Agritourism blooms

Valley farms are taking part in a booming business in California.

Posted at 11:00 PM on Sunday, May. 15, 2011

By Robert Rodriguez / The Fresno Bee

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Thousands of people come to the Valley every year to tour the national parks and Yosemite -- and Dinuba farmer Mike Naylor hopes a few will stop at his place.

Naylor can't offer the majesty of ancient granite cliffs, but his setting has its own homespun charm: Visitors can stay at his 95-acre tree fruit farm.

"And they don't just stay at our farm -- they stay in our house," said Nori Naylor, Mike's wife. "It doesn't get more real than that."

The Naylors have joined a trend called agritourism. And its growing.

The federal government's 2007 Census of Agriculture found that 685 California farms were involved in some form of agritourism. Now, there are easily more than 1,000, according to University of California researchers who have created a database to track the trend.

The UC researchers also launched the first study of the trend in California. Last month, they announced the results: Nearly two-thirds of California agritourism operators planned to expand or diversify over the next five years. Now the researchers are watching for more growth.

"There is no question that there is a lot of potential for growth, and we are seeing it happen," said Shermain Hardesty, director of UC's Small Farm Program.

In agritourism, growers have found a way to tap into a broader consumer phenomenon. Increasingly, people want to know where their food comes from, and that has become obvious in their buying choices. For example, more people are buying organic products: U.S. sales of organic food and beverages grew from $1 billion in 1990 to $24.8 billion in 2009.

And, anecdotally, growers say they are seeing more people shopping at farmers markets and touring working farms.

Agritourism also has the potential to reach more local consumers. People like Fresno mom Minal Patel enjoy trudging around a field harvesting strawberries, cherries and grapes. She believes it's an important part of eating healthy.

"I also want my 3-year-old to understand where we get our fruit from and how it is grown," Patel said.

Farmers realize the potential this new consumer base represents. The UC's agritourism study showed that nearly 30% of the farmers offering agritourism events supplemented their regular farm income by $50,000 or more in 2008.

"We know from all the consumer trends that people are willing to pay for an authentic experience and for specialty foods," said Ellie Rilla, community development adviser for UC Cooperative Extension in Marin County. "And agritourism provides that."

For Hanford farmer John Olivas, reaching out to the public has meant survival for this three-acre berry farm. Selling directly to consumers means bigger profits.

Olivas grows several types of berries, including blueberry, raspberry, blackberry and tayberry. Tayberry is a cross between a blackberry and raspberry.

Along with letting people pick their own fruit, he also operates a fruit stand and sells at farmers markets. His Rancho Notso Grande draws hundreds of visitors from the Valley and from the Bay Area and Southern California.

"Right now, I am getting about 20 calls a day from people wanting to know if the berries are ready for picking," Olivas said.

"In this business you have to find access to markets and get to the people who are looking for premium, quality produce. And you have to provide them with an experience. You really have to have the whole mix to survive."

The Naylors also know the value of agritourism, despite some good-natured ribbing from their neighbors.

In February, they remodeled their ranch-style home and created a bed-and-breakfast type of venue. Since opening, they have welcomed about 20 guests, who paid between $129 to $179 a night.

The visitors have come from New Mexico, Florida and Southern California.

"I know some of my neighbors thought I was nuts for doing something like this, but it works," said Mike Naylor. "Now they are saying that when they have buyers come into town, they are going to park them over here."

In southwest Fresno, Mike Smith also hopes to cash in. This summer, he will allow people to pick their own flowers, lavender and produce on his 40-acre organic farm. And in the fall, he will open the pumpkin patch for the public and school tours.

"For us, the ultimate goal is to have the entire ranch open to the public," said Smith, a longtime family farmer who has been producing mixed vegetables for years and has sold produce to wholesalers.

Small Businesses Snub Couponing

By Cindy Vanegas

Published May 02, 2011

FOXBusiness

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Entrepreneurs’ willingness to jump on the couponing bandwagon has fueled tremendous growth for daily-deal companies like Groupon and Living Social. The contagion has even spread to non-traditional couponing businesses like The New York Times and Facebook. While it may seem like every local business is out to entice customers through daily deals, there are some entrepreneurs taking a stand against couponing.

“The sales spike from couponing is like a one-night stand,” said Hans Hess, founder of Elevation Burger. "You get something really quick and it’s enjoyable for a little while, but it doesn’t give you the basis for a long-term relationship."

Hess didn’t like the idea of couponing, but when franchisees approached him about offering a coupon through a daily deal site he allowed them to test the concept at five locations over a number of months.

“We tried it and realized it was not a way to build relationships with guests,” recalled Hess, “Our theory is that the kind of person buying the coupon is just looking for a deal and they are content just going deal to deal to deal.”

Hess allows new franchisees looking to draw a crowd to offer one daily deal. But they can’t repeat it and it must be done within the first two months of business.

Tom Kelley, managing partner at Concept Branding Group, warned that couponing can cheapen a brand in consumers’ eyes. “We discourage clients from doing it,” said Kelley, “There are more efficient ways to market than shotgun couponing.” He suggests businesses try building community alliances and working with community organizations to help attract customers.

Consumer psychology toward couponing can also impact price perception. Marketing consultant Michael Zipursky said coupons can be dangerous because people will associate the business with the discounted price. “Say you offer a product or service for $50 that is usually $100, people will perceive the value of that product or service at the lower price.”

An expectation of discounting among coupon-addicted consumers can also have a negative effect on consumers. Stephen Hinkis, vice president of franchise operations at Newk’s Express Café (Newkscafe.com), was approach by several daily coupon sites and turned them down. “The problem with couponing from our experience is you can’t wane your customers off of couponing and if you remove the coupon you have to do damage control,” Hinkis said.

The boom in customers a deal creates could put entrepreneurs at risk of losing future customers after the deal is over. Pierre Panos, founder of Fresh to Order, warned that most business owners get slammed when the coupon takes effect.

“They don’t know how to handle the volume and they lose far more than they would have gained,” said Panos, “If the experience is bad, because they did not execute it well, then the customer will tell potential full-paying guests not to go there.”

For entrepreneurs willing to bite the coupon bullet, Zipursky recommended they “think about the effect that the coupon will have on the business, how much a customer is worth and how much they are willing to spend to get that customer?”