August 2020 Impact Assessment
About NAFDMA
We are entrepreneurial farm families who invite customers to visit our farms and experience the food and the fun we create to sustain our livelihood. Our membership is made up of farmers, extension agents, industry suppliers, researchers, farmers’ market participants, and government officials. Together we work to advance agritourism including on-farm retail, pick your own, consumer-supported agriculture, direct delivery, and farmers’ markets. We facilitate events, resources, communications, and peer-to-peer exchanges that bring together new relationships and opportunities.
NAFDMA was founded in 1986 and is a membership-based non-profit trade association dedicated to advancing the farm direct marketing and agritourism industries. NAFDMA is a financially transparent organization. Any current member may request a copy of NAFDMA’s annual budget or current financial statements.
Impacts of COVID-19
Short answer – some farms have simply chosen to remain completely closed, while others have been open throughout covid affected times and are pushed beyond their capacity. A variety of responses showing the spectrum will be detailed below.
- A year-round farm in Ohio with an on-farm market closed the market to in-person customers, but moved all orders in March to an on-line portal with drive-thru pick up. Response was incredible and their staff could barely keep up with orders due to the increased staff time required to fill the orders. Once the state moved to the next level of opening, they opened their market to in-person retail, began U-pick operations, and have had steady business (almost beyond capacity) throughout the season.
- A farm in Pennsylvania which typically hosts a strawberry U-pick festival and event in the spring decided to host a drive-thru strawberry festival. They had great demand for the “event.” However, weather conditions meant the strawberry harvest didn’t coincide exactly with the planned “event” so they had to work with partner farms to provide the needed product. The partnerships and farm connections they had developed in other geographies meant they did not have to cancel and provided them with an outlet for other bakery products and produce from their farm.
- A farm in Colorado typically is only open in the fall, as a destination for fall agriculture education and entertainment. With the uncertainty of knowing what fall would bring, they decided to host some spring weekend drive-through “markets” with favorite food products from the farm (caramel corn, etc) and leftover products from the previous season. This provided some revenue for the year to boost what might be a concerning fall, but also allowed time to try options for drive-thru options, if it needed to be implemented for the fall.
- A farm in California hosts many school field trips as a part of their business model, encouraging children to learn agriculture education and nutrition. With school moving remote and field trips not occurring, this income has vanished. The farm normally has several play structures as part of the field trip experience, but has closed those completely for the year. To adjust income, they have changed their focus to U-Pick as a family activity. They have seen incredible growth in U-pick this year and are able to space family groups for safe distancing.
- A orchard in Connecticut had a website, but had never developed an online ordering system. As they saw the immediate lockdown in the New England area, they realized the only way to keep their operation connected to the outside world was through on-line ordering. In one weekend, they developed an online ordering system and were able to take credit card transactions through their website the following Monday. They had ordering hiccups and reported about a 5% error rate in fulfilling the online orders (despite their best efforts to double check each order), but customer satisfaction was high and drive-thru pickup went smoothly.
- An orchard in Oregon decided to add drive-thru pickup AND a delivery service for their online ordering. They were concerned customers would not want to come to the farm to pick up the orders, so they offered the delivery service. It required SO much staff time and extra labor costs however, they are unsure if it will actually mean they have made a profit on that service offering. They obviously have kept customers and provided a community service (which maintains relationships for the farm business with the community), but it may not mean a profit on their bottom line.
- An operation located in North Carolina made the decision about a decade ago to adjust their business model to provide agriculture education and entertainment on the farm property, but work with other local farmers to bring in produce to sell instead of growing much of their own produce. Due to this business model, they technically have not been able to open the operation under state law (as of late June), because they are not providing an essential service. This means the local farmers with whom they contract do not have a market for their products and the operation itself has no income.
Obstacles to Sector Response
Labor/obtaining employee help has been a VERY difficult task for multiple reasons.
- Potential employees were able to make more on unemployment payment income than they would as a starting employee at the farm, so many individuals were not willing to submit applications to work on the farm as employees.
- If they did have someone willing to work, that individual may work for a while, but then may become uncomfortable with the interactions with members of the general public, despite the safety precautions in place by the farm.
- Some farm employees also had family members who were exposed to Covid, so the employees needed to quarantine as a result of that exposure, resulting in labor shortages on the farm.
- Lastly, issues related to international travel and foreign worker visa approvals have meant some seasonal skilled farm labor is missing. The farms who rely on this skilled labor are truly hurting. They have been trying to work with local labor, but the local labor are not skilled and the overall harvest is suffering.
- Since the US has a state by state model of reopening (or county by county in some areas), each farm is having to research with their own local authorities to know the options for reopening. As each stage of reopening occurs (or is rolled back), they need to reconnect with the authorities to confirm their operation is in compliance. Each agritourism farm may fall under restaurant regulations, farm regulations, market regulations, playground regulations, etc., so it is not immediately clear how they must comply.
- Overall, at this point in the season, many producers are weary and exhausted. This is typically the time of year when they are excited and “gearing up” for the excitement of the fall season to come – but they feel as if they have already been through a difficult season. I believe farmer/producer mental health will be critical this year as producers will be facing a year of unprecedented labor challenges, very high individual work hours, along with all the same personal challenges faced by society at large.
Successful Marketing Adaptations in Response to COVID-19
- Many farms had developed arrangements prior to covid with local farmers in their area who do not have farm markets but have meat, eggs, and produce to sell. With the rise of covid, they began to increase the quantity of these products sold, but also reached out to additional local farmers to add to their offerings. Customers felt safer coming to smaller farm retail markets as opposed to larger grocery stores, so many on-farm markets also began adding staple products they might not typically carry (flour, yeast, toilet paper).
- Many, many farms either created e-commerce (online purchasing platforms) sites from scratch as a result of covid or greatly upgraded their online offerings. They quickly worked to integrate their Point-of-Sale systems with their credit card processing systems. Many also had to upgrade their website bandwidth capabilities.
- Online and Social media marketing became primary ways to communicate with customers – even more so than previous years. With many farms implementing new drive-thru markets or new hours of operations, these needed to be communicated clearly and quickly. Online and social media channels became a way to not only reach the farms existing customer base, but potential new customers who may be looking for different, perceived “safe” activities to do in the pandemic era.
- For those farms who are able to continue with some of the farm-based entertainment (corn mazes, sunflower mazes, photography shoots, etc.), most have implemented timed ticketing to limit crowd size on the property at one time and encourage physical spacing.
Economic Impact on Sector
- Labor costs have been so unusual this year, farms are unsure what the final impact will be on net revenue for the year. While they have seen increased sales and customer demand, drive thru operations, online sales, and “personal shopping” require much higher levels of labor intensity. Farms believe the increased labor cost will be mitigated by the higher sales, but final numbers are yet to be seen.
- For farm operations who have changed their business model to no longer grow much of their own product, but instead provide ag education/entertainment and sell local produce from a variety of partner local farms, their operations may not be deemed “essential” by local authorities. Therefore, they have no income stream for themselves and for the partner local farms whose products they sell.
- Some locations have changed to a cashless only operation. If a farm has reliable internet and has a customer base willing to accept a “credit card only” system, it is one less touch point for customers and staff. Limited rural internet coverage is obviously a challenge for many locations to implement this system, however.
- Customers have been very interested in coming to smaller farm markets. They perceive these as safer and want to support their local farmer. Some farms report a little drop off in customer activity as most of the country has moved into stages of reopening, but most farms and farm markets are still seeing high customer demand.
- U-pick operations also see high demand. Farms and outdoor activities are perceived as safe, since families and social groups can distance themselves. It provides a wholesome activity when many other entertainment options are not open. Some families who may have never considered visiting a farm or doing a U-pick experience are doing so this year, because other activities are not available to them.
- On the opposite spectrum, if a farm typically relies upon event income (weddings, corporate gatherings, concerts, picnics, etc.), nearly all event income is gone this year. Some weddings are being rescheduled for late summer, but at a much smaller scale. Large events are not occurring, so any catering business associated with those events is not realized income. Some farms have been able to pivot to using the same space for smaller family or group picnics or campfires (and selling catering or picnic food boxes with it) to supplement income, but the event economy is reeling from the impact of Covid.
Impact on Sector Members
- Disabled farmers and customers are at special risk as simply exposing themselves to the general population means they are at higher risk of exposure to coronavirus. While a disabled agritourism farmer may wish to open their operation, they worry about their exposure to having the public visit their farm. Disabled customers are much more likely to choose conventional grocery store delivery services rather than visiting a farm market or even choosing to do a drive-thru farm service.
- Migrant labor (typically minority populations) are disadvantaged due to travel restrictions and quarantine requirements.
- Some agritourism operators and suppliers to agritourism operations are veterans. I do not believe their physical circumstances are different, but their mental health may be additionally compromised from the added stress of the mitigating situation.
Contact Information for NAFDMA:
P.O. Box 30481
Indianapolis, IN
46220
Suzi Spahr suzi@nafdma.com
