Building a business is not one size fits all, which goes for indoor farming too.
There are various business models that a modern-day farmer can adopt, and we’ve seen a broad spectrum of them from ZipGrow farmers over the past decade. Take, for example, Frank Fitts of Yellow Hammer Farms. He predominantly sells directly to restaurants and wholesalers with a B2B model. His business has been successful partly due to Frank’s connections in the wine distribution industry and his efforts to build a network in the commercial sector. Then there are farmers like Abby and Mark from Farm Girl Greens, who own and operate a Community Supported Agriculture (CSA) farm, which provides fresh farm-to-fork quality food directly to customers. A B2C model where she is scaling up as customer demand increases.
ZipGrow farmers often use the tools in UpStart University to build their original business plans.
Part of developing that plan depends on geographic region, demand in that region, and the ability to adapt if necessary.
When Christian Gerig launched his ZipFarm, Lokal 365, in 2020 in St.Gallen, Switzerland (pop. 75,000), his business model was B2B selling fresh basil, peppermint, and sage directly to big retailers. “It was quite successful, and we could increase our sales every week. We had the same efficient output daily; that’s a big advantage.”
But after a while, Christain found that the benefit of consistent crop production had its setbacks with his chosen distribution model.
“There was no forecast from them (retailers). We would get the order the same day as delivery. It became frustrating for our team to be ready to deliver according to that demand, with too much wasted on days where we had reduced orders.”
In March 2022, Christian ceased the production of basil and began trialing new crops. He re-started with a business model that gave him complete control over crop production levels, plus the added bonus of longer shelf life of the product.
The winning formula: Pure essences.
Now rebranded as PinkFarm by Lokal365 AG, Christian produces essences from crops grown in his farm to make water-based favored solutions with no alcohol, sugar, or synthetic additives. He provides a product that is grown, harvested, manufactured, and sold all from the same facility providing full transparency to his methods. The main application is to add to drinking water.
Christian has committed to a B2C model and used some previous industry knowledge. Before he became a modern-day farmer, he owned a factory in China producing bamboo extract for the personal care industry, transferring those techniques to make edible essence; his team worked on product development over the summer and tested many crops.
”With the ZipGrow systems, we have stable output and can make full use of it by making the extract from fresh plants.” He really looked carefully at cost analysis and operating expenses to produce each crop, focusing his attention on fast-growing plants that can remain in the Towers for a long time without replanting, thus reducing labor time.
The current product line is a tasty lineup of natural essences of rosemary, strawberry, lemon balm, mustard leaf (spicy), lemongrass, and Shiso, a member of the mint family, native to Japan.
Christians farm consists of 33 ZipRacks with 15 Towers on each side. That gives him over 2000 sq feet of vertical hydroponic growing.
As consumer trends move away from soft drinks, customers are also becoming savvier shoppers, seeking wellness solutions that provide nutritional value. An important part of the Pink Farm business model is to engage the customers in creative ways and provide insights to the development of the products.
“There are many people who really like to know the details about production.”
This curiosity from consumers has led Christian to offer interactive live shopping events. “The essence was our first innovation, and the live shopping shows are our second. We created them for distribution and sale activity. They are a huge opportunity to show our customers what we do.”
Live shows are streamed in German (their target market) through Instagram and the PinkFarm website. “Each weekly show is a mix of information, product promotion with live selling from the farm- with some guest appearances.”
Customers can also book a livestream appointment.
In a recent “show”, Christian welcomed local bartender Maurus Schedler as a special guest to mix up some fun farm-fresh cocktails, like the Pinkerella!
Pinkerella Cocktail Recipe
His mobile farm is turning heads in Gallen too. This mini-model of the farm mounted to a bike is perfect for giving taste-testing sessions and demonstrations in and around the picturesque city of St. Gallen.
In addition to expanding the essence menu, there are plans for “Pink Care,” a 100% natural, simple personal care product line that would be sold directly to the customer. Christian notes that this would take a significant time and funding to develop as the skin care industry is complex. Still, Christian believes that there is customer demand for these products that will provide premium ingredients with no fillers. “We will be able to have a very natural, very simple formulation of cosmetics.”
At ZipGrow Inc, we love seeing this innovative approach to business development. Excellent work, Christian!