25%

)

Deve

lop

a bu

sine

ss p

lan

(39%

)

Com

petit

ive

pric

ing

(39%

)

Expa

nd p

rodu

ct li

ne (5

0%)

Keep

fina

ncia

l rec

ords

(43%

)

Colla

bora

te w

ith o

ther

s (2

1%)

Prom

ote

buy

loca

l (32

%)

Mai

ntai

n a

mai

ling

list (

32%

)

Deve

lop

a m

arke

ting

plan

(29%

)

Prom

ote

agri-

tour

ism

(7%

)

Cont

inuo

us e

duca

tion

(7%

)


Figu

re V

-5.

Effe

ctiv

enes

s of

Bu

sin

ess

Man

agem

ent

Stra

tegi

es, b

y R

etai

l Sal

es

*On

a sc

ale

of 1

to 5

, whe

re 1

is n

ot e

ffect

ive

and

5 is

ver

y ef

fect

ive.

Per

cent

age

of re

spon

dent

s in

par

enth

eses

( ).

$25,

000

- 49,

999

3.0

3.0

3.0

3.43.43.43.53.63.

84.04.

2

4.5

5.0

12

23

34

45

5

Bran

ding

(0%

)

Deve

lop

a bu

sine

ss p

lan

(20%

)

Deve

lop

a m

arke

ting

plan

(20%

)

Add

serv

ices

(20%

)

Prom

ote

buy

loca

l (53

%)

Cust

omer

edu

catio

n (3

3%)

Com

petit

ive

pric

ing

(47%

)

Prom

ote

agri-

tour

ism

(27%

)

Mai

ntai

n a

mai

ling

list (

47%

)

Keep

fina

ncia

l rec

ords

(33%

)

Loya

l buy

ers'

pro

gram

(7%

)

Expa

nd p

rodu

ct li

ne (4

0%)

Cont

inuo

us e

duca

tion

(13%

)

Colla

bora

te w

ith o

ther

s (7

%)

$50,

000

- 99,

999

3.03.

23.33.33.

53.8

3.84.

04.34.34.34.

5

4.5

12

23

34

45

5

Bra

ndin

g (0

%)

Loya

l buy

ers'

pro

gram

(6%

)

Cus

tom

er e

duca

tion

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W.L. Uva 47

$100

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Expa

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Figu

re V

-6. E

ffec

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nes

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y R

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re 1

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( ).


W.L. Uva 49

NeNeNeNeNew Yw Yw Yw Yw York Vork Vork Vork Vork Veeeeegggggetaetaetaetaetabbbbbllllle Gre Gre Gre Gre Growowowowowererererer

DirDirDirDirDirect Markect Markect Markect Markect Marketinetinetinetineting Surg Surg Surg Surg Survvvvveyeyeyeyey

January 2001

This project is sponsored by

Horticultural Business Management and Marketing ProgramDepartment of Applied Economics and Management

Cornell University

New York State Vegetable Growers Association

New York State Farmers Direct Marketing Association

APPENDIX B -- SURVEY INSTRUMENT


This survey is part of a study to assess the economic importance and complexity of directmarketing activities performed by New York vegetable growers and their importance to NewYork’s economy.

· ConfidentiaConfidentiaConfidentiaConfidentiaConfidentiality is guarlity is guarlity is guarlity is guarlity is guaranteed.anteed.anteed.anteed.anteed.· Please include all the direct retailing to consumer activities on your farm in 20002000200020002000.· Please provide your best estimabest estimabest estimabest estimabest estimatestestestestes if book figures are not available.· Please return the questionnaire in the ready-to-mail envelope.

1. What crops did you produce on your farm in 2000?

√ √ √ √ √ ALLALLALLALLALL tha tha tha tha that at at at at applpplpplpplpplyyyyy PrPrPrPrProduction totaoduction totaoduction totaoduction totaoduction totalllll

____Vegetables _________acres

____Fruits and berries _________acres

____Nursery and greenhouse crops _________ft2 or acres

____ Others: Others: Others: Others: Others: plplplplplease specify __________________ease specify __________________ease specify __________________ease specify __________________ease specify __________________ _________________

2. Do you retail directly to consumers (including roadside markets, pick-your-ownoperations, farmers’ markets, etc.)?

Please check one: Yes ________ No ________

* IF NO* IF NO* IF NO* IF NO* IF NO, pl, pl, pl, pl, please stop herease stop herease stop herease stop herease stop here and re and re and re and re and returetureturetureturn the surn the surn the surn the surn the survvvvveyeyeyeyey.....

* IF Y* IF Y* IF Y* IF Y* IF YESESESESES, pl, pl, pl, pl, please continue.ease continue.ease continue.ease continue.ease continue.

○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

T T T T Thank yhank yhank yhank yhank you.ou.ou.ou.ou.

1. The county where your farm is located: ________________________________

2. The county(ies) where you retail to consumers (if different from above):

_______________________________________________________________

3. Total years your farm has been involved in direct retailing to consumers: _____ years

4. Please check check check check check oneoneoneoneone of the following that best indicates your farm’s total annual grosssales in 2000 (include all sales – wholesale, retail sales and purchased for resale).

____ Under $10,000 ____ $500,000 - $749,999____ $10,000 - $49,999 ____ $750,000 – $999,999____ $50,000 - $99,999 ____ $1,000,000 - $2,499,999____ $100,000 - $249,999 ____ $2,500,000 - $4,999,999____ $250,000 – $499,999 ____ Over $5,000,000

W.L. Uva 51

5. Please indicate ALL of the marketing methods that describe your operations in 2000:

% of% of% of% of% of tota tota tota tota total fl fl fl fl farararararm sam sam sam sam salllllesesesesesWWWWWholholholholholesaesaesaesaesallllle:e:e:e:e:

Supermarkets & grocery stores _______%

Other retail farm markets _______%

Food service (restaurants, etc.) _______%

Other outlets (shipper/packer, broker, processor, etc.) _______%

DirDirDirDirDirect rect rect rect rect retail to consumers:etail to consumers:etail to consumers:etail to consumers:etail to consumers: _______%

100%100%100%100%100%

PlPlPlPlPlease consider the fease consider the fease consider the fease consider the fease consider the followinollowinollowinollowinollowing questions based on yg questions based on yg questions based on yg questions based on yg questions based on your rour rour rour rour retail operetail operetail operetail operetail operaaaaation onltion onltion onltion onltion onlyyyyy.....

6. How would you describe your rrrrretailetailetailetailetail location(s)? (Check ALL that apply)

____ Urban (a central city area with populations of at least 50,000 or more and a density of at least 1,000 people per square mile)

____ Suburb: ______ miles to the closest central city area (population of 50,000 +)

____ Rural: : : : : _______ miles to the closest population center (population of 5,000 +)

____ Near or at a tourist region

____ Off a major U.S. interstate or state highway: _______ miles off the highway

7. What is the size of your total retail area? _______ ft2 or acres

What were your total retail sales in 2000? $________

8. Please describe the seasonality of your retail operation:

MonthlMonthlMonthlMonthlMonthly ry ry ry ry retail saetail saetail saetail saetail sallllles as % ofes as % ofes as % ofes as % ofes as % of tota tota tota tota total rl rl rl rl retail saetail saetail saetail saetail sallllles (Tes (Tes (Tes (Tes (Totaotaotaotaotal = 100%)l = 100%)l = 100%)l = 100%)l = 100%)

____% Jan. ____% May ____% Sept.

____% Feb. ____% June ____% Oct.

____% March ____% July ____% Nov.

____% April ____% August ____% Dec.

2


9. Please indicate ALL the products you rrrrretailetailetailetailetailededededed direct to consumers in 2000:

√ ALLALLALLALLALL tha tha tha tha that at at at at applpplpplpplpplyyyyy AnnuaAnnuaAnnuaAnnuaAnnualllll % Pur% Pur% Pur% Pur% Purchasedchasedchasedchasedchased g g g g grrrrross saoss saoss saoss saoss sallllleseseseses fffffor ror ror ror ror resaesaesaesaesallllleeeee

___ Fresh vegetables (including potatoes) $_______ ⇒_______ %

___ Fresh fruits, berries & melons $_______ ⇒_______ %

___ Nursery and greenhouse crops (bedding andpotted plants, flowers, trees, etc.) $_______ ⇒_______ %

___ Pumpkins $_______ ⇒_______ %

___ Christmas trees $_______ ⇒_______ %

___ Meat, poultry and eggs $_______ ⇒_______ %

___ Dairy products (milk, cheese, etc.) $_______ ⇒_______ %

___ Valued-added/processed food products(Cider, juice, wine, preserves, honey, mapleproducts, snack food, etc.) $_______ ⇒_______ %

___ Baked goods $_______ ⇒_______ %

___ Ice cream $_______ ⇒_______%

___ Gift and other gardening accessories $_______ ⇒_______ %

___ Others: plOthers: plOthers: plOthers: plOthers: please specify __________________ease specify __________________ease specify __________________ease specify __________________ease specify __________________ $_______ ⇒_______ %

10. Please check and describe all direct marketing methods used in your operation in2000:

√ ALLALLALLALLALL tha tha tha tha that at at at at applpplpplpplpplyyyyy AnnuaAnnuaAnnuaAnnuaAnnual gl gl gl gl grrrrross saoss saoss saoss saoss sallllleseseseses

___ Retail farm store, roadside stand $____________

___ Entertainment activities: farm tours, hay rides, $____________petting zoo, festivals, parties, etc.

___ Pick-your-own fields $____________

___ Restaurant/café/deli $____________

___ Catalog sales $____________

___ Internet sales $____________

___ Community supported agriculture (CSA) $____________

___ Farmers’ market stands (_____ times/wk.) $____________

___ Others- plOthers- plOthers- plOthers- plOthers- please specify: _______________________ease specify: _______________________ease specify: _______________________ease specify: _______________________ease specify: _______________________ $____________

3

W.L. Uva 53

11. Please check which direct marketing aspects are included in your retail business andindicate their importance to your operation. (1=not important; 5=very important.)

√ ALLALLALLALLALL tha tha tha tha that at at at at applpplpplpplpplyyyyy CirCirCirCirCirclclclclcle Onee Onee Onee Onee OneNot imporNot imporNot imporNot imporNot importanttanttanttanttant V V V V Very imporery imporery imporery imporery importanttanttanttanttant

___ Fresh farm product market: 1 2 3 4 5vegetables, fruits, meat, dairy, etc.

___ Processed & value-added food market 1 2 3 4 5___ Organic products 1 2 3 4 5___ Garden center: bedding & garden plants 1 2 3 4 5___ Pumpkin and christmas tree sales 1 2 3 4 5___ Bakery 1 2 3 4 5___ Ice cream stand 1 2 3 4 5___ Gardening accessory and gift shop 1 2 3 4 5___ Entertainment activities: farm tours, 1 2 3 4 5

hay rides, petting zoo, festivals, parties, etc.___ Pick-your-own fields 1 2 3 4 5___ Restaurant/café/deli 1 2 3 4 5___ Catalog sales 1 2 3 4 5___ Internet sales 1 2 3 4 5___ Community supported agriculture (CSA) 1 2 3 4 5___ Farmers’ market stands 1 2 3 4 5

12. Please indicate the months each department is in operation.Months in operMonths in operMonths in operMonths in operMonths in operaaaaationtiontiontiontion

√ ALLALLALLALLALL tha tha tha tha that at at at at applpplpplpplpplyyyyy (month) - (month)(month) - (month)(month) - (month)(month) - (month)(month) - (month)___ Fresh farm product market: vegetables, fruits, ________ - _______

meat, dairy, etc.___ Processed & value-added food market ______ - _________ Garden center: bedding & garden plants ______ - _________ Pumpkin and christmas tree sales ______ - _________ Bakery ______ - _________ Ice cream stand ______ - _________ Gardening accessory and gift shop ______ - _________ Entertainment activities: farm tours, hay rides,

petting zoo, festivals, parties, etc. ______ - _________ Pick-your-own fields ______ - _________ Restaurant/café/deli ______ - _________ Catalog sales ______ - _________ Internet sales ______ - _________ Community supported agriculture (CSA) ______ - _________ Farmers’ market stands ______ - ______

4


5

13. How many years has the farm been involved in each direct marketing aspect, andwhat changes do you foresee for each department in the next five years?

√ √ √ √ √ ALLALLALLALLALL tha tha tha tha that at at at at applpplpplpplpplyyyyy Expected chanExpected chanExpected chanExpected chanExpected changgggges in nees in nees in nees in nees in next 5 yxt 5 yxt 5 yxt 5 yxt 5 years (cirears (cirears (cirears (cirears (circlclclclcle one)e one)e one)e one)e one)YrsYrsYrsYrsYrs. in. in. in. in. in StarStarStarStarStarttttt NoNoNoNoNo

operoperoperoperoperaaaaationtiontiontiontion -up-up-up-up-up ExpExpExpExpExpandandandandand chanchanchanchanchangggggeeeee RRRRReduceeduceeduceeduceeduce EliminaEliminaEliminaEliminaEliminatetetetete

___ Fresh farm product market: ____ yrs 1 2 3 4 5veg., fruits, meat, dairy, etc.

___ Processed & value-added ____ yrs 1 2 3 4 5food market

___ Organic product ____ yrs 1 2 3 4 5___ Garden center: bedding & ____ yrs 1 2 3 4 5

garden plants___ Pumpkin & christmas tree sales ____ yrs 1 2 3 4 5___ Bakery ____ yrs 1 2 3 4 5___ Ice cream stand ____ yrs 1 2 3 4 5___ Gardening access. & gift shop ____ yrs 1 2 3 4 5___ Entertainment activities: farm ____ yrs 1 2 3 4 5

tours, hay rides, petting zoo,festivals, parties, etc.

___ Pick-your-own fields ____ yrs 1 2 3 4 5___ Restaurant/café/deli ____ yrs 1 2 3 4 5___ Catalog sales ____ yrs 1 2 3 4 5___ Internet sales ____ yrs 1 2 3 4 5___ Community supported ag (CSA) ____ yrs 1 2 3 4 5___ Farmers’ market stands ____ yrs 1 2 3 4 5___ Others- please specify: ____ yrs 1 2 3 4 5

______________________

14. Please indicate which marketing tools you used to promote your direct marketingoperation and rate their effectiveness. (Scale: 1 = not effective; 5 = very effective.)

√ ALLALLALLALLALL tha tha tha tha that at at at at applpplpplpplpplyyyyy NotNotNotNotNot VVVVVeryeryeryeryeryefefefefeffffffectiectiectiectiectivvvvveeeee efefefefeffffffectiectiectiectiectivvvvveeeee

___ Yellow pages of phone directory 1 2 3 4 5___ Newspaper advertising 1 2 3 4 5___ TV advertising 1 2 3 4 5___ Radio advertising 1 2 3 4 5___ Road signs, billboards advertising 1 2 3 4 5___ Direct mailing 1 2 3 4 5___ Sales promo. (coupons, discounts, etc.) 1 2 3 4 5___ Internet (Web-site, e-mail) 1 2 3 4 5___ In-store promotion (free samples, 1 2 3 4 5

product display & signs, info. brochures)___ Community relations 1 2 3 4 5

W.L. Uva 55

14. Marketing tools (cont.)


___ Participate in regional/state-grown 1 2 3 4 5promotional programs

___ Participate in tourism promotional program,i.e. brochures 1 2 3 4 5

___ Word of mouth___ Other: please specify __________________ 1 2 3 4 5

15. What percentage of sales was your promotional budget?

_______ % of total retail sales

16. Please indicate the tools you’ve used to improve the profitability of your retailoperation and rate how effective they were. (Scale: 1 = not effective; 5 = very effective.)


___ Developed a business plan 1 2 3 4 5

___ Developed a marketing plan 1 2 3 4 5

___ Expanded product lines (value-added, organic, 1 2 3 4 5added new products or varieties, etc.)

___ Added services (delivery, guarantee, extnd. hrs., etc.) 1 2 3 4 5___ Competitive pricing 1 2 3 4 5

___ Branding 1 2 3 4 5

___ Utilized frequent buyer’s program 1 2 3 4 5

___ Provided customer edu. (newsletter, handouts, etc.) 1 2 3 4 5

___ Maintained a mailing list 1 2 3 4 5

___ Promoted agri-tourism 1 2 3 4 5

___ Collaborated w/other farms & marketers 1 2 3 4 5(buying, advertising, etc.)

___ Promoted “buy locally grown” 1 2 3 4 5

___ Kept financial records and made management 1 2 3 4 5decisions based on them

___ Provided continuous training for mngrs./staff 1 2 3 4 5

___ Other: please specify ___________________ 1 2 3 4 5

6


17. What are the top three barriers/pbarriers/pbarriers/pbarriers/pbarriers/prrrrrobobobobobllllleeeeemsmsmsmsms facing your retail operation?

Most important barrier/problem:________________________________________________________________

Second:__________________________________________________________________________

Third:____________________________________________________________________________

18. What are the top three opporopporopporopporopportunitiestunitiestunitiestunitiestunities for the future success of your retail operation?

Most important opportunity:________________________________________________________________

Second:__________________________________________________________________________

Third:____________________________________________________________________________

19. What are the top three trtrtrtrtraininaininaininaininaining or pubg or pubg or pubg or pubg or publicalicalicalicalication topicstion topicstion topicstion topicstion topics you would like to see available toyou and your employees to help you market successfully.

Most important topic:________________________________________________________________

Second:_______________________________________________________________________________

Third:____________________________________________________________________________

20. Other comments:

TTTTThank yhank yhank yhank yhank you vou vou vou vou very mery mery mery mery much fuch fuch fuch fuch for yor yor yor yor your assistance. Plour assistance. Plour assistance. Plour assistance. Plour assistance. Please rease rease rease rease returetureturetureturn this surn this surn this surn this surn this survvvvveyeyeyeyey, in the en, in the en, in the en, in the en, in the envvvvvelopeelopeelopeelopeelopeppppprrrrrooooovided, to :vided, to :vided, to :vided, to :vided, to :

Dr. Wen-fei UvaDepartment of Applied Economics and Management

456 Warren HallCornell University

Ithaca, New York 14853-7801

7

RB No Title Author(s)

OTHER A.E.M. RESEARCH BULLETINS

Fee(if applicable)

Impact of Generic Milk Advertising on New YorkState Markets, 1986-2000

Kaiser, K. M. and C. Chung2002-02

What Successful Small Farmers Say: A Series ofReports on a Survey of Successful Small FarmOperators

Cuykendall, C., E. LaDue, andR. D. Smith

2002-01 ($12.00)

Dairy Farm Management: Business Summary,New York State, 2000

Knoblauch, W. A., L. D. Putnam,and J. Karszes

2001-06 ($12.00)

Supply Chain Management in the ProduceIndustry

Perosio, D. J., E. W. McLaughlin,S. Cuellar and K. Park

2001-05

Promotion Checkoffs, Why So Controversial? TheEvolution of Generic Advertising Battles

Crespi, J.2001-04

Community Collaboration Among Small BusinessSupport Organizations: Attributes of Effectiveness

Schlough, C. and D. Streeter2001-03

Information Technology and Credit Scoring atAgricultural Banks in the Northeast and EasternCorn Belt

LaDue, E.L., C. Cuykendall, andJ. Stokes

2001-02

Identifying the Extensive and Intensive Effects ofGeneric Advertising on the Household Demandfor Fluid Milk and Cheese

Schmit, T., C. Chung, D. Dong,H.M. Kaiser and B. Gould

2001-01

A Multimarketing Analysis of Cashew Productionin Mozambique

Kyle, S. and O. Negiz2000-05

The Decision to Enter Consumer Direct Initiativesby Supermarket Companies

Park, K. and J.L. Park2000-04 ($25 ea.)

Business Summary New York State 1999 Knoblauch,W.A., L.D. Putnamand J. Karszes

2000-03 ($12 ea.)

Impact of Generic Fluid Milk and CheeseAdvertising on Dairy Markets, 1984-99

Kaiser, H.2000-02

Paper copies are being replaced by electronic Portable Document Files (PDFs). To request PDFs of AEM publications, write to (be sure to includeyour e-mail address): Publications, Department of Applied Economics and Management, Warren Hall, Cornell University, Ithaca, NY 14853-7801. Ifa fee is indicated, please include a check or money order made payable to Cornell University for the amount of your purchase. Visit our Web site(http:/ /aem.cornell.edu/research/resbulletin3.html ) for a more complete list of recent bulletins.

Documents

An Analysis of Vegetable Farms’ Direct Marketing …publications.dyson.cornell.edu/research/researchpdf/rb/...W.L. Uva i Farm retail marketing or farmer-to-consumer direct marketing