Diversification is key to success: Ken Love
Ken Love, of Love Farms, Captain Cook, South KonaKen Love has 35 years experience as an agricultural producer, processor, chef, and educator. His specialty is tropical fruits. Although Ken and his wife Margy sold their farm a number of years ago, Ken harvests fruits from several farms and sell dozens of tropical fruits, both fresh and in processed products. He has a number of test fields at the UH experiment station and manages other farms. Love’s policy is to diversify his markets, rather than relying on just one or two. His markets include a local produce distributor, supermarket, hotels, chefs, and direct to consumers at the farmers market and through Internet sales. By diversifying market outlets from low-end wholesale to high-end chefs, Love can usually count on selling all of his harvests, whether they are 10, 100, or 1000 lbs.
In addition to fresh fruits, Love Farms produces about 150 jams, jellies, spices, and dried and frozen-pureed fruits. These products add value and further diversify markets. Also, by preserving fruit, one can maintain sales throughout the year, even during seasons when many fruits are out of production. Diversification also can be helpful in spreading labor demands over the whole year, reducing the need for hiring costly external labor.
Based on many years of working with Dr. Kent Fleming, an extension economist at University of Hawai‘i, Love has learned how to price his products based on cost-of-production calculations. Through the years, Love has learned to resist the temptation of lowering prices below cost just to make sales. He often scolds other farmers for selling below cost, as the practice is unsustainable for any farm enterprise and tends to erode profits for all farmers. A major issue for Hawai‘i farmers is the cost of production, which can be several times greater than the cost of similar imported products, especially processed products such as jams and jellies. To compete, Love makes his products stand out from the imports through labeling as “handcrafted,” which he believes speaks to many consumers today. Love suggests that all farmers who sell to local markets become spokespersons for the locally grown movement.
In his roll as president of the Hawai‘i Tropical Fruit Growers and an educator, Love advocates for product diversification for both producers and buyers. This begins with knowing one’s own capabilities and strengths in production, processing, and marketing. The next step is to calculate the cost of production and set up a pricing structure for different markets including wholesale and retail.
Also in his role as an educator, Love believes that no one farmer can produce a consistent supply at all times. For any crop, it is important to build strong local markets independent of any individual producer. By diversifying the supply, each individual farmer benefits from having contributed to building strong local markets and distributors.
This market profile was excerpted with kind permission of the authors from:
Elevitch, C., N. Milne, and J. Cain. 2012. Hawai‘i Island Farmer’s Guide to Accessing Local Markets. Hawai‘i Community College Office of Continuing Education and Training, Center for Agricultural Success, and Permanent Agriculture Resources. http://hawaiihomegrown.net/pdfs/Hawaii-Island-Guide-to-Accessing-Markets.pdf