By David Ceaser
Originally published in Issue 10
So, you have been dreaming about starting an urban farm or are about to launch your new career with an indoor farm. You have gotten funding from friends and family (and Kickstarter) but have you really dotted all the i’s and crossed all the t’s as far as what challenges you will be taking on as you get your business up and running?
The truth is that many urban farming operations enter the business from one perspective. They may be started by a grower who knows a ton about growing but little about the business and legal end of things. Or, the operation may be started by someone with a business perspective who wants to see a farming operation thrive, but has little knowledge of the daily ins and outs of running a farm.
Many urban farms fail. It’s good to be as prepared as possible when starting out so you don’t repeat the same mistakes as others.
Here are some important things to think about before getting started. Any one of these roadblocks could delay your project for several months so it’s best to look at these things ahead of time rather than letting them derail your progress.
Zoning, code issues
Since urban agriculture (as it’s known today) is a relatively new field, many municipalities are unfamiliar with it and do not have any sort of code on the books for how to permit your project. If you can’t obtain a permit, then you can’t obtain a business license.
Your options will be to move your project to another location where it is permitted, permit under a different classification such as a food processing facility (if you can convince the planning department), work without a permit (there are work arounds depending on the location of the facility) or wait until legislation is updated. Many city planning departments will not be familiar with indoor agriculture projects so it is very valuable to do your homework first.
It is good to have at least basic drawings to show them how the facility will be laid out and will operate. It is also good to be familiar with cities that have urban farming legislation on the books so that you can show that to local planning departments as needed.
What is your business model? How will you make money? Will you sell your product wholesale? To restaurants? Direct to consumers? To supermarkets? At farmers markets?
Each of these particular customers may require certifications before they will purchase your product. These might be as simple to obtain as county ag permits or as complex and expensive as organic certification or regular tests for pathogens. It is important to know what your customers will ask of you beforehand so that you are prepared.
Water is a key ingredient in your facility whether hydroponic or soil-based. Important questions to consider are: Can you use the existing municipal water? Will you need to invest in expensive filtering equipment to remove excessive salts or metals? Are there restrictions on water use (such as in California)? Are there disposal issues to be educated about regarding disposal of nutrient-rich water?
Hydroponic farming can be done with different growing media. Do you have a guaranteed supply of that medium, especially for operations where the medium is only used for a short period of time and replaced? If you are looking for organic certification, does the medium meet the requirements for certification? If not, what alternatives are there? If you are using soil, what tests do you need to do and what adjustments will you need to make to the soil?
If you are running an indoor farm, energy costs can be one of the most expensive budget items. Using lights and dehumidifiers can really be expensive.
Do you know what your power rates are? Do you know when power is most expensive? Do you know how much light your plants need ? Is the electricity in your area reliable or should you have a back up generator on hand? Do you know how much power your facility needs and how much does the property you are looking at offers? Is the existing electrical system up to code? How much will an upgrade cost?
If you are running an indoor facility, floor design is of key importance. You need to simultaneously design your floor for multiple factors such as being able to be cleaned easily, drainage, traction and bacterial control.
Just like when you are baking bread, if you run out of flour, you have a big problem. The same is true with your farm. You will have numerous inputs and if any one of them runs out, your production will be slowed or might even stop. Make sure you have a reliable source for all your inputs and a reliable backup source just in case.
So much of indoor farming and even aspects of outdoor farming are based on monitoring data and adjusting as necessary. What controllers will you use for your operation? How will you use the data that are being produced to your advantage?
Are you the type of person that feels more comfortable seeing everything in person and making adjustments on site or are you comfortable with making adjustments to your growing operation remotely? These questions are very important to think about before you get started so that production data can be easily understood and analyzed and the appropriate adjustments can be made to your operation when needed.
When looking at your urban farming business, I have found it very valuable to analyze production and costs on a square foot basis. I have a background in real estate and using a square foot methodology has proven very valuable and easy to understand.
Full Cycle Planning
Many operations do intense planning for how to grow their product but don’t think about the best way to harvest and package until it is upon them. Unfortunately, harvesting and packaging can be very labor intensive and if not well planned beforehand, can turn a profitable venture into one that loses money. Talk with your buyers (especially supermarkets) about specific packaging needs they may have from the start and from there, plan a system that reduces labor costs whenever possible.
These are just some of the items that need to be thought about when launching an urban farming operation. There are many more that will undoubtedly arise based on your particular situation. If you are prepared with the ones listed above, it will significantly reduce headaches, time delays and money lost in your urban farming venture.
David Ceaser has over 20 years experience working with plants and agriculture in numerous capacities and countries. He has studied agroecology, horticulture and business along with several years working in real estate development. He currently does consulting work and operates a small outdoor urban farm specializing in herbs and salad greens. To contact David, please e-mail firstname.lastname@example.org