Generating Sales With Retail & Wholesale Tactics
In this episode of the Direct Farm Podcast, Joe Schirmer of Dirty Girl Produce returns to talk about Farm sales and the key benefits that direct-to-consumer and wholesale channels have impacted his Farm business. Dirty Girl Produce is a 40-acre Certified Organic family Farm located in Santa Cruz County, CA. They specialize in growing over 20+ varieties of fruits and vegetables and sell to both retail customers and wholesale channels.
dirtygirlproduce.com
barn2door.com/resources
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Rory Loughran: Welcome to the Direct Farm Podcast. I'm Rory, your host for today's episode. We've got a great conversation for you today with a member of our Farm Advisor Network, Joe Schirmer of Dirty Girl Produce, located in Santa Cruz, California.
Welcome, Joe. It's been a little while since we've had you on the podcast.
Joe Schirmer: Yeah. Thanks Rory. Thanks for having me.
Rory Loughran: Yeah. To maybe start out and give people a little bit of a refresher on Dirty Girl Produce, could you just kind of tell us a little bit of the history behind your farm business?
Joe Schirmer: Sure, yeah. We're in Santa Cruz County in Watsonville, and right now [00:01:00] we are farming on 42 acres and we've been farming this operation since 96, so we've been doing it a while. We've moved around a bunch. Used to be in Santa Cruz on three acres and then came, spread all throughout South County.
We do a whole bunch of row crop veggies, strawberries, tomatoes, all kinds of broccoli beans, all this sort of stuff. We go year round and of course we're set up structure our business. We have five farmers markets here locally in Santa Cruz, also mainly in the East Bay, Berkeley, and in San Francisco.
And then we have a lot of accounts and exposure up there, right, that we sell a lot too, so we do some delivery runs and stuff like that.
Rory Loughran: Yeah. And so you didn't really do a whole lot of direct to consumer sales until like 2020, right? Were you mostly just wholesale before that?
Joe Schirmer: No, we've always done farmer's markets. That's been our, that's been our case. But then, there's a lot of restaurants. There's also a lot of, you know, within San Francisco there's a bunch of small businesses that either [00:02:00] caterers or they have delivery business.
They re a lot of people resell. There's some small grocery stores, stuff like that. And then we wholesale our tomatoes. Our tomatoes is our biggest single crop. And we have those in our dry Farm tomatoes and those things were wholesaling and moving, but most everything else is mostly we do, mostly retail and say like wholesale/restaurant price.
Rory Loughran: Yeah. So, you guys kind of did make that shift a lot more towards doing online direct to consumer sales. I know you've talked with us about that before, but do you wanna kind of maybe hit on that and what that kind of change was like going from what you were doing before to that?
Joe Schirmer: Sure. I think our business over the last few years, you know, we're using QuickBooks online, we do the Ferry Plaza Farmer's Markets on Saturday in San Francisco. It's a very busy market. There's a lot of restaurants, so we've been using like phones and iPads to write receipts on QuickBooks so we did have some tech, but we needed to go more and I really was actually in thinking that I wanted to go online more with sales [00:03:00] and also with communication. Now everybody has an email and we all have G sheets and we share like our farmer's market list to everybody that's picking and selling and everything, so that so we all share these sort of things.
We didn't really have that going into 2019 and I actually moved outta country for six months with my family. I was gonna work on that anyway. And that was December of 2019 and then, bam, pandemic hit 2020 and it just, you know, forced us to move quickly into this online platform.
And we started immediately. What had happened is our farmer's markets really slowed down a bunch. It maybe cut in half because of the pandemic, but kept going the whole time. But all of our restaurants, all of our wholesale, everything that was all just zero. So we lost that huge amount. And this is coming March, we still have a lot of food at this time of year, so we just launched straight into this whole farm box program and delivery, and we were doing it with Instagram and Facebook and just piecing it together in [00:04:00] that just frantic, crazy first couple months of the pandemic.
It was just really crazy. It was just wild. And then luckily I'd already toured Barn2Door. I'd also toured all the other platforms. I was shopping around beforehand, so I knew when it was time, I was like, Okay, boom, let's go Barn2Door.
So we did it and we changed that segment, which is probably like, at that time on the year, it's probably, 20 to 30% of all of our sales is restaurants, maybe more. And then the other 70% was cut in half because Farmers cut in half. Farmers markets cut in half. So least 50% of our income was, you know, halted at that point.
So we pushed on and we started doing home delivery, pick up sites. There's restaurants that were, you know, as soon as we started making a farm box and offering it for sale, either pick up or delivery, however, we're gonna do it. You know, our restaurant accounts, they were not doing anything cuz they were closed.
And a lot of people, they just stepped forward and said, Hey, I'm gonna be a pickup site. Hey, I wanna do this, I wanna do that. So we had a lot of outreach and a [00:05:00] lot of those pickup sites are still the same ones as we originally just jumped into in spring of 2020. So we really jumped on board with the whole full retail, direct to consumer pick up sites and deliveries, you know, home delivery of retail.
These are obviously not restaurant deliveries which we would do in the past. And it probably went from, like, I don't know, 95% retail business in the spring to summer of 2020 because restaurants had cut off too, now we're getting back to about 50/50, right? We've slowly trickled back to about 50/50 full retail, direct to consumer, and then now we do so much restaurant and wholesale.
And then, and what's great about it is that beforehand our accounts receivable was such a mess. lot of times it's like almost like a shoebox full of receipts that at the end of the year I start calling people up and say, "Hey, keep paying me." It was pretty hard for us to [00:06:00] maintain cuz we got so drowned.
So what happened is, when all the restaurants and wholesale left, we had Barn2Door wholesale page set up. And as they came back I could say, "Hey, look online, you pay when you check out." And that was a huge cash, because they came in, you know, I might have, you know, $60 to $150,000 right now in accounts receivable just because so many people would've been buying stuff from me and they've been waiting 30 days plus to pay me.
So I'm seeing this year, especially as restaurants are really coming back, I'm really seeing that we're ahead in our operating capital just because we have such a huge accounts receivable account going on right now.
Rory Loughran: No, that's really, I mean, I, and that's something I've heard from a few other Farms that work with wholesale accounts or restaurants, is that they can be really slow to pay. And so was that kind of one of your primary challenges with like, with how you were doing business before you kind of switched to Barn2Door and selling online?[00:07:00]
Joe Schirmer: Yeah, the problem with my business is that it's small enough that I can't afford to have like a full-time like accountant or someone that is really like working in administration. So like I have to do a lot of that stuff. And when I do find someone that can do some of that, it's usually they do part this part, you know, farmer's markets or other things.
So it's hard to fit that role. So it's easy for me as an owner to fall behind on my administration and my accounting. So, that's one thing that has really helped me, especially because I've lost a few key employees that would help me out with administration and accounting during the pandemic because of the pandemic.
And so, it's been great as people have been coming in and basically restaurants opening, reopening and getting to the point where they're not just open, but there's people coming in and they have buy power, cuz as they're coming in it's sorted out more. So it's been really, the time I've spent that [00:08:00] I normally would be trying to track people down and get paid is me just helping people get online, figure out what we're doing, sign them up, help 'em until they understand what's going on and then they come on, cuz it's new.
You have to be, you know, receptive to, you know, I've been doing it a certain way with a lot of customers for a long time, and I'm the one that's changing, right? So I facilitate that, that transition of the customer way more than I'm dealing with accounts and aging. And so that's been really, a really positive and time saving element of moving over online like we've been doing.
Especially when we deal with wholesale. I say wholesale and restaurant cause a lot of restaurants I deal with, half the stuff they're buying, they're actually paying retail for it. If we don't have a lot of something, we pay retail. If we have a lot of something and we break prices down.
But a lot of times, I wouldn't say I'm just doing wholesale. Wholesale, I tend to think is 50%. I'm getting 50% of the value of retail, roughly. And in a restaurant I'm saying, [00:09:00] it's probably average is 75% because a lot of stuff that my restaurants are buying are things that I'm only gonna grow a little bit.
And they're fairly expensive because they're hard to produce in that along the quality. And so I just do a little bit I know I can sell retail. So restaurant wholesale for me is a different world.
Rory Loughran: Yeah, no, definitely. And I feel like I keep hearing more and more about like the being kind of choosy about what things you choose to grow for restaurants and. And being particular, even like following the trends around what restaurants want. So that, that's awesome. But so you kind of touched on earlier that you were doing delivery and you have pickups.
And I feel like most commonly, most people do prefer, home delivery. They don't have to go anywhere. It just shows up at their house. But you still have maintained this the pickup option for the last couple years. Why is that? Is it a popular option for you and your customers?
Joe Schirmer: I mean we're writing the trend the, CSA or Farm box. So there's obviously, as soon as the pandemic hit, there was this huge spike. We were putting all of our food into these farm boxes and [00:10:00] we couldn't make enough farm boxes. We had jars of tomatoes, we had all these beets and onions and stored root crop things that people, we could not make enough boxes.
We were just delivering constantly. And as the pandemic has subsided, people are about going stores and shopping at farmer's markets and stuff. And so we're kind of riding it out and what we do is we do like a farm box, a small farm box, and a salad box, which are kind of generic boxes.
But we also sell, when it's strawberry season, we do half and whole flats of strawberries. And when in tomato season we do 5, 10, and 20 pound tomato boxes. So just having these pickup sites as placeholders for strawberry and tomato season really help out because it all balances out to have a delivery day for us.
When we leave the Farm we're essentially leaving the Farm on Tuesday and Thursday and we have a delivery route. When our restaurants are back, which is now, maybe we get, you know, four to six restaurant deliveries that we're doing. [00:11:00] In the wintertime, it might die down.
There might be times where we only get one delivery and do we really run the truck, 140 miles to get this one small delivery, you know? but what happens with the pickup sites is even on the days that there aren't very many at any given spot, all together, it makes it worthwhile. And adding on to that, the delivery to the restaurants is great.
And it makes the whole day, you know, basically a dollar number that makes it viable for us to continue our Tuesday, Thursday delivery, right. So really what we've done in the past is when we didn't have too much stuff, we just stopped doing deliveries on Tuesday or Thursday, or we'd only do it once a week.
We were inconsistent enough that people weren't expecting it, and so now since it's a routine, where actually I find we're building that, that customer base through our delivery. Cuz sometimes it takes people a while to really get, "Oh, you have delivery?" You know, cause we get people on Tuesday and [00:12:00] Saturday at markets in the Bay Area.
Restaurants that pick up, you know, all the time have for years and, but "oh, we didn't have this, if you want it, we can bring it on Tuesday." "Oh, you deliver? Okay." Or Thursday. So it all really is feeding off itself right now. So even when we have pickup sites for some neighborhoods like in San Francisco, I'm sure if we were doing home delivery right now, which we're not, we would get a lot more interest.
But for us it's too far away. It's too technical right now to do that. So we're just holding onto these pickup sites and people, a lot of the people that are doing it have been doing it like all through the pandemic, you know, and some people come and go, but a lot of people, I mean, San Francisco's kind of a walking city, so people tend to like doing it.
And there's a few restaurants for one. You gotta go to A16 Pizzaria, get pizza at the same time, or get some takeout or whatever. Go down in San Francisco Mission. So there's other, you know, benefits for people wanting to pick up, but we do offer delivery through [00:13:00] other delivery services. So if anybody ever needs a delivery, that's still an option. We're just not doing it.
Rory Loughran: Yeah. Have you seen like, cuz I feel like sometimes a pickup can kind of be like almost a gateway into other, into like, delivery. Have you seen customers kind of, they maybe sign up and do pickups or they're buying stuff from you at the market and then that kind of translates into a home delivery customer?
Joe Schirmer: Yeah. So we have two mailing lists, right? So we do retail and then we do wholesale, which is wholesale restaurant, right? We get two different newsletters from Mailchimp to each of these groups. And a lot of times they overlap cause there's a lot of chefs that just, shop in market for themselves. Like, you know, vice versa, regular customers that are shopping that you know, then buy at work. So what we do is when we get emails, we get alert people of all these changes. So, just having that accumulated email list for when we do say, "Hey, we're gonna [00:14:00] launch our Saturday or Tuesday or Thursday home delivery, a farm box retail to San Francisco and South Bay" or something like that.
Then, we already have these two lists to, to go off and announce that with a little link on there to say, Buy the shop now. Buy this. So, I think accumulating the mail, the mailing list is huge if and when we do these pivots and we're all, I feel like we're constantly evolving and changing.
We're always pivoting to the new angle. I have one company, Fog Hollow Farms in Brentwood. They're buying, you know, a pallet of tomatoes and they're shipping them in small boxes all throughout the us. It's something that I try to do, I don't wanna do.
It's too complicated. They do this. And so I'm sharing that link with whoever emails me, text me, I put it in the Mailchimp to say, "Hey, check in to Frog Hollow. Here's the link to buy our tomatoes if you want 'em in New Jersey, and you wanna get five pounds." So, it's nice to be able to pivot and be able to reach people through our email, you know, when we need to.
Cause I'm [00:15:00] sending that out weekly and alerting people. Okay. It's tomato season, strawberry season, you know, pretty soon strawberry season's gonna be over. Then tomato season's gonna be over. We're going back to farm boxes and we're gonna be trying to drive farm box retail subscription, you know, and that's gonna be what we're gonna be trying to do.
And as well as we'll be trying to drive sales on our restaurant/wholesale email as well, telling them, Hey, we have a lot of this, we have a lot of it. We gotta a lot of jars of tomatoes, giving you a deal right here if you buy mouse, sort of thing. So, so it's really nice to have be able to reach that part of our market. So a lot of our customers we have contact with or a way to get reach them, but we slowly over time are accumulating that. And I think that just takes time to build that email list, right?
Rory Loughran: Yeah. So, I was kind of curious, and I know a lot of Farms when they're starting out, a pickup option is more appealing because not ready, they're not sure if they're ready to go full blown [00:16:00] home delivery yet, so they might start with a pickup option. How did you decide where to offer your pickups?
Joe Schirmer: That's good. I think it starts, we have five farmers markets, so each of those farmer's markets is a pickup, right. And then really what we did is we kind of whittled it down from the first little pulse in the pandemic in 2020. We said, "Hey, we're gonna do home delivery", right?
And so we started with home delivery, and then we quickly we're gonna do Monday home delivery. We couldn't, with two cars. We could not deliver them all. On Monday, so it's over into Tuesday and then we're gonna do Thursday. That's spilled over into Friday. But then as it all kind of started shrinking back down, people did step forward and it's just kind of a thing that people have expected with these Farm Box CSA things is that there's a pickup site.
And so people really approached me first to say, can I be a pickup site? [00:17:00] So we did that and people would pick up and if people stopped picking up there, we'd stop using that host. And we did that on about, probably five, five hosts. And then you know, we use like my house, which is easy cause I don't care if one person comes or six people come, it doesn't matter. I can still use that as an option.
And of course on Farm, we have two days a week where people can pick up on Farm, which isn't a big one, it's mostly a restaurant kind of pick up. But we just kind of naturally evolved and then we just kept the ones and I tried to put it like, say if, you know, if you're in Santa Cruz and you go up into San Francisco, over to the East Bay, Berkeley and drop it back down. There's a big loop and that's kind of like our delivery route. So I try to plant like, okay, on Tuesday, here's one here, one here, and then on Thursday, one here and one there, you know? So there's, on both Tuesday and Thursday there's pickup site.
There's actually two in San Francisco on Tuesday and Thursdays. Different sites on different days, and then two in the East Bay [00:18:00] on Tuesdays and Thursdays, so it kind of equals out. And they're all different. So depending on, you know, what area, East Bay is very big. San Francisco is very big as well, so I kinda tried to split it up so at least there'd be one day, one time a week where people could pick up that was reasonably close to them.
And then the ones that people kept ordering for, we just kept those and it just kind of evolved. And of course the, you know, like Pizzeria Delfina is a restaurant that's next to Delfina and they have like four or five pizzerias through the Bay Area.
And Craig, the owner I've known since I've been farming, so I've known him probably 20, 25 years or something like that. Also A16, you know, I've longstanding relationship with them. And so a lot of these sites I have deeper connections too. And so that has a lot to do with it because I've had some people say, "Hey, I wanna do it."
And they start doing it and they realize like, Hey, this didn't draw enough business to them or whatever they were trying to get out of it. And then they stop. if you don't totally know that another person's [00:19:00] intention or businesses change over time anyway.
And it can be a hassle, it's really like, I try to kick down some tomatoes or whatever, whenever I can to this place cuz they're basically just hosting for us for free because they want to. And so, sometimes that's not gonna work. I don't expect every restaurant to be able to pull that off.
It's gotta have some sort of a meaning or some kind of use for, you know, some of 'em, it's like they're getting a delivery anyway, so, it works out cuz we're bringing a Farm box pickup on the same day.
Rory Loughran: Yeah.
Joe Schirmer: but really just, it evolves and it's really kind of random and then you just see what works. Try a bunch of things and see what works and keep those. That's kind of how we've evolved it.
Rory Loughran: Yeah. And I love that idea too, like restaurants that you have longstanding relationships with, or even for folks that have a friend that has a business in town or something. I don't know, a coffee shop. It could be anything really, I think. But being able to kind of utilize those connections and use spots like that as pick up locations if they're in a good spot for customers to get. I was also [00:20:00] curious that I know a lot of times I think sometimes people can get stuck, especially if they're in the early stages of a business where you're kind of willing to chase after a customer. And they'll almost like a lot of Farmers will go with or try to pursue or meet any request that somebody asks.
And I'm sure people will always ask about like, Oh, can you make this a pickup location? Or can you go here? What is your response to that? Or what would maybe be your advice to that when people ask to go somewhere that you aren't currently offering fulfillment to or aren't doing a pickup location at that somebody, maybe one customer is reaching out, asking about?
Joe Schirmer: Yeah, that's a really good question. I think that it's always beneficial to have an open ear and listen to suggestions from all your customers, especially when they're big customers like restaurants or wholesale or whatever. Listen to 'em, but make sure that don't just, don't go so far out of your way that it helps some another business and not necessarily yours.
Some things you really have to check and say like, is this [00:21:00] serving me or not? And really there's a huge difference between, I mean, I wanna say almost like with restaurants, when you seed money, when you could feel the seed money coming from a new business. And so if you're trying to build your business, you're in a different position. You know, maybe you do want to go out of your way to stretch that long day and do that extra delivery because you're trying to push and see what you can do and what you should and shouldn't do.
It's not necessarily your set plan, but I think over time you wanna make sure that whatever strategy for sales and fulfillment you're pursuing, it's gonna work for the Farm and not against you. Because I've just known that we've had a lot of delivery sites here in Santa Cruz and the mountains that, you know, my driver said, "Hey, this road too sketchy. It's way too far away. He's got a $25 order and it's taken me 45 minutes round trip to get there."
There's a lot of things that you just have to [00:22:00] consider and make sure that it's serving you. Make sure it's serving your Farm. And I think that's key to it, especially if if you're dealing with restaurants. I think there's some pitfalls that we all get into with restaurants and I would say as well as retail customers and home delivery, if you get into the option.
Put the delivery details in the notes and that can mean to some people, Okay, I want you to go to my Aunt Martha's house, knock on the door three times. And then when her cat comes here and goes over there, then go put it over the fence and go over there and then If she's not there, then take it down.
Like, whoa, you have to kind of draw the line and as well with a restaurant. One thing that we've really done, that's posting our live inventory has helped is a lot of times when we open up our ordering to: You can text me, you can email me, you can call me, or I can run into you on the street or the farmer's market and you can tell me, Hey, send me a box of [00:23:00] tomatoes next Thursday.
What happens is it opens up into things like, Hey, we're outta cannellini beans right now. I don't need to explain it. There's no cannellini for sale, so you can't buy 'em. I don't need to say, Hey, I want cannellinis, cranberry beans, I want tomatoes, I want radishes. And I have to go back and say, Hey, are we gonna have radishes?
Like we preset what we have. When it's there, you buy it. And if they say, Hey, I want cipollini onions no bigger than a 50 cent piece or something like that. And then all of a sudden, we're tasked with sizing. Sizing, even though it can be so awesome and people will love it. And I think for some businesses it's probably worth sizing, you know? I mean, we're talking baby carrots, beets, everything.
If you get into sizing and if you have basically indicated that you're open to sizing, you get it on every order, or you're gonna get it on so many orders. I really like [00:24:00] posting and now when people try to say, Hey, I need this. I say like, "Hey, I don't know the size that's gonna come out. We're gonna have what we're gonna have and this is how we're posting it."
Because some things, especially as the orders pick up and we have like, 10 restaurants, 20 restaurant pickups on a Saturday. My crew doesn't have the time to do everything, and they're not gonna go through and pull apart all these bunches to make all these perfect little things.
So in a lot of ways it, it puts a fence up there, and helps you draw a line of what you can and can't do. And I think it's good to push it and try to be that person, that business that can do stuff for customers, but then also just realize when it's too much, like I said, when you can feel this is not serving me.
This is extra work and I can just sell it this way anyway. So, yeah, I think that's really helped me, you know, get rid of sizing in unduly complicated delivery and harvesting [00:25:00] instructions, right? And also the time, you know, if you're text messaging with someone, an order, they text you, okay? Then I go to the field and I confirm. He texts me. And I text back say this, but not this, they text me. And each one of those texts, you get it in the middle of the field. I'm not necessarily down at my designated time in the office to look at, analyze these orders and figure out what's going on.
All of a sudden missed your order deadline or it's too late or whatever. So it's really the amount of energy it takes to be doing that. You just eventually, there's gonna be too many orders and unless you're someone that just walks around all day long with a cell phone answering people for orders, it's so much easier to get a real schedule down online where you can post what you have and they can buy it.
Rory Loughran: Yeah, no, definitely. Just having kind of those barriers or like the barrier of the online store is really nice for that. And then, yeah, I love what you're saying about if you give 'em the room, then they'll take it to start [00:26:00] doing those kind of modifications and specifications and things like that.
And so, keeping that to a minimum definitely saves the Farmer a lot of time. I was curious about, I know you mentioned your first pickup locations were your farmer's markets. I was wondering if, is that ever kind of a selling point to folks that are buying from you to the farmer's market?
Like, hey, if you want a guarantee to get something at the farmer's market, like order it online ahead of time and we'll have it here for you?
Joe Schirmer: Yeah, it is. But we limit it, you know, so essentially like our two pages that we offer, a retail page and a wholesale page. The wholesale page for people that sign up, has lists every item that we're gonna sell, or at least that we sell we have enough of to post online. Now, usually we'll have more at the farmer's market, but sometime we'll sell out before we get to the farmer's market, right?
So a restaurant can go online and they can order by the item, right? The retail page, you could buy a generic, like a generic farm box, a salad box, [00:27:00] small farm box. But we also offer strawberries and tomatoes in different increments. You can buy half that or whole flat of strawberries, for example.
This time of year especially, we run out of strawberries at the market. And so we said whenever it runs out and someone shows up, "Hey, do you have any strawberries?" Like, "Hey, no, you can get a half flat. You just got a pre-order online" and you give 'em a little QR code and it gets them to sign up.
And so the retail, you know, you're not able to be a retail customer, a regular farmer's market customer, go online and buy whatever you want. Six of these, two of these, one of those.
Maybe in the future we would do that, but that's really time consuming at the Farm for us to make all those orders. But there are certain things, you know, if you want tomatoes and or strawberries or a Farm box, you know, we'll hold these for you. We'll get 'em ready for you and we'll hold 'em so they can pre-order. So that helps the customer do that and also gets them into our system with our emails, email list and everything like that.
So it [00:28:00] is a winning thing, but it's like I said, we don't do it with everything for them. Often, like, we sell cases. Jarred tomatoes, we have strawberry jam. Christmas time comes around, they wanna make sure that they have a full case of strawberry jam to give out stocking stuffers so they can pre-order. A retail customer can pre-order those jars, you know. And that's really helped for a lot of people. Cuz also we're gonna bring our jars and we might sell out and someone comes and wants a certainess or they want the price made on the jar, on the full case.
So they can pre-order. So there is a lot, We do have a lot of offerings because of that at farmer's markets for our retail regular farmer's market customers.
Rory Loughran: Yeah. I like the way that you structure that too cuz I feel like the tomatoes or the strawberries are like kind of your specialty items or your high demand items. And so especially making those, the ones that you can pre-order, I think is a great way to go about it. Cuz then those are the items that people might come just to your stand to get.
And if they can't get 'em, then that's a great plug for your online store.[00:29:00]
Joe Schirmer: Yeah we kind of have two businesses. One is our regular Dirty Girl Produce, where we grow like maybe 70 different items throughout the year. The other is tomato season. When it's tomato season, we have a whole other crowd, whole other distribution, whole other people come. They ask year around when our tomatoes starts.
So, it's nice to be able to get those peeps and get 'em in our system and then try and sell 'em a Farm box later. Because they do like Farm, they do like to support us. They know us, so they know that, you know, the quality of the produce that we grow. And they may come for the tomatoes, but they stay for the small Farm box delivered. Or they get jars for Christmas or who knows what.
But they see that we have the tomatoes will bring them in and then they'll see there's other options. There's other things we do and there's other days of the week at farmer's markets or you name it, you know, where else we find Dirty Girl.
Rory Loughran: Mm-hmm. Yeah, definitely. I know we've talked a lot about kind of how you've gone about wholesale and it sounds like that business is really kind of made a [00:30:00] comeback. So that's great to hear cuz I know, I think the last time we talked it was just at the start of restaurants starting to reopen and things like that.
But I'm glad to hear that part of your business has really opened back up again. What would be your advice maybe to Farms? Cuz I know wholesale accounts a lot of times for Farms is something they want to pursue, but they're not, maybe not sure how to go about that.
What would be your advice to somebody that, that is trying to find more or start getting into those wholesale accounts, working with restaurants to sell them their produce or meats or anything?
Joe Schirmer: Yeah, sure. I think there's a few good strategies, and it really depends on where you are. You know, how rural you are, how far away you are from the nearest biggest city. Or stringing together delivery routes. Every community is different. So with restaurants and wholesale as well, I feel, like for us it's easy because we have sold in San Francisco and it's such a big city.
It's a big food city. So many restaurants for so many people that come there to eat, just to eat. So it's crazy. So we have a lot of support on those. But I think [00:31:00] ultimately they know about us because we've proven ourselves at the farmer's market. A farmer's market for someone that's starting out may not be the long term business plan, right?
And I see it with farms, but often way more with other like value added businesses that sell at farmer's markets. Farmer's markets for them are like incubators. Start off with the sales, that you get your crew going, you're producing something. And then you get the exposure cuz people are gonna see you at the farmer's market.
They're gonna see your product. You can meet them, you can talk to 'em. Restaurants come around, they're looking, "Hey, what's this? I like that." All of a sudden you start building your relationship. So I feel like that is Farmer's markets are a really good way. It gets you exposed it, it puts your product out there, and then you can build from there.
Another way to do it is just to straight up, go out to dinner or lunch or breakfast or wherever, go and pursue these places. Look up where all these places are and go just knock on the door. Give 'em a business card there. I know if you eat somewhere, for [00:32:00] people that really care about what they're doing in restaurants, a lot of the chefs that I deal with, they're artists. This is their life's passion.
They love talking about food. They appreciate and makes them feel good when people appreciate their food. Being able to spend some money and going out to a restaurant, I think, you don't have to spend all the money, you don't have to go big or anything, but, you poke around and have a cocktail or figure out a way to get yourself in a restaurant and talking to the people and give a business card, QR code. Get an email, get a, some sort of contact.
These days, communicating with people really varies in technology. Being a Farmer, Farms tend to be, a lot that I know at least, the smaller Farms, behind in technology compared to all the other businesses, compared to restaurants. You go to restaurants now, a lot of them now, there's a QR code. You look the menu up on your phone, that's so new.
And so being able to adapt and [00:33:00] being able to, you know, what do you gotta send someone an email? Maybe you have to send 'em a text. Maybe you send them a business card and they're gonna call you on the phone and do this. So there's a whole a wide range of different businesses and how they're run.
A lot of restaurants are small businesses. Some are huge venture capitalists funded businesses as well, and a lot of wholesale accounts are huge and they're huge corporations. So each one of those you need to have a different game plan in dealing with them. But I think really pursuing that, I think farmers markets are great incubators, even if they don't end up being their long term goal that they'll put your name and your product out there.
I suppose that you could just start throwing out Google ads in your neighborhood and getting a lot of people from online, just starting out online. But I think it's really a combination between like, approaching brick and mortar, selling at farmer's [00:34:00] markets, flyering. There's a lot of people that go to their church groups, right? There's a lot of organizations. Youth sports groups, sponsored team. I mean, there's all these kind of things where people promote themselves in their community.
So, they try to get their, their name out. So yeah, I think there's a lot, but there's also the online portion. I'm sure some people could do it and really be successful in just starting out a Farm online. I don't know anybody who's ever done it because we've just now arrived right at that point.
But I find that I have a lot more directed targeting at people that have either already bought our produce or found us on their own. I feel like is where I try to really market and grow. So, for someone just starting out, you just cast the net really wide as wide as you can and see what works and then drop.
If it's not working, drop it and just go for the revenue streams that are working, you know, that seem to be working.
Rory Loughran: Yeah. I was curious too, like is there anything that if somebody, if a restaurant reaches out to you [00:35:00] or it's just somebody you're thinking about maybe trying to start working with, is there anything that you ever notice about a restaurant business or a wholesale account that causes you to be like, Actually, no, we're not like, that you avoid? Are there any flags or things like that or maybe something you look for in a restaurant that makes it a better partner for you and Dirty Girl Produce?
Joe Schirmer: Yeah. I'll tell you one thing that like vetting restaurants in the old, like pre pandemic Dirty Girl Produce was pretty much getting to know the buyers who sometimes are the shops, sometimes they're foragers, sometimes they're a friend of the house, sometimes they're the owners. You never know. You have to slowly build relationships and figure out, you know, if you're gonna hand someone off $250 worth of produce and they're just gonna sign their name on a piece of paper, you wanna know that they're gonna pay you because I've not been paid a lot.
There have been a lot of businesses that I've dealt with that have gone bankrupt and have not paid me. You know, most of the time people are [00:36:00] really pretty good at paying like, far and wide. But if you're gonna have a lot accounts, and you're gonna have a lot of money in aging.
You're gonna have to expect that some of that is eventually not gonna come back to you. And so one thing that's really nice in that vetting process, in building a relationship with a restaurant is if you do have this online platform where they're paying up front, then they're already paid for the produce.
So you don't necessarily need to build that relationship as much. Maybe that's a starting point. And during the deliveries and emails and, Hey, I like this. I didn't like this. Whatever, you get feedback from customers. Then you start building that way, which is different than when what we used to do.
Like we weren't necessarily gonna let people sign and walk away if we didn't know them. But also we probably let way too many people sign and have way too much money outstanding. And then that's money that's just, I'm paying interest on my credit line instead of it coming into the bank and paying off.
So it costs money to do that. So [00:37:00] there are a lot of red flags in dealing with restaurants and wholesalers. I'll tell you wholesalers, I love them. I love y'all. But it's a sharky, sharky place. Okay? Like, like people are, look, buy low, sell high. People are trying to make money. And so you have to expect that.
My main wholesale right now is through Fruit World, and it's my friend Cindy that I've known for 25 years is a really good friend of mine. If she wasn't selling my produce, she's still my friend. So I really trust her and we have a really good working relationship as well. Building those relationships with wholesale, it works, but you gotta be tough, you gotta be gritty, you gotta get paid, you gotta set up for yourself. With restaurants, I'd say the same. I think sometimes people, especially when you're on Farm all day, you can easily get taken with an invite to a restaurant.
Oh, come on in, I'll pay, and it's like, Oh my God, this is amazing. They're feeding us. And this is, taken care of. And so sometimes there's an emotional component to a restaurant account that can [00:38:00] affect your rational thinking and you're looking after your business, you know. You wanna say "Well, I like this so much", or there's something else I'm getting out of this relationship with this restaurant that isn't like, you know, I need to look at the dollars and cents.
It's worth delivering them. They're paying a fair price, so forth. And so you really need to evaluate and also like, you know, getting to know your customer. A lot of times I think that's what sustained me as a Farmer over the years is that the customer appreciation, being able to meet your Farmer and build those relationships and have people appreciate.
If it was just like disembodied, I never met the people in person, it's harder. You feel it less. So I think that there's an important value that you get that's not monetary when it comes to building relationships that's really important. And it's what feeds a lot of us. A lot of us are not making that much money.
We're basically Farming to be able to do it and so these things, you know, our relationships and accounts are meaningful in other ways [00:39:00] other than the money. And I think it's important to shape those as well as the financial gains. But also one thing you gotta see, you gotta be wary of, that I found a lot and I've seen is the effective seed money, which is, when someone first starts a business or someone just gave them money or they have a lot of money or they have a different kind of money that you're used to. And cuz a lot of times when people are gonna start a business, they start with a huge budget.
They've loaned, they've borrowed money and they're spending and they wanna get the best. And so they come to Dirty Girl cuz they want our name on the menu and then they want our good produce on the plate, right? And eventually when the operating capital isn't alone, they've spent the loan or the credit line. And they have to spend the money that they're buying produce with money that has actually are receipts that are meals in the restaurant. They feel it different. Sometimes people take off and their successful and they stay.
They're new, they start with us and they keep us. [00:40:00] But I've seen a lot people coming, buying from us, buying hot, like large amounts. And then once they really feel that crunch, feeling like, "hey, maybe I can't pay these prices", or "hey, maybe I can't buy this much produce." Or, it changes, So really be wary of that change.
I would say especially be wary of that change if you are a business that is gonna give terms like 15, 30 days. You know, when someone's starting out new, I would be wary. It's risky even though it's exciting and I think it's good to be on the team that is gonna be pumping money into PR and outreach and you know, like a new business does a lot of that.
So it's good to be on that team when they're doing it cuz it's good for you as well. But I would be wary about loaning a lot of money out by giving people produce on terms when they aren't solid, long term customers. You know, I always call it seed money. Like you can feel the seed money and you can feel the seed money dry up when businesses change [00:41:00] in how they're funding their operating capital.
So it's almost like if you're an investor, which I'm not. I wish, but I'm not. But if you're gonna invest in the stock market, you go research the businesses, right? You don't just gamble away and look at, you know, numbers up and down and whatnot, and, you know, you wanna really be a wise investor and so your accounts are gonna be, generally, it's interesting with MailChimp because MailChimp will show you purchases that people made by clicking on MailChimp, right?
So it'll say how many purchases happened from this MailChimp event on wholesale and how many on retail? And the average purchase, the price. So our retail, the average retail is much less than the average wholesale. The average wholesale is much higher. So in a lot of ways it really behooves I think a Farm to put a little bit more energy into each one of those wholesale accounts just because they are going to potentially bring in more income.
Now maybe retail is, you're getting [00:42:00] fully paid. And wholesale, you're getting partial payment from 50% to, like I said, 75% to a hundred percent to, you know, wholesale/restaurants. Restaurants sometimes are retail as well, so... but they're bigger purchases. So these accounts, building restaurant accounts, just vet them clearly, but it really has helped me. I've seen a huge improvement, especially when people come in new and they come in hot. They just say, "here's the link to our store. Order before 10, the cutoff, and you pay on checkout."
And that's what they do. And I think that really helps because then buy as much as you want or as little as you want, yeah.
Rory Loughran: Yeah it's kind of a nice way to have a little bit more protection against somebody that might have a lot of money now, but in 30 days they might not have so much money in the case of a starting restaurant or something like that. That's really good advice.
So I was curious Joe, just kind of as a final question, but what's kind of next on the radar for Dirty Girl Produce? What do you got planned for the year ahead? What's next?
Joe Schirmer: Man, I'll tell you. [00:43:00] I am just having a moment in Dirty Girl. I've been renting the whole time I've been farming, since 1998. So, and I farmed on, I think over 15 parcels at this point. We are in a capital raising mode. We have a bridge lump proposal that I'm spreading to some of our restaurants and our restaurant groups.
All our customers who we are close with who have expressed interest. We're going to try and buy one of our properties. So I think mid-December to by the end of the year, I'm hoping to be close to buying one in particular. It's gonna take a little while and it's really complicated.
But it's really cool and I'll still be a renter of farmland, but to have a headquarters where we can put equity in month to month, you know, paying a mortgage and building equity that way instead of trying to save all the profits for my carrots in a bank account somewhere, that's pretty hard when you're Farmer, you know. So I'm really psyched trying to buy [00:44:00] property and building up Dirty Girl headquarters, which is what I think we're gonna be doing.
So really excited on that. And other than that, just, you know, sustainable ags means that, we do good enough this year in order to be able to do it next year, right? And that's a huge task every year. So, we're speaking right now in the middle of September, and it's just in the throes of the biggest part of our year. So every little detail, every little decision has a much larger potential benefit or consequence this time of year. So I think right now, finishing this year and moving into land owning position is gonna be great and a lot of people that are Farmers, you know, throughout other parts of the country. Like buying a Farm here is a million dollar proposition minimum.
We can't get a $300,000 farmhouse with acreage. Those days are way over. So, it 's a big ask and I'm sure it's like that elsewhere as well. But there's still a lot of places that you [00:45:00] take for granted that you can buy the Farm or someone had a Farm that you could inherit or buy from your family. Here, it's kind of crazy expensive, but at the same time, it's an asset that I'm hoping to build equity, so...
Rory Loughran: That's really exciting for you and for the Farm, and I'm sure for your family as well. So definitely best of luck with that. And I'll look forward to next time we talk or next time we have you on the podcast. At least that hopefully that'll be close to wrapped up.
Joe Schirmer: Cool. Thanks Rory.
Rory Loughran: I want to extend my thanks for Joe for joining us on this week's podcast episode. Here at Barn2Door, we're humbled to support thousands of Farms across the country, including Farms like Dirty Girl Produce.
We're honored to get the opportunity to learn from our most successful Farmers who share the tactics and resources and tools that they use to grow and manage their Farm businesses. If you would like to connect with Joe and other Farm Advisors, attend Barn2Door Connect. You can register for weekly sessions at barn2door.com/connect.
For more information on Dirty Girl Produce, you can follow them on Instagram at Dirty Girl [00:46:00] Produce. Thank you for tuning in. We'll see you next time.