Industry sector:

Organic farm: Pricing policy

If you mostly sell to the wholesale trade, you will not have a great deal of influence over the price you receive for your products - you will generally have to accept what the market offers.

However, if you sell to local retailers and catering establishments, you should have more control over setting your prices. Bear in mind that the retailer or caterer will add their own mark-up so perhaps aim to offer your produce at around 60% of normal retail prices. (Remember to look at organic retail prices rather than those of traditionally produced items if you are not sure how much your type of produce normally sells for in a shop.)

If you are intending to sell direct to the customer, there are certain things to bear in mind when setting your prices:

  • organic produce generally attracts higher prices, particularly when sold in outlets like farm shops or farmers' markets where shoppers tend to be a lot less price sensitive
  • your customers may be prepared to pay extra as they will know exactly where their food has come from. So it makes sense to do everything you can to promote the provenance of your produce
  • adding value to cuts of meat by, for example, adding herbs and spices can be an inexpensive (to you) way of increasing the retail price
  • if you're selling direct through your own website, it can be easier for customers to check how competitive your prices are by quickly searching online for similar suppliers. You may need to work hard to justify your prices if they're much higher than your online competitors'