Another Way to Build CSAs
Consumers don’t have to wait for a farmer to start a CSA (Community Supported Agriculture) farm; instead, they can organize themselves into a group and then find a farmer or farmers to grow food for them. In the June-August 2006 issue of The MOF&G, we featured efforts of MOFGA and the Maine Council of Churches to start new CSA farms through congregations. The Farm Direct Co-op based in Marblehead, Mass., offers another model.
The Co-op “started as a conventional CSA but morphed into a co-op,” explained organizer Richard Harrison at a MOFGA-sponsored talk at the 2006 Maine Agricultural Trades Show. Harrison added that the lack of farmland in his area meant that people couldn’t farm where they were, “so we did the next best thing” by advancing and supporting the role for local or regional agriculture. He and his wife, Sarah, started the Co-op from their own home, never taking any money out of it for themselves. They paid for their own CSA share. Six years ago they hired their first employee. The Co-op is nonprofit but not tax exempt.
The mission of Farm Direct Co-op is “promoting environmentally sustainable lifestyle options through the distribution to its members of regionally grown organic food.” The Co-op has 345 members and three distribution depots, in Salem, Marblehead and Melrose, all north of Boston. It buys from 21 farms—18 in Massachusetts and three in Vermont, but two primary growers supply 68% of the food. The other 19 each supply from 1 to 4% of the food. It offers mixed vegetables, fruit and cheese, and the average distance food travels from farm to table is 125 miles. Most of the food is certified organic; some is grown using Integrated Pest Management methods. “We’re working to get more organic each year,” said Harrison.
Of the Co-op’s $120,000 annual budget, 62.5% goes to farmers and 37.5% is used to run the Co-op. (A 50% markup on produce funds the Co-op.) Some money ($1,400 in 2005) goes toward scholarships, as well—subsidies for members who can't afford the share price. “We have never turned away a member for lack of funds,” Harrison said.
The Co-op employs six part-time staff members. The back office financial manager reports to the volunteer treasurer, who reports to the nine-member volunteer board of directors. The three depot coordinators and the newsletter editor report to the manager, who reports to the board of directors. Other than these paid workers, volunteers staff the depots. All members are required to give two hours of volunteer work, and they may give more.
The 2005 fee structure was:
Membership $ 40
Single share, vegetable 150
Family share, vegetable 250
Single share, fruit 90
Family share, fruit 150
Herb share 40
Cheese share 40
Extended share (two large
deliveries in November) 50
Winter share 45
Delivery (Dec.) 75
Income from 2005 was:
Membership $ 11,680
Single, vegetable 29,550
Family, vegetable 28,250
Single, fruit 13,950
Family, fruit 15,750
Bulk sales 1,829
Home delivery 533
A summary of the 2005 budget showed:
Cost of goods sold 68,305
Gross margin 49,937
Insurance 2,699 (on directors and officers; depots; worker’s comp.)
Expenses $ 40,980
Net ordinary income 8,957 (Scholarships, donations, interest)
Net income 9,313
This very tightly run operation, Harrison noted, builds up cash reserves early in the year, then draws them down later in the year. In its 14 seasons, it has never had to borrow money.
For marketing, the Co-op depends on a brochure; a flyer; its Web site, www.farmdirectcoop.org; a weekly newsletter during the 20-week season and a monthly newsletter at other times (the editor is paid, but volunteers provide articles); end-of-year sign-ups; and an annual meeting. “A lot [of marketing] is word-of-mouth,” said Harrison. The typical member is a woman in her 30s or 40s with young children and a husband. About half of the members are activists. All surplus food (about $5,000 to $6,000 worth per year) goes to shelters for the homeless.
Management tools include enrollment analysis (with extrapolation based on the previous year); an ordering process spreadsheet; Quickbooks for accounts receivable, accounts payable and the general ledger; and an outside payroll service.
Membership was kept at 250 for many years because the Co-op didn’t want its depots overrun. A critical size is about 120 members per depot, because “we want to build community,” said Harrison. Once the Co-op opened its third depot, in Melrose, it was able to increase membership to (as of June 2006) 345, or 115 members per depot. The Co-op sells out of memberships every year.
The Harrisons are impacting agriculture beyond their Massachusetts co-op members and the Vermont and Massachusetts farmers they support. They own a 52-acre farm in Montville, Maine, of which 6.5 acres are leased to Jason Glick and Jen Bruce, who run a 100-member, MOFGA-certified CSA. The Harrisons plan to build a small, three-season, sustainable house and garden on the property.