Let’s talk business

By Simon Huntley

Originally published on the Small Farm Central blog on 05/24/2017 

In every business, there is some “customer acquisition cost” (CAC from now on) — in other words, how much do you spend to acquire a single customer?

In my experience, for most CSA farmers this number is close to zero and not something you think about.

Even if you are not spending money on traditional advertisements, there are costs to find new customers. There is a website hosting fee, staff or personal time to develop content for the website, Facebook boosted posts, email marketing software like MailChimp, time spent developing content for email marketing, and on and on. So even at a basic level, if you think your cost of customer acquisition is $0, it is not.

I asked farmers on the CSA Farmer Discussion group on Facebook about their CAC and answers ranged from up to $100 to as low as $2.

Here is where it becomes a major blind spot and perhaps a systemic problem within the CSA movement/industry. The meal kit companies like Blue Apron, food hubs, and grocery stores have the economies of scale, the marketing expertise, and cash to spend $100s to acquire a single customer. So they can spend money on Facebook ads, Google Adwords, direct mail and whatever they can figure out to acquire a cost at less than their target CAC.

So if they are able to do this, they take the air out of the room from a marketing perspective and it does start to pull people away from CSAs and towards programs that have better marketing reach. If Blue Apron spends $100 to acquire a customer and the average CSA spends $3 to acquire a customer, that means on average that a potential customer is going to hear about Blue Apron 33 times for every one time they hear about the CSA! Can you blame them for choosing Blue Apron? They almost don’t have a choice!

It is certainly not getting easier. In the early 2000s, a farm could just show up and tack a CSA sign on their website, get some good press, and fill up their membership. People were actively going out and looking to join a CSA farm in these years, so it was relatively easy to find new customers. In this new landscape, where there is a lot of competition from all angles, I believe that we need to get better at marketing in general and starting to think about CAC and the types of channels you can use to reliably generate new customers at a profit will be important.

This is one of the trade-offs in using direct-to-consumer farm marketing: if you sell wholesale or through a food hub, they take care of finding the customers and you will get a lower percentage of the retail dollar. In a CSA, you are getting close to 100% of the retail dollar, but you need to go out and find those customers and finding customers is not free!

Acquisition cost also needs to be paired with your retention rate and the lifetime value of your customer. So if your retention rate is very low, then you cannot afford to spend as much to acquire each customer because you will not be able to spread that cost over multiple seasons. So acquisition cost and retention are intertwined in this way.

I have seen a couple rules of thumb in the larger business world that may help us to think about CAC in the CSA context. One rule of thumb is that a business wants to see CAC paid back within a year of the initial sale, so in the context of a CSA, if your average yearly spend per customer is $500 and you have a gross profit margin (minus marketing spend) on that of 20% then your aim should be to get CAC to be below $100. Assuming you have a fairly good retention rate (>60%), over the long term this will pay back well for you, although you will need to do some more calculations with your own numbers to make this analysis work for your situation.

There are many ways to view this, but the rule of thumb that I am thinking about is to look for a CAC that does not exceed 10% of the first season that the member is with your farm. For example, if your average price is $500/season then a CAC of $50 should be profitable over the long term.

In some ways, I hate to be the guy injecting all of this business terminology into CSA because these are such high-ideals business. However, I think there is a lot to learn from the wider business world that we can apply to CSA programs so you have the freedom to go out and develop your business to impact more people while building a business that supports your family.

In the end, it is all about the goals you have for your farm business. Are you getting the CSA membership numbers you want? What is your most profitable marketing channel? If dealing with these kinds of issues like customer acquisition is not in your skill set, you may need to hire someone with these skills, delegate, or consider pursuing other marketing channels like wholesale that don’t require this kind of work.

How do you think about customer acquisition cost within your CSA? How much are you willing to spend to acquire one customer?

In your corner,

Simon Huntley

Will Blue Apron (and other meal kit delivery) replace CSA farms?

By Simon Huntley

Originally published on the Small Farm Central blog on 07/26/2016

Community Supported Agriculture (CSA) is under pressure throughout the marketplace. When I started working on CSA farms in 2005, in many areas of the country there were few options to buy from local farmers besides farmers markets.

In the intervening 10+ years, the market has changed.

We have Whole Foods, grocery cooperatives, farmers markets every day of the week (9000+ now!), food delivery concepts and much more. The plethora of options is changing the way eaters think about joining a CSA farm and their expectations. If CSA does not work for them, there are a lot of more flexible options out there that may work better for them. There is even a lot of confusion about what CSA is and what CSA is not.

We cannot stick our heads in the sand and pretend that nothing is changing. The CSA model has evolved since it came to the United States in the early 1980s and we’ll need to continue to change to stay relevant. I’ll write more about the future of CSA in the near future.

One of the new concepts that has taken inspiration from CSA are the meal delivery services that deliver pre-apportioned recipes ingredients to your door step. It’s a meal in a box. One of the biggest of these services is called Blue Apron.

Earlier this summer, I signed up for Blue Apron to learn from their model and figure out how we can use their success to improve the CSA model.

One estimate is that 3% of the US population has tried a meal delivery kit service. From the numbers that I see, that is likely higher than the proportion of the US population that has tried CSA.

Blue Apron’s tagline is a “better way to cook”. It has many competitors including Green Chef (https://greenchef.com/home) “deliciously simple”, The Purple Carrot (a vegan concept) https://thepurplecarrot.com, Freshology “Inspired. Healthy. Living.” https://www.freshology.com. There are many others.

Signing up for Blue Apron

I was impressed by the website experience: you sign up for a weekly plan that will auto-bill each week but you can pause deliveries as long as you remember to pause by the right day. I signed up for a weekly plan for a family of 4 which was probably a bit too much because my young boys (1 and 5 years old) don’t eat as much as an adult or teenager. There is some choice in the recipes you receive or you can just accept the default. There is no vegetarian option.

It is not cheap. My plan cost $69.92/week. That is is $8.74 per meal, per person while the average in-home dinner meal costs $4 per person. So this service does not compete with the grocery store: it competes with restaurant eating and it is probably for the higher end of the market. This is not a service for the family with a small grocery budget.

In the welcome email, Blue Apron promises “Fresh, Seasonal Ingredients”, sourcing from local farms (local to whom? This just is not true), and cooking tips and techniques.

Perhaps it is pedantic to focus on their promise of “local farms”, but here is what the email says about the producers:

I hope that Blue Apron is supporting a local farm somewhere, but it is not local to me in Pittsburgh. This kind of casual deception is disturbing and I’m sure most eaters can see right through it, but as true local farms, you must push against these deceptions and tell your story to your customers. This is one of your largest advantages, so make sure you are clear on it with customers!

Cooking with Blue Apron

The Blue Apron box showed up on my doorstep delivered by FedEx on the day that Blue Apron promised. An email is sent on the shipment day to announce the meals that will be delivered so you can plan for the week.

Everything looks great when it comes to the doorstep: the box is beautiful with huge ice packs at the bottom of the box. Everything comes in pre-apportioned ingredient packs. For example, 2 ounces of butter in a clamshell container. One of my first thoughts is how wasteful all of this is: the home delivery, the cardboard box that I will throw away, the ice packs, and the tiny containers of cheese. It is hard to imagine dealing with this amount of waste on a weekly basis.

However, it is impressive in a lot of ways. It totally takes the thought out of cooking. Blue Apron provides glossy recipe sheets that describe in detail how to cook each dish. I think we can learn from this in our CSA farms: people don’t know how to cook and there is value in completely spelling it out for them! They are clearly willing to pay more to lose some of the stress of figuring out what to cook and how to cook it.

Here is an example of the recipe cards:

The recipes are not super simple. They take some time to put together. I found in the recipes that my wife and I made, it took about an hour to get food on the table.

I’m a pretty good cook. Ever since my first experience in college of living on my own, when I realized that all I knew how to make was pasta, I have gradually built up my skills in the kitchen. However, one thing I noticed about Blue Apron is that since everything was so spelled out on the cards it made me stupid: I put a whole head of garlic in a small amount of salad dressing which overwhelmed the whole salad and ruined it with way too much raw garlic. And I like garlic.

In hindsight, that was obvious, but since the recipes cards did not exactly spell out the amount of garlic to use, I just put the full head of garlic. So I’m not sure if these meal kits actually help people learn to cook on the fly like a CSA member needs to know how to cook: to look at the ingredients available and put together something that works.

However, the meals were delicious. The quality of produce was outstanding. It took a lot of the thinking out of deciding on meals for the week and shopping for the ingredients. It is hard for me to see someone doing this in the long term, week-after-week based on the waste and the cost so I see long term retention as difficult for these services, but it is a really fun and easy way to cook new dishes.

Do Meal Kits Compete with CSA?

Yes, I think they do. They are changing the expectations that members have for food delivered in a box. There is zero food waste — everything is used in the recipes you are given.

Wasted food in a CSA is a huge problem. It makes members feel bad and they decide to go with more flexible options like farmers markets in the future. So I think the cooking education part of CSA is huge. We need to make sure our members are successful with their boxes and that is not easy!

The produce from Blue Apron is of impeccable quality. If a CSA member gets less than the best quality food in their boxes, they will go elsewhere. To compete over the long term, the product in a CSA box needs to look at least as good as the product in Whole Foods or in a Blue Apron box.

However, on your side as a CSA grower is the story and connection that you have to your customers. I think if we try to compete with the Blue Aprons and the Whole Foods of the world, as small, independent producers we will always lose over the long term.

CSAs need to become more customer centric to react to a changing marketplace — we are not the only game in town any more! — but we also need to be mindful not to lose what has made CSA so successful.

The magic and the way forward will be found in balancing those opposing forces.

I’ve been diving deep into this problem, spending time with the research and with CSA members to better understand their experience. Look for more on this topic in the near future!

I would love your feedback. What kinds of competition are you seeing in your local area?

One Dollar, One Vote

By Simon Huntley

Local farms are an essential part of healthy local economies.

They protect farmland from development, they take care of the environment by responsibly growing on their land, they build a rural lifestyle for farm families and their employees, they preserve local food production, and often build a community around their farm.

However, it’s not a glamorous lifestyle. It’s hard being a local farmer.

There are crops to grow, irrigation to run, hail storms to worry about, bills to pay, payroll, equipment to fix, and on and on. It’s a complex small business.

Local farming is demanding work that has benefits we can all agree on. How can we as consumers support farmers in this work?

Buy directly from your local farmer.

Do you know your farmer’s name? Then you are buying from your local farmer.

Have you visited your farmer and have you seen where the crops you are eating are grown? Then you are buying from your local farmer.

There is certainly a government policy aspect to supporting local farms and I respect the political work that many organizations do on behalf of farms. However, what I see lacking for many of the farms I work with are the sales to justify the investments that need to be made on the farm to compete in the competitive local food marketplace. The tractors that need to be bought, the post-harvest handling facility that needs to be built, the multitude of systems that need to developed on the farm, let alone the marketing expertise that is needed; all of this is expensive!

In a democracy, you get to vote once or twice a year, however with your food choices, you are voting three times a day. One dollar, one vote.

Vote for local farms. Buy farm direct.

It’s up to us in the local farm community to develop better ways for you to access quality local food. We need to make sure that this food is convenient, cost-effective, and high quality. That’s why Harvie exists.

However, at a certain point, we all need to pull out our wallets and vote for local food production if we want these farms to thrive.

Thank you for supporting local farms!

CSA: We Have a Path Forward

By Simon Huntley

Last August of 2016, I wrote an article entitled CSA: We Have a Problem detailing my research into the struggles of CSA farmers to retain existing members and attract new ones. If you have not read that article yet, I suggest you go back and read that first. It still feels very relevant over a year later.

A lot has happened since:

Elizabeth Henderson spearheaded the development of the CSA Charter laying out our common values.

The 4th annual CSA Day brought together 1500 CSA farmers.

Amazon bought Whole Foods to form what I am calling Whole Amazon.

I called for 5 million CSA shares by 2030.

Blue Apron went public and is in a lot of trouble.

For our fledgling industry, the signs are not positive. CSA still serves just 0.4% of U.S. households. Blue Apron and the 100 other copy-cat meal delivery services have taken the food-in-a-box model and reduced it the absurd level of shipping to your door a tablespoon of butter or a single egg in a carton. Growth of CSA farms within our data set has leveled off. Whole Amazon is in a price war with the grocery industry. Wal-mart is advertising local food.

So why am I optimistic about the survival and growth of CSA?

For one thing, look at all of the competition in this market! The fact that big business wants in tells us that we really have something here.

Listen to the Blue Apron ads. What is the first thing out of their mouths? They claim to support local farms, which is an obviously false claim (at least exaggerated) since they put together the meal kits in centralized factories and ship them throughout the country. So by definition, they are not supporting farms local to their consumers. However, with their millions spent on advertising agencies and analytics, they still feel like “local farm sourced” is their strongest lede.

The difference is, in CSA, we actually are farm direct. 

CSA will not be exactly the same model as the one that thrived from the 1990s to the early 2010s. Almost every industry has changed radically since 1990 and ours has too. I believe that the “classic CSA share” is becoming a relic of the past.

I believe we need to understand our members better. Even more importantly, we need to understand our non-members better. What is it going to take to get the next 5% of the population to consider joining a CSA? It likely needs to be a different “CSA product” package and different marketing message.

As I look towards the future, I am aware that the CSA model has been remarkably successful since it was introduced in the United States in 1986 and we must not lose the essence of CSA as we innovate. If we try to compete with grocery stores, aggregators, or Whole Amazon, we will lose. We cannot compete on price, variety, or convenience, though we do need to consider those factors. We can compete on relationship, taste, quality, and freshness. Blue Apron can’t compete with that. Wal-mart can’t compete with that. Whole Amazon is no longer interested in competing on anything other than price and convenience.

What is a CSA?

If we are going to innovate, we need to know what a CSA actually is. The CSA Charter released in February of this year goes a long way to describing that. In my article “CSA: We Have a Problem” I listed the following characteristics that are essential for me:

Direct connection between one farmer and the member.

The majority (> 75%?) of the share is grown on the farm. Any off-farm produce is clearly labeled as such.

The customer commits for the season and pays some amount ahead of time.

The customer is flexible about what is in the box each week based on what is harvested from the farm.

This framework allows us innovate to make CSA more customer friendly without forgetting what has made this model successful.

Based on my research here are some innovations on the “classic CSA model” that make CSA more customer friendly and will help us reach the next 5% of households:

Box choice: the standard box just doesn’t work for people, and in the era of choice and convenience, a standard box is no longer good enough. This is the big one based on my research.

Flexible weeks: every-other-week options, switch delivery days and locations based on vacation or other factors.

Flexible share sizes: smaller shares for single person households

Keep the farm front-and-center: how do you get people to know you? Members form the relationship with the farmer and that is what keeps them long term.

Payment plans: reduce up-front cost, take payments throughout the season to decrease sticker shock and open CSA up to more people. Emphasize the weekly cost over the seasonal cost.

Online payment: if you are not taking credit cards, you are losing customers, especially young people.

Cooking education: connect the dots between the box and dinner table. If the member does not get food on the table, nothing else matters.

Delivery convenience: work into people’s lives. That could mean home delivery (though I’ve found that members are often not willing to pay the extra price for this), workplace drop off, grocery store drop-off, or simply more drop-off locations.

Communication: make sure the member knows everything they need to know to be successful with their share. Give a weekly farm update, consider video. 

CSA is not expensive: the average CSA shares costs $25/wk or $100/month. That’s less than most people’s cell phone bill or cable bill. It’s less than buying a latte at Starbucks every day. One month of CSA is less than cost of one single meal for the whole family at a quality restaurant. We need to find a way to change the conversation around price of CSA and put it into the proper context.

In addition, there is a general problem that CSA by-and-large serves a very thin slice of the population: 30-50 year old, educated, white women (see Ryan Galt’s data). How do we grow beyond this demographic? How do we pull millennials into this? How do we serve less well-educated, less affluent populations? How do we make non-whites feel welcome in CSA programs? I think it is a huge gap that we need to overcome. In fact, in terms of health outcomes of CSA membership, the biggest gains are to be found among people with negative health indicators, who least likely to join a CSA currently (source Tim Walls from University of Kentucky).

Marketing and customer acquisition

Blue Apron is willing to spend $144 to acquire a single customer. I’m not suggesting that you should do this, but most CSA farms are spending $0 on customer acquisition and relying on word of mouth to bring in customers. With so much competition for these food dollars, that’s not going to be enough. Right now is the time to start working on a marketing plan for 2018. You are almost certainly not investing enough time and money on marketing.

Over the past year, we have been working on a new platform to address these issues and help our farms thrive over the next 10 years. We piloted this platform with 8 farms and 500 end consumers, delivering over 10,000 boxes this season. Look out for an email soon with further details.

Whether you decide to join us or tackle these issues on their own, this off-season is the time to get to work. These problems will not fix themselves. CSA is a genuine connection between a farmer and consumer and is more than the sum of its parts for both farmers and consumers. I want to see more consumers be able to take advantage of the health and well-being advantages of being a CSA member. I want your farm to be economically successful with the high-margin sales of CSA memberships so you can take care of your land, your family, and increase your quality of life. I want you to farm for the long term and not burn out. I want your kids to be excited to join your farm some day.

I know many farmers shy away from the intricacies of marketing and business. You likely did not expect that your work as a farmer would be as deeply tied to spreadsheets and advertising campaigns as it is to soil health. To serve your land, your customers, and your family well you need a solid business. That’s no easy task.

-Simon Huntley

Founder, Small Farm Central

CSA: We Have a Problem

By Simon Huntley

Since CSA migrated to the United States in 1986, this model has been remarkably successful. It has now grown to over 6,000 farms (estimated) in the United States and many more in Canada and the rest of the globe. All of this growth occurred despite the very grassroots nature of CSA, asking customers to pay up front, and the non-consumer friendly nature of the program. The current state of CSA would look like a huge success from the viewpoint of the CSA pioneers in Massachusetts and New Hampshire in 1986, however there are problems mounting in our community.

CSA still only serves a small minority of families. In my local market of Pittsburgh, I estimate that  5,000 CSA shares are sold per season in a metro area of 988,000 households. That means only 0.5% of households in this region buy a CSA each year. What a huge opportunity for growth! Of course, we won’t convince everyone to buy a CSA share. That’s fine, but even if CSAs grow membership by 10x, that’s still only 5% of households. I believe that we can get there, but it will not be easy.

As I have discussed in the past, big business has noticed the success of CSA. CSA is beset with competition from alternatives for access to local, fresh food like farmers markets, grocery stores, grocery delivery concepts, and more. I covered this in more detail in my article WILL BLUE APRON (AND OTHER MEAL KIT DELIVERY) REPLACE CSA FARMS?

Exactly 30 years from the founding season of CSA in the United States, I think we are at an inflection point. Anecdotally, many farms are reporting declining CSA sales, though I should note that this decline has not yet shown up in our data.

Will CSA exist in its current form in 5 or 10 years? I honestly don’t know. I think it could easily go either way: CSA could grow substantially or membership may continue to shrivel.

I want to make sure that CSA does thrive because I love what CSA does for farmers and for eaters — and CSA is a big part of what we do at Small Farm Central and Member Assembler! With this goal, I’ve spent the last six months digging into the research and doing 1-on-1 interviews with eaters to understand how we can reinvigorate the CSA model.

Retention is Key

Over the past couple of years, here at Small Farm Central, we have compiled the CSA Farming Annual Report and one of the most interesting findings of this report is the average retention rate of CSA members from one season to the next. In 2014 it was 45.2% and in 2015 it was 46.1%.

It took a while for me to recognize this as a huge issue, but I now see that it points to a profound disconnect between what a CSA customer thought they were going to get and what they got. Certainly, you will never retain 100% of your customers. People move, money gets tight, they try another CSA, but if your CSA is churning through half of your customers each year, you have a huge problem. Your business is on fire.

With a low retention rate, a CSA will have trouble maintaining membership, let alone growing membership to the desired scale. To me, it is about profitability. A high retention rate makes the life of the CSA farmer easier in marketing, it points to a happy customer base who will recommend the farm, and it creates conditions where farm profitability may exist.

Think of this: a new member has a huge hurdle to jump to join a CSA. They need to hear about the CSA model, then they research different CSA farms in their area, then they look to see which ones deliver near them, then they need to understand the model and which share type makes the most sense for their family, and finally then they need to reach for their credit card and make a commitment. So, clearly most potential customers never get to that last step. The ones that do are fully sold and fully committed to the idea.

Now they go through a full season and it doesn’t work for them for one reason or another (I’ll talk about this later in this article) and they cancel. What a tragedy for the farm and for CSA in general! We’ve lost another customer who likely will not come back to CSA.

Even on a macro scale, this is a huge problem. If a household tries a CSA and they are not satisfied, they decide they will go back to the grocery store, farmers markets, try a delivery service, or buy at Whole Foods. They likely will not seek out CSA again. We’ve lost that customer. Ouch.

As I’ve spent more time over the last year talking to folks about CSA, I have come to realize that in some circles, among certain eaters, CSA is known as the place where the farm dumps the produce seconds or where you’ll get a whole box of kale that you don’t know what to do with. This is not fair for most CSAs, but I’m afraid that the “brand” of CSA is starting to become tarnished. If this accelerates, we are really in trouble.

However, one study from California gives me hope for these lost members: former members were asked if they would join a CSA again and 74% said “Yes”, 23% were “Unsure” and only 3% said “No”.

Joining a CSA is about the Customer

If we want to see CSA continue to grow, we need to get a lot more customer-centric. I know a lot of CSAs are already trying to figure this out. First off, I suggest that you must talk to your customers more about why they join, why they quit, and spend the time to really understand that — don’t assume you know anything!

I’ve spent a lot of time knee-deep in the university research on CSA and doing one-on-one interviews with current and former CSA members so I’ll tell you what I have learned, but there is no substitute to actually talking to your customers. You must listen to their concerns with an open mind.

It can be really easy to get stuck in the way we are doing things now or having a producer-oriented approach — thinking, “I worked so hard to grow this food and build this farm! Why won’t people join?” But it is important to remember that everyone works hard for their money and they are buying something for themselves, not for you. A CSA farm is not a charity.

What makes a CSA a CSA?

Before you think about innovating on the CSA model to become more customer-centric, you need to determine what is non-negotiable in your CSA. What makes CSA special? Because key to this process is figuring out how we retain what is compelling about CSA while making it more customer centric. If we try to compete with grocery stores, I believe we always lose.

I did this exercise last year after the Midwest CSA Conference as I began thinking about what it would take to grow CSA memberships by 10x. You may agree or disagree with these attributes (and I’d love to hear your feedback on this part of it), but this is my concept about what makes a CSA a CSA:

1. Direct connection between one farmer and the member. 

2. The majority (> 75%?) of the share is grown on the farm. Any off-farm produce is clearly labeled as such.

3. The customer commits for the season and pays some amount ahead of time.

Everything else about a CSA feels negotiable to me. Within this framework there is a lot of room for innovation and we’ve seen a lot of innovation here at Small Farm Central through Member Assembler as we work with hundreds of CSAs across the country. Lots of farms are trying to figure out ways to attract and retain customers.

One concept that I have left out of my definition on purpose is “shared risk” that comes up in a lot of other definitions of CSAs. I leave it out because I think it is misunderstood: there is almost never true shared risk in a CSA. It is not shared risk in terms that the member may get nothing in their box during the season. In a diversified vegetable operation of an experienced farmer, the shared risk is that the member is being flexible about what they get in the box. For example, it may be a bad year for tomatoes due to blight, but there will likely be another crop that thrives in that same season and the customer will get more of that crop. To speak to this, I’ll add a fourth tenet of CSA:

4. The customer is flexible about what is in the box each week based on what is harvested from the farm.

For other viewpoints on this, check out California’s legislated definition of a CSA and the USDA definition.

Why do members leave?

I have been focusing my research on the CSA members that leave because these are the people that have expressed their dissatisfaction with the CSA model by not joining again. My thinking is that if CSAs are churning off 50% of their customer base each year, over time there are many more ex-CSA members out there than current members. These are people who “get it”, but were put off for one reason or another.

In Confessions of a CSA Failure published in the Chicago Tribune in 2015, Barbara Brotman writes eloquently about her first season in a CSA,

“..you can’t just throw [the vegetables] out — or at least I couldn’t. This wasn’t store-bought produce grown by some faceless, far-off corporation. These were vegetables grown by my CSA, lovely people who packed the boxes themselves and sent emails with pictures of their farm.

I felt guilty about all the spoiled produce we were throwing out. I felt a constant pressure to cook or eat our vegetables. I chafed at the loss of control over what foods we would get, and perplexed that you can have that much food in your house but nothing for dinner.

My summer in a CSA was a learning experience. I learned that kohlrabi doesn’t taste as scary as it looks. I learned that I really like beet, goat cheese and honey tarts. And I learned that my CSA also sells its produce at farmer’s markets.”

In this specific case, it sounds like the CSA just gave her too much produce and this definitely does happen. The worst experience for a member is to get their CSA box, feel guilty about not eating it, let the food rot, and then throw it out three weeks later.

Be careful not to think of this in too simplistic of terms: it may not have been too much food overall. Rather, it was too much of the wrong kind of food. One high retention CSA farmer told me that he looks at what sells quickly at the farmers market to know what to put in the box: if it doesn’t sell at the market, members don’t want it in their box.

So why do members leave a CSA? What can we do to improve retention rates?

As I started my deep dive on this issue, I had theories. It’s about paying ahead. Or it’s about convenience, they want home delivery. Or it’s about wanting more choice. Or CSA is too expensive.

However, I left my theories at the door and started talking to folks. In one of my 1-on-1 interviews with ex-CSA members, I talked with an 87-year-old woman who lives alone. Her main problem was that the pickup location was on a back porch with stairs and it was too hard for her to go get the share or to arrange for someone to pick it up. In addition, since she lives alone, she just didn’t eat enough produce to go through the entire box, so a lot of it went to waste. In this case, a CSA is probably not the best option for her! That’s OK! Remember, we’re not going to be able to serve everyone and we don’t need to.

Or there is Kathy who lives with her husband and two kids. Her main problem with CSA is that her husband is out of town every other month for work. She loved the CSA, but when her husband was out of town, most of the box would go to waste and it did not make sense for her. Perhaps if she could pick the specific weeks throughout the summer when she would get a box, CSA would work for her.

So as you can see, the problems are specific to each person’s circumstance so while there is a lot you can learn from these 1-on-1 discussions, we also need to zoom out to see the bigger trends.

There is a wonderful study out of the University of California by Ryan Galt that surveyed 1,149 current and 409 former members in 2015. I think the answers are in this study!

There is a lot of great data there including who buys CSA shares (gender, economic levels, and race), reasons for joining and more, so I encourage you to take a dive through the data yourself if you are interested. One really interesting point is willingness to pay: on average members said they would be willing to pay 19% more for their share. I would like to write more about value and price in a future article.

However for now, my focus is on ex-CSA members because this is where I see the greatest room for growth, so I focused on the slide titled “Reasons for discontinuing”.

The top four reasons in the study were:

Lack of choice about products included (41%)

The product mix did not meet my needs (47%)

Too little diversity in products in the share (33%) 

Lack of choice about quantity and/or frequency (23%)

So the top four reasons in this study for members who leave were all related to choice.

This is what came up in my 1-on-1 interviews as well. People wanted the ability to choose what they liked and what they didn’t like. I looked back at my CSA philosophy and I don’t see anything in there that means that everyone needs to get the same one-size-fits-all box. Some people like cabbage and other people don’t.

Choice is not part of the traditional CSA, of course. I see the standard box as a matter of convenience for the farmer rather than something that is key to the CSA model. Why does everyone need to love cabbage? That doesn’t mean that person does not support the farm any less. We just don’t have any mechanism to keep cabbage out of that member’s box and give it to someone else who loves it.

In addition, the feedback that you get at the farmers market is blunted in a traditional CSA. If a product is not favored by your customers at a farmers market, it’s obvious because it is what you pack back on your truck at the end of the day. In a CSA, you will likely end up hearing about it on an end-of-season survey, but the damage is already done by then and it may be easy to ignore that feedback. The product that was not favored rotted in the refrigerator and the member already has decided to shop at the grocery store or farmers market next season. So building better feedback in the CSA model is vital to improving year after year.

This comes up often in my conversations with farmers when they talk about survey data: the farmer reports that one member loves green beans and another hates green beans. What do you do with that information? You can’t do much in the case of a prescribed boxed share. You need to get more flexible if you want to serve both of these customers. Alternatively, you can focus on the more adventurous customers who are happy with the box as it is. If you are able to find and retain these members, then maybe choice is not an issue for your members.

A cross current to this “give them what they want approach” that came up in my interviews with CSA members is the CSA members value the adventurousness of being in a CSA program. Each week the box is a little surprise gift. It’s exciting to find out what is new and different, but there is a balance here. Too much adventure is overwhelming and the food ends up spoiling and ends with “veggie guilt” as one CSA farmer described it to me. To make it more complicated, each member’s “adventurous quotient” is going to be different. Some members will want just the basics while other members will cook everything you throw at them.

All of the other reasons that members leave CSA pale in comparison to the choice issue based on my research. This is encouraging because I think we can do something about choice without fundamentally changing the nature of CSA or the growing practices of CSA farms.

Always Be Educating

The issue of choice is complex because we don’t just want to give people what they know they already like — there is some chance that you can educate your members into liking beets for example. Maybe they just didn’t know how to cook them yet!

We need to remember that a huge hurdle to being successful in a CSA program is cooking. We are delivering a box of uncooked produce to a public that is not used to cooking with raw products. It’s a huge leap to take. One farmer described this to me saying, “people pay me to make their lives more difficult.”

Clearly, anything the CSA can do to educate members on what to do with the products in the box will go a long way. Videos, recipes, newsletters, cooking demonstrations and whatever else you can come up with! The cooking education can even turn picky eaters into adventurous ones over time.

It may not sound like your job as a farmer to do this kind of education with your customers, but if you want to retain the member you must focus on their success. Especially that first season is going to be a big adjustment for members, so provide as much support as you can to your first season members.

I think we can do a lot more in the cooking education end of CSA. It’s absolutely essential. There are companies out there assisting farmers with this including Local Thyme or Cook with What You Have.

CSA 2.0

In technology terms, “2.0” describes the next iteration, the next generation of a technology product. I believe we need “CSA 2.0” for CSA to thrive over the next 10 years. There likely will continue to be room for traditional CSAs in the marketplace, but to grow the number of families that participate in CSA, we need to become more customer focused. We need to serve eaters better because that is what makes happy members, keeps them coming back, and recommending CSA to their social circles. I know change is hard, but I hope to be a part of modernizing CSA and helping you be profitable with your CSA.

My research leads me to believe that it is fundamentally about providing more choice to members about what is in their box. There are many models out there already that provide that already.

A really simple and effective method is what I term the “market style CSA” where vegetables are put out in bulk and members are to box their own share (for example, Appleton Farms describes how their CSA works). Most often the share is prescribed to make sure the farm has enough of each product but some farms just tell members to take a certain number of items or fill their bag. A trading bin can be put at the end of the line to let members trade an item they don’t like for one they will eat. Though this is more labor intensive because each site needs to be staffed, this tends to lead to high retention rates. A few years ago when I studied three of the highest retention farms that use Member Assembler, all three were employing some kind of market style model.

I have ideas on how we can improve on the market style model, using customized boxed shares that retain what is strong about CSA while increasing retention.

I want some feedback from farmers before I am ready to release my ideas publicly, so if you are curious about where CSA goes from here or you are looking to make changes to your CSA, email me back and let’s talk!

P.S. As I look towards the future of CSA, I want to make sure I honor the past: one of the founders of CSA in the United States, Trauger Groh, died in July.