Picket Fence Creamery
Picket Fence Creamery is a family owned and operated dairy farm and country store in Woodward, Iowa. The farm, owned by Jeff and Jill Burkhart, utilizes 80 acres. Using rotational grazing, the 80 Jersey cows produce milk that is pasteurized on site and bottled or made into value-added products such as ice cream or cheese. These products are sold in their farm store and marketed throughout central Iowa.
In their store, the Burkhart’s offer a variety of dairy products and meat products along with market products from 80 other Iowa families. The products in the store range anywhere from locally baked goods, hormone free meats, Iowa wines to organically grown vegetables.
The milk from the Jersey Cows is 100 percent natural and both the milk and the meat (beef and pork) are produced without the use of artificial hormones. The cows “live outside in the grass pastures and drink fresh, clean Xenia rural water.” From the milk the Burkharts make 2 percent and whole milk, butter, ice cream, whipping cream and cheese curds.
The dairy is also operates tours and welcome visitors to come and take a look at the animals and products. One Sunday every month the creamery has a “Sample Sunday” where they invite people to come out, try different foods and stay for lunch. Jeff Burkhart says it’s a “great way to get new customers.”
“September of 2003 is when Jeff and I started the dairy,” Jill Burkhart said. When the dairy first started both Jill and Jeff had other jobs to support the dairy and both pointed out it was never the goal to get huge but they had hoped it would produce enough to support their family. As they continued to try to make the “little farm work”, the picket fence around their backyard became the think tank and then the name for the dairy.
Before they went too far with their grass-based dairy idea, Jeff and Jill got in touch with some people who got them started writing a business plan. After finding (through an ISU survey) that about 75 percent of people were interested in a local dairy farm, Jeff and Jill continued to prepare a business plan and talked with some local grocery store chains.
When the business plan was finally complete, the Burkharts spoke to their banker in Ogden who was very receptive. The banker told them that “we were the only two farmers who presented a business plan,” they noted. They learned about the Value Added Agriculture Producer Grant program and although they did not get funded on their first try, they started to build the dairy without initial grant support.
In the beginning of the dairy, the main challenge was staffing. When the dairy first started, Jill noted that they were running on a skeleton staff. It wasn’t so much an issue of finding employees but affording too many employees. They were successful in receiving a VAPG working capital grant on their second try. After they received the USDA funding, they were able to hire more staff to help them in their growing business.
Today, their biggest challenge is that of the fluid milk market. Jill points out that they feel that they are at a size now that works, but that the fluid milk market keeps tugging at them to get bigger. Yet Jill laments, fluid milk is the least profitable. But, Jill says, the business is growing bigger in other ways and they don’t feel the need to get bigger at the moment. “The way to make more money is through products such as cheese and ice cream,” Jill says.
One of the biggest successes of the dairy is that they sell only the milk they raise on the farm. In their business plan they were hoping to achieve the goal of processing all of the milk they produced in one year but were able to do so in just five months. They were able not only to market just their milk but also have total control of the quality and to produce the milk without any artificial hormones.
The products that the dairy produces are also in three local grocery store chains along with some high end restaurants. In fact, 10 percent of the milk goes to restaurants and 20-25 percent goes to the stores. As Jill puts it, “we can’t provide them with enough milk!”
Like any business, a major goal is new customers. Sample Sunday, they note, is a great way to get new customers and to have people come out and try the products and take a look around. They welcome any new customer who comes into the dairy and are hoping for more.
But, in the end, their overall goal is to continue to be successful and to grow not only in customers but what they are able to produce and sell to other parts of Iowa.
When they were awarded the VAPG grant, the Burkharts were able to pay for many expenses and used it for working capital. They also used the funding to help with labor, buying ingredients and to get a billboard up on the highway.
They note that the grant helped them learn and become more efficient and also helped them “get through the two or three year hump.” They were also able to afford more help and advertize their business and services in four counties to help make Picket Fence Creamery become more successful.
About USDA VAPG
VAPG funding has been offered by the USDA periodically since the early 2000s. A new round of funding is anticipated to be announced in the coming months. To be considered value added, projects must show how products are differentiated in specific ways from commodity crops. Typically, projects must also show how they may deliver greater returns to producers.
Independent producers, farmer or rancher cooperatives, agricultural producer groups, and producer-owned business ventures, including non-profit organizations, may apply. In previous cycles, applicants were required to be producers of the raw commodity who will maintain ownership of that commodity through the process of creating a value-added product. Grants have been available for planning projects (such as marketing and business plans and feasibility studies) and working capital projects (which might include wages or packaging supplies). (http://www.rd.usda.gov/)