Scale It! How To Launch A Successful Microgreens Start-Up Business | Michael Milne | Skillshare

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Scale It! How To Launch A Successful Microgreens Start-Up Business

teacher avatar Michael Milne

Watch this class and thousands more

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Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Watch this class and thousands more

Get unlimited access to every class
Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Lessons in This Class

12 Lessons (57m)
    • 1. Course Introduction

      3:06
    • 2. Unit 1 - Conducting Market Analysis Through A Broad Search

      7:47
    • 3. Side Note - The Pros and Cons of Traditional Retail Outlets

      7:31
    • 4. Unit 2 - Dodge the Competition Through Specialization

      7:12
    • 5. Side Note - The Danger of a Price War

      1:51
    • 6. Unit 3 - How To Determine Your Price Point

      7:05
    • 7. Side Note - Know Your Numbers

      4:55
    • 8. Unit 6 - Packaging Labelling and Branding

      2:24
    • 9. Side Note - The Issue of Delivery

      0:57
    • 10. Unit 7 - Tips on Record Keeping

      1:08
    • 11. Side Note - To Certify or Not To Certify

      2:11
    • 12. Unit 8 - Invest in New Efficiencies and Expand Safely

      11:01
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About This Class

This course focuses on taking your microgreens growing to a commercial scale. Using some tried and tested business practices, as well as stories from my own experiences as a microgreens grower, I will take you through the steps to successfully launch your own microgreens start-up business. We'll examine how to:

- Conduct a market analysis to gauge demand

- How to dodge the competition and create your own markets through specialization

- How to determine your price point

- How to package and brand your product

...and much more.

If you've ever dreamed of starting your own business, growing microgreens commercially has one of the lowest barriers to entry, and with the help of this course, a healthy side-hustle income, and potentially a full-time income in the future, could be yours.

Meet Your Teacher

Michael is a square foot farmer who's interested in growing an abundance of nutrient-dense foods in the smallest areas possible. He's here to teach people easy, imaginative, and budget-friendly ways of growing, preparing, and preserving their own foods so they can experience the culinary delights of little-known food varieties, cultivate food independence, and enjoy the myriad health benefits that come with eating clean.

See full profile

Related Skills

Business Sales

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Transcripts

1. Course Introduction: Hi everyone, thanks for joining me. It's been a year since I created the girl at micro greens kitchen garden video on skill share. And since then I've had the opportunity to talk to some of you about the details behind scaling up a micro greens kitchen garden. There's lots of interest in pursuing micro greens cultivation from a business standpoint. So the good news is it can't be done. I'm a grower of micro greens and I value the part-time income that I earn from it. But the reality is the planting trees is seed and harvesting micro greens is a very small fraction of what running a micro greens business is all about. Now you've likely seen clickbait links and YouTube videos titled something like how I earn $10 thousand per month growing micro greens in my basement. I should warn you that I had never in my experience, nor have any of the other commercial growers I've had the pleasure of meeting ever come close to earning that amount of money off of our micro greens operations? Some people have been able to find full-time success for in micro greens and maybe you can't too. But before you start ordering boxes of trays and truckloads of potting soil. Let's start from the very beginning of this course is a guide to launching and scaling a startup micrograms business using some tried and tested business practices, as well as my own experiences in the industry for the past five years. Along the way, I'm going to add some stories of a big mistakes I made. Because if you can learn from my mistakes, you'll hopefully be able to avoid them on your end. So here's what you can expect to learn in this course. The first unit will offer some ideas on how to analyze market demand in your area. That's going to help gauge if there's enough interest in micro greens to even think about proceeding with the business. And the second unit will redesign the business model of a typical micro greens startup. And I'll demonstrate how specialization and certain types of micro greens and marketing to a nice clientele can potentially help you avoid the traditional pitfalls that most startups experience in their first year. In the third unit, we'll do some math, crunch some numbers, and figure out how to set up price point for your product. Will also look at some ideas that have a package and brand your product depending on the retail models you've chosen and how to arrange your gross space so it's as small and economical as possible. And the final units I'll talk about some things to keep an eye on as you get a foothold in the industry and business increases and also some things to consider in terms of growing your operation past that coveted 12 month mark. Now one thing I won't be demonstrating in this video is the actual process of growing micro greens. So if you want to learn the basics of cultivation, check on my other video here on skill share about growing a micro greens kitchen garden, where I'll give you a step-by-step guide on exactly that. What we did in the kitchen garden isn't much different from a commercial operation, is just on a smaller scale. To grow commercially, you'll use the same seed, the same soil, the same process. And it'll just be a larger quantity of seed on a ten by 20 tray instead of the ten like tens that we used in that video. So if you're ready to get started with a micro greens startup business, let's go for it. 2. Unit 1 - Conducting Market Analysis Through A Broad Search: Now the first thing that's so important to do when launching a micro greens business is to make sure demand exist for them in the first place. This isn't difficult to just require some research and that research can all start online. Look for any wholesalers in the area within about an hour's drive from you? When I say wholesalers, These are either farmers who grow micro greens to perhaps give them an income during the off-season. Or people like you and me who just want to grow on a commercial basis. You're looking for websites that talk about what varieties they grow, whether they delivered to your area or not, and how often. One thing he probably won't find is they're priceless, but don't worry, I'll give you some tips on how to access that information. Also, while you're online, check out the online grocers who offer home delivery. That's a really fast growing sector of the grocery industry right now. Do they offer micro greens? What varieties do they offer and what price for what commodity? The next phase of your research and balsam legwork. Now I don't know how things are where you live, but where I am in the world which is just an hour outside of Toronto, Canada, micro greens are still considered a pretty niche product and they had a small but dedicated following. There are premium product to which accounts for a higher price point when you buy them at the grocery store. For that reason, don't be surprised if you have to visit a few different grocery stores in order to find them. Any of the budget or convenience stores that specialized less and fresh products and more processed and pre-packaged and canned goods likely won't carry them. You'll probably find a micro greens display and stores that carrying lots of fresh products. And it's usually the organic stores. Again, that's how it is in my neck of the woods. If you find micro greens are quite prominent wherever you go, then that's great. Word is getting out and that knowledge about them in the marketplace will make your marketing efforts that much easier. Since you're just starting out on the idea of a micro greens business, if you have any epic ambition of growing and selling hundreds of pounds of different varieties each week. I want you to put that aside for now. The key to the most successful startups is to start small. So if you're interested in growing on a mass scale for a lot of different outlets. There's no reason you can't, but that's something you'll have to work up to both in terms of your expertise and likely in your capital investments. You're only one person and there's going to be a lot of jobs you'll have to find time for in order to run the business successfully right from the get-go. So instead of visiting grocery stores with lots of different locations in your area, focus instead on visiting smaller, independently owned stores and restaurants. The main reason is the barrier to entry will be lower. There'll be more willing to take a chance on dealing with a small local growers since they're small themselves. There's also less bureaucracy. So you'll likely be dealing directly with the manager of the products section who's in charge of placing weekly orders. Fewer people to deal with means shorter lines of communication, which in turns hopefully means less confusion, fewer mistakes, less restoration. So now that we've realized our size and its limitations scratched the big chain restaurants and grocery stores off your list. Let's continue to narrow our possibilities. Small independent grocery stores give a good indication of retail demand in your area. Restaurants are also a big consumer of micro greens, sometimes as a garnish to certain dishes to add some color and some flare, but also for something fresh to stuff in a wraps or into salads. Constantly on the hunt for something different. Micro greens are incredibly flavorful. They look beautiful with vibrant color and they're available year round. These are all benefits to a restaurant. Now, what if your broad search turns up nothing at grocery stores and restaurants and your Google search doesn't find any local wholesalers. You'll probably be jumping for joy, thinking you have the market cornered, but not so fast. Lack of supply in an area might be an indication that the demand isn't there to sustain the business in the first place. It could be that in the past, several people have tried to sell micro greens at a commercial scale and ultimately failed to find enough business to sustain themselves. Let's ask the people who had no go to the grocery store and ask to speak with the products clerk, head to a couple of restaurants and I recommend the independent ones that tout and emphasis on local food and their menu. And ask to speak with the person responsible for sourcing ingredients. That can sometimes mean the head chef. So don't be surprised if they take a break to come out and talk with you. For both small grocery stores and restaurants, go during your last busy hours, which for grocery stores is usually late morning to mid afternoon. And for restaurants, try between the two o'clock and four o'clock period. It's that low time between the end of their lunch crowd in the beginning of dinner service. As these people about potential interest in your product, they won't be shy to tell you the reasons for not stocking or using micro greens. And this is where you'll get an indication of whether there were some businesses operating in your area in the past and why they're no longer around. Maybe they weren't consistent with equality. Maybe the price was too high, maybe they were difficult to deal with. There are lots of reasons. Businesses at any kind of stick around if they are already dealing with a micro greens supplier, some products managers and chefs may be open enough to tell you who to dealing with and whether they're happy with the product and the service they're getting. This gives me an opportunity to hear about what's potentially wrong in this arrangement and see if you can position yourself as the solution. I once had a chef hand me the price list of his supplier. He told me what he didn't like about that supplier. There was inconsistent quality for a high price and they had an unreliable delivery schedule. And he said if I can improve on any of these problems, the job was mine. If the grocery stores or restaurants are familiar with micro greens, but they don't have a provider ask if they'd be open view bringing them some samples of the varieties you're most confident and growing better yet, save yourself a couple of weeks ago time and had the samples ready for them right then and there here are a few pictures of what I took around a few years ago when these samples got me the first-ever jobs that I had growing commercially. You're nothing too fancy, just some small A1's containers with clear labeling filled with the micro green varieties I had the most practicing growing at the time. Be careful we're getting ahead of ourselves here. They might be so enamored with your product and the presentation. They could ask for more information like a price list right there on the spot and it won't look too good for you if you don't have this information handy. I know this because it's exactly what happened to me. I was so busy gauging interest in getting door slammed in my face. When a restaurant finally showed some interests, I hadn't taken the time to prepare myself with the answers to the questions they were most likely going to ask. It looked a little bit amateur when I said I email them with something later on. So let's get some more information figured out before we hand out samples and then have to answer their questions with guesses instead of facts. Farmers markets are probably the most obvious avenue for micro greens. And when you're first starting out as a market garden Farber, Some of the best things to stock on your table, especially in the early months of the season when you might only have some early spring crops like bags of spinach radishes and the first harvest of kale. So head down to your local farmers market and talked to anyone carrying micro greens. Do they wholesale to larger places? Do they find there's enough of the demands right there at the market level, bison and try them against what you've grown. Are they more flavorful? How fresh to they taste? What does their packaging and branding look like? Try to really gauge a competition from every angle so you know how to distinguish yourself. We're going to talk about all of these elements of your own operations soon. We've just completed the first unit of beginning of micro greens startup business, which involved gauging market interest in your local area through a really broad search of traditional resale avenues, local indie restaurants AND grocery stores and farmers markets. Now using my own experiences with all three of these avenues, let me give you the pros and cons of selling your micro greens in each one. 3. Side Note - The Pros and Cons of Traditional Retail Outlets: One of the pros of dealing with grocery stores is that they're giving you access to a large customer base. Grocery stores are very difficult and expensive to run and you've got high inventory cause most of which has a limited shelf life. Staffing costs high ran to if you're at a really affluent area, tons of cooler and freezer storage, which is murder on hydro bill. So if they've been around a long time, they've developed a strong clientele and stocking your product there, it gives you access to that clientele, which in turn fosters brand recognition for your product. Brand awareness is one of the longest hardest processes and growing a business and developing the customer base with loyalty to your brand. The goal of every business out there. That's something a grocery store can potentially give you. If all goes according to plan and sales are consistent week after week, stores will place a set order with you which is invaluable to the micro greens grower. Consistent orders help you plan your planting schedule more effectively and gives you a consistent revenue stream you can rely on. There are some cons to dealing with retail grocery stores. They take a large percentage of each sale that's made, which is how they make their money. Or they'll want to wholesale price if they buy from you and a larger quantity, which will be significantly less than you'll be able to earn if it's a direct sale to a customer, which is what it would be at a farmer's market. So this is going to vary depending on the store and who you're negotiating with. The only advice I can give you here is to know your own costs to the penny. So you know how much you can afford to sell each unit of micro greens for and ensure you're never losing money on a sale. We're going to go over cost and pricing and an upcoming unit. There also might be some competitive products already stopped and existing stores, which gives you a bigger challenge to introduce your brand right next to ones that are already established. Restaurants are the most likely to place recurring orders with you if you're a good, consistent grower with competitive price point. And as we just said, a set recurring weekly order is invaluable for a startup micro greens operation. In my experience, restaurants potentially asked for a more diverse variety of micro greens. So this is a bonus for you if you're comfortable with growing lots of different types. The cons unfortunately are many. Restaurants have a very high failure rate, well over 90% of their first year. So I would suggest being very apprehensive about dealing with any restaurant that hasn't made it through 12 months of business. On the other hand, new restaurants are usually actively looking for good, consistent suppliers because no one wants to deal with them from the get-go. So this can be a good opportunity to retrench yourself within an organization. And if they end up becoming a success, you'll be along for the ride and hopefully they'll value you that much more for being with them since the beginning. Restaurants are also very finicky about the products that they receive from suppliers. The higher the price point on your menu, the higher their expectations were to suppliers, and the more you should be aware of that your supply will be scrutinized for any imperfections. No seed halls clinging to the sunflowers leaves, no overgrown pea shoots with woody stems, no radish or muster extends that are too wet. It's all going to be examined very carefully and perhaps even rejected if it doesn't meet their rigorous standards. You should always aim to offer the best quality product and possibly can. But it's also up to you whether you feel your upper offering that level of cosmetic perfection week after week. Restaurants often operate on a very slim margin, meaning they keep him very small percentage of the price point once all their costs are factored in. This means they'll pressure you to meet a lower wholesale price for them. Beware of the sudden changes you might see in restaurants, they're usually an indication that things are not going to well. If a head chef is suddenly replaced with someone else, that replacement might have a hand in redesigning the menu to make it more on their own. That means at the stroke of a pen, your micro greens can be taken off the menu and no longer need it, and that's the end of your relationship with that restaurant. Microbes are usually one of the more expensive inputs on a menu. So if the restaurant hits hard times and asked to start taking on some cost-cutting measures. Expect that your micro greens will be one of the first things to go. Again, you're off the menu and you're out the door. I'm happy to say that there are more pros and cons to selling microbes in a farmer's market setting. But firstly, it offers really good marketing opportunities. You're going to be there with a bunch of other vendors. And as you come to know each other, take advantage of any cross-promotion opportunities from booth to booth, like offering a small discount to customers of the bread or jam maker in the stall next to you. This gets your product in the hands of people who have never heard of you before and next week, they might have you and your microbes on their market ShoppingList. Farmers markets are also a good way to meet people in the food industry who might know restaurant owners who are looking for a micro greens supplier. Chefs might actually shop there every week and buy from you as well. You can also count on people who shop at farmers markets being a little savvier in terms of their product knowledge than the average grocery store customer. So expect that a good portion of the weekly attendees will already know about the features and benefits and micro greens and be really glad to see you there. It tends to be a very welcoming environment for talented growers and people offering high-quality products. And there's no reason that can't be u. This also takes away the need to introduce and educate people about your micro greens first before they possibly take a chance and buy them. The main Khan I can think of when selling at farmers markets is speculative growing. As a micro greens grower, we have to think about how many varieties to offer on a weekly basis. And those trays will have to be planted up to two weeks before market day. That means that by the time you attend your first market of the season, your trays for the next two weeks are going to have to already be planted. Seed and soil are expensive and so is your time. So you don't want to dedicate more of it to grow micro greens, then you're going to be paid for. Unfortunately, with farmers markets, however much product you bring each week until you establish a clientele you can count on is just going to be your best guess. So expect that there will be some waste, but don't let it actually go to waste. Use any unsold product left over at the end of a market day to get to know other vendors, trade it for some of their products. Bartering between vendors at the end of a market day was always one of my favorite things to do at markets. Here's another trick to turning unsold and potentially waste micro greens into another product. Recognize these. 36 hours ago they were a big pile of freshly harvested sunflower micro greens, the result of a larger artists that I needed. I put them in the dehydrated, dry them for 36 hours at 95 degrees Fahrenheit. And this is the result. You can do this with any kind of micro green. Sunflowers need a bit longer since they're bigger and juicy or the most of it varieties. Once you've removed the rest of the halls, pour them into a blender like a Vita Mix and just pulse grind them quickly. It doesn't take long. What you're left with is dry deaths that you can now sell as a powder. The drying process makes the material shelf-stable, stick a label on it. This is a way of turning waste product into something profitable. So those are some pros and cons of dealing with grocery stores, restaurants, and farmers markets. There are lots of benefits to selling through these channels. But as you can see, the list of cons associated with grocery stores and restaurants in particular can be enough to make even the most gung-ho grower think twice about proceeding with a startup. Now if that's the case, let's proceed to the next unit where I explained how specializing in particular types of micro greens will help expand your operation into niche markets. Most growers don't even think of. This means less competition, more consistent sales, and minimal waste. So let's get started. 4. Unit 2 - Dodge the Competition Through Specialization: So now that we've completed a broad search of potential micro greens retail outlets, let's drill down a little further and narrow our search. We're going to couple this exercise with determining the positioning of your micro greens and where you want to fit in the market. Now to specify our search a little more, let's examine what micro greens offer people. In other words, what are their benefits? All my programs are packed with vitamins and minerals, but some varieties offer really important attributes that are unique to that family. The brassica family includes mustard, kale, broccoli, cabbage, cauliflower, which offer a huge amount of nutritional benefits like high levels of Vitamin C, a, e, k, as well as folate, calcium, iron, potassium, and phosphorous. But they also have something else that's special about them. Their particular movie High and an active compound called sulphur profane, which has proven to be a very active cancer fighter in clinical research. Not to mention that it may help reduce cholesterol, relieved diabetes-related complications, and repair sun damage to skin. I can see places like naturopathic clinics being particularly excited about something that offers this array of benefits. An analysis of the benefits of certain types of micro greens like this offers you the potential to specialize in a certain field. So maybe instead of taking the more obvious route like restaurants and grocery stores and trying to break through any existing competition by inciting a price war. In other words, offering your microbes for less and the hopes that these places will switch to you as a provider. You can carve out your own niche territory in different sectors through specialization. Best of all, the more you narrow your potential customer base, the more likely it is that they're already well-versed in the benefits of micro greens. And that helps you get over that first, initial educational stumbling block and onto the possibility of becoming a supplier that much faster. Now let's go a step further and brainstorm some potential retail avenues. Let's say that there's a natural path clinic that's interested in carrying your micro greens. What would that look like in practicality? We know micro greens should be refrigerated for prolonged shelf-life. And if the clinic isn't equipped with any kind of display cooler or even a standard fridge, they might look to you to provide that equipment, which is a big up-front expense for you in an unproven marketplace. We also want to get away from growing speculatively. Remember that to deliver micro greens on a weekly basis, we have to plant our first trace two weeks ahead of the first delivery date. That means that by the time you're ready to deliver your first week of product you've already planted for the next two weeks. And that's a lot of time, a lot of seed and a lot of soil expense that went into a market that you speculate will be successful. So to get around this problem, let's instead look to similar industries to see how they mitigate that potential waste cycle. Juicing companies have developed really good ways of dealing with the same problem because fresh pressed juices have the same problem as micro greens. They need to be refrigerated wherever they're stored and their shelf life is usually pretty short. One thing they do is offer a subscription service where people purchase different amounts of their juices and lock into a 248 week or even 12 weeks subscription model. This is ideal for micro greens Grover's too, because you know how much you have to grow and harvest each week for prolonged schedule, you're not in danger of over planting or under planting, which reduces potential ways and helps with your cash flow because the subscriptions. Paid for in their entirety right up front. A lot of these juicing companies also offer a delivery service which you should consider to people love the convenience of things getting delivered fresh right to their doorstep. You can even highlight this by saying it's delivered the same day it's harvested, which has a level of freshness you won't get in stores are eaten farmers markets. So to return to the natural path clinic example, by offering delivery, you can cut out the need for the up-front expense of having to provide a retail refrigeration setup right there in the clinic. Remember that when it comes to things like delivery, concentrate entirely on local markets. You're far better off advertising to a certain small area where you can deliver large amounts of product in a shorter distance, driving half an hour between different deliveries. Transportation is expensive and your time is valuable. So be sure to take that into account. So to recap, we could break open new markets and discover niche clientele by discovering niche benefits, certain micro greens offer step one researcher family of micro greens, or even one particular type that you're confident you'll be able to grow consistently and discover their specific nutritional benefits. Step to brainstorm a group of people who would likely find those benefits really important. Step three, brainstorm a list of places you would likely find a high concentration of these people in your community. Step four, gross and samples that clearly label the health benefits of your specialty micro greens. And take them around to some of those places where you expect to find your target market. Asked to speak with the owner or the person in charge to discuss what you're offering. Step five, look at the storage that's already available. There. Is the owner or a person in charge willing to allocate some space at a refrigerator, like a grab and go cooler? Or will they help facilitate some marketing directly to their existing clientele in order to allow you to offer a subscription and delivery service. Now let's return to the list of micro greens and their benefits that we started above. Research some more benefits and try to match those benefits with a niche clientele. Besides naturopathic Linux, there are lots of organizations with specific interests that actively Sergio products that cater to those interests. The wheat grass family offers a host of different health benefits, but barley grass in particular contains all nine essential amino acids that your body can't produce naturally. I can see exercise outlets like gyms or yoga and pilates centers taking an active interest in these benefits. They could be offered fresh for people to use themselves. Or if these gyms and yoga centers have juicing bars built-in offer your services as their main supplier. This is how narrowing your search and specializing helps uncover an interesting clientele that will support your endeavor with a lot of passion. Think of it this way. And abroad sales area like a grocery store, you're going to get a broad cross-section of people with broad interests. Many will be interested in micro greens. They're coming to the grocery store for pasta or frozen food or cereal, a ground beef. But by specializing, you'll find pockets of niche customers in your area with niche interests like health benefits of specific micro greens, there'll be much more excited about consuming your product over and over again. And although the group seems small, they're elevated interest in what you're offering more than makes up for the size. A few of these groups, and you'll be well on your way to establishing a really secure customer base that will help your business to grow. Giving that you're willing to offer a fresher product with added benefits like delivery to their clinic or their place of work, or their residents, they might even be willing to pay a higher price point. So speaking of price point, let's get our calculators out because it's time to do some math and determine that in the next unit. 5. Side Note - The Danger of a Price War: Now I briefly mentioned this, but it bears repeating. If you're going to pursue the obvious pads and micro greens retail that we examined off the top, like grocery stores, restaurants, and farmers markets. There's really only one way to distinguish yourself in the field when you're starting out against established competition. And that's with a lower price point. I really want to caution you against going this route, the barrier to entry, and that's the level of difficulty both financial and intellectual to starting a business is relatively low for micro greens, shelves, trays, seed, soil, and light are ultimately the base cost, perhaps amounting to a couple of thousand dollars right off the top. So what's to stop someone else from coming along in another few months and undercutting your prices the way you did to the other established businesses before. This is called a price war and it's a race to the bottom. Ultimately, small businesses and especially startups are the first casualties of a price war because you've got those limited cash reserves. And it usually ends in a blood bath for the more established businesses to. Grocery stores and restaurants are always looking to cut their costs and increase their margins. And all things being the same like consistency and quality. Why shouldn't they deal with the person who's charging them the least? I'm not saying to eliminate restaurants and grocery stores as your options outright. Some could end up being really good consistent revenue streams for you, but that's only provided you're earning what you need. If you approach these places with a lower price point to get a start, you're going to find yourself really regretting it at a couple of months when you wind up doing just as much work as these established suppliers, but for much less pay. The best way to determine your cost, it's a source your materials practice growing to determine your highest and most consistent yield portray, measure your time and include all of that in a price point you're willing to standby. So let's talk about that more in the next unit. 6. Unit 3 - How To Determine Your Price Point: Okay, so we're gonna get to the simple math on this very zoomed. But by now you should have an idea of what competition exists in your micro greens field and what they're charging for the product. For grocery stores, check out the price tag. And some instances they might even break down what the price is per pound or 100 grand. If you've spoken to restaurants, they use micro greens. They might be able to tell you right up front what they pay their supplier for the micro greens that they use. And if they don't tell you that, check out the suppliers website to see if there's a price list there. In most cases it isn't. So give them a call and ask or send an email. You might have to be a little bit sneaky here and pretend you're a restaurant or juicing company who's potentially interested in using a product. The information you should be able to see here are details like did they deliver and how often? What is the price per pound of each variety that they offer or do they sell some the other way, like by the living tray. Is there a minimum order per week? Do they offer lower prices for higher quantity orders? What varieties do they specialize in? Are they certified organic? These are all details that tell you where they position themselves in the marketplace and you can determine for yourself which ones are important to you and which ones aren't. It's important to know everything your competition offers and the price associated with what's offered. So you can decide where to position yourself. Well, you offer a more budget product at a lower price or a premium product at a higher price? What about positioning yourself somewhere in the middle? How will you communicate the benefits of your product in relation to that price? So people feel they're getting value for their money. Now to work out our price per pound, we have to know our cost per pound. So here's what we're gonna do. We're gonna take one of our ten by 20 phrase. And I am going to apply the amount of soil in that I would use to plan to any tray of micro greens. So the soils even now, I just got to know the weight of my tray. I'm going to wait with the soil in it and that's going to tell me exactly how much soil I just use. The weight of the tray I use is 350 grams or 12.35 ounces. Once I place the usual amount of soil in it, I waited again and subtract that amount from the 350 grams the tray ways without the soil. This gives me the weight of the soil in the tray, which is 190 grams or 6.7 ounces. I buy my soil and square bales, 18.1 kilograms or 40 pounds, and it cost me $20. When I divide the weight of the soil in the tray, a 190 grams by the amount in the bail, 18.1 kilograms, I get 0.0104, which means I use 0.01% of the total weight of the bag to fill that tray. When I multiply that weight by the price I paid $20, I get 0.208. Which means the soil in the tray cost me $0.21. Okay, so now that we know the approximate cost of our soil, as per usual, We're going to water the tray, let the water drain out, so we'd have a nice moist soil base. Then we're going to add our C sub z should always be laid out beforehand. And depending on the variety, you want a way to seed and then shake it over the tray. And depending on the sea variety, you're going to use some different amounts. Let's say I'm planting a tree of sunflower micro greens, which means I need a 150 grams of dry sunflower seed or 5.3 ounces by my sunflower seed and five kilogram bags, 11 pounds for $47.97. Now if I divide a 150 grams, but a total weight of the bag, 5 thousand grams, it gives me 0.03, which means a 150 grams of CDE is 0.03% of the seed in the bag. Now I multiply 0.03 by the total cost of the bag, 4797 and it equals 1.44. So $1.44 is the cost of the seed to plant this tray. Add that to the cost of the soil, $0.21. And that means that total tangible cost of planting that trait is $1.65. How amazing is that? If I can sell one pound of sunflower micro greens for $13 and it only cost me a $1.60-five to plant. That means I realize $11.35 in profit, but not so fast. Aside from your tangible inputs like soil and Trey and seed cause you've got your intangibles, like electricity costs for light and heat, and other inputs like water. It's difficult for me to give you an idea of what kinds of costs you might face here, because hydro and water prices vary so widely throughout the world, there are ways of keeping those costs as low as possible by doing things like use LED lights, those at very low cost to run. If you're able to grow with sunlight in a greenhouse that's essentially free. Microbes don't need too much water either, only enough to moisten the soil base throughout the growth cycle and more to silk and wash them once harvested, tried to use a really efficient hose with a low spray setting. So there's not too much wastewater draining from the bottom of the tray is after watering them. Also grow vertically. You shelving to grow up instead of out to save on square footage and to take advantage of warmer conditions above you. My advice is to look at your utility bills before growing and then again after a month or two of growing and see how they changed, then try to keep that difference in mind. A lot of these recommendations point to other costs we have to start talking about, which is everything you'll need to get started. And then we'll return to the price point and positioning analysis. So let's calculate our start-up budget in the next unit. Now in trying numerous ways to depict the next units visually, I eventually decided to write it all down. So unit for a step-by-step way to calculate your start-up budget using a case study as an example, is available as a PDF download in the course notes. Also included in those notes is unit five, where I list and discuss the different types of gross spaces. Gross base is going to be different, especially with regards to whether you're growing in an indoor setup and outdoor setup or a greenhouse, which is really a mixture of the two. There are no right and wrong ways to set up a gross space. There are just better ways which are entirely dependent on your circumstances and how much capital you have to invest from the get-go. So go ahead and download those notes, go through them, and then come back for unit 67 where we'll discuss packaging, labeling, recordkeeping, and then move on to expansion plans and little side notes I want you to keep in mind throughout this analysis as well. 7. Side Note - Know Your Numbers: Here's a little story I want to share with you about a big mistake that I made really early on in my micro greens growing. I had looked at a bunch of competitors and the different types of micro greens varieties and that they were offering. And there were a bunch that I was growing that they weren't, at least they weren't offering on a commercial scale. And one of those varieties was French lentils. Now it seems that the most popular micro greens varieties that virtually every micro greens company is going to grow our sunflower P radish, and maybe some of the brassicas. But no one was growing French lentils. And I found this odd because I thought they were relatively easy to grow. They were very flavorful, they looked great. So when I went out to different restaurants and took samples, I included French lentils as one of the samples. One restaurant in particular took a really active interest in the French lentils. They've never seen it offered before. And they really enjoy the flavor of them. They liked the consistency of them. So they made a ten pound order with me for two weeks from the day that I went in and talked to them a little bit about it sample. So I planted the French lintel seed the next day. And the growing went really, really well. But I had never grown ten pounds of French lentils before. So how many words I supposed to plant? What I should've done was grown tray after tray of French lentils. And really, really pay attention to the detail. How much seed was I planting? How much was I harvesting off of each one of those trays? Was I using the least amount of seed to get the highest yield? That's something you can only determine through a lot of practice. But I had agreed to a price point for the French lentils. And I said that I would do it for exactly the same amount of money that I was going to offer all of the other set, all of the other micro greens that I was going to grow for them, which works sunflower and p. Now sunflower in P have a very high yield portrayed because they're large micro greens and they absorb a lot of water. So a lot of the weight of sunflower and P micro greens is from their size and from all of the water that they contain. French lentils are different than that. There are actually a very, very thin micro green and they don't grow very tall either. So a couple of weeks passed, and I grew a lot of different trays of french lentils. And I thought, well, if I planted about, I don't know, 20 trades, I think I just selected that number arbitrarily that I would be able to get ten pounds of micro greens off of 20 trays. I was so confident of the way that I was growing them. I even took a picture of my growth space with all of the French lead tools, just about done growing. And I sent that picture to the owner of the restaurant and he got really excited and I said, okay, I'll be there in a couple days with the whole French lentils order all ten pounds. So the day of the delivery came, I got bright and early. I went down to my gross base and I started harvesting the French lentils. I had already finished harvesting more than half of the French lentils trays and I big pile of French lentils next to me and I thought, well this has to be pretty close to ten pounds, so let me way and see how many I already have. So I got her to scale. I got an a bowl, I started adding the big pile of harvested French lentils into this ball. And once I had piled them all in, I was really, really alarmed. I got another scale. I checked that there's the same amount. I've got a third scale. I put the ball on top. Same amount. Well, I had already harvested over half the trees and French lentils that I'd planned it and I barely had three pounds. They were expecting ten. So with only about six or seven trays left, there's no way that was going to make up the difference of what this restaurant had ordered and what I promised to deliver. I panicked, I had no idea and I was kicking myself because here I was so confident that I can meet ten pounds just by planting 20 trays, assuming that I would get one pound of French lentils off of each tray. And it was far, far less in the end that don't turn out to be such a big deal. I walked in there later on that day I had all the P Argus Did. They were beautiful. I had all the sunflower art was did they were beautiful and I had the right amounts for those. And then I handed him a French lentils and I said, Unfortunately, I barely have over three pounds. I expected the owner of the restaurant just to say, Thanks, but no thanks. Your services are no longer required here. Thankfully, a restaurant is a great, great guy, and he kinda just laughed it off. But I was lucky that could have gone really badly at any other restaurants. So I'm just cautioning you now. Know your yield, portray, know what price you need in order to be profitable for that variety of micro greens. And don't list it as a potential of what you're willing to grow for restaurants, grocery stores, if you're not 100% confident that you're going to achieve that yield every single time and that you'll be able to earn money on each one of those trays. 8. Unit 6 - Packaging Labelling and Branding: Packaging isn't a complicated issue for micro greens and you're really just looking for a couple of important criteria when selecting something. Number one, make sure it's transparent. Let the freshness of your micro greens do the selling for you. Freshly washed and package micro greens with their deep green shades are different stem colors, particularly Tried and radish. Look beautiful and transparent packaging helps showcase this. Number two, make sure that container is stackable. If your product is retailing out of a refrigerated grab and go cooler or closed-door display refrigerator. Whoever's in charge of arranging them will really appreciate how easy your containers can stack can be neatly arranged. Number three, make sure they seal tightly, both to keep the microbes fresh and to offer a bit of tamper-proof security. Both at the containers I have here fit the bill and even better, they provide you a lot of space for your label. Now in terms of the labels, you're gonna want the name of your micro greens, the best before date. Just print a flat line on this that you can stamp as you need too. That way there's no time limit to use the labels. The weight of the micro greens in your container. You might want to stamp this onto the health benefits if you can fit them. Any contact info for your business such as your website, your social media, your phone number. And depending on where you live in the world, you might have to include all of this in multiple languages. Now there are lots of small printers on the market that hook easily into your computer's USB input and print on thermal labels. They look great and in here well to most packaging even in refrigerated settings. This will help you avoid the cost of getting labels professionally printed. Printing companies usually want to first order of five to 10 thousand labels in order for it to be cost effective for them. But until we're confident we're going to be moving that many units, let's eliminate that upfront expense and rely on some small batch home printing for now. In terms of branding or product, I'm sorry to say I'm not much of an expert at all. Snazzy eye-catching labels and witty company names can only help you stand out at retail level. So I encourage you to put some emphasis on this and tap the shoulder of someone you know, who's graphically inclined. If no one comes to mind you some of the resources right here on skill share, there are plenty of instructors who are experts in the branding and marketing field who can help you get started on this end of things. 9. Side Note - The Issue of Delivery: When you first start out, you're going to be tempted to say yes to a lot of things in order to secure your first buyers. And that's okay. Strive to offer the best service possible, but don't overextend yourself and agree to do something that's incredibly inconvenient for you, like driving somewhere three hours away twice a week to deliver only a small amount of microbes because they're willing to be your first customer or agreeing to cut your price points significantly to help another fledgling business in the hopes that they might buy more when they get more financially secure. That inconvenienced might not seem like such a big deal when you first start and it's exciting to get those first customers. But as you grow those clients are going to continue to suck a lot of attention away from the newer customers you find closer to home or ones who can afford your product and are easier to deal with. So as much as it might pain you in the beginning, don't be afraid to say no to things that don't feel right in the beginning, you'll be glad you did in the long-run. 10. Unit 7 - Tips on Record Keeping: This is a very quick but essential unit on keeping track of your actual business inputs and outputs. Most importantly, your invoices. The busier you get, the easier it will be to lose track of these things. Now you're free to design a spreadsheet however you want, but at the absolute minimum, you should include this much information. A column for your customers names, the planting date for a particular order, the number of trays he planted, the amount you harvested from those trays, as well as the date you harvested them on the date you deliver that order, and the date you sent the invoice for that order for invoicing. There are lots of great free tools out there that allow you to send invoices via email and keep track of what's been paid or what's still outstanding. Be careful with credit card payments, these will cost you a lot over time as they're charged at the highest rate, anything from 2.5 to 3.5% of the cost per transaction. The easy way around this is to ask your customer to pay you by e transfer, which sometimes depending on the bank cost the sender a transaction fee, but is usually free for you to accept. 11. Side Note - To Certify or Not To Certify: Now just a word of warning about specialization. The more you specialize, the more you're going to find people who are very, very educated about your product. They're going to ask you a lot of questions. And one of the questions you might commonly get asked is, are you certified organic? Well, when you're first starting out as a micro greens growers, certifying yourself as an organic grower is another added cost. Being a certified organic grower means that you're opening yourself up to an inspection by accompany who's going to come and look at your seeds, where you source them, look at your methods. What about your substrates that is certified organic soil? Watering them, how are you growing them? There's a certain procedure you have to follow in order to be growing organically. I looked into organic certification last year because a prospective new client told me that I had to have it in place as a requirement to work with them for a third party company to come into my gross base and check a bunch of boxes that I was already using a certified organic substrate. Seed and municipal tap water would have cost me over $900 for the year. So before you pursue this, the first thing you need to find out is if it's important to a lot of different people you're hoping to sell too. I've seen some companies avoid this added costs by being really open and transparent regarding their farming methods. One thing you can do is invite potential customers to stop by your growing areas so they can see your inputs and see your process. Then they're confident that you're offering the cleanest product available. Most won't make this effort, but a small fraction of your customers will. I think working with an organic certification board is a good type of investments that you should aspire to. And once you hit a certain level of sales, by then you should be dealing with larger distributors who needs you to have that certified organic symbol on your label in order to access the organic markets legitimately. Now at that stage, it would be impossible for you to give a tour to every possible customer anyway. But as a first step, I don't think paying for organic certification is necessary. Be transparent in your methods and echo those methods and all of your marketing on your website. And he brochures you might have printed and social media. 12. Unit 8 - Invest in New Efficiencies and Expand Safely: Once you've made it through that first 12 months of business, you've surpassed just about every other business startup, most fail within that period. By that point, you've no doubt learned a lot about the challenges of offering a consistent supply of micro greens week after week to, uh, hopefully steadily growing, or at least equally consistent customer base. Now right around that 12 month mark, you're probably going to start to wonder What's Next. Things that seemed like huge challenges when you first started out, you can probably do now without much thought. I remember when one restaurant asked me to double my microbes delivery to them immediately from 15 to 30 pounds every single week. My first time dealing with that, it took almost an entire day to clean soil, soak the trays and make sure I was planting enough C to cover that off. And after a couple of weeks of working at this scale though, I got a lot more efficient and it never took me that long again. And that's the great thing about having consistent orders on a weekly basis. It's good for you financially, and it also gives you the opportunity to get better and more efficient in your production. Speaking of efficiencies, don't hesitate to make investments in your business to help automate it. Always delegate the work that takes you the longest and that you enjoy doing the least, like bookkeeping or social media updates. The more clients you add to your list of weekly deliveries, the more it's going to feel like there aren't enough hours in the day to get everything done and keep moving your business forward. So don't get bogged down in the chores. Investing in machines might seem costly, but the time they'll save you in the harvesting stages, for example, will be well worth it and they'll pay for themselves in the long run. Water bubbler is will help wash your micros after harvest and an electric salad spinner can shake the water from five pounds of micro greens in less than a minute. These are just some of the ideas. There are new innovations being advertised online all the time. Many you can even build yourself. Never be afraid to invest in new machines that will make your operation faster and more efficient. And if something isn't your strength, but it's important, don't be afraid to outsource it. Another thing you've probably experienced as exploring different avenues of resale you've never anticipated and are beyond what we've even mentioned in this course. The thing about starting a small business is you never know what opportunities are going to come your way. You're going to network, you're going to meet new people. And inevitably you're going to explore a lot of ideas that others give you you may never have thought of. Here's an idea for a big expansion opportunity in microbial greens, and it's based on an opportunity I got in the midst of my second year growing. I was approached by a juicing company that cold pressed and bottled their own juices, but also had their own distribution system in place. So several delivery vehicle set out in the middle of the night after production finished and delivered truckloads of the juices, not just to their own retail outlets, but to lots of other outlets they partnered with to carry the juices. So these were vegan and vegetarian restaurants, organic grocery stores, Jim's yoga and pilates studios and lots of other elements we already talked about in our specialization unit. What does using Company decided to do was leveraged this supply chain and reach out to other producers of products that would probably sell well alongside their juices at these various establishments. So think about the type of thing we're talking about here. Cold pressed juices are nutritious within huge array of health benefits. They appeal to people who take their health very seriously. It's pretty much the same target market as micro greens. Juice and company was also interested in using micro greens and reduces. Further. There was the opportunity of making my micro greens available fresh to the vegan and vegetarian restaurants that wanted to use the London menu. So this was a huge opportunity, though it did require some adjustments to output. They wanted certain types of micro greens package together in a specific ratio. And one of those varieties was arugula, which I had never grown before. They also wanted more microbes on a weekly basis than I had ever grown and they all need it to be soaked, rinsed, spun, packaged, and clearly labeled. None of this is going to be a big deal in terms of change to my operation. And after almost two years of steady growing, I was confident I could grow that amount of product including the arugula. I just needed some practice with that 11 thing it did require, however, was a huge expansion to my grove facility, both in terms of square footage with a lot more investment and shelving trees, seed, soil and lights. I budgeted that to meet their quantity. I would need around six to $7 thousand for new infrastructure. And I was also going to need to sign a long-term deal for a larger growth facility, which meant higher monthly rent. Now, one thing I did immediately before moving on any of this expansion was to sit down with the company owner contacted me. And when opportunities like this come, I really encourage you to always meet the interested party in person. You've got a much better sense of who they are and what they're all about, then you can send just over the phone or even if you're just exchanging emails. Now, that first meeting went really well. I didn't have any concerns about him particularly, and my online research of his company showed me that he was actually quite well regarded into juicing industry. He did want my micros at a lower wholesale price point than I was used to selling them. But I did the math and I realized that this loss was something I could absorb if he consistently ordered at that higher volume week after week. There were some things that concerned me, however, one, he was in a huge hurry to have me deliver that huge quantity of microbes. He essentially wanted me to step into the role immediately, which wasn't possible. I need to practice with growing arugula. I needed to find a larger gross space and I had to find the money for the expansion. I told them it would take me at least a couple of months to get everything in place and that concerned them. And in turn, that reaction concern to me also realized that I had existing clients who still needed my microbes each week and I didn't want to let them down. They'd been the foundation of my business for the previous two years. And I really valued these people in order to slow the pace down a little bit here, I told him I'd be willing to take on a small portion of his weekly growing more of the story started coming out at that point, he'd already ended his business relationship with an existing micro greens provider and he was in a jam. He needed someone to step in and pick up the slack immediately. So let's step back for a second and weigh the pros and cons of what we know about this opportunity so far. Well, the first and most obvious pro is that this was going to be a much larger audience to sell two. Also, it would offer a good, consistent revenue stream week after week. And there were opportunities for even more expansion beyond the weekly amount he already quoted me. Now besides the arugula, which I hadn't grown before, it was a pretty straightforward process and I was experienced in the other varieties he wanted. It also took the pressure off my own marketing and my delivery. Essentially you wouldn't have to mark it beyond this, he was going to take care of all the marketing and do all the deliveries. I would only need to deliver to one central location. Over and above all this, it looked like it was gonna be a really good alliance that I'd be building with what appeared to be a well-regarded and established business. Now there were some obvious cons. Firstly, he wanted a lower wholesale point from it. So I'd be selling my micro greens for less than I ever had. Also, he anticipated that I would be taken care of all the costs for the expansion. Most significantly, I'd have to find a new growth facility, a larger 12, which would commit me for a long time. The typical commercial leases in my area require at least a three year commitment, but more commonly it's five years and sometimes even ten. Aside from the higher monthly rent, there were gonna be a lot more costs associated with moving to a new growth facility, would I have to put in some electrical upgrades, but I have to put in some plumbing there. We're also going to be costs for tray and soil and seed and infrastructure. After a few more conversations with the owner, I started to get a little more concerned. It sounded like he made a really rash decisions. His relationship with his existing micro greens growers. He also became very impatient with me when I said I needed time to properly expand and not let down my existing customers. He bristle at the idea of me phasing myself in and had no regard for my concerns about the added costs I'd be taking on would ultimately help to make the decision easy for me was when I asked him about signing a contract to guarantee me a certain number of weeks of growing just to cover myself, I needed to make sure that I could count on a steady income for at least a set period to ensure I could cover the initial cost of expansion. The owner against it knows this. And he actually added a line at the end of the email. If you're not interested, I'll find someone else who he is. Well, I walked away from this opportunity and it's a shame I couldn't make it work, but my concerns about the cost of expansion while working with a particularly difficult and unpredictable owner to presidents, it was a good learning opportunity, and it also gave me the indication that there were a lot more opportunities out there for a micro greens grower on a large scale. I just needed to partner with someone who had access to a large market. In other words, a distributor who set up and product jibe with mine as perfectly as juicing did. Well, long story short, I ended up making some calls to juicing companies who manufactured the same product and had the same sort of delivery mechanism and distribution channels. And I actually found someone who was willing to strike a similar arrangement with me. He didn't have any interested parties in the beginning, but as we marketed the idea to some of his outlets and I provided some free samples to them. We've got some takers and the business has actually grown steadily since that. It's not on the level I was promised from the first company, but I'm confident overtime will get there. And best of all, I was able to start slowly with this other company using my existing space and infrastructure. It didn't require a huge expansion right from the get-go. If things keep on, I will need to expand to a larger gross based, but at least I'll be ready for it. And I've put money aside for the potential expansion each month. So won't require a loan or any serious Ilia capital in a short period of time. The bottom line is, be open to any opportunity that comes your way, especially ones that allow you to expand your operation. But do lots of research and due diligence. Make sure you're earning what you need to earn, your moving at a comfortable and sustainable pace. And you're fostering a good business relationship with level headed respectable people and you're not rushing into a situation that's going to leave you in debt just to cover someone else's bad business practices. And even if it doesn't end up going the way you want, step back, take stock of the opportunity that was presented to you and see if you can rearrange it and take it to someone else who can make it work with you. Thanks for completing the course. I hope it gave you a lot of ideas for how to proceed with your own micro greens business. 2020 was quite a year and my business was impacted severely from the covert 19 outbreak. I've written about it in detail and it's all available for you to read and the downloadable content wherever you are in the world, all the best to you in the coming years and good luck in all of your micro green growing pursuits.