Author: Sheilah

The Legal Side to Growing a Business

 

I discovered that starting a business requires research, planning, thought, and decision making, much like plotting out a garden. Participating in the Enterprise for Equity program helped set the course I needed to take to make the leap and open a business in Washington State.

My first course of action was to research resources and interview farmers, lawyers, insurance agents, graphic artists, and tax experts. Most of the wholesale flower farmers I spoke with have chosen to operate their business as a sole proprietorship. This means that their business is owned and run by one person and there is no legal distinction between the owner and business entity. A sole proprietorship is the least  expensive and complicated route to forming a business. I chose to form a limited liability company (LLC) for the added protection and creating a plan that will work for me. An LLC provides owners (members) protection from business debts and liabilities. Creditors cannot pursue the personal assets (house, savings accounts, etc.) of the owners to pay debts. An LLC can be taxed as a sole proprietorship, a partnership, or a corporation. The one drawback to an LLC is the added filing fees, annual fees, and extra paperwork. I will need to keep records of business expenses completely separate from my personal spending. I will also have a separate business banking account.

Before making my final decision I consulted with Barnard Kalikow of Kalikow Law office in Olympia. We discussed my desire to bring a partner into my business in the future and the advantages of sole proprietorship, LLC, and corporations.  We both agreed it would be best to form as a limited liability company for asset protection and the ease of bringing in a future business partner.

I also met with Brian King of Farmers insurance company, he acknowledged that my business was low risk. I do not have people visiting my farm, nor am I selling a product for consumption, however my home policy would not cover incidents are accidents related to the business. The yearly cost for business insurance will be $900.00.

Another helpful and free resource for information was Keri O’Connell from the Washington State Department of Revenue. Keri is a tax information specialist and offers taxpayer services, she was a guest speaker at Enterprise for Equity. I found the Washington State Department of Revenue staff to be approachable and helpful. Their website is www.dor.wa.gov

Filing with the Washington Secretary of State is required prior to filing for a business license for corporations and limited liability companies. They assign a Unified Business Identifier (UBI) number. This is a nine digit number that will be used to file and pay all state taxes and do business in Washington state.

For federal taxes a Unified Business Identifer (UBI) will be assigned as well. This number is for federal tax filings. Both numbers are like a fingerprint for the business.

https://www.sos.wa.gov/

 

The cost for filing a business license application was $5.00 for my trade name, $19.00 for the processing fee, and $30.00 for a general business endorsement fee.

http://bls.dor.wa.gov/

 

 

 

 

 

 

Final Self Evaluation

https://docs.google.com/document/d/1QQkqUWggx1GYx0T9XLr3VkEH82Pi6Dvi9qrUI5MCcxw/edit

Rows of colorful foliage at Jello Mold Farm.

I designed my spring quarter Independent Learning Contract (ILC) to outline and document the steps needed to start a sustainable wholesale cut flower farm business. My project was entitled Growing a Farm: Cultivating a New Farm Business. My learning objectives were to gain hands on experience in farm field cultivation, learn the legal steps required to open a farm business in Washington state, and learn the fundamentals of botany.

 

The most valuable learning experience for me this quarter was the work I performed as an intern at the organic farm at Evergreen College, and at Jello Mold Farm in Mt. Vernon, Washington. The purpose of my internship at Evergreen was to continue to gain the hands on learning needed to operate a farm. I wanted to expand on the practices introduced last year in the Practice of Organic farming program, such as propagation, field cultivation, irrigation, and harvesting. My field supervisor was Beth Leimbach, assistant manager at the organic farm at Evergreen. Working with Beth one on one was a rewarding experience, she has high expectations and exacting work standards from her twenty plus years working in the small farm and plant industry. A task as simple as watering the seedlings needs to be done correctly to protect them from damage. I learn by doing, and need to perform a task repetitively in order to master it. I feel I have gained the hands on knowledge I was seeking through constant involvement and practice working on the farm. I also had the opportunity to learn how to  enter data in the computer program Ag Squared. Last year I shunned this task, Beth pushed me out of my comfort zone and insisted I gain rudimentary computer based crop data skills. I also benefited from having the opportunity to work with and try different tools and materials, such as paper and thrip mulch.

I applied for, and received a week long internship at Jello Mold Farm in Mt. Vernon Washington during the week of May 20th. Working with Diane Szukovathy, one of the founding members of the Seattle Wholesale Growers Market Cooperative was the most valuable learning experience for me this quarter. My business plan is structured around growing woody cut stems and selling them to the Seattle cooperative. Diane and Dennis offered insights and advice for the wholesale market and helped me narrow down my plant selection for my farm. I learned valuable techniques for harvest, post harvesting, and transport of woody cut stems. Part of the internship involved spending a day at the wholesale growers market. Diane introduced me to several growers who generously offered advice for plant selection. I was also allowed to sit in on a meeting with the market manager and a west coast distributor who is interested in partnering with the Seattle market. The business advice, networking opportunities, and hands on experience at Jello Mold aligned perfectly with my learning goals. I was able to move forward with confidence in opening my business after gleaning the advice from experienced farmers in the wholesale floral business.

 

My final learning objective was to gain a greater understanding of botany. I was not able to enroll in a botany class at SPSCC community college this quarter, instead I opted to study The Great Courses: Plant Science: An Introduction to Botany. By Dr. Catherine Kleier.  I completed the twenty four lectures and read the accompanied book, however, I feel the course did not meet my learning expectations. I read Thomas Elpel’s Botany in a Day and Geoff Hodge’s Practical Botany for Gardeners.  I opted to make a notebook based on Elpel’s text,  Botany in a Day. I collected and identified plants using the pattern method outlined in his book.

 

I feel I gained new skills and achieved the goals outlined in my individual learning contract, with the exception of a comprehensive understanding of botany.  My learning style is hands on, The internships, business research and interviews I completed were activities that can not be learned in a classroom setting. The botany studies were a challenge to learn on my own. I feel I would have gained more working with someone or in a classroom setting. I do plan to take three ethnobotany classes offered this summer quarter at Evergreen. I hope to expand my knowledge in botany and plant taxonomy.

Week Nine

A peony in full bloom.

This week I reflected on my time spent working as an intern at Jello Mold Farm, and contemplating the direction and focus I need to take to grow a sustainable farm based business.  The internship gave me valuable insights into the inner workings of the Seattle Wholesale Growers Market Cooperative, and the realities of farming as a livelihood. The owners of Jello Mold generously shared their vast amounts of knowledge, experience, and advice. They were incredibly open and trusting in sharing their personal financial information. This allowed me to gain a clear picture of the practicalities of running a farm based business.

I was impressed with the lean farm practices implemented in the daily operations at Jell Mold Farm.

A small tool shed centrally located in the fields.

 

Tools and supplies are neatly organized and labeled.
Fellow intern Pam storing poppies ready for market.

Diane stressed the importance of time saving techniques such and organization. Procona cooler buckets are used to store and transport products. Diane uses a color code system to harvest and store the flowers and woody greens. The white and black buckets are for products sold on the market floor. Green buckets are only used for pre sold orders, this helps eliminate mistakes to special order customers.  Wasted time equals wasted money. Small farms operate on a tight budget of time and money, organization saves time and money.

A refrigerated room is essential for storing flowers or food for market. The Cool Bot system can easily be installed for under a thousand dollars.  The unit at Jello Mold is 9 by 16 feet, the cooling system cost $650. Dennis stressed the importance of following the manufacturer’s instructions. Their room is lined with plywood covered in mildew resistant paint, and foam insulation is used instead of fiber.

 

Procona cooler buckets are used to harvest, store, transport, and display flowers and greens.

https://www.pagter.com/en/procona

Moving forward

I feel ready to move forward and officially start a wholesale cut flower business on my property. Going through the Enterprise through Equity program helped me create a comprehensive business plan and map out the necessary steps needed operate a successful small business. It was especially helpful research the start up and operating cost associated with opening a farm based business. I was required to map out a contingency plan to fall back on if my business does not make the money I anticipate during the first years in business. This exercise helped to remove the fear of failure and move forward with starting a farm.

Working as an intern at Jello Mold gave me a snapshot of the realities of making a living as a farmer. I also gleaned some very useful information from farmers who learned through trial and error. Diane and Dennis recommended I consider installing more hoop houses than I had previously considered. They also suggested I buy crop insurance from the USDA whole farm revenue protection plan. I also had to reconsider some of the plant choices I was set on growing, such as Hypericum, Spirea, Limelight Hydrangea, and Snowball Viburnum. Learning and working with farmers offers access to information accumulated through hands on experience.

 

Week 8 Internship at Jello Mold Farm

Rows of colorful foliage at Jello Mold Farm.

I spent the week of May 21 through the 25th working at Jello Mold Farm in Mt. Vernon Washington. My internship proved to be a wonderful learning opportunity that aligned perfectly with my learning goals. Owners Diane and Dennis were incredibly generous, sharing their vast amounts of knowledge gained through years of experience growing flowers for the wholesale cut flower market.

Jello Mold flower stand at the Seattle Wholesale Growers Market Cooperative.

 

I started the week off learning how to harvest and package flowers and foliage for the wholesale market.

Dennis demonstrating the proper way to select, cut, and bundle sweet peas.

Sweet peas are a popular and lucrative crop sold at the Seattle Growers cooperative. Dennis and Diane start their seeds in soil blocks in November and plant out in their hoop house in February. They lime the soil to maintain a ph between 6-7.5, the plants are watered regularly and pinched back when young to encourage branching. String trellis netting is installed from ground to the top of the hoop house roof. Harvesting last from late April to early July.

Sweet Peas are sold 15 stems per bunch, the minimum harvest length is 7 inches. Harvest stage is done when the bottom two flowers have opened. The bouquets can be stored up to five days in cooler before selling. The average vase life is five days for Sweet Peas.

The mission statement displayed in the new office of The Seattle Wholesale Growers Market Cooperative.

On Wednesday morning we were up by 2:30 am to make a delivery to the Seattle Wholesale Growers Market Cooperative. Last year Dennis and Diane purchased a refrigerated truck. This enables them to load their wares the night before, it also allows for easier transport of pre loaded racks.

I was impressed with the cooperative spirit of the market members. Diane introduced me to growers, they shared helpful advice and freely answered my questions on crop selection. Fellow members helped one another unload and set up their displays. The market manager Molly coordinates crop planning with the growers to ensure that there is ample stock and variety for the customers and ensures that the market is not flooded with the same products. This benefits buyers and growers, helping to maintain the cooperative spirit that is the foundation of The Seattle Wholesale Growers Market.

The floor display of Everyday Flowers. Owner Vivian is a founding member of the market.
Gorgeous anemone flowers on display from Everyday Flowers. Anemone is a genus of over 200 species of flowering plants in the Ranunculaceae family.

 

 

 

 

 

Week Seven

An unknown variety of lilac growing on my farm.

I have been researching possible candidates for wholesale cultivation for the cut flower market this week. Two woody shrubs that I am interested in growing are Syringa, better known as lilac, and Viburnum,  commonly called snowball bush.

viburnum opulas

There are over one hundred species of viburnum. Most have one or more ornamental traits that that make them a desirable choice for wholesale production. Viburnums are easy to grow in the pacific northwest, optimal growing conditions are moist acidic soil. Viburnum acerifolium, mapleleaf viburnum is a native to eastern North America. It grows best in heavy shade. It produces stunning fall foliage in shades of pink, red, and purple.

Pros

  • Many early flowering species have highly fragrant flowers.
  • Several cultivars produce colorful fruits or striking fall foliage.
  • Snowball viburnum is among the top ten bestsellers in the cut flower market.

Cons

  • Fragrant species have a short vase life.
  • Harvesting for fall fruit can only be done biennially

Lilac Syringa

Lilac is also one of the top ten sellers, stems command a good price. It does not ship well, this makes it a good choice for the local market, with little competition from international conventional grower.

Lilacs perform best in a sunny location with well drained soil and  ph levels between 6 and 7.5. They need to be fertilized in late fall and again after flowering, with a nitrogen, phosphorus, and potassium ratio of 1-3-5. High nitrogen concentrations must be avoided to produce flowering.

Bacterial blight occurs in spring when there are mild temperatures and wet weather. Symptoms of lilac blight are similar in appearance to fire blight in fruit trees. The flowers wilt, turn brown, and unopened flower buds turn black. The disease starts as brown spots on the stems and leaves of young shoots in the spring. The spots become black and spread rapidly in warm wet conditions. Recommended species for the northwest  that are resistant to bacterial blight include: S. josikaea, S. Lomarowii, S. microphylla, S. perinensis, and S. reflexa.

Pros

  • Lilac thrives in the northern regions.
  • Fragrant flowers in shades of blue, pink, lilac, and white, singles or double flowers.
  • Once established plants can last for decades with minimal maintenance.

Cons

  • Plants have a long juvenile period before production.
  • Stems have hard wood and are difficult to hydrate.
  • Vase life is short, an average of five days.

Week Six

Week six started out with much warmer spring like temperatures and sunny skies. Beth and I decided it would be best for me to continue to focus on honing my skills with the BCS walk behind tractor and irrigation set up and maintenance.

I was able to accomplish both chores while working on the hedgerow I helped plan and install last year as a POF student. My area of focus last year was integrated pest management (IPM). Our IPM group mapped out a hedgerow 100 feet long with three rows spaced 4 feet apart. We installed native shrubs such as snowberry and serviceberry, along with several shrubs sourced from Burnt Ridge Nursery in Onalaska, Washington.

http://www.burntridgenursery.com/

The shrubs we planted included Viking Aronia, Golden Silverberry, and Autumn Olive. Aronia (Aronia melanocarpa) is a shrub with small black edible berries that are highly nutritious and attractive to pollinators and wildlife. It is a self fruitful shrub, meaning it transfers pollen from the anther to the stigma on the same flower to another flower on the same plant. Many plants cannot produce fruit from their own pollen, they need pollen from another flower of a genetically different plant or cultivar to set fruit. Many varieties of  apples, cherries, and pears need another variety nearby to cross pollinate and produce fruit.  An example would be the asian pear variety Housi,  planted in close proximity to another asian pear variety such as Shinko or Kosui. Pollination is performed by bees,  it is important to attract bee activity by providing flowers. Another method used to attract wild mason bees is to install a mason bee home. This is done by drilling a hole 4/16 inch in a 4 inch wide piece of untreated lumber. The bee house should be installed 6-7 feet from the ground.

Viking Aronia in full bloom.

 

Most of the plantings from last year survived, I was able to make an inventory by accessing the planting map from our initial installation from last year. The practice of having a dated map of planting location and plant varieties is crucial to operating a well organized farm. This is a practice that I have started using on my farm and an important lesson I learned during my internship. Many of the plants from last year had lost their tags, having a concise map with measurements saves time and eliminates guesswork.

After mowing around the hedgerow I inspected and repaired the irrigation lines, next I weeded and applied a thick layer of wood chips to help conserve moisture and suppress the weed pressure.

 

Week 5

“My Mid-Quarter Narrative Evaluation”

Last week we experienced two consecutive nights of temperatures in the thirties with morning frost. Unfortunately the basil and tomato starts that we set out in the unheated greenhouse sustained frost damage. I spent the morning picking out and cleaning up the damaged foliage. Our spinach starts seem to be suffering from a nutritional deficiency. Beth pointed out that the spinach is yellow and slow growing. We plan to apply a foliar spray next week.

Frost damage on basil starts.

 

 

 

 

 

 

 

The following day on the farm was very satisfying, I managed to complete every item on my to do list. Two of my chores were activities that I have been avoiding, logging into Ag squared and running the BCS walk behind tractor. Working with computers is not my forte, I have come to the realization that I need to hone my computer skills to successfully track inventory and perform bookkeeping basics in my new business. Last year as a POF student I worked with the BCS tractor many times, yet I never felt competent adding attachments or operating it on my own. Beth is a perfect fit as my field supervisor, she pushes me out of my comfort zone, making sure I learn and relearn whichever skills I’m lacking. I had to familiarize myself with the basics of operating the BCS and spent over an hour flail mowing on Wednesday. I plan to continue using it until I’m completely comfortable handling and maintaining the BCS. A walk behind tractor would be an enormous asset on a small farm like mine.

https://bcsamerica.com/products/tractors

 

Deer and Elk Fencing

The elk have returned this week. They will begin calving toward the end of May.

While writing my business plan I realized that fencing will be of the most expensive start up costs in my first year. I have a resident herd of over seventy Roosevelt elk that pass through my property throughout the year. They return in the spring for calving season, and in October for their rutting season. I am always amazed that a herd of animals that are the same size as a horse or cow can appear and disappear so quickly and quietly. I feel blessed to have the opportunity to live with and observe the herd year round. Though they are noble, the elk and deer can wipe out a crop overnight. To manage this problem I opened up a swath of land one hundred feet on each side of Mclane creek, to act as a passage through my property.  Working with the Thurston Conservation District we have established a buffer of native trees and shrubs along the creek. I hope that by offering a wildlife passage they will go around, rather than through  the growing areas.

I am using Rhonda hart’s book Deerproofing Your Yard & Garden, an useful guide for deterring and fencing out deer and elk.

Mapping out my fence.

 

Six Quick Fencing Lessons

  1. When Possible, fence first, plant second
  2. If deer can’t go over, through, or under, they’ll go around.
  3. A fence with a hole is no fence at all.
  4. Fences over bumpy or steep ground are more difficult to install and can be more expensive in terms of both materials and labor.
  5. Pounding beats digging. Post driven or pounded into the ground are more secure than those placed in a hole dug out by hand.
  6. There’s more than one way to fence out a deer!

courtesy of Deerproofing Your Yard & Garden by Rhonda Hart  pg. 154

This week I priced out the cost of materials for fencing off nearly an acre of growing space. The fence will be eight feet tall with two gates. I have yet to decide exactly where the gates will be located. The hardware for the gates are not included in the materials list. I will definitely use an auger to drill the fence post!

Cost of Deer Fence

Prices reflect April 2018

200 feet x 200 feet deer fence eight feet tall

80- 4x4x12 foot post Home Depot $24.57 ea $1965.60

186- bags concrete Home Depot $3.50 es $651.00

5-48 x 330 wire fence Tractor Supply $279.99 $1400.00

Total Cost of materials $4016.00

I attached Plant Pro-Tec repellent clips to my unprotected pear trees to test their effectiveness. The active ingredient is garlic oil

 

I’m testing the usefulness of Irish Spring soap tied in old socks. I’ve hung several soap enclosed socks on my young fruit trees that were defoliated by deer last year.

http://www.americanatural.com/products/insect-animal-controls-repellents/plant-pro-tec-deer-repellent.html

 

Week Four

This week we took advantage of the sun and warm temperatures to prepare the beds for planting and install drip irrigation on the farm at Evergreen. I have little experience in setting up a drip irrigation system from start to finish, so I was happy to work closely with Beth on this project. Beth was very thorough in going over the entire layout and system using irrigation products from Dripworks.  https://www.dripworks.com/

First we started with the pressure gauge attachment. The water pressure at Evergreen’s farm is 60 psi, much too high for a drip system. The pressure gauge attachment we used brought the pressure down to 12 psi, which is ideal for the drip system.

A pressure gauge attachment is used to control the water pressure.
The drip system laid out and ready to go.

 

 

 

 

 

Last week I received news from Diane Szukovathy, co-owner of Jello Mold Farm that I was accepted for a weeklong internship at their flower farm in Mt. Vernon. I am very excited to have the opportunity to work with Diane on the farm and at the Seattle Wholesale Growers Market Cooperative.  Last year our POF class visited the wholesale flower cooperative and Jello Mold farm. The field trip was what inspired me to pursue a sustainable wholesale cut flower business. I was especially impressed with the cooperative model of the growers market, several small farms working together to market and sell their sustainably grown products. I have decided to postpone the purchase of my woody shrubs until after my internship at Jello Mold. I hope to gain greater insight to the varieties that are in demand in the northwest flower market. Diane and Dennis specialize in woody cut stems, they grow and market unusual floral produce such as raspberry foliage, chestnut branches, snowberry, and ninebark in addition to annual and perennial flowers. My interest and focus is on woodys that grow well in the northwest acidic soil conditions. My internship at Jello Mold is May 21 through May 25th, I plan to return with a wealth of information that will aid me in choosing plant stock and care. My goal is to become a member of the growers cooperative my second year in business.

http://jellomoldfarm.com/seasonal-availability/march/

Week Three

My Great Courses botany course arrived this week. I am also reading Thomas Elpel’s Botany in a Day.

I have started studying the Great Courses Plant Science: An Introduction to Botany. The course consist of four dvd disc with thirty minute lectures on botany. There is also a  book that accompanies each lecture. I’ve watched and read the first two chapters entitled The Joy of Botany, and Plants are Like People. In the first chapter I learned that algae are not plants, but photosynthetic organisms. I skipped ahead to chapter 16, entitled Seagrasses, to take advantage of a weekend trip to the ocean to clam dig.

Seagrasses face many challenges in their environment, such as low light conditions, anaerobic substrate, and high salt levels. To overcome the low light levels seagrasses put their chloroplast, where photosynthesis occurs, in the outer layer or epidermis. Seagrasses are rhizomatous, they store sugars in their roots for times when light levels are too low for photosynthesis to take place. Seagrasses host bacteria in their roots that help break down nitrogen to a usable form. Seagrasses deal with their slaty marine environment by increasing the concentration of salt in their tissues, so that it is saltier than the ocean water. This safeguards against the loss of water to the surrounding environment.

Seaweed are multi-cellular algae, they have little or no vascular tissues.
Seaweeds photosynthesis in all their tissues; most plants photosynthesize only in their leaves.

Week Two: Internship

Tulip season has begun! My first chore in the morning was harvesting the tulips for market. Flower harvesting for market differs from cutting flowers for a home bouquet. Tulips are harvested for market when the petals are closed and starting to show some color. If the outer petals are green they are left in the field for harvesting at a later date. The stems are cut long and low, down to the bulb. Some wholesale sellers leave the stem attached to the bulb, storing them intact or selling them with the bulb. This practice can promote a longer shelf life. The foliage is stripped, and the tulips are packed immediately into sanitized buckets and stored in a refrigerated cooler.

Tulips picked, packed, and ready for market.

This week I finished up my business plan draft for Enterprise for Equity. I found a lot of recent articles on the wholesale cut flower market. I was able to glean some encouraging data from an interview of Diane Szukovathy, founding member of the Seattle Wholesale Growers Market Cooperative. The interview is in the March 2018 issue of Growing for Market, a monthly newsletter for market gardeners, edited by Lynn Byczynski.

The Seattle Wholesale Growers Market Cooperative was founded in February of 2011. Diane Szukovathy and husband Dennis Westphall, owners of Jello Mold flower farm and 11 other northwest growers formed a growers cooperative with shared marketing opportunities and goals. The first year the cooperative generated $300,000 total sales revenue. Jello Mold’s gross income increased by 84% during their first year. Last year the co-op generated $1.68 million in revenue. In December the market relocated to a larger space that will allow them to meet demand and continue to grow. Nearly 55% of the market sales are from pre-sold orders. 65% of the sales are from members of the co-op, the remaining sales are from consignment sales. New growers are encouraged to sell on a consignment basis their first year. The six member team of full time employees manage operations and lend support to new growers, who are assigned crops to fulfill the growing demand. The co-op does not require members to sell exclusively through the co-op. I plan to target local florists within a 25 mile radius, but my primary goal is to sell on consignment and seek membership in the Seattle Wholesale Growers Market Cooperative during my second year of operation.