Article 3-4 Harvesting Profits

A rapidly expanding global marketplace is stimulating interest in hydroponics as a means for growing commercial crops. In connection with the enlarged marketplace are a combination of other factors that have also contributed to this growing interest. Worth mentioning are: the innovative technologies that make hydroponics an easier and more successful growing method; the increased availability of equipment for the home and commercial hydroponic grower-, a steadily rising human population; diminishing farmland and urbanization.

In the past. large commercial hydroponic facilities did not recognize the appeal for higher quality produce; this created a gap in the industry which ended up being filled by “organic” soil farmers. It was later realized that in order to have a financially successful hydroponic enterprise, it is necessary to change priorities, directing the emphasis towards quality, not quantity.

Today, large-scale corporate hydroponic farms generate vegetable and flower crops for export as well as for domestic use. For example, roses grown hydroponically in Holland are shipped world-wide; vegetables grown in Canada are shipped south to the United States and hydroponic lettuce is flown from Australia to Japan to garnish McDonald’s hamburgers.

In the midst of this major commercialization, there are a few traditional family farmers who have learned to apply new technologies in growing and marketing to their small-scale hydroponic endeavors. Hydroponics offers the family farmer a unique opportunity to generate substantial profits and participate in an economic boom. However, there are several factors which must he understood for a family farm to succeed.

First, the farmer must have a market for produce. Developing one can be easy in some places, difficult in others. Keep in mind that it is a particular challenge to create a market for unfamiliar or unpopular crops. so grow crops the market demands. This might seem obvious to the entrepreneur, but failure to anticipate and satisfy market needs can lead to a disaster. And it is essential to note that the only way to generate good profits is by marketing a crop of high value and quality.

There is constant growth in the manufacture and distribution of hydroponic equipment and supplies. Products ranging from hobby planters for the high-tech home gardener to large-scale systems for commercial crop production are available in an assortment of styles to suit your growing space and other specifications. Remember: the chosen system and nutrients must be effective. This goes beyond saying that they must “work,” to mean that there are aspects of this set-up that must be in balance with each other. These aspects include the cost of the equipment, the amount of labor required to operate the system, the reliability of its installation and its new environment.

All farming endeavors are by definition somewhat risky. Since the beginning of civilization, farmers have had to deal with adversity. Bad weather conditions, poor soil, inadequate water supplies, insects and plant diseases, transportation complications, competition and a host of other problems have been blocking the roadway to easy crops and high profits.

Hydroponics helps to overcome these barricades to successful farming. By keeping your system in a greenhouse, you are taming the often harmful conditions of the environment. And the system itself provides the crop adequate mineral nutrients and oxygen as well as a reliable water supply to promote strong, healthy growth. Such vibrant plants are much more resistant to insect infestation and disease. With hydroponics it is possible to grow crops closer to the market, thus reducing the cost of transportation and increasing the crop quality for the consumer; “vine ripened” is only possible when the crop is grown close to home.

For several years I have written about the While Owl Water Farm, using it as a model to discuss hydroponic technology. For this article, I have interviewed the farm’s owners for an in-depth look at family hydroponic farming. Ideas and ideals are easy to discuss in theoretical terms, but it is the specifics that make the difference between success and failure and the difference between a marginal income and a substantial one. The White Owl Water Farm has become an extremely successful enterprise, offering a prime example of what can be achieved by using hydroponics for family farming. William Texier and Noucetta Kehdi share the responsibilities of operating While Owl. Together they grow the crops, and while William takes lead responsibility for technical matters, Noucetta handles marketing and customer relations, The following interviews were conducted with Texier, Kehdi and some of their better known clients.

The Growers

LB: How did you initially determine what crops to grow?
WT: In the first years we experimented with many different crops. We wanted to determine what would grow well hydroponically and what kind of quality and yields could be achieved. The list includes alpine strawberries; many types of lettuces and salad greens, traditional as well as oriental; tomatoes; various colors of sweet arid hot peppers peas; beans; culinary herbs and a limited number of ornamental plants, plus food supplements including medicinal for homeopathy.

LB: How do you affect quality and flavor in a crop?
WT: The short answer is that you choose a variety for flavor and grow it to full ripeness. Most commercial farmers select varieties for yield, appearance and shelf life. Many large commercial hydroponic growers are “packaging water,” in other words, growing crops that lack flavor because they are emulating the Californian and Mexican field growers whose produce fill supermarkets with tasteless fruit. Poor flavor is associated with poor nutrients. In an effort to save money on nutrients, the large growers were producing flavorless fruit and vegetables when only a small additional investment would have been required to yield a much more flavorful crop. It is important to separate the things that can be easily handled by the grower from those that could present a real problem. For example, an overcast day will cause lower light levels and the crop will not develop sugar as fast and efficiently as it would under full sun. The grower can do little to alter light levels. On the other hand, mineral nutrition is a key in growing high-quality produce. With a willingness, the hydroponic grower can provide superior nutrition to the crop. Over the years, I have tried many different nutrient products and techniques. I always keep a hydroponic unit just to test new nutrients and nutrient supplements.

LB: How did you get started?
WT: We started on a very small scale to determine if the project would be economically viable. We used a 10 by 20-foot AeroFlo system to grow tomatoes and peppers. In the beginning, we worked out of our backyard and sold our produce at local farmers’ markets. We quickly realized that however small your operation, there is always a client for you. Even when we were a very small-scale operation it became clear that a market exists for high-quality produce.

LB: How did you develop markets for your crops?
WT: Parallel to finding the best and most practical plants to grow, it is important to examine the market. One easy way to do this is to visit the stores and restaurants around your area, check prices and talk to produce managers and chefs. Depending on your area, some produce are quite difficult to get-both in and out of season-especially good quality ones; produce managers and chefs will be happy to give you this information.

There are a few possibilities in developing your market. You may specialize in one expensive crop and try to sell it over a large area, or you can diversify your production and sell it to a few clients in order to get most of their produce account. When starting, it is difficult to diversify much because you need space and experience; but in the long run, it may be an interesting alternative. It depends, too, on the area in which you live. That’s why it is important to examine the market thoroughly before getting started. First, select the places you would like to sell to. They would be the fine restaurants and best grocery stores in your area. Keep the delivery route as short as possible. Once your crop is ready, call; talk to the person in charge of buying produce and introduce yourself. I generally suggest to drop them a sample and follow up with a phone call a few days later to get their opinions. My sample is of course well presented. I include a business card with my delivery days and my price, which I keep close to the market price.

I generally receive good feedback and have no problem introducing myself into the market. I noticed that it helps to arrive ahead of the season or just at the beginning of winter. Good timing is essential because once a new client starts working with you, it is rare that s/he lets you down without reason.

The two obstacles I most often encounter are the fact that my produce is not labeled “organic” and that hydroponics is not traditionally known to be of excellent quality. The latter is easy to overcome once the buyer has tasted my produce, but the former is handled with a little more delicacy. One argument is of course that we use no pesticide, no herbicide and no chemical pest control. Then I present a study on a tissue analysis that has been made on our peppers. It shows that, not only do they contain more vitamins than soil grown peppers, but they contain not even a trace of heavy metals which are harmful to human consumption. I think this is due to the excellent quality of nutrients and the water-culture system that we use. In this manner, I have been able to sell our produce to even the organic grocers in our area. I give them a sign with our logo and a text describing our produce to hang on their shelves. Their clients have proven to accept our produce since they have been selling more basil than ever before!

Another aspect that I feel is important is to keep an open communication with your clients. As long as we don’t create any inconvenience to their business, our clients are ready to listen to what we have going on. For instance, it is quite difficult, particularly in the beginning of an operation, to stick closely with your forecast. Sometimes you may fall short on some produce. Our clients have been quite supportive as long as they were informed in advance that a delivery may be short. There is an art to selling what you produce and producing what you sell.- Never more or less, respectively.

If your produce is good, there will be no problem selling it. But to keep your customer, it is essential to maintain quality, consistency and reliability. To keep a market, it is most important to build a reputation on those three things.

LB: What kinds of yields do you generate?
WT: In an area of 60 by 20 feet, we produce an average of 200 pounds of sweet, colored peppers a week on a yearly basis. We sell for an average of $2.00 a pound.

The same area yields approximately 100 pounds of basil a week. We sell it for an average of $6.50 a pound. In California, prices are not as good as in other areas. We have heard of places where the prices are much higher. In Nevada for example, basil sells for as much as $14.00 a pound, and in Washington state, for $17.00 a pound!

This is why it is imperative to study the best cash crop in your area since it varies greatly among different localities.

The Clients

The most important measure of an enterprise’s success is found in the satisfaction of its clients. White Owl produce is served by some of the finest and most famous restaurants in the San Francisco Bay Area and Sonoma county, as well as a few quality-oriented produce markets. Following are interviews with some of White Owl WaterFarm’s clients.

Recognized by peers and critics as one of the great chefs based in Northern California, Maureen Hayes can be found in the kitchen of the renown California Cafe in Corte Madera, CA. The cafe gained local notoriety when President Clinton dined there with Apple Computer Chairman, John Sculley. It is one of an elite group of local restaurants specializing in “California Cuisine,” that which places an emphasis on cooking with the freshest, ripest ingredients. Chef Maureen Hayes accents her cooking with basil from the White Owl Water Farm. I spoke with her about the quality of hydroponic produce.

LB: Do you think that hydroponic product can gain acceptance in the gourmet community?
MH: Only if the quality of the produce is outstanding. When I first introduced White Owl’s basil to my kitchen, I intentionally did not tell the other chefs about the change; I wanted to see their reactions. They immediately noticed a difference. This basil has much larger leaves; it’s more fragrant, full of flavor and has a smoother texture. In the past I have found that hydroponic produce lacks flavor-this is the first time I have encountered hydroponic produce of superior quality.

LB: What do you look for when selecting ingredients?
MH: Flavor! I try to buy from small producers in order to support local products. If a product is locally grown, it is likely to be fresher and riper. Price per pound is secondary; the key is impact on the plate. For example, White Owl’s basil has a stronger aroma; we get more yield per pound and it packs more punch.

LB: How would you compare White Owl’s basil with “organically grown” basil?
MH: That is not a relevant comparison. “Organic” is only one factor concerning quality. “Organic” only means that the produce has been grown within certain guidelines. Over the past 10 years, there has been a great increase in public awareness surrounding “quality” in produce. The trend towards “organic” is a reflection of this increased awareness. Likewise, there is a trend away from the tasteless produce of the mass growers. I have chosen White Owl basil simply because of its fragrance, freshness and fleshy texture.

The next interview was conducted with Dennis Reynolds, the produce manager of San Sebastopol, CA-based, Food for Thought, a top-notch supplier of high-quality groceries. Food for Thought specializes in ‘organic” produce, fresh fish, vitamins and what is popularly referred to as “health foods”. Their customers consist of well educated, health conscious people with a taste for superior foods.

LB: Your start is noted as a supplier of “organic” produce. Do you find any resistance to hydroponically-grown produce from your clients?
DR: We post a small sign which identifies the White Owl produce as ‘water-culture grown without chemical pesticides or herbicides’. Since introducing White Owl basil, sales have never been so strong. The shelf life of White Owl basil is amazing; it lasts until the last bunch is sold. Our clients recognize its superior fragrance and quality.

White Owl peppers are also a very popular product. We could sell more if they could deliver more, but we understand that they are a small producer. We are able to purchase sweet peppers for $1.50 per pound from one of our regular suppliers. The White Owl peppers cost us $2.00 per pound, but we feel the higher price is justified because of the difference in quality.

For the answer to my final question, I spoke with chef Jeffrey Madura, from the John Ash restaurant in Santa Rosa, CA. John Ash is Sonoma County’s finest and most famous restaurant. This is quite a significant statement considering some of the world’s finest wines and cuisine come from Sonoma County. John Ash favors fresh, locally grown produce and they are one of White Owl’s oldest customers.

LB: How would you compare the White Owl produce with that from other suppliers?
JM: Over the last three years, I have found the White Owl produce to be of consistently high quality. Our restaurant only serves “in-season” produce and we are always happy when pepper season comes. We know that we can always rely on White Owl for consistency and quality.

As Maureen Hayes pointed out, the trend away from mass market produce and towards quality-oriented produce available from the local supermarket without a second thought. Today a growing number of consumers seek out farmers’ markets in order to purchase “organically grown” produce. Americans have always been knowledgeable summer gardeners with a preference for “vine ripened” produce. Some actually have the time, space and skill to grow their own fresh fruits and vegetables, or they live in a region where farmers’ markets can serve as their source for superior-quality produce. Now the opportunity has risen for small-scale growers to use hydroponic technology as a means for growing their own high-quality produce as well as participate in an economic boom, which is being recognized on a world-wide scale. It can often take quite a while for new ideas to spark, but when they ignite, their fire can rage. Consider that only 10-years-ago the small home computer was thought to be an instrument for just a handful of eccentrics and geniuses. Today it is barely possible to find a small business or student without one, and the interest and public acceptance are still multiplying. It will not take long for “hydroponically grown” to become the norm when consumers think of fresh, high-quality produce; and those who recognize this opportunity today will become the mass suppliers of tomorrow. And while they harvest their profits, they will provide the rest of us with superior produce and a better quality of life.