Prairie Crossing Organic Farm

Marketing Plan

L.F.G. Team

Agenda• Executive Summary• Situation Analysis• SWOT and Planning Issues• Goals and Objectives• Marketing Strategy• Action Plans• Financials• Questions

Executive Summary

The Opportunity

• Significant growth potential in organic farming sector

• Partner with local businesses

• Support the community and expansion

The Service

• Farm Business Development Center (Organic Farm)

• Learning Farm

The Strategy

• Leverage existing local health conscious market

• Educate through targeted advertising & promotion

Executive Summary

~Long-term sustainability

~Increased brand recognition by 25%

~Synergy between the Learning Farm and Farm Business Development Center

Objectives & Results

External: word of mouth,

incorporation of social media, continued growth of organic products market

Internal: commitment from

the foundation, budget, execution of plan

Critical Success Factors

Aerial of the Prairie Crossing Organic Farm in Grayslake, IL

Situation Analysis

Farm Business Development Learning Farm

Situation Analysis Cont.

Objectives & Goals

ObjectivesDevelop greater

presence of PCF in the community

Support sustainable existence of PCF and the organic food industry

Increase the number of farms growing organic produce

GoalsIncrease demand / recognition of 25%Develop & enhance sales channels – increase demand 20%Expand land & equipment capacity – est. increase in capacity of 50% over next 5 years

Consumer Analysis About U.S. Families

73% buy organic products at least occasionally, chiefly for health reasons

31% were buying more organic foods in 2009 than in 2008 17% largest increases in spending in past year were for

organic products 59% expect to increase the amount of organic products purchased in 2010 Organic foods appeal most to those ages 35 – 44 Consumers back to basics to bolster health

Source: 2009 U.S. Families' Organic Attitudes and Belief Study, Source: Consumer Union poll data March 2010 & “Today’s Specialty Food Consumer 2009”

Primary Research – Survey 29% - familiar/71% - not familiar

Prairie Crossing References 14% - other, 11% - friend, and 4% - family member

Familiar with Prairie Crossing offers 14% - Farmer’s Market 4% - Sandhill Organics 4% - Learning Farm 4% - Business Development Center

Organic foods cooking class 47% - likely to neutral 53% - somewhat to very unlikely

Organic farming 21% - very to somewhat likely 11% neutral 68% somewhat to very unlikely

Source: 28 surveyed from Surveymonkey.com

Market Size & Sales Analysis US Organic Market

24.8 billion in 2009; 5.1% growth Highest growth in produce – 11.4% 1.8 billion or 9.1% growth in non-food

Retail make-up Mass markets i.e. Wal-Mart

2009 - 54% of sales 2008 – 43%

Natural markets i.e. Whole Foods 2009 – 43% of sales 2008 – 48%

Remainder from farmers markets, online, export, etc.

Product Line Analysis Organic markets

Non-food (Organics fabrics and cleaning products) Animal (Beer, Pork & Poultry) Produce (Vegetables, Fruits & Grains)

Prairie Farm Services (farming & education) Produce through incubator and permanent farms

Competitive Analysis Varies by channel

Channels: Direct Markets

Other farmers markets participants Local Community Supported Agriculture Programs (CSA) Home Gardens

Natural Product Retailers i.e. Whole Foods Conventional Retailers i.e. Wal-Mart Restaurants i.e. McDonalds

Competitive Analysis

1991 1998 2006 20090%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

7%

31%

46%54%

25%

6%

10%

38%

68%63%

44%

8%

Share of Organic Sales by Market Channel

Natural Product Retailers

Direct Markets, Export & Other

Conventional Retailers

Sh

are

Competitive Analysis

Direct Markets

Natural Products Retailers

Conventional Retailers

Local Growers

Out of Region

Foreign

SWOT AnalysisStrengths

Success in farming and exceptional business acumen of family farm as a model

Success rate for incubator farmers after leaving Prairie Crossing (80%)

Business fully supports the trend for a healthier lifestyle & consumer preference for locally grown produce

PCF is certified as an organic grower

Property borders major roads & train line

WeaknessesLimited community awareness and understanding of the organization

Lack of connection of the two sectors

Limited land and equipment capacity

Location of the farm is hidden and somewhat secluded

Lack of revenue from the Learning Farm, not self-supportive

SWOT Analysis Cont.Opportunities

Growing demand/awareness of organic food & locally grown produce

Sales Expansion: Larger food chains (Jewel, Whole Foods) Small independently run markets Institutions (hospitals, schools, prisons) Restaurants

Effectiveness of websites (fragmented & hard to find)

Partnerships with universities/ hospitals/health clubs to educate the community

Develop uncertified land to increase farming capacity

Threats Economic conditions limit external funding

Economic conditions effecting consumers ability / desire to pay the higher price for organic food

Growing season is limited compared to out of state competitors

Impact of weather conditions

Sales competition with other local organic farmers & non-organic farmers

Planning Issues Connections to greater community

Leveraging of synergies

Limited land & equipment

Limited Supply -> Limits ability to expand sales

Seclusion of the farm

Marketing Strategy Statement

“Increase brand identity and recognition within health conscious consumers who

want to support the community by purchasing locally grown organic produce.”

 “Increase awareness of the learning farm

which looks to educate and inspire people to value healthy food, land, and community

through experiences on the farm.”

Target Markets Primary Target Market

Existing local consumers Live in Grayslake or surrounding community (Lake County) Purchase organic products 50% or more of the time

Secondary Target Market Emerging / New organic consumers

Live in Grayslake or surrounding community (Lake County) Buy organic products less than 50% of the time Educational component critical

Positioning

“To health conscious consumers, Prairie Crossing Organic Farm is an organic farm that

offers locally grown quality produce educates on the value of healthy food & land is an integral part of the community

It is the only organic farm in Lake County to offer both produce and education.”

Marketing Mix Strategies

Product

Keep existing products & services

Expand education offerings

Pro

motion

Billboard(s)

Targeted promotion at local establish-ments

Sponsor community events

Community centers

Local restaurants

Distribution

CSA’s

Farmer’s Markets

Company website (services)

Social Net-working Sites

Price

Appropriate level to expand and support organi-zational growth

Service Mix Strategies

Peopl

e

Local communities

Schools

Restaurants

Beginning Farmers

Physical

Evid

ence

Increasing foot print

Logo

Billboard

Organic Restaurant on premises

Processes & Procedures

Federal and State Grants

Marketing promotions initiatives

Research & Analysis of Demand

Customer Satisfaction

Implementation Strategy PCF leading Brand in N.E. Illinois Organic Food

Subdivision Fresh Market Open Trade Day Local School District Lunch program Local radio stations program- Spanish/Russian

Create PCF Label/Logo Information Board Center in Whole Food store

Redesign PCF Web Page Under one Umbrella - individual Farmers web page Place order for Organic Food

Implementation Strategy Cont. Expand existing land size

Seek new corporate investors Seek Federal and State government sponsorship/grant Develop new ‘One Delivery Center’ Allow multiple family participation in the program

Healthy life style Create a Healthy Juice Booth in the Health clubs Use Local Community Center to advertise and sell

organic food Use local News paper to introduce local organic food

Task/Activity Time Period Responsibility Cost

Appoint intern for March to October 2011 March 2011 Director

$20,000

Research promotion and advertisement sites April 2011

InternN/A

Secure agreement from farmers to put Prairie Crossing logo on their websites

May 2011 Director

Place order for promotion media design, production and placement (billboards, displays, brochures)

June 2011 Director$10,000

1000/year

Organize and run events at corporate cafeterias, health clubs, schools, subdivisions, restaurants, organic food retailers. 20 events in 2011 and 6 each year @$1000 each

Growing Season Intern$20,000,

6000/ year

Update websites with event schedule and product availability

Growing Season Director

Promotion Action Plan & Programs

Sample Logo

Task/Activity Time Period Responsibility Cost

Secure farmer commitment to sell up to 50% produce under the Prairie Crossing Organic Farm brand at a predetermined price

April 2011 Director

Secure farmer commitment to adopt Prairie Crossing recommended product mix

April 2011 Director

Develop packaging contract. Select a preferred supplier

May 2011 Director

Apply for Farmers Market Promotion Program grant

March 2012 Director $1,000

Secure equipment loan of $500,000 with US Farm Service Agency credit guarantee if necessary

Feb 2012 Director $5,000

Explore corporate investments (Whole Foods, Wal-Mart)

Jan 2012 Director $5,000

Product Action Plan & Programs

Task/Activity Time Period Responsibility Cost

Develop a peer inspection plan among participating farms to ensure consistent quality and labeling

May 2011 Director

Mediate peer inspectionsGrowing Season

Director

Quality Action Plan & Programs

Task/Activity Time Period Responsibility Cost

Issue order for website. Include features not present in current website like events, promotions and order processing

March 2011 Director

$8,000 one time, $1,000/ yr.

Secure agreement with captive farmers to distribute a portion of their produce through Prairie Crossing’s distribution channel and pricing contract

May of each year Director

Secure contract with distributor for Chicago area

April 2011 Director

$1000

Develop packaging contract with a preferred supplier

May 2011 Director$1000

Form a cooperative of local organic farmers in the region to sell under Prairie Crossing brand.

Jan 2013 Director $5,000

Distribution Plan & Programs

Task/Activity Time Period Responsibility Cost

Primary research of price at regional retail stores and farmers markets

March 2011 Intern

Order secondary market research data for regional pricing and demand of organic produce

March 2012Director

$5000/ year

Secure price agreements from farmers and distributor to allow 2.5% margin on all produce routed through Prairie Crossing cooperative

May of each year

Director

Pricing Action Plan & Programs

Financial Assumptions Sales per acre = $20,000 / year Margin for distributing through Prairie Crossing

channel = 2.5% Equipment loan = $500,000 (Feb, 2012) Interest on equipment loan = 6% Expected acres and branded sales level

YEAR 2011 2012 2013

  Acres 90 99 109

  Branded Sale Level % 25 37.5 50

Financials

YEAR 2011 2012 2013

         

Revenues Rentals   $800 $1,600

  Margin on Produce Sale $50,000 $55,000 $60,500

Expenses        

 Product/ Service development

  $11,000  

  Distribution development $11,000 $1,000 $6,000

 Promotions and advertisements

$50,000 $7,000 $7,000

  Pricing research $5,000 $5,000 $5,000

  Interest   $30,000 $30,000

         

Earnings Before Tax

  -$16,000 $1,800 $14,100