Pricing to Cooperate not Compete with Fellow Beekeepers

[BattenkillJB]

5 hives in one season. Math: $1500 expenses divided by 150 lbs of honey = $10.00 not $199 cost per lbs. Add jars and labels. This is just an attempt at some sort of baseline.
I love my bees and enjoy having coffee with them in the morning. I just find that pushing the envelope on production isn't good for the bees. For those who would like some extra income for retirement or even their hobby it is good to how some price ballpark.

[Daniel Y]

I am selling last years honey at $8 a lb. a lot of reasons are in that price. What you are doing here is called price fixing. and that is in fact illegal whether you think it is devious or not. It is illegal for you to get together with your competition and agree on a set price. You should actually be able to set your price based upon investment, cost and profit necessity. It costs me XXX dollars to produce a lb of honey. in order to get paid and make a profit I can figure out my price. Now if I can produce and sell at my necessary profit lower than you. then I beat you in the competition. If not then I best get better at what I do. reduce my costs etc. For a small business or hobby I use a 3X formular. it is costX3 this covers all costs + labor = price. Now the costs like gas, electricity etc that are very hard to track do not need to be you simply take the large obvious costs and the X3 takes care of other things. the difficult to identify much less calculate costs plus your businesses profit. Think of the business as a person itself that also needs to be paid. SO one of the 3X factors is that pay to your business. One of the 3X factors is simply the out of pocket money you paid out so you are doing nothing but getting your money back. the last one is covering all the no seeum costs that your spend but don't really realize it. Then because you want to get paid for your time as well you set an hourly rate for your work and add that. Now this formula leaves a lot of room to reduce prices by working faster. finder lower cost methods etc. so you can land at a competitive price. Price fixing on the other hand is getting together and figuring out what price to set because if it is the only price your product can be gotten for you can sell it for that. Illegal.

[hivemaker]

When competitors within the same industry put their heads together to come up with a price for their product. It is called Price fixing and Illegal in this country.

ditto

[clyderoad]

5 hives in one season. Math: $1500 expenses divided by 150 lbs of honey = $10.00 not $199 cost per lbs. Add jars and labels. This is just an attempt at some sort of baseline.

the $1500 equipment costs is expensed in the first year? if so then next year, if the bees live, your expenses are only jars and labels so maybe $1.00/lb ?
so, if you want to make 10% profit this years honey is $11.00/lb and next years honey will be $1.10/lb ?
how does this help you?
how much honey are you tying to sell?
there are threads here on beesource that have discussed pricing, selling honey and making it a business, etc.

some basic book keeping help may be in order to guide you forward, and a business plan.

[BattenkillJB]

OK. Price fixing? My my. I haven't seen two beekeepers agree on which end of the bee has a stinger. I thought this might open a discussion on just what beekeepers are basing their prices on since the price of honey seemed too low at markets. Given my example using five hive set in one season and basing bee gain/loss, equipment life, supplies and other expenses including packaging. I think $10.00 a lbs might work.
But as most of you have pointed out I am an idiot and conspirator. This was fun.

[hivemaker]

The price of honey seemed too low at markets. Given my example using five hive set in one season and basing bee gain/loss, equipment life, supplies and other expenses including packaging. I think $10.00 a lbs might work.

The prices are usually set based on what the market will support. If you need a guideline here are the national wholesale prices for type of honey and place of origin.
https://www.ams.usda.gov/mnreports/fvmhoney.pdf

I get 6.00 a lb and sell direct to customers. I can't produce enough to justify bottling and sending to market.

[Tennessee's Bees LLC]

Maybe the problem is not the price. Maybe the problem with the beekeeper of today is they can't produce well. Also many are not sustainable.

We have hives producing over a hundred pounds each. (We don't have the greatest honey flow either) if you can't make money at $8 a pound you have a production problem not a price problem. We build our boxes, bottom boards, lids and anything else we need besides the frames. I don't sell my honey for any more than I would pay for it. Depending on location we sell for 4-6 bucks a pound

[Jason A]

Let's bee smart like the Canadians were about Maple Syrup pricing and get a consensus on prices that are sustainable at small marketplaces.
We shouldn't even go down near supermarket prices for what ever they call honey. So lets start the bidding at $15.00 a pound at retail stand.
What is your opinion out there? Remember lowering prices for competition is usually a downward spiral for everyone I've seen prices much too low lately.

No thanks. I'll stick with capitalism. "Price fixing" is both immoral and wrong. If you have a better product, consumers will purchase your goods/services.

[TalonRedding]

It's a very simple concept of supply and demand and whole selling vs retailing which will vary between different areas and also from year to year depending on many factors. I live in rural TN and I have NO problem selling for what I charge, which is average national retail price. You also have to ask yourself how long you want your honey supply to last. If you sell out in a month, you either aren't producing enough or you aren't pricing high enough to meet demand. This fact won't matter much to a hobbiest, but it will to the sideliner or large scale producer who aren't just trying to make the business pay for itself but also need to earn a profit. The ones who are serious about it know how much their time is worth and how much time they have in their operation. If you want return customers, you need to be reliable, otherwise all you are producing is a novelty item. It's actually a fun lesson in basic economics, and I personally think it should be taught in a similar fashion in the school systems.

[TalonRedding]

I also meant to say that I was at the grocery store the other day (Save a Lot) which is a lower end grocery store similar to Aldi for those who don't know. I snooped around for their honey prices and it cost $6.86 plus tax for a 1 lb squeeze bottle of honey, commercially produced. With the tax, it is a few cents cheaper than what I sell for. Makes me want to raise my prices...

[sqkcrk]

Wait, you're at my stand?!

No, jw, he's before the at.

Sell your own honey for what you think it's worth and for what you can get for it. Screw whatever someone else is willing to sell theirs for. Sell your own honey.

[sqkcrk]

Ok, we all love free market capitalism. So let's frame this a little differently so that anyone interested in what to charge on average might get some insight.. Given groups of 5 hives for one year there are approximately $1500 in bees and equipment. We win a few lose a few. Out of those five hives three produce honey -about 150lbs.(just for arguments sake). We've heard $8.00 a lbs so we have $1200 gross income for this model. Not so good on face value. So with luck we get more honey. Oh I forgot we have the cost of jars and labels. Darn. We need even more honey.
So folks isn't it reasonable to ask how much can we charge and still be sustainable even if we don't get paid for our time? I personally have no way to assess this in any market survey. Maybe someone does and can contribute that or we could hear from forum beekeepers their idea of a reasonable price.

You have had a few hives on a weekend farm for a couple of years. You have a long way to go and more hives to buy and keep. It's farming. A style of business unlike others. So, unless you are in it for the long haul, best leave it to those who are and have been.

You can ask all you want about what is reasonable to charge to maintain sustainability, but unless you get out and do, instead of talk, it's all for naught.

[sqkcrk]

5 hives in one season. Math: $1500 expenses divided by 150 lbs of honey = $10.00 not $199 cost per lbs. Add jars and labels. This is just an attempt at some sort of baseline.
I love my bees and enjoy having coffee with them in the morning. I just find that pushing the envelope on production isn't good for the bees. For those who would like some extra income for retirement or even their hobby it is good to how some price ballpark.

If you ever figure out what it cost you to produce a pound of honey, let me know. And show how you decided on that figure. I have been at this a long time and I don't know the answer to that question.

[dtrooster]

I'm trying to figure out how you spend $300 a hive without trying to. As far as getting paid for time, only a full time beekeeper who earns his only source of income with bees gets to use that one. Time spent is only worth income lost that would be earned if you were doing something else. ( I.E. a job, an extra job, or a sideline with defined income) Sitting on the couch watching the tube, barbqueing, swimming doesn't count. People crack me up talking about what there time is worth

[beemandan]

But as most of you have pointed out I am an idiot and conspirator. This was fun.

I think many people simply disagreed with you. Which you seem to have taken offense from. You wanted a discussion and you've gotten one.

Given groups of 5 hives for one year there are approximately $1500 in bees and equipment.

I know of very few businesses that recover all..or even anywhere nearly all....of their start up costs in the first year. Take that $1500 and divide it up over ten...or even seven years and then recompute.

[D Coates]

I get $9 per pound. To me it doesn't matter what others are charging. Those that are too low sell out and eventually leave the market as they learn it's too hard to too little reward, or raise their prices. I focus on my product and make it look as professional and unique as possible. In a meaningful way differentiate how you get to market, what you offer in that market and how you look in that market. This differentiating adds value and allows you to sell for a price that works for you. I'll never get price shoppers as Wall Mart and local grocery stores will beat my price by at least 1/3. Don't worry about the others, worry about yourself.

[AstroBee]

While I agree with the majority of the comments posted here. I have seen some of our local long time beekeepers not keep pace with the changing market. We have several local beekeepers who have been producing honey for 50+ years and really didn't realize that $15 per quart was a bit on the low side. They were very grateful when some of the younger folks informed them on current pricing. I see nothing wrong with this kind of exchange. If someone local calls and asks me what I'm charging, I simply tell them. This information is widely available though our markets or retailers carrying our products.

[rolftonbees]

I happen to know that my honey is a bit better than most in my area. I therefore feel no problem in asking a bit more for it. I let the buyers set the price, not the other sellers.

[aunt betty]

I'm selling it by volume (gasp).
$5/cup which is 12 ounces weight.
Lets see....that's ~ $6.66/pound.
We sell a lot of 12-ounce bears and it's easy on the change making at $5 a bear.
To get to JW's $8/pound I'd have to go up to $6/bear.

Comb is $10/pound and the chunk honey is $15/pint so I'm not undercutting anyone that bad. I get what I can and it sort of sucks that only 45 minutes away a guy is selling his honey for $35/gallon. ($3/pound)
I get my face rubbed in that every week or so.

Se la vi.

[usngunr]

I've been selling mine at $8.00 a lb. I had a super off of a wild hive that was dark and thick, I sold that with a description of "wild hive, very limited supply" for $10 a lb and it's sold out already. Frankly I didn't expect for it to sell like that. But my description in the listing must have worked. I've got some nice labels and hang tags coming, we'll see what happens. I've been telling the older guys around here that $15 for a quart is way cheap for real honey. But hey, we charge what we feel it's worth. I got my bees for my honey stock, I'm growing past that. I'll not give it away though. Too many hours sweating in that veil and getting stung.