If you’re going to sell seed, the main element that will determine whether it is profitable is the price you charge. To determine your prices:
- Look at how other seed companies price their seeds
- Consider the quantities you will sell
- And then, fine tune your prices
This post is one in a series on seed economics that begins here. Quick Review of previous posts:
- Seed profitability can be evaluated as $/bedft.
- Small scale growers should average $2.50/bedft to $5.00/bedft
- Profit in space is calculated by : Seed yield (g/bedft) x seed price ($/g) = $/bedft
- A warning – I mix metric weights and imperial distances with reckless abandon.
1. What do other seed companies charge?
I have a collection of seed catalogues that I read over and over to see how they approach seed pricing. Pricing changes with
- The quantity sold (packets, different bulk formats)
- The crop
- The variety (how rare and how hard to produce seed)
- Whether the seed is organic or not
- The US/Canadian $ exchange rate
- Whether it is local
The catalogue I spend the most time with is Wild Garden Seeds. Frank and Karen Morton make a living growing 7 acres of seed that they mostly sell bulk to other seed companies. Their operation seems to be what small scale seed growers can strive towards. Their catalogue is also a great read.
2. What quantity you will sell?
The biggest difference in pricing depends on how much you will sell at once to one customer. That difference is most noticeable when you compare selling bulk to seed companies or market gardeners, or selling small seed packets.
Our farm sells
- Tatsoi seed bulk for $50/400g ($125/kg or $0.125/g)
- 2g packets of Tatsoi for $3 ($1500kg or $1.5/g)
Wooo … $125/kg for bulk vs. $1500/kg for packets.
If we apply our seed profit in space tools
- For Bulk seed: 25g/bedft x $0.125/g = $3.125/bedft
- For Packet seed: 25g/bedft x $1.5/g = $37.5/bedft
There is potential money in selling seed packets. Hold your horses, though. Without a good seed marketing structure in place, it can be quite tough to sell a large amount of packets.
On the other hand, if you approach a seed company who does sell many seed packets, they might be in a position to buy a large volume of seed from you.
3. Fine-tuning your prices
Once you have surveyed the seed marketplace and considered what quantities you will be selling, you can determine your prices
Start with the profit in space formula:
Seed yield (g/bedft) x seed price ($/g) = $/bedft
By plugging in your seed yield and different seed prices, you can determine different $/bedft and compare them with your target $/bedft.
This chart compares different $/bedft for 400g of Tatsoi.
|Price ($)||Weight (g)||$/g||yield (g/bedft)||$/bedft|
*Remember that yield is the other variable that affects $/bedft.
The price I choose will depend in part on my target $/bedft but also on how much of my harvest I think I will be able to sell. That’s right, so far we have been looking at the production side of things – essentially evaluating potential profit. Whether you can sell your seed or not is even more important in making seed profitable on your farm. (After I have finished this series on seed profitability and taken a short break, I will go through marketing and planning a seed crop – can’t you guys wait?)
We’re almost through looking at seed profitability. Next, I will add a few more thoughts about profit in space and then touch a bit on profit in time.