Many traditional and seasonal marketing channels have been closed or greatly modified by the restrictions imposed by the Covid-19 pandemic. Producers and craft foods entrepreneurs have pivoted to online sales and on-site recommended safety protocols to continue as many direct sales as possible. Now may be the time to explore collaborative marketing opportunities to develop one more direct marketing outlet.
Collaborative marketing can be structured in different formats that can be used to grow sales volume, increase efficiency, lower costs, and enter new markets. Collaborative marketing business structures range from very simple, contract-like agreements to the formation of new corporations. Small farms should consider temporary, limited-scale collaborative projects before developing substantial business agreements.
Something as simple as a consignment agreement allows one farm to sell through another’s market channels while collaborations don’t need cooperatives or formal, any collaborative marketing effort should include answers to these basic questions: who, why, what, when, and how the collaboration will work.
This marketing season that has been truncated by the pandemic provides an opportunity to explore possible joint ventures in collaborative marketing. A joint venture agreement is usually a limited term project so perhaps multiple farmers could contribute to an existing CSA farm with expanded shares or to a farm market looking to increase inventory for more direct sales. This could be for a set time, say the 2020 growing season. At the end of that time, all parties can evaluate how well it did or didn’t work. If it works well, they can consider a more formal agreement or continue with a joint venture agreement.
Some key things need to be considered with a joint venture agreement.
Collaborative marketing arrangements vary in type, purpose, size, and effectiveness. No particular structure guarantees the potential for profitability. Rather, compatibility, equitable contribution of resources, and proper planning, seem to be the keys to success. Keep communications robust, with an eye toward reaching defined sales goals.
Collaborative Marketing for Small Farms
https://cvp.cce.cornell.edu/submission.php?id=98
Collaborative Marketing
https://extension.psu.edu/collaborative-marketing
To print this article (pdf) click the "Download document" below.