Grower Boosting Business With Growing Local Movement

For John Lutz of Lutz Family Farm in Marshall, WI, the increasing consumer trend toward buying locally grown, fresh produce is no surprise.

Lutz, a seasonal vegetable and fruit grower with 100 acres of farmland, has successfully grown his small business by paying close attention to the local market, not letting supply outpace demand, and not being afraid of change.

“Early on, I was trying to sell lettuce, cabbage, and spinach but found that other growers were doing it so there was a lower demand for those items than others,” says Lutz, a fourth-generation family farmer. “I didn’t look at my market well enough and it was less expensive to get into that aspect of growing than others.”

At one point, Lutz had a greenhouse on his property where he grew as many as 10,000 bedding plants. He decided to sell them at the Dane County Farmers’ Market where he thought he had found a “niche.” He soon discovered that “everyone else was doing the same thing.” So he and his wife Cheryl “took to our own field” and decided to solely grow produce instead, he says.

Today, Lutz’s primary crops are sweet corn and strawberries. He also seasonally grows and sells tomatoes, cucumbers, melons, and peppers. The greenhouse that was once on his property is no longer there, and the small tent from which he initially sold fresh produce at his Madison-area farm is now only used when he is on the road.

Trial And Error

Lutz learned how to grow and market vegetables at a very young age. “When I was 12 years old, I worked at a truck farm,” he explains. “We had an acre of cabbage that we sold to a local sauerkraut factory. The following year, it was cabbage, broccoli, and onions. I did the books and got orders ready. We supplied organic vegetables to 13 different places in Madison.”

Throughout school, Lutz continued to farm. In 1978, he began taking over what had been his father’s farm. He took some agriculture classes in high school and later an agricultural “short course” through the University of Wisconsin system. He also enrolled in some business management courses at the Madison Area Technical College. But it has primarily been through trial and error that he has learned the most about which products to grow and what will sell.

“Customers will sometimes say ‘I can’t find certain items.’ If I hear that enough, I will consider putting something in as a test market the following year,” he says. For example, every other year Lutz tests a new variety of sweet corn. “But there have been three different times where I’ve grown different varieties and haven’t liked them. In those cases, I won’t sell it. The taste and the flavor have to be good to me,” he says.

The Dane County Farmers Market also was the location where Lutz initially sold his fresh produce. But five years ago, his wife encouraged him to put a sign out by the road. “We started selling out of a 9-by-9 foot tent,” he explains. “Then we built a stand off of our shed. We have been selling from that the last four years in addition to still selling at the farmers’ market,” he says.

In addition to knowing the best venue to sell his produce, Lutz has to pay attention to the rather short seasons for each crop. For example, strawberry season generally runs from mid-June until July 1, and sweet corn season from late July until about mid-August. Yet after many different trials, Lutz carefully evaluated his crop potential and his marketing efforts and determined that “sweet corn and strawberries seemed to be the best fit for us,” he says.

Premium Pricing

Lutz Family Farm’s decision to solely grow and sell produce came at a time when demand across the country for locally grown, fresh food has continued to increase. One study by Ohio State University researchers published last year surveyed shoppers at 17 Midwestern locations, including retail grocery stores, on-site farm markets, and off-site farmers’ markets. Among the survey’s findings were these:

– The average retail grocery store shopper was willing to pay 48¢ extra for strawberries that were produced locally. Farm market shoppers were willing to pay 92¢ extra.

– Retail grocery store shoppers were also willing to pay 54¢ extra for fresh produce that was recently harvested. Farm market shoppers were willing to pay 73¢ extra.

One of the researchers’ conclusions was that small farm owners who grow and sell their produce locally can expect to be able to charge a premium for that produce.

In Lutz’s experience, farm market shoppers in Wisconsin will typically pay 25% more for produce that’s locally grown versus non-locally grown produce they find in the grocery store.

“Quite often, you need to educate your customers on what they think they’re looking for versus what you have to offer,” he concludes.”It’s not unusual where there might be a bug or imperfection in your fruit or vegetables that they’re concerned about. You need to explain to them what happens to some of these non-local products by the time they get to the grocery store. [They need to know] that there’s a real advantage to buying local.”

To read tips from Lutz for successful farming in a down economy,