EXAMPLES of businesses value-adding by telling their story are a dime a dozen in sectors where the product is immediately visible.
Cute rare-breed pigs, gnarled olive trees and farm-fresh eggs all have a story that is easily translatable to the consumer.
But a silo full of oats? Now that’s a harder sell.
However, one small business based around a farm at Natte Yallock, near Maryborough in Victoria’s Central Goldfields region is having a go at doing exactly that.
Peter Cain, of Dad’s Oats, said the business, set up in 2015, was a means of taking a good story in agriculture and selling it to consumers.
The Cain family have been farming at their current location since the 1860s.
Up until the creation of Dad’s Oats, by Peter and his sister Alicia, the family’s oats were simply sold off into bulk markets.
“The idea for the business came because we are in such a good region for growing oats,” Mr Cain said.
“Agronomically, the climate really suits oats and we wanted to see if we could sell that story of having a top quality, traceable product.”
Now, the top five per cent of the crop, graded and screened to get good quality oat groats, are sent to processors where a range of retail products are produced.
“The oats are screened and graded, we want the heaviest oats with good colour.
“At present we are only producing Echidna variety oats, but that is also something we will look at if there are other varieties with good end use characteristics.”
Most of the product goes into 750 gram and 1kg resealable packs, which research found was the preference for most consumers, but options such as bulk buy buckets of oats are also available.
Consumers are also given the opportunity to buy rolling equipment so they can freshly roll their own oats.
Since establishing the business with capital raised by crowd-funding, Mr Cain said it had been a steep learning curve.
“We didn’t have a background in food processing so we’ve learnt a lot in that space.”
This year, the company is on track to process around 50 tonnes of oats.
“It might not sound much for producers of bulk commodities, but when you break it down, it is enough for a couple of million bowls of porridge.”
The brand now has an established following.
Mr Cain said consumers liked both the story behind the oats, along with the fact they were single source and fully traceable.
Initially, much of the sales platform was through farmers’ markets and sales direct to cafes but now most inquiry comes through the website.
The products are used at many cafes across the country and are available across a network of 60 food stores but Mr Cain said direct sales from the website were growing quickly.
“The crowd funding not only raised the capital necessary, it also gave us exposure to a critical mass of willing consumers and confirmed we were on the right track and it has gone on from there.”
He said while the bulk market would always remain important for Australian grain growers, the more grain that could be value-added, the better.
“Adding value to the product is a great option, it helps spread the risk.”
He said the viticulture industry had been an inspiration in differentiating the family’s product.
“You take a look at what is happening in wine, in many ways wine could be a commodity product, yet they use the story of the origin of the product and use it to help create a premium.”
The Dad’s Oats business was initially set up as a side project for the Cain siblings, who hold down full time jobs in Melbourne, but Mr Cain said it was rapidly expanding.
“Earlier in the month we exported our first international shipment, a pallet which went to Singapore as part of a distribution deal we have set up there.”
“Asia is a big growth market for quality produce, the consumers there have a passion for high quality, clean and green food.”
Mr Cain said he saw Dad’s Oats as an advocate for the grains industry overall.
“Part of our job is to educate our customers and show them the product and explain how it is grown.
“We are not certified organic, we don’t use pesticides but we do use some fertiliser and we explain that fact to the consumers and they generally are far more worried about pesticides than the use of synthetic fertilisers.
“It is all about engaging with your customers.”
Mr Cain said innovations in technology had made small scale businesses such as Dad’s Oats more viable.
“It is still a lot of hard work but you can manage direct to customer delivery systems through technology better than you could in the past.”
Mr Cain will speak about his experiences setting up an agricultural-based business using crowd funding at Grain Growers’ Innovation Generation (IG) conference in Adelaide from July 3-5.
Get more details on Dad’s Oats at www.dadsoats.com