Notes from Building Strategies & Orchard Systems for a Sustainable Future.
Dr. Clark Seavert, Oregon Sate University, gave an interesting talk on managing an orchard to achieve profitability. He’s observed three key factors to successful orchard: Price, Yield (when you get it and how much), Costs — Production and Establishment.
Seavert recommends to orchardists a five year business plan with specific goals and a method to benchmark progress. 1. Increase revenues in all blocks to a minimum of $25,000 per acre. 2. Increase net farm income by 5% annually. 3. Improve efficiencies and utilizations of labor with new orchards and future technology. 4. All orchard blocks will be designed to adequately acquire and retain labor.
He identified five financial ratios and performance measures: Working capital; debt to asset ratio, return on assets, profit margin, term debt to EBITDA (earnings before interest, taxes, depreciation and amortization).
He made a prediction: a grower’s data will become a source of revenue because government and others want that information.
For another session on short-term strategies for managing limited labor resources, several key issues were called out: Grow the crop that people want to pick and make a profit doing it.
Increase number and season length of H2-A and non H2-A employees. Increase number of supervisors. Think about crew/housing/transportation investment and sharing. And consider the work environment.
One grower stressed that pickers most of all want to make the most money, so workers will pay attention to a given orchard’s difficulty. If a block is woody versus another block where fruit are easily accessible, they will go with the site that makes them money.
Here’s one remark from a grower that stuck in the mind. In Northern Washington State, the legal marijuana industry is growing. The grower wondered if pot growers will begin competing for resources, such as labor, with fruit growers.