From Seed to Success: How KPIs Can Transform Your Market Garden

KPI, what now? If you're wondering what KPI stands for, it means key performance indicator. It's a way to understand your business better by looking at the numbers or metrics on your farm to see how it's performing. KPI's can give you visibility into your business and allow you to make informed decisions to improve production processes, reduce costs, and keep your customers happy. That sounds pretty good, right?

In this article, we've listed several key metrics that will help boost your market garden's profitability and ways to improve those KPIs to help your business grow.

Market Gardeners' Guide to Profitability

The basics of a market garden are selling crops to customers. Collecting some basic information about your farm will help give you a baseline of how your farm is doing. You might already be tracking them. But while we're going through these numbers, make sure that you're looking at the right data and that you're keeping accurate farm records.

Some basic components of every market garden are land and soil, plant selection, disease and pest management, water management, labor, sales, and marketing. By focusing on metrics on how to best utilize your resources, like soil, water, and plant health, market gardeners can make data-driven decisions that enhance productivity and sustainability. 

Basic Market Garden KPI's to Track

• Yield Per Acre (or Hectare):

  This is a fundamental KPI, measuring the total amount of crop produced per unit area. It helps identify areas of the farm that are more productive and can be optimized to achieve a higher yield. 

  Some ways to optimize yield per acre can be improving soil health, selecting the right seeds, implementing precise irrigation, enhancing nutrient management, and practicing integrated pest and weed management. This includes optimizing planting times, utilizing fertilizers, managing pests, and optimizing water usage. Another way to optimize your yield per acre can be by growing vertically. This increases the area that you have to grow.

• Crop Quality Index:

  This measures factors like size, color, and texture of the produce, indicating the overall quality of the crop. 
  

  You can optimize your crop quality by focusing on improving soil health and ensuring nutrient balance. You might look into the quality of your soil with soil testing. To improve soil, you can incorporate practices like cover crops, crop rotation, and organic amendments. Optimize nutrient management by tailoring fertilizer applications to crop needs, specific areas, and soil conditions.

  
  

• Harvest Efficiency:

  This metric helps you understand how efficiently crops are harvested. It takes into account losses and looks to maximize the value of the harvest. Looking closely at this metric can help you improve harvest efficiency. There are several ways to optimize your harvest efficiency. First, you can coordinate labor and machinery so that you have them on a schedule to make sure they are in the right place at the right time. By coordinating staff to be there when you need them AND having the tools you need for the harvest, you will manage this harvest much more efficiently. This will avoid delays and bottlenecks during the harvest. If using machinery at harvest, make sure that it is in working order and that it is calibrated to the area and plant you are harvesting. Educate your team on the safest, best, and quickest methods for harvesting, which will help you all be on the same page.

  
  

• Growth Cycle Time:

  This metric shows the time it takes for crops to reach maturity. This is especially of interest in vertical farms where space is more limited. This is an important factor, knowing how fast you will be able to take your product to market.

  A few suggestions for optimizing your crop growth cycle can be achieved by creating the perfect growing environment for your crop. You can do this by raising average daily temperatures during cooler periods (growing in a greenhouse) as well as adding supplemental lighting (where you can). These additions can accelerate plant development and increase your growth cycle. This isn't always an option, but for plant starts and smaller areas, it might be something to look into for your farm.

Financial and Economic Metrics for Market Gardeners:

• Cost per Unit of Production:

  This KPI helps determine the cost of producing a specific crop amount, allowing for the comparison of different farming methods and crops. This is one metric you'll want to see decrease. You can utilize things like monitoring and analyzing your farm finances, comparing your cost of production to industry standards, investing in resource efficiency, soil health, and possibly working with neighbors or a cooperative to purchase inputs in bulk
  

• Profit Margins:

  This metric shows the profitability of crop production, showing the percentage of revenue remaining after deducting all your production costs. You can increase profit margins on your farm in a few ways: add new products or value-added products, which might be something you make from the non-saleable items, up your marketing game, control your operational costs, and always measure what you're doing by keeping accurate farm records.
  

• Return on Investment (ROI):

  This may be one of the most important KPI's to track. It measures the profitability of the farm vs the investments you've made. This gives you insight into how purchases are stacking up to see if they are worthwhile.

  Look to where you can save time, money, or effort. Make sure you are tracking everything in a farm accounting app or spreadsheet to see where money and spending are coming and going in your farm business.

Input Efficiency and Sustainability:

Inputs are something that many farms rely on. Here are a few KPI's or metrics that you might want to track in reference to inputs, sustainability, and efficiency on your farm.

• Fertilizer Efficiency:

  This measures the amount of crop yield achieved per unit of fertilizer used, indicating the effectiveness of fertilization practices. You might also choose to measure how one fertilizer used is better or worse than another, or the accuracy of application, to ensure that you are applying only where needed. Optimization of fertilizer efficiency starts with a soil test. You can then monitor and adjust your soil pH for the exact needs of the plants you're growing. You can also save money on fertilizer by only adding it to the areas that need a boost.
  

• Pesticide Efficiency:

  This KPI assesses the effectiveness of pesticide use in controlling pests and diseases while minimizing environmental impact. A few metrics you might choose to focus on are crop yield vs pest damage, cost per application, compliance aspects of pesticide use, the environmental impact of pesticide use, and different pesticides' effectiveness. You can also employ natural pesticides or other methods like companion planting and beneficial insects as well.

  
  

• Water Efficiency:

  Water can be costly, and it is a valuable resource. Water efficiency metrics measure the amount of crop yield achieved per unit of water used. This metric highlights the importance of water management on your farm. Some metrics you might want to measure are water consumption per unit of production, soil moisture, percentage of reduction of water used vs past years, monthly/yearly water quality, maintenance costs, and more. Some ways to optimize your water consumption are to reduce where you can, conduct audits of your irrigation system to see how well it's working, identify if there are leaks, and harvest rainwater (if that is allowed in your area).
  

• Soil Health Index:

  This KPI monitors the health of the soil, including nutrient levels, pH, and organic matter, which is crucial for long-term productivity and sustainability of your soil. You can keep track of your soil health along with amendments and other key nutrients in Farmbrite soil health software.
  

Other Important KPIs:

• Labor Efficiency:

  This measures output per worker or per hour, helping identify areas where labor allocation or automation could improve productivity. 
  

• Inventory Turnover:

  This KPI tracks how quickly farm produce is sold or utilized, reducing food waste and ensuring fresh produce reaches the market. This is another place where you might track to make a value-added product. If you sell lavender by the bunch, the loose lavender that is off the stem can be made into sachets, candles, or soap. You might also have a mailing list of customers who might purchase a product often, and they would appreciate an email or call when you have items that are sitting and need to be sold.
  

• Market Performance:

  This KPI tracks the market price and demand for crops in your area. This helps you make informed decisions about planting and harvesting. By knowing this information, you can understand which products are selling (to whom) is a huge factor in understanding your market. Some places that can help you understand these numbers are your state's department of agriculture and the USDA National Agricultural Statistics Service. These help you understand market trends and conditions.
  

• Environmental Performance :

  These are metrics that quantify an organization's environmental performance, helping track progress towards sustainability goals and identify areas for improvement. These KPIs can include energy consumption, water usage, waste generation, carbon footprint, and various other environmental impacts. It's important to understand the impact we have on the environment around us. Not only can understanding these metrics keep your surrounding environment healthy and safe, but it has also been shown to increase profits.

We are certainly not telling you that you need to track all of these metrics. There's a lot here, and they might not be relevant to your business. But we hope that you will get a few good ideas on what you might track and how that might be beneficial to your farm business.

Our mission at Farmbrite is to help farmers improve their farm business, and we've seen the benefits that crop growers find by monitoring some of these KPIs. They gained valuable insights into their operations, identified areas for improvement, and we able to make data-driven decisions to enhance productivity, efficiency, and profitability.

Thank you for reading about these KPIs. We hope this article was helpful to you. If we can help you with your market garden by utilizing crop planning and growing software, please let us know. And as always, Happy Farming!