A few quick things:
- Want to receive this list via email each week? Sign up here.
- Milk prices are dropping. Read on for more.
- Greek yogurt prices are increasing. Sorry.
- Calicutts Autumn Harvest Spice Blend hits the shelves, just in time for pie pumpkins to roll on in.
- One final round of tomatoes this week — we’ve got small quantities of heirlooms, red slicers, sungolds, and mixed littles. And lots of green tomatoes, ready for frying (or grilling, or pickling, or fermenting, or pie-ing!).
- No staff pick this week, we’ve got enough pricing changes to deal with!
Scroll down for the full list of what we’ll have this week!
I have a lot I want to talk about this week — visits to Village Acres and Pecan Meadow Farms; how hungry all the green tomato recipes I just looked at made me; how even though the days are (mostly) still warm, the early dusk and the cool evenings are slowly convincing me that it’s truly fall; how I am not sure I’m totally back in the swing of things, and have been really grateful for easy meals like ramen with Sweet Farm Kim Chi, scrambled eggs with Dusty’s homemade hatch sauce and North Mountain Pastures breakfast sausage, and PIZZA with Knead dough and CapoMozz and fresh tomato sauce and and and…. But! What I’m actually going to talk about is pricing. Exciting, right?
If you read the Quick Things above, you know why — this week we’ve got some prices going up (just two, or maybe just one, depending on how you count it), and a whole bunch of prices coming down. Why?
In the case of the Fiddle Creek Greek Yogurt prices going up, it’s as simple as you might think — our cost went up. I don’t have a direct relationship with the folks at Fiddle Creek, but my understanding is that they have a very small herd of cows, and a very in-demand product, and are probably at or approaching capacity. It’s very easy for me to believe that they need this increase to fund expansion plans, or just to stay afloat at their scale. Regardless, while I wasn’t all that surprised to see an increase coming from them, I was surprised at the percentage. Since this is already a higher dollar value item and we were, to be completely honest, a little squeamish about the price to begin with, we’d already priced it with a slimmer margin than we prefer to have on a perishable product. There was no way we could absorb the increase. On the other hand, since that yogurt is so popular and isn’t nearly as perishable as some of what we carry, we don’t have a ton of waste on it and the slim margin has worked out okay to this point. In talking to many of you who enjoy the Fiddle Creek yogurt on a regular basis, it sounded like, for the most part, you’d rather we continue carrying it at the new higher price than switch to a different brand. So that’s what we’re doing — basically just passing the increase we’re seeing on to you. And, for what it’s worth, if I talked to you last week, you might be happy to learn that the actual increase is not as bad as I was initially quoting based on my quick reading of the new price list and some poor mental math. The pints go up to $6.75, and the quarts to $13.
So what about the Apple Valley Creamery milk prices going down? That one’s a little more complicated. Have our prices gone down? Sort of, but not by as much as we’re lowering prices. For this one…I’ll back up a little bit. When Dusty and I bought the stand and opened as Radish & Rye in the spring of 2015, one of the first things we did was to lower milk prices. Had our prices gone down? No (in fact they’d just gone up!), but we learned that the way Apple Valley’s wholesale program works, higher volume accounts earn bigger discounts on their purchases. The discounts come in very small increments — 2% at a time — but back then we thought that if we could sell a little more milk, we could consistently hit the next discount tier, and the best way we could think of to sell more milk was to lower prices.
And so we did. It felt scary, because in order to make up the difference, we’d need sales to increase not just enough to hit the next discount tier, but pretty significantly beyond that. We were brand new to retail, and just had no idea if it would actually work out the way we hoped, but we also figured that, just on principle and all else being equal, we’d rather sell more of something at a lower markup than less of the same at a higher markup, even if the end profit was the same. As it turned out, within about six months we were pretty consistently hitting the next discount tier, so our cost went down by 2%. I never did go back to see how long it took before we were selling enough to fully make up for the initial price decrease, but I think it was within the first year. Since then, sales have continued to increase, and we’ve been hitting the discount tier after *that* for the last year or so. So to recap — when we started, we lowered prices on milk by somewhere in the ballpark of 10% in anticipation of future cost decreases, and since that time our cost has decreased by 4%. When I look at it that way, I start to wonder if maybe we’re crazy to be rolling out another 10% decrease. (Maybe we are.)
But! The other thing that has happened is that as volume has increased, our dairy waste has decreased. That is, we less frequently have bottles reaching their sell by dates before we can sell them. Of course it happens from time to time, but as a percentage of total sales, it’s significantly less, which means that we’re able to realize a higher effective margin on the category as a whole, even if the profit on an individual unit stays the same (or decreases). We’re also occasionally knocking on the door of the next discount tier, which is awfully tantalizing, but of course even hitting that consistently won’t make up for the decrease we’re rolling out this week.
You might be wondering — all this talking, but what are the new prices? For most of the dairy products in quarts and half-gallons, prices are going down approximately 10%, depending on the product and how the rounding worked out. There are a few items that aren’t changing at all (quarts of heavy cream, where, similar to the Fiddle Creek, we opted to just not apply the same kind of markup that we do to other products because it’s so damn expensive — but so damn good — already). There are some that are changing by a less significant percentage, largely because they’re items where we’re still seeing some waste, and we don’t think further lowering the prices on those products is going to move more of them consistently enough to reduce that waste. Bottom line: half gallons of whole and raw milk (by far the biggest movers) both go down to $4.75 (a 9.5% decrease). Half gallons of low-fat and skim are now $4.50. All milk quarts (except chocolate) are now $3.25 (13% decrease). Chocolate milk, half & half, and the pints of heavy cream are all down a little, but less significantly. Etc, etc.
You might also be wondering — why bother? If sales have increased, isn’t that an indication that people are fine with the prices where they are? Well, maybe, but the short answer is: because we can. We’re here, doing what we’re doing, to make a living (and pay our staff), but also because we want to get good food in the hands of as many people as we can. We want the farmers to do well, and we want the food they produce to be as accessible as possible, both physically and financially. I do want to be clear here that I’m not trying to frame this as an altruistic move on our part — it’s a business move — but we hope it’s one of those occasions where everyone’s interests align. By shaving prices, the milk is more affordable and accessible to those who want it; Apple Valley Creamery has a greater outlet for their delicious Animal Welfare Approved dairy; and, hopefully, we gain enough additional customers and incremental sales to eventually make up the difference.
It’s still a little scary, even now that we have some retail experience under our belts. I hope it works. I’d love to write another post like this, in another three years (or less!), telling you we’ll be lowering prices once again. But for that — we’re going to need some more refrigerators….
P.S. I haven’t forgotten about Barcelona Part II (it’s burning in my mind!), but it didn’t happen this week. 🙁
Staff Picks yield this week to lower milk prices
- Green Beans
- Collard Greens
- Lacinato Kale
- Honeycrisp Apples
- Grimes Golden Apples
- Lions Mane
- Red Onions
- Sweet Onions
- White Onions
- Red & Yellow Bell Peppers (limited)
- Green Bell Peppers (arriving Friday)
- Mixed Hot Peppers
- Habanada Peppers
- Yummy Snack Peppers
- Russian Fingerling Potatoes
- Yukon Gold Potatoes
- Sweet Potatoes
- Red Beets
- Red Breakfast Radishes
- Green Leaf Lettuce
- Mesclun Mix
- Just got word — maybe others arriving Friday!
- Pie Pumpkins
- Butternut Squash
- Delicata Squash
- Robin’s Koginut (limited quantities)
- Spaghetti Squash
Tomatoes (all limited)
- Green Tomatoes (not limited)
- Sungold Cherry Tomatoes
- Mixed Cherry Tomatoes
- Heirloom Tomatoes
- Red Slicing Tomatoes
- McGrath’s Original
- Sesame Original
- Irish Oatmeal Pan Bread
- Three Seed
- Everything Bread
- Cinnamon Raisin
- Baguettes (fresh Saturday only; available frozen every day)