Post by Jay Blair on Oct 3, 2007 13:47:48 GMT -5
Its a positive aspect to have started your worm farm without a large investment.
A spoke with a grower who started marketing bait in his area back in 2000 using the salvaged equipment / bait cultivation method for the E.f. bait popular in his area.
From what he explained to me, by 2003 he had a well established list of customer bait retailers purchasing bait from him at $1.50 per deli cup.
His sales were steady until last year when another grower entered his market area offering bait at a $1.25 per cup.
He at first considered starting a full blown price war , but when he heard that the competition was using commercialy purchased equipment and worm chow, he instead only warred the wholesale price below $1 a cup, then retreated as the other economic prices started climbing.
The competition of course started trying to recover the original prices to offset the costs of their intitial overhead, while the guy with the low initial overhead was able to idle his operation for 9 months until the customers the competition coaxed away began returning.
He told me he now has 80% of his customers back, selling his bait at $1.25 a cup , enjoys hearing the competator complain of how much he has lost on his equipment and spent the last year gardening and building up his homegrown garden waste feed.
We both laughed when he told me that the fella who tried to take over his market share tried to sell him commercial equipment for $8000 in a market area that only generates $3000 to $4000 in bait sales a year.
Low initial overhead is often the most important key to success in a small market area.
A spoke with a grower who started marketing bait in his area back in 2000 using the salvaged equipment / bait cultivation method for the E.f. bait popular in his area.
From what he explained to me, by 2003 he had a well established list of customer bait retailers purchasing bait from him at $1.50 per deli cup.
His sales were steady until last year when another grower entered his market area offering bait at a $1.25 per cup.
He at first considered starting a full blown price war , but when he heard that the competition was using commercialy purchased equipment and worm chow, he instead only warred the wholesale price below $1 a cup, then retreated as the other economic prices started climbing.
The competition of course started trying to recover the original prices to offset the costs of their intitial overhead, while the guy with the low initial overhead was able to idle his operation for 9 months until the customers the competition coaxed away began returning.
He told me he now has 80% of his customers back, selling his bait at $1.25 a cup , enjoys hearing the competator complain of how much he has lost on his equipment and spent the last year gardening and building up his homegrown garden waste feed.
We both laughed when he told me that the fella who tried to take over his market share tried to sell him commercial equipment for $8000 in a market area that only generates $3000 to $4000 in bait sales a year.
Low initial overhead is often the most important key to success in a small market area.
