The Farmers Group strategy is to profitably and efficiently utilize present and future agricultural technology in the production of vegetables. The company, by acquiring an existing profitable vegetable farm with all the necessary custom-innovated equipment, will gain a significant industry advantage. Additional application and utilization of horticultural technology in the production of strawberries will allow double utilization of the climate controled portion of the overhead. Farmers Group hopes to consolidate considerable goodwill already created by exercising the option of not adding another high-production facility to the present supply-demand scenario.
The company's goals in the first year are to:
Prepare the future site.
Relocate and expand Green Acres vegetable system and get it operational.
Integrate greens culture into the system.
Have the composting system in full production by early spring of the second year.
The company's long-term plan is to phase out whichever products are least lucrative and replace them with products that are practical and cost efficient.
5.1 Competitive Edge
Farmers Group's main competitive advantages are:
Efficient production utilizing greenhouses.
Reduced overhead by fully realizing crop output potential and economies of scale through joint costs.
Knowledge due to research since 1988.
5.2 Marketing Strategy
Farmers Group will initially market and supply its products to target customers. The company is further exploring marketing opportunities on the Internet. To this extent, the company would like to set up a website to market its products.
The company will utilize aggressive advertising strategies to further market its products. These strategies include the promotion of products through the sponsoring of spots on cooking shows and exhibitions, and also engaging prominent chefs to help promote this fledgling industry.
5.2.1 Pricing Strategy
The company sets its pricing based on market rates as far as vegetable products are concerned.
Farmers Group's pricing for strawberries will exceed the average market price for the following reasons:
Taste sampling at outlets will be encouraged.
Unparalleled flavor superiority will addict greens tasters.
Promotion of pesticide-free, fumigant-free cultural techniques of soil, environment, ozone, and health-friendly production techniques.
5.3 Sales Strategy
At Farmers Group, the sales process is primarily the same for vegetables as it is for composting products, in that both products will be mainly sold through wholesale marketing. As in the past, live shipments will be delivered by contract carriers in special oxygenated tanks carrying 8,000 vegetables or more, and will be continued as demanded. Farmers Group's bagged manure products will be delivered and unloaded in sizable wholesale quantities by the pallet.
Smaller, more local orders will significantly increase the overall sales when the 300-450 live vegetables carrying tank system is put into service late in 2000 or early in 2001.
The company's average sales cycle from first contact to closing of the sale is approximately 3 to 12 days for vegetable products. Farmers Group plans to shorten this cycle. Furthermore, the company estimates that from first contact to sale conclusion, the cycle for fresh strawberries will run 3 days or less. Composted products sale cycle should run from 3 to 12 days.
Direct sales contacts of vegetable markets by delivery personnel, as well as cold calling by telephone of potential market outlets, will also be employed.
5.4 Strategic Alliances
The company has strategic alliances with:
Alabama State University Horticulture Department
Southeastern Alabama State University Biology Department