Archive for Farm Business

7 Tips for Surviving The Recession with Your Alpaca Business

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Over the weekend I received an email from an alpaca friend. She was so discouraged about her alpaca business. Full of doom and gloom, I could tell she was thinking of throwing in the towel.

Her state of mind inspired me to write about how to survive the economic downturn.

  1. Remember that you are not alone. People with money in the stock market, real estate, cattle, horses, and pretty much any business you can think of have lost a significant portion of their investment (at least on paper).
  2. If you don’t sell your alpacas at today’s current low prices, you don’t lose money. Economic advisors have called alpacas a “hold” investment for now.
  3. Don’t let panic selling cause you to drop your alpaca prices to a place where you’re not comfortable selling.
  4. Keep in mind that your pregnant alpacas are out in the field growing your investment now. They are working for you. Focus on their care.
  5. Your Investment almost doubles with each female cria. This knowledge should leave you feeling good about the money you have invested. (Stock holders do not have this assurance.)
  6. If you don’t already use the alpacas’ fleece to bring in money – this is the time to do it. Let the alpacas do their part to earn their keep.
  7. Remember why you got into the alpaca business to begin with. For the majority of people in the alpaca business, money was not the number one reason they invested in alpacas. The animals and the lifestyle they allow are more important to most of us.

Get back in touch with what motivated you to have alpacas in the first place.

What other ideas do you have for surviving the recession with alpacas?

Why All the Sales Lists in the World Aren’t Enough to Sell

oldfencingPhoto by Angela at Farmers of the Future

Each day there are more and more places for alpaca breeders to list their sales animals. Alpaca Nation and Alpaca Street come to mind immediately. There are new, up and coming alpaca sites as well. Alpaca Market and Alpaca Classified (both Yahoo groups) are good place to post animals and other things for sale. Many AOBA regional affiliate sites also have Sales Lists on their web sites.

Occasionally a Buyer picks out an alpaca over the internet and buys him or her. But this is rare. How often does this happen to you? In this economy?

People may shop around on the internet, and we do need to have our animals on some sales lists. Don’t get me wrong. But what sells people is the relationship they will have with you. This is actually good news. Why? Because sales lists are targeted to a mass audience. The costs can add up. The scope too broad and too impersonal.

What really matters is the relationship – and it doesn’t cost you a dime. You can develop relationships with a few people and sell alpacas to them. Unless you are a large farm (and most alpaca breeders do not have large farms), you will probably not need to sell that many alpacas each year. You don’t need a mass audience. Only a few people who are a good fit for you and your farm.

Focusing on grass roots marketing and word of mouth will be more effective than a simple sales list. Having an Open House, passing out your business cards, and following up with your qualified leads can all lead to sales.

Many times I have heard from customers, “You are the only one who called me back.” Be the one who calls back your farm visitors, the people who sign your guest book. Get to know your prospects. They will need to know and trust you to hand over the kind of money alpacas command.

Sales Lists are necessary, but not sufficient. Pick up the phone and call a prospective alpaca breeder today. Build the relationship and the sales will follow.

Field Trip to Yocom-McColl: Interpreting that Histogram Report

Written by Melinda Cook, originally published on her blog, The Pacablogger.

Remember those field trips during your old school days? The excitement of going somewhere new, a day not sitting behind a desk, the chance perhaps to eat lunch out, getting your permission slip signed? I loved them way back when and still do. In pretty much all respects (except the permission slip thing),  a visit to the venerable Yocom-McColl labs very much took me back to those days. When at the end of it all, you came away with eyes agog and brain stuffed to the last wrinkle and cell with new information .

Besides a hospitable welcome by Margaret and Angus McColl and their friendly staff, a tour of the facility is an eye opener to the fiber business beyond our growing alpaca industry. Much of the activity there focuses around sheep and other fibers , not just in raw form, but also in cloth, yarn, and finished product. It’s a foreshadowing of what’s to come for us as we move to a true commercial industry and the depth of analysis that will come. But for now,  I’m concerned more about our relatively narrow world of alpaca fiber testing.  What is the measurement process ? How do I use the numbers for my breeding program? What is the correct interpretation and use of the fiber stats? Beyond that, I am ready to soak up whatever other tidbits of precious information that Angus was willing to share from his vast wealth of experience.

So what does happen when your little bag of fiber lands at Elk Place in Denver? Well here’s the Cliffs Notes version -

YM Cutting Machine

Cutting the Test Sample: Like quite a few of the tools we saw, the machine to cut the sample off that fiber you sent in was customized by Angus himself.  It has a guillotine-like blade that thumps down and whacks off 2mm off the cut end to ensure a testing sample that has experienced the same conditions e.g. environment, nutrition etc. This 2mm sample is then washed with a degreaser in a little cup and flash dried with a burst of air, leaving residual matter and grease behind.

OFDA 100Into the Conditioning Lab: After drying, the sample is conditioned in the Conditioning lab, where the humidity and temperature are held at 65% and 20 degrees Celsius, respectively. This creates an environment identical to those of measuring labs worldwide so that the stats generated in each lab are apples to apples (You know that little note on the bottom of your histogram reports that say “This test performed according to I.W.T.O. method 47 or 12″? Well, that one line sentence has a lot more meaning when you see the precision and complexity of the preparation and measurement process).  Once conditioned, the fiber is prepared precisely on a glass slide for viewing. There are two machines in the lab that are used for measurement: the OFDA 100 (that’s when you get the spin fineness and curvature in addition to the usual AFD, SD, CV, and % fibers greater than 30m measurement) and the Sirolan Laserscan (which gives you just the AFD, SD,  CV and % of Fibers greater than 30m). The OFDA 100 is what we observed in action (mostly because the Laserscan is a big enclosed box – not so fun for layman viewing ). The slide is placed on the black base and as the machine scans back and forth across the slide, it uses a camera to generate images of the magnified fibers. It then takes measurements across the width of each of fiber strands, averaging them together to get the Averge Fiber Diamenter (AFD) in microns. While we were watching, we observed it taking over 500  measurements in just seconds. Zowee.  It also figures standard deviation (SD), Coefficient of Variation (CV), spin fineness and curvature – CV and spin fineness recalculating on screen dynamically. The histogram forms on the computer before your eyes. It’s amazing to see. And the margin of error in the AFD? According to Angus, not greater than 3/10th of a micron. Wow. That’s 3/10th of 1,000,000th of a meter, to put it in everyday terms that perhaps I can wrap my brain around. The Laserscan will give you the same AFD, SD, and CV measurements through a different technology.

OK, so now I have this great report with quantitative, objective measures that I can publish, quote, and use to make decisions regarding my breeding program and fiber use.  What does it all mean?

Here are the conclusions I’ve come to:

AFD: Average Fiber Diameter. This is probably the most straightforward and easy to understand. This is the average diameter in microns of all the sample measurements taken.  This is your measurement of fineness which translates into the grades of royal baby, baby, superfine,adult, coarse etc. As an average , however, this means that not each or even most of the fibers are equal to the AFD. It is best viewed with the SD or CV to consider variation around the AFD.

SD:  Standard Deviation. This is the average deviation away from the AFD in microns.  So if you have a small figure, you have better uniformity in micron. High SD means greater variation in micron. In general, you’ll hear a lot of people say they want less than 5m SD. Get close to 3m SD and you’re talking really uniform. You can look at the bell curve represented in your histogram report to see whether you have a skewed distribution.  Most commonly, you might perhaps see a very tight distribution on the left side and then a more spread out distribution of points on the right side, signifying your variation is due perhaps to guard hair.

CV: Coefficient of Variation. This is simply a calculation where the SD is divided by the AFD and then multiplied by 100 or (SD/AFD)*100.  Many people rely on the CV to track uniformity which is correct. However, it can be misleading as a standalone metric if fineness is of primary importance in your program. For instance, you can have an animal at 16m with an 3.8m SD and therefore a CV of 23.8m.  But an animal at 23m with an SD of 3.8m has a CV of 16.5m. Which would you rather have? Well it depends – are you prioritizing fineness or uniformity? When you talk to mills they will sometimes say CV is the more important metric. But that is because from a processing standpoint,variation is the enemy. Variation in micron, staple length, tensile strength can really muck up the machines and consistency in end product. This is the difference between consistency of product and grade of product.

% Fibers Greater than 30m: 30m as a fiber diameter is the commonly used threshold for prickle factor. In other words, above 30 m and you have prickle, below and it’s fiber that is tolerated by the skin. So this measurement is useful for determining end use of the fiber.

Spin Fineness:  What’s the difference between AFD and Spin Fineness? Spin fineness is a pure mathematical calculation that normalizes the AFD measure based on a CV of 24.  In other words, if your fiber has a CV different from 24, the fiber diameter is recalculated to what it would be if the CV were equal to 24. That means if you have a very low CV, the spin fineness will reflect a number lower than your AFD.  So what is this figure used for? This normalization is used to predict how the fiber will process when compared to other fiber. By assuming the same CV and adjusting the fiber diameter accordingly, you get a comparison that removes the variation consideration. This to me seems to be a measurement purely useful for processing.

Curvature: We’ve seen a lot about curvature lately. Curvature measures the angle in crimp in deg/mm. In general, higher curvature numbers correlate to higher frequency of crimp. Higher frequency of crimp correlates to greater fineness…in general. Greater fineness does not always show up as higher frequency of crimp or high curvature as we know. But since we’re talking quantitative measures to come to objective conclusions, what is the real value of this measure? It seems that the curvature is a good indicator of resistance to compression. The greater the curvature reading (the greater the crimp so to speak), the greater the resistance to compression. The greater the resistance to compression, the greater the memory.  Lack of memory, as you remember, is why alpaca sweaters easily lose their shape and why it is often blended with wool which has great memory.

Needless to say, I came away from the visit with much more than an understanding of the testing process. I’ve summarized just a bit of it in the above. As a breeder in Colorado, I am always amazed at the depth of knowledge to which we have ready access right under our noses. A visit with Angus and Margaret will bring that point home quicker than most any activity. Besides an informative trip, it was a pure pleasure to spend time with them.  Their generosity in sharing what they know will delight you and Margaret will have you rolling with laughter.  So I can only say it was a day more than well spent and like those field trips of my childhood, filled me with more information than I could immediately absorb and eyes once again agog.

Cattlegrower – Social Media for Ranchers

Photo by Jim Snyder

Photo by Jim Snyder of Buggy Ridge Farms

Like MySpace and FaceBook but Only for Ranchers (Alpaca Ranchers included)

It’s common opinion that most ranchers are old school, set in their ways, and don’t like change.

Perhaps this thinking is why the live stock Industry has traditionally been behind the curve in adapting to and using technology. Perhaps this is why most ranchers can only rely on their own close circle of contacts to promote and market their products to. Perhaps this is why many live stock producers fail to realize their full potential, or worse yet, fail altogether.

High in the plains of Wyoming, Chad Golladay and his family of six raise Lowline Angus and hay on their modest 300 acre ranch which they began building just three short years ago after being hooked in to the business through a 4-H project for his nine year old daughter.

Says Chad, “Despite the numerous fairs, stock shows, etc. that we’ve participated in, it was always a challenge to make new contacts in the Industry, or keep in touch with those we were able to meet. It seemed that if you weren’t part of the ‘good old boy’ network that most doors and opportunities were very difficult to open.”

“I think we’ve all met many fine people we’d like to discover more about and learn from. But if you’re like me, too many result in lost contacts and lost business. With the advent of social networking sites like MySpace and FaceBook, I thought… ‘Why not a social network just for ranchers and livestock producers?’” says Chad.

CattleGrower.com was born. A network community for livestock producers of all types and ages to connect, collaborate, and promote their operations.

Within only a few months of its creation, CattleGrower.com now boasts over 2,500 bovine, equine, sheep, goat, alpaca, and other livestock producers and enthusiasts who visit and contribute to the site regularly.

CattleGrower.com boasts a robust and powerful platform that allows its Members to:

- Create and develop new contacts
- Share and learn from each other
- Expand their marketing reach

While anyone is allowed to visit CattleGrower.com as a guest, Members are able to:

- Post Classifieds
- Share video and pictures
- Create and join events
- Create and participate in polls
- Have their own web page profile for marketing

Best of all perhaps is there is NO COST to become a Member.

Says Chad, “I believe we all want to do better by ourselves, our operations, and our families. CattleGrower.com provides that possibility – Simple to understand and easy to use, yet powerful enough to be limited only by your imagination – best of all, it costs you nothing.”

To learn more about CattleGrower.com please visit www.CattleGrower.com

And when you get there, please friend, Alpaca Farmgirl! This is one of my favorite social media sites. What other social media sites do you use in your Farm Business?

Alpaca Nation Means Business

an-_girl-125x125Alpaca Nation recently sent it’s customers an email. In it, they let customers know that they appreciate their participation in their customer satisfaction surveys and that they will be making some changes based on the feedback they received.

They report that they will be upgrading with larger photos, lineage reporting, and show results in the coming months. Alpaca Nation states:

The survey results included a lot of comments about the current economic challenges and our prices.  We are proud of the fact that we have never raised our membership fees in the 10 years since Alpaca Nation started.  However, many members indicated that additional pricing options are desired and that many of the additional services offered by AN, such as ANSync and banner advertising are cost prohibitive.  As a result of this feedback, we are announcing pricing changes.

The email goes on to report that price changes will include AN Sync. This is the service where the updates to customers’ Sales Lists and Herdsire Lists on their own websites are  in sync with their Alpaca Nation listings. (To demonstrate this service, here’s an example: Fairhope Alpacas Sales List and Fairhope Alpacas Alpaca Nation sales list are in sync. When the Alpaca Nation account is updated, the farm website updates as well.) This makes life easier and saves lots of time for breeders. New pricing will be $50/per year for all modules, decreased from pricing that started at $200/year with a $100 set up fee for each module and each module was an extra $100-150.

Alpaca Nation is also lowering their banner ad prices by an average of around $100/ad. Ad price includes design and artwork, which has always given them extra value. They’ve also added new payment terms and new herd count tiers. For more information visit the following:

More about ANSync:  www.alpacanation.com/ansync.asp
More about Banner Advertising:  www.alpacanation.com/ads.asp
More about Membership Prices:  www.alpacanation.com/FAQ/FAQ_cost.aspx

What Can Small Businesses Learn from Alpaca Nation?

  1. Know what your customer needs. How do you do that? Ask. On a small scale, you can call them and ask them. “How are we doing with our customer service?” “How can we serve you better?” “What additional services/products would you like us to provide?”If it’s not feasible to call your target audience, email them a questionnaire or have them fill out a form on-line when they sign up for something or make a purchase. The main point here is to DO something with the information that you gather. Hear what your customers want AND find a way to give it to them. This is a time to build loyalty, not be greedy.
  2. Hear what your customers want and respond to it. Find a way to give it to them. Even if you make less money from each customer, building/maintaining your current client base will ensure your long-term success.
  3. Make your price points more accessible to consumers in the current economic climate. By lowering their ad prices, AlpacaNation will likely increase the number of advertisers which should make up for the revenue lost by lowering ad prices. If your product’s pricing is not accessible, your sales will suffer.
    • *If you are selling alpacas, I am not suggesting you sell them “cheap”. Instead, consider offering a select number of animals at a lower price or put together a discounted package price. In this economic climate, I generally recommend that alpaca breeders hold their alpaca investments and grow their herds. That said, do continue to create cash flow and build your customer base by making prices more accessible to a larger target audience with a small percentage of alpacas from your herd if your herd is large enough to do so.

  4. Research your competition. Find out what services the competition is offering…and beat it. Alpaca Nation is the 2,000 lb. gorilla when it comes to advertising alpacas on-line. They were the first on the scene and they own the market share. It is hard to imagine anyone else catching them when it comes to internet traffic. Within the past few years, other on-line alpaca sales sites have come onto the scene. They have done several things to try to compete with Alpaca Nation, including offering FREE sales sync programs, and fees and ad rates that are lower than Alpaca Nation’s. Rather than resting on their laurels and letting their disgruntled customers gradually drift over to the competition, they are meeting the challenge head-on. The recent move to make these same services on Alpaca Nation more accessible with new lower pricing, should allow Alpaca Nation to maintain most of their current customers.

Thanks to King Kong traffic statistics, Alpaca Nation will maintain their spot atop the Empire State Building of alpaca internet sales lists for the foreseeable future.

What other business lessons can we learn from those at the top of their respective fields? Leave a comment and tell us.

Do Your Dream

Photo by Jim Snyder

Photo by Jim Snyder

With all the economic upset lately, I have been contemplating being in the alpaca business and what that means for me during these harrowing times. One friend pointed out to me that if I had all my money in the stock market, rather than invested in alpacas, I would have about half of what I used to have. While the alpacas are not very liquid, they are retaining their overall value and many are insured. The investment in bloodstock will compound as they have babies. When the economy turns around, we will have lots more alpacas to sell. Sounds good on paper, but there’s more to being successful than the bottom line of a balance sheet.

The other day, my long-time friend and customer, Gary, reminded me not to lose sight of the fact that I am doing what I love. He’s right. Despite all of the economic turmoil that is going on, every day I get to wake up and do what I love. He wanted me to think beyond the money, beyond the financial worries that all businesses face these days, and to experience the joy each day that comes from working for myself and loving what I do.

After I talked with Gary, I came in the house and told my husband, the Artist, about our conversation. His reaction was quite strong. In 2000, we both quit lucrative jobs to work for ourselves. I left a career as a psychologist to stay at home with our children and breed alpacas. The Artist left an engineering position behind to follow his dream of being a full-time sculptor. He used to work 12-14 hour days at a job where his only focus was the paycheck. Nothing beyond that. He was driven entirely by the paycheck. He didn’t love it.

The Artist said, “If you can put those same hours and drive into something you love – it takes a lot less effort. The feeling of satisfaction goes beyond the money. It’s rewarding, enriching, worthwhile. Over time it gets easier to put more into what you do when you love what you are doing. You can accomplish more, go farther, and your focus is more intense.”

“It’s hard to put a price on doing what you love. Enjoying your day, looking forward to the next day, dreaming about it…life is no longer mindless motor functions. You don’t feel the stress and pressure. No one is looking over your shoulder. You take pride in your work. You reap the reward or experience the failure. This is satisfying. No one else takes the credit for it.”

I knew I had to share his thoughts with you. He left a great job and worked unbelievably hard for many years to find success as a Sculptor. Every day he is grateful that he gets to “Do his Dream”.

It was great to be reminded to stop and smell the roses (hay or whatever). I am blessed to love my work, and to have the opportunity to be a farmer, and to be around alpacas and my babies every day.

Do you do what you love? If so, what is it and how does it fulfill you? If not, what’s holding you back? Please share your thoughts and comments.

Business Dinner Plans

Today's Menu: Sweetness and Warmth

Today's Menu: Sweetness and Warmth

Guest Post & Photo by Deborah L. Vassar of Mariposa Farm Alpacas

As alpaca owners we are often business owners.  And as business owners we are expected to have a business plan.  However, writing a business plan can be intimidating.  To me, it can be compared to dinner.  I’m going to assume that everyone reading this has eaten dinner numerous times through out their lives.  So let’s assume that our overall goal is to eat dinner (or in the case of your business plan, to make money raising alpacas).

First we need to obtain raw materials (something edible):

  • Grocery store
  • Farmer’s market
  • Your garden
  • The fridge
  • Outsource to someone else

Dinner preparation:

  • Your stove
  • Someone else’s stove
  • Grill
  • Microwave

Dinner delivery:

  • On china
  • On a paper plate
  • Eaten out of the pan while standing over the sink

And don’t forget the financing:

  • Your wallet
  • Someone else’s wallet
  • Dine and dash (not recommended)

Much like there are many ways to have dinner, there are a variety of ways to run an alpaca business.  A business plan specifies how you run your alpaca business now as well as your future goals and dreams.

To get started on your business plan you can find recipes here and here.  Fill in the ingredients you already have on hand (information you already know).  Next make a visit to the Alpaca Academy to start filling in the missing ingredients.   If there’s still a few items missing simply mark as ‘to be determined’ or ‘I don’t know yet.’  Substitutions are definitely allowed.

Remember this is your business plan. Highlight what makes you stand out from other alpaca owners.  Write it in first person and make it easy to understand.  It’s okay to use bullet points and lists.  In fact, someone outside of the alpaca industry should be able to understand why you’ve chosen to raise alpacas, how you’re going to make an income, and your goals for the future.

Once a draft is written, it’s time for a taste test.  Take your draft down to the Small Business Administration. They’ll be able to provide valuable feedback.

Writing a business plan takes some effort.  Don’t let all that effort go to waste by putting it aside.  The plan is a tool.  It provides the actions needed to achieve your goals.  Review the plan every six months or so.  Does it still meet your needs?  Does it need some more spice?  Do you need to cut back on the fat and carbs?  The plan doesn’t need to be rewritten.  Just add a page with the date, changes made and why the changes were made.

Meals are so integrated into our lives that most of us probably don’t even think of all the options and choices that go into them.  These same skills, which you already possess, can easily be adapted to creating your alpaca business plan.

Bon Appetit!

Tips for Success in the Alpaca Biz #1

Tip #1 – Don’t Forget About the Older Girls

You are about to choose the females that will make up your foundation herd.  Financially, this may be the biggest investment you will ever make and you want to make the right choice.  As you gaze out across the pasture, the weanling females playing in the field catch your eye.   Those cute faces just tug at your heart strings.  The youthful maidens (females who have not yet produced offspring) still have that fuzzy face with the added advantage of possibly being pregnant or ready to be breed to your favorite herdsire.  And then there are the older pregnant females who have one or more cria.  Their fleece is not as soft as it used to be from having multiple cria and let’s face it, they just are not as cute as the younger females.

So how do you choose that perfect herd? Do you go with your heart and pick one of those cuties pronking in the pasture or pick one of the less exciting older girls out in the field? More »

If not now, Never?

oldredbarn4small

My husband always tells visitors that he wishes we had gotten alpacas sooner. He believes the time he spends outdoors working, as well as the tranquility of farm life will surely add years to his life.

Recently, I was able to follow a discussion that took place between a potential farmer and several traditional farmers on the farm social networking site, Farmers of the Future. By traditional, I mean farmers of row crops and cattle, rather than this relatively new (since 1984 in the U.S.), outside the box, farming with alpacas.

I was surprised with the intensity with which they urged the person who was considering farming to “Jump in!” Here were some of the comments they made to the person who was unsure about exactly how and when to get into farming:

  • “I wouldn’t wait on the economy, because if your thoughts turn that way, you will never be able to farm”.
  • “I too would not even think about waiting. If you wait, you will never get started”.
  • “I would not wait on the economy, once it starts to turn around interest rates will start to go up. If you have the ability to borrow the money you need go for it now while rates are still low.”
  • “No, go at it now if you love to farm. There is not a better way to live your life”.
  • “It is not going to be easy, but if it was everyone would farm!”

This reminds me of when people advise you there’s no “right” time to have a baby.  This IS a great time to invest in farming. Alpaca farming. Alpaca prices are lower, tax advantages are great, the animals compound your investment, and they are fully insurable.

Farming is not for everybody. But if it’s farming that you want to do, I ask you: If not now, when?

Farmers for the Future

As an alpaca farmer, it is great to hear the perspective of the traditional farmer. While there is not much overlap today in the alpaca industry and traditional farming, that will be changing in the years to come. People have been farming since the beginning of time, and any of us who love the farm lifestyle can learn from others who share that love.

Check out the social networking group, Farmers for the Future. It’s a great place to interact with Farmers of all kinds.




View my page on Farmers for the Future



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