Behind each CrowdFarming project there is a Farmer or a group of them making it possible. It’s the Farmers who determine the adoption price and sale of their harvests.
Thanks to the people who adopt, the Farmers produce knowing the final selling price of their harvests (adoption price). This, of course, offers them the security and motivation to get up each morning to work with much anticipation. It makes a lot of sense, doesn’t it?
“And what do you people in CrowdFarming live on?
The CrowdFarming team works to disintermediate the food supply chain. But how do you bypass this kind of supply chain without becoming an intermediary yourself? The answer is simple: by providing value-added services.
Direct food sales between farmers and consumers need services to make it work: a platform to offer and sell products, logistics to move the packages, customer (or CrowdFarmers as we call them) service and outreach tools to promote themselves. These are the 4 services we provide to Farmers.
“Do CrowdFarming decide the selling price?”
No. The Farmer decides the selling price.
“How much do you charge the Farmers for those services?"
We charge the Farmers based on sales. We are going to succeed. If the Farmer succeeds, we succeed. If the Farmer doesn't sell, we don't charge. The amount we charge depends on the product, the weight of the order, the amount sold, the country of origin of the Farmer, the cost of transportation to the destination or how you pay for your order: visa, mastercard, direct debit or american express (the most expensive option!)
In adoptions we charge the Farmer 16% of the net price (excluding transport costs and taxes). This is not what we earn. With this 16% we absorb the financial costs, our payroll, social security, 7-days-a-week customer service, payment of servers and other providers.
If we get a Farmer to sell a lot we will achieve economies of scale at a logistical level that will allow us to obtain a higher profitability and a lower environmental impact of the shipments. We have achieved a business model that allows our profitability to be in line with our values: the fuller the trucks are, the less environmental impact per good transported and the greater the profitability.
"How much does CrowdFarming make a year?"
In some cultures it is considered impolite to ask this, but don't worry, it doesn't bother us. Transparency is key if we are to succeed in our purpose.
Since we founded CrowdFarming in 2017 we have been losing money. More and more every year. "Are you out of your mind?" A little, yes, we don't deny it, but losses were in our plans for the first few years. We do not feel that we have wasted the money but that we have invested it to achieve one goal: to disrupt the food supply chain. To be profitable without making the product too expensive we need to gain volume and get more and more people to buy their food from the farmers.
Our aim is to reach a number of farmers and consumers by 2021 that will enable us to enter the path of profitability.