By Jane Fyksen, Crops Editor
Wednesday, July 27, 2011 12:33 PM CDT

Deciding to add value to farm production or diversifying by launching some unrelated enterprise requires more than a creative idea.

It takes work targeted at marketing and a financial plan. However, having a passion for what you’ll be doing will turn most of that hard work into enjoyment, and hopefully, generous profits.

The first step is to think creatively about new product development. Brenda Reau harkens to the old Beach Boys’ hit with the probably familiar refrain, “Wouldn’t it be nice if…” Reau says finishing that phrase can be a powerful tool for would-be entrepreneurs. “Don’t get stuck worrying about the feasibility or how to implement the idea. The goal is to get you thinking about desirable products or services that would be ‘nice,’” she says of this easy brainstorming technique.

Reau, a long-time Extension educator for Michigan State University, was recently named assistant director of MSU’s Product Center. Working out of Monroe, Mich., she’ll provide leadership for the Innovation Counselor Network of Extension educators across her state, facilitating business development and value-added enterprises in the area of food, agriculture, natural resources and the bioeconomy. She and her family live on her home farm, raising Suffolk sheep. They direct market and sell breeding and show stock. Reau’s 15-year-old daughter has a large rabbitry and a Community Supported Agriculture (CSA) produce business.

Reau provides a few real-life endings to “wouldn’t it be nice if” Moms didn’t have to wash, core and slice apples for their youngsters. She says Peterson Farms in Shelby, Mich., has it covered. They sell fresh-cut apple slices to consumers and restaurants.

Say you like hard-boiled eggs, but don’t like cooking and peeling them. “Wouldn’t it be nice if” you could buy hard-boiled and peeled eggs at the grocery store? This product is now available in the dairy section of many grocery stores, brought to fruition by someone’s creativity.

“This simple method for generating great ideas for new products works!” Reau stresses. “A new product that serves an unmet consumer need and solves their problem will be poised for success.”

She says local foods “with a story” are very appealing to consumers. Many families have favorite recipes passed down for generations. There’s opportunity to commercialize these family favorites and market them to consumers looking for homemade taste and who “love a food product with a story behind it.”

Kim Stricker grew up making Pierogi with her Polish grandmother. This stuffed type of dumpling is traditionally filled with a potato, cheese or sauerkraut filling. Stricker recognized the appeal of this simple home-style food and launched People’s Pierogi Collective in Detroit.

Reau cites John Spillson, the third generation in his family to make Greek rice pudding here in the U.S. When his grandfather came to this country from Greece in 1918 he’d brought with him the treasured family recipe for rice pudding. Spillson is still making the same recipe for Spillson’s Rice Pudding, now in the dairy case of southeastern Michigan grocery stores and expanding across the Midwest.

As long as we’re talking Greece, Reau says Greek-style yogurt is gaining favor among consumers, resulting in dramatic sales increases. Consumers are attracted to Greek yogurt for its rich, thick texture and extra protein it provides. (It has twice as much protein as regular yogurt due to the process used to make it, she notes.)

“All yogurts are made by heating milk and cooling slightly and then adding active cultures and allowing the mixture to ferment until set. With Greek-style yogurt, the mixture is strained to remove the whey which results in a concentrated, thick and creamy mixture that will stand up on a spoon. Whey is the liquid portion remaining after milk is cultured; it contains several nutrients including whey protein. Most Greek-style yogurt processing separates and removes only the liquid portion of the whey, leaving the whey protein intact in the yogurt,” she explains.

“It requires more milk to make Greek yogurt which is a plus for dairy farmers. Most Greek yogurt is made from non-fat milk, so there is no fat in the product despite its lush texture,” she adds of what might be a product for a farmstead dairy processing start-up.

Even though the average price of Greek yogurt is considerably higher than regular yogurt, it’s attracted the attention of many consumers, looking for “more natural and authentic food products”; Greek-style yogurt fits that image, according to Reau.

Reau says consumers are also seeking out “heritage breeds” of livestock, and meat products from those breeds.

“What’s old is new again, at least when it comes to breeds of livestock. Consumers are becoming increasingly interested in heritage breeds in their quest for food with a story. They not only want to know where their food comes from but want to know the history behind it,” she emphasizes.

Generally, notes Reau, a breed is referred to as “heritage” if it’s existed for more than 100 years. The American Livestock Breeds Conservancy (http://www.albc-usa.org) is the national organization that working to preserve and promote heritage breeds and educating the public about their attributes. “ALBC feels preserving this population of animals is a significant facet of preserving the agricultural roots and tradition of farming and maintaining genetic diversity,” she remarks.

Both chefs and consumers are increasingly willing to search outside of traditional market channels to seek out producers of these breeds, which they feel offer special attributes. Take the heritage turkey market for instance. Heritage breeds like Bourbon Red and Standard Bronze are making a comeback—at premium prices. These turkeys grow slower than the usual Broad Breasted White, have darker meat and a different flavor.

There has also been growing interest in heritage breeds of hogs such as Tamworth and Berkshire, and heritage breeds of cattle like Dexter, Devon, Belted Galloway and Highland. These cattle breeds are well-suited to pasture-based production. (Grass-fed beef is also sought after by a growing number of consumers these days.)

“As with any niche market, producers need to create value in their products and relay that value to the consumer. Heritage meats and poultry are most often direct marketed to consumers, which requires an additional time commitment and the willingness of farmers to interact with consumers,” she notes.

Another idea for livestock producers is meat snacks, like jerky, snack sticks and pork rinds. Reau says they’ve seen a 20 percent increase in sales over the last five years. While the average jerky customer is male, between 35 and 54 years of age and has a household income of $50,000 to $70,000, women are also now discovering meat snacks. A recent Penn State University, says Reau, assessed the snacking interests of active women between ages 18 and 45. Evaluating the hunger-satisfying properties of 100-calorie samples of beef jerky versus 100-calorie portions of other snacks, the study found that women reported beef jerky to be far more satisfying and effective at controlling their appetites. Sixty-five percent reported they’d select beef jerky as a snack.

“Opportunities may exist to further develop niche markets within the meat snacks industry. Natural snacks that rely on salt rather than sodium nitrate may have appeal to some consumers as well as snacks made from organic or no added hormone meats. New label designs on existing products may also increase the appeal to female consumers,” says Reau.

Utilizing coupons for your value-added products can increase sales by tapping into the growing trend of coupon use among consumers. Placing coupons in local food guides is a way to maximize attracting customers who want locally made products and are looking for savings. Business owners may also print their own coupons and distribute them throughout the community target specific locations or groups of consumers.

A relatively new trend is consumers printing their own coupons off of the Internet. Farm businesses that have their own website may want to consider placing a coupon on their site for potential customers to print. This can be a great method for attracting business without additional cost.

Reau says a business plan is especially critical for entrepreneurs starting new businesses. It’s the roadmap for the business and helps to explain your business in common language. It can also be used as a measuring stick for performance of the business. A business plan forces you to take a good look at all aspects of the business, and can be used as part of a financing proposal.

“The business plan should be written before anyone is hired or the first product is made or service rendered. If you think you are too busy trying to launch your business and don’t have time to do the plan the time crunch will only get worse once you launch your business,” she states. “It sounds like it is a big job and it is! Creating a business plan may take a significant amount of your time but it is well worth it. A well written plan will be a useful tool in creating a roadmap for your business and help you go from a bright idea to a successful enterprise.”

It’s a way to “make sure you’re grounded before you make a major investment,” she adds.

Besides local foods, today’s consumers are also very enthusiastic about what might be called the “farm mystique.” “There’s a segment that “absolutely craves knowing where their food comes from” and is thrilled for the opportunity to meet a farmer, Reau concludes, noting this is, in large part, the driving force behind the “explosion in farmers markets.” Tap into people’s desire to meet a real farmer and get back to basics by buying food directly from the producer—even better if that food has a “story” behind it.