Is Ecommerce Right For My Farm?

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vegetables
The printable resource includes the following items:
  • Credit card processing fees can’t be avoided. Plan for approximately 3% of sales but don’t be scared to ask your customers to contribute to these fees for credit card sales, especially for your regulars who love supporting you.
  • It is becoming more difficult to use payment apps for free for the sale of goods and services, e.g. Venmo allows free transactions between family and friends but they are required to report sales of over $20,000 for the calendar year to the IRS. A new requirement that would make the threshold $600 was scheduled to be implemented for 2023 but it was delayed.
  • Learning curve: Keep realistic expectations with adopting a new system, especially a virtual one! It will take more time on the computer; expect glitches, and be patient with the learning curve.
  • Selling online does not mean less time with customers. It will probably be more time because you’re in a much larger, virtual marketplace, and people can more easily reach you to ask questions (and maybe with complaints too!) and may have higher expectations on responses.
  • Test before you launch. Before launching your store, ask friends to run test orders to make sure everything is working right!

Know your goals and motivations, and create a plan. Why are you adding ecommerce? Do you have existing customers and adding the store will make it easier for them to pay you, or do you want to find new customers and expand your reach? Are you eager to combine sales and inventory data? Create a simple ecommerce plan. The Small Farm Tech Hub at CAFF has resources to help!

Understand your audience: Online customers may have different preferences and expec- tations than your existing customers. Define who your target audience is to better con- nect with them.

Make a marketing plan. Adding an e-commerce option doesn’t necessarily deliver more sales. You’ll need to market your online store to make the most of it.

  • Communicate regularly with customers (1-2x/month) to maintain & increase sales.
  • Check with your website host and/or ecommerce provider to see if email marketing is included. Many providers now carry this service for a small extra charge and it is one of the most important marketing strategies for a farmer.
  • Learn strategies for social media engagement, increasing average customer orders, customer retention, etc.
  • Consider adding discounts and promo codes for new customers or referrals from exist- ing customers.
  • Review and respond to how your customers shop: Online stores provide a valuable op- portunity to track analytics: who is visiting what sites, what products have the most views, etc. Use this to inform marketing and inventory decisions.
  • Evaluate the results: Write out your expectations for how the online store will help you with your business and review from time to time. Does e-commerce help keep you better organized or less organized? Has it saved you time or has it added an unexpected burden? Have your sales increased? Have you gained new customers that keep coming back? At what point would you be willing to drop an online store if you aren’t seeing results?
Taking the quiz will result in one of the following recommendations

Hold off on building your own store for now and work through another vendor

  • Consider selling through a third party who aggregates from other producers. Examples: Gather Flora, local food hub, a larger producer in your community, Harvestly.
  • Partner with another farm that has an online store: see if they can add you as a vendor and sell your products on your behalf for a small cut of sales. 

Educate yourself. Check with your local library system, Small Business Association Chapter, or community college on free or affordable classes related to business management, e.g. Udemy online classes, Excel for beginners, how to use social media, how to build websites, etc.  Seek out opportunities to get more training in using online systems (The Tech Hub at CAFF provides free 1:1 support and workshops).

How it works: The most simple option for farmers looking to have an online presence. Provide customers with a way to learn about your business and contact you for placing orders. 

Who’s it for: Farms with limited time and money to pay for online services and hosting platforms. This is a great way to get started and launch an online presence for finding new customers or building relationships with existing customers. 

Examples and options:

  • Social media: You can create a free profile via Facebook, Instagram, NextDoor, etc. Focusing on one platform that carries more of your customers is a strategic option.  Instagram is more widely used among millennials, Facebook is more used among Gen X, and NextDoor is a ultra-local platform that works by neighborhoods and zip codes. 
  • List your business on Google with a free Business Profile. Google’s search engine is a great way to connect with current and new customers online. Make sure your contact information is up to date and you know how to sign into your account. There are many folks in your neighborhood who could be saying to their smartphone, “Hey Google – find a farm near me!” This is a great way to highlight your farm to your community.
  • Create a simple, free website. Examples include Google Sites, Carrd, Strikingly and make sure to clearly communicate how customers can get in touch with you.

TIP: Social media sites do offer built-in e-commerce options, but their fees may be higher than other platforms, e.g. Instagram charges 5% on shipped orders. Always be careful with websites soliciting you for any paid services.

How it works:  Customers call or use a contact form on your website (these can be added using google forms, a Wordpress plug-in, etc.) to submit an order by email. You use a point-of-sale (POS) option for payment. 

What’s POS? Accounting software and many banks provide point-of-sale options for their clients. If you are new to selling online and think that you can manage orders manually for each one of your customers, this may be a good way to get started! If you’re an existing customer, you’ll have fewer accounts to manage and your funds will be deposited immediately.

Examples and options: 

  • US Bank uses talech Mobile for one of their POS options. This POS has a $0 software fee, allows for multiple users, supports up to 100 products and provides basic order management. A card reader is also available and the credit card processing fees are competitive.
  • Quickbooks allows you to send invoices to customers who can pay via PayPal,Venmo, Apple Pay®, credit, debit, or ACH bank payments. 
  • You can get creative with Google forms linked to your website.

How it works: You create a “store” or “shop” on another platform. These options allow customers to buy your products for pick-up, delivery, or shipping. You can link your store through your other sites or social media. Shipping adds additional layers of complexity and requires careful consideration.

Who it’s for: This is a great option for a farm who wants to launch an online store quickly and provide online purchasing to customers.  This option usually takes less time to set-up compared to creating your own e-commerce store. 

TIPS: Make sure to research percentage of sales fees and how taxes are collected (or not collected) before deciding on a third party host for an online shop. Learn what point of sale system (Square, Stripe, Paypal, etc) the platform uses and if you can connect your existing account for receiving payments.

Examples and options: 

Here are some free or low cost simple e-commerce platforms to consider.

GENERAL/NOT TAILORED TO FARMS 

TAILORED TO FARMS 

  • EatFromFarms – $15/month (use their website hosting or integrate store into your website) 
  • GrownBy – low cost options, especially for CSAs. Created by farmers for farmers. 
  • AirMart – free or monthly subscription

How it works: Your website has an integrated online store 

Who it’s for: This is a good option if you want to sell and manage sales through your website, and you have a clear understanding of what inventory you want to sell online. This option will require more time to set-up your store compared to creating a shop on a 3rd party platform (option listed above). 

Commonly used website hosts such as Square, Squarespace and Shopify offer e-commerce options for a monthly fee. If you have an existing website (example: you already use Squarespace) we recommend looking into adding e-commerce to keep all of your systems in one place to help with account management. 

Examples and options:

There are a TON of options for e-commerce platforms that come with a fee. CAFF doesn’t recommend any one of them in particular. From farmers, we’ve heard of these the most: 

  • Squarespace: Nice designs, easy to use. Selling farm goods usually requires some creative thinking and workarounds. 
  • Wordpress: Lots of plug-in options and templates, and a professional developer can customize your site exactly how you want it. WooCommerce is the e-commerce platform Wordpress uses. It is free but requires a hands-on approach or the hire of a consultant.  Please note that wordpress.com and wordpress.org are two different platforms with different options.
  • Shopify: More advanced than Squarespace with a ton of plug-in options and integrations. Not as visually appealing.  Also takes creative thinking and crowdsourcing of what plug-ins will best do the job for the need. Tend 2.0 has added an option to connect sales to a Shopify store. 
  • Open Food Network: A not-for-profit, open-source e-commerce platform. This is a great option for businesses looking to participate in the open-source community

How it works:  Your website has its own online store with powerful capabilities. 

Who it’s for: Your business has a large amount of consistent sales (+$200,000 gross annual sales) or you have a lot of unique buyers. A platform that is dependable with managing a high volume of orders and customers is key to avoid any future headaches around data-consolidation, inventory management, or lost sales. These platforms are more expensive at $60-$400/month but can be worth it to keep sales moving and customers happy.

Options: Look into specialized e-commerce software for your business. Consider hiring a consultant if you have the funds and staff to help run the online store. 

Examples: 

  • Farmigo for a large amount of CSA customers.
  • LocalFoodMarketplace for multi-farm producers, e.g. Food Hubs, farmers markets, farm aggregator, etc.
  • LocalLine offers a wide range of rates & plans for producers planning to expand. Used by CSA farms and farms who aggregate from other producers. 
  • GrazeCart for meat producers.

Platforms like Shopify and Wordpress can serve as advanced options but require purchasing additional plug-ins, hiring a developer, etc.

We hope that you found this resource helpful. This quiz is in beta mode and we would love to hear your feedback. You may submit feedback at the end of the quiz or by emailing techhub@caff.org.  

This resource was created by the Small Farm Tech Hub at Community Alliance with Family Farmers (CAFF). Visit www.caff.org/TechHub for more information and to access additional resources. Funding for this E-Commerce Decision Tree Resource was made possible by the U.S. Department of Agriculture’s (USDA) Agricultural Marketing Service through grant 21FMPPCA1007. Its contents are solely the responsibility of the authors and do not necessarily represent the official views of the USDA.