Urban Agriculture Story: Fighting food price increases with In.Genius Farms
In 2011, Khaled had an idea about building a vertical farm in his backyard. He ran some tests and quickly realized the economic potential. In 2015–16, he was already making a living using only 1,200 sq.-ft.
I noticed Khaled’s work through his Instagram account ThePlantCharmer during the summer of 2016. At that time, I thought that the yields he claimed sounded too good to be true.
Curious to learn if it was real, my wife and I decided to pay him a visit in Montreal. We soon learned that his accomplishments were exactly as described. We even thought that he may not have bragged enough about them.
Since then, Khaled has expanded his operations on 37,000 sq.-ft of peri-urban land and has experienced a 600% revenue growth in the past 3 years, while providing some of the lowest prices for chemical and pesticide-free local produce.
Here’s the story of In.Genius Farms, a backyard vertical farming project turned into a serious business with big ambitions.
How it all Started
Khaled, the founder on In.Genius Farms, has a background in international business. His professional experiences were in completely different fields than agriculture.
Among other things, he was a consultant for SocialEyez, a social media engagement agency in Dubai. He also worked in the hospitality sector at the prestigious Fairmont Queen Elizabeth, in Montreal.
In 2011, as he was experiencing a lack of interest at work, Khaled wanted to try something different, something new.
“I always liked horticulture and plants,” he said. “I also noticed people’s concerns over food price increase, as well as growing demand for local food,” he added. Therefore, he decided to test an idea: growing food vertically in the most efficient and easy way possible.
After 3 years of experimenting in his backyard, Khaled saw the financial viability of his project. Moreover, his Instagram account was getting serious attention. It gave him leverage to promote his work.
“Conventional agriculture is limited. You can try to improve it over and over, but it will still remain limited.” — Khaled
Khaled explained the resistance to change in agriculture. “Most of the time, farmers are just trying to improve what they know, instead of trying something new,” he said.
By using social media to promote his methods and the results of his experiments, it showed people that changes are possible. Thus, he garnered attention from people of various backgrounds open to doing things differently.
Katie, Khaled’s spouse, has joined the project. By seeing day after day how much food per square foot was produced in their backyard, the idea became very attractive. She saw in it the opportunity to make a difference.
Known as The Tea Charmer on Instagram, Katie benefits as well from a considerable audience to share and spread ideas.
“Average people can’t afford an organic melon at $8.00. Quality healthy food should be accessible and affordable to everyone, and I want to make this happen”. — Katie
Involved since the early days, her new role will be to focus on food processing and packaging.
With the production increasing in volume, it increases the potential for food waste as well. Katie’s new responsibility will be to mitigate and maintain it at its minimum. Every item of produce grown but not sold will be transformed into jams, pesto, chutneys, pickles, and more.
Katie will also be in charge to solve the packaging issues. They were solved in part with the pick your own concept as well as by introducing bring your own packaging.
“It turns out that the trend is to eliminate packaging, and our clients were already self-engaged towards this approach,” said Katie. “We only need to continue providing them with convenient and sustainable solutions that keep leaving more money in their pockets,” she added.
The Business Concept
The business concept is rather simple: growing food vertically to optimize yields and revenue per square footage. However, it is complicated to make things simple.
Like software, Khaled’s system is solving a problem (fighting high food prices) through a simplified, user-friendly and frictionless experience (growing food vertically and efficiently) that offers the best value for the money (increasing revenues, while lowering production costs).
His goal is clear: providing people with affordable chemical and pesticide-free locally grown produce, without compromising quality, variety, and profitability.
Khaled’s system eases most of the daunting farming tasks and has eliminated maximum friction, from growth to marketing.
To achieve this, he focused his efforts on:
- Generating a high return on investment (ROI)
- Mitigating labor cost and labor scarcity
- Getting the proper agricultural inputs
- Minimizing losses (food waste)
- Operating fast and timely harvests
His system consists of vertical farming units. Each unit is a 4’ x 10’ wooden A-frame with support for 5 rows of rain gutters on each side. His farm counts over 350 units like these.
Nonetheless, Khaled explains the A-frame is a low-cost structure that provides an insane ROI. “It is a means to generate profit right at the beginning,” he added.
“One A-frame cost about $100 in material, takes less than 20 minutes to assemble, and can produce up to 6 harvests of 200 heads of lettuce per season, using only 40 sq.-ft. Even sold at a low price of $0.75 per lettuce, it will generate about $900 in revenue its first year.” — Khaled
So while others spend millions of dollars on expensive technologies that can only be sustained by selling high-priced products, Khaled generates both growth and profits selling at low prices.
Moreover, his company growth is showing no sign of slowing down. Starting this year, Khaled expects to reinvest 10% of the revenues in research and development to stay ahead of the curve.
To sustain growth, keeping a tight grip over operational costs is essential. By using rain gutters to grow food, he solved the weed problem, as they have no room to compete with crops. This way, workload is considerably reduced (almost no weeding!) and the need for herbicide is eliminated as well.
He uses a mix of both organic soil and fertilizer, designed to address each crop’s needs. All units are connected to a semi-automatic dripper watering system (as you can see below), leaving only visual inspection as the main task during the growth period.
“By growing like this, not only you are more efficient per square foot, but the food waste is almost zero.” — Khaled
To further mitigate the labor costs and scarcity, he mobilizes some of his social media followers to plant seedlings. In exchange for 4 hours of work, volunteers each receive a 65$ voucher. They can use it at the farm to buy the products they want, at any time during the season, without any restrictions. See the example below.
Khaled mentions that not only does it get the job done faster and better than if he had hired people, but each participant also has the potential to bring up to 25 new clients.
The same concept applies to harvest. Khaled creates self-harvest events. As the A-frames become green walls full of fresh produce, they look like open-air grocery aisles. No need to kneel, bend or get dirty. You just walk around the aisles and select the product you want. “Harvesting events aim to be family-friendly, as much as a family BBQ”, said Khaled.
“With our prices, happiness in the face of clients is priceless. It’s like if they were suddenly believing that relief exists for their wallet.” — Khaled
The Pricing Strategy
Some of In.Genius Farms’ marketing stunts planned for this summer are strawberries at $1 a pound, as well as three heads of lettuce for $1.
Khaled aims to win clients’ trust and loyalty by tearing down barriers that separate them from access to quality local produce.
His pricing strategy is about making him entrenched in his field. He is able to maintain a 30% margin on most of his produce, even while selling lettuce heads $0.75 each.
Although he could charge the market price to get a higher margin, Khaled explained that “if you do too much profits, it becomes very tempting for competitors to get in.”
“When you master your operations and your costs, you can provide lower prices for a minimum of profits,” he said. “Thus, the barrier to entry becomes too steep for potential competitors and it is less tempting for them to try your market, leaving you all the space to scale,” he added.
While some spend their efforts and funding to educate people on how they should pay high prices to support local organic food, Khaled chooses to focus on client needs. He understands that people are seeking convenience, frictionless accessibility, and good prices.
His business model provides him the perfect leverage to answer these needs. It is low-cost, low-labor, low-time consuming, low-food-waste, all while being highly productive and profitable.
To demonstrate the real potential of his system, he chose strawberries.
“Strawberries are a symbol. It is one of the most difficult crops to grow without pesticides or fungicides, as well as an expensive product for a fringe of the population. By making it accessible at $1 per pound this summer, not only we will prove our point and generate customer loyalty, but we may also generate pure and simple happiness.” — Khaled
The Power of Social Media
On social media, Khaled operates in bursts. He posts only when it is relevant or when something is worth sharing.
Khaled mostly uses Instagram to reach a general audience and demonstrate the potential of his solution.
“If you want to be remarked, you have to be remarkable!” — Khaled
Instagram provides him the perfect visibility to promote his model and communicate at a large scale his vision on the future of food.
With Facebook, Khaled takes a different approach. For him, it is the perfect tool to target a local audience that can convert into sales.
Recently, Khaled decided to add In.Genius Farms on RakeAround to provide clients with an e-commerce option. It started with a seedlings sale during an urban agriculture festival in Montreal May 2019.
You may see further collaboration between In.Genius Farms and RakeAround in the near future as RakeAround is developing new software for high volume urban agriculture businesses like Khaled’s.
Crops Variety and Yields, all Vertical
Beyond leafy greens, In.Genius Farms grows over a dozen varieties of vegetables, herbs, and berries.
“Leafy greens are useful to harmonize profit rate, but what keeps the customers is variety and volume.” — Khaled
Here’s a non-exhaustive list of the products available at In.Genius Farms for Summer 2019:
- Strawberries (18,000 plants who produce 1 pound of strawberries each)
- Variety of lettuce (2,500 heads harvested every week, 18–19 weeks per season)
- Mini eggplants (400 plants who produce 2.5 pounds of mini eggplants each)
- Bell peppers (1,000 plants who produce 2.5 pounds of peppers each)
- Tomatoes (1000 plants who produce 12 pounds of tomatoes each)
- Swiss chard
- Herbs (basil, parsley, cilantro, chives, dill)
- Bush beans
- Sweet peas
- Cucumbers (400 plants who produce 4 pounds of cucumbers each)
- Mini melon (150 plants who 10 pounds of melon each)
- Red onions
- Garlic (9,000 heads)
It should be noted that certifications can vary depending on where you live. In.Genius Farms are located in Laval, Quebec.
In Quebec, when you grow food and sell over $5,000, you need to register with the UPA (Quebec Professional Farmers’ union).
A permit issued for fruit and vegetable production from the MAPAQ (Quebec Ministry of Agriculture, Fisheries, and Food) is also required.
Although Khaled is growing food without chemicals or pesticides, using organic soil and organic fertilizer, he doesn’t have an organic certification.
For him, Organic appellation is a dogma. It has limitations and is more of a barrier than a solution for better access to fresh and healthy local food.
He feels like an Organic certification wouldn’t bring any added value to him or his clients. “It is all about the value for the money,” he explained. “Whoever is going to win, it’s always the one who fits this requirement, Organic label or not,” he added.
In.Genius Farms’ Next Steps: Expanding or Franchising?
Khaled is convinced that the market for fresh and chemical-free local food would grow drastically with affordable prices.
As the labor intensiveness was removed from the equation, using a model like his could help. “Most of the tasks are organized in blocks of 3 hours,” he said. With the help of 2 interns, Khaled admitted that he and Katie may work no more than an average of 4 hours per day.
He estimates that one could operate the farm alone working 10 hours a day, 7 days a week during the whole season (which is 6 months in the Montreal region). Revenue could range from $200K to over $300K.
“We are working on expanding our radius of influence by either getting affiliate farms or franchising our model. Either way, we will spread like dandelions.” — Khaled
The next step would be to standardize all aspects of his business and pull together standard operating procedures (SOPs) in order to provide a fast, efficient and profitable bootstrapped franchise opportunity.
“We are here to prove that we can build a massive, enduring company while delighting our clients with quality food at prices they never thought were possible. It’s time we elevate the standards.” — Khaled
Do you have an inspiring urban agriculture story to tell or innovative ideas to share? Contact us or leave a comment below!
About RakeAround and Ecommerce Solutions for Urban Agriculture
The practice of urban agriculture is soaring, stimulating new innovations that increase yields in small spaces in cities. People like Khaled and Katie are true ambassadors by innovating and promoting the benefits of growing in cities, and E-commerce can play a role in what they do.
Online shopping has reshaped our buying habits, especially for city dwellers. As e-commerce-for-all is still relatively new, RakeAround provides a simplified online selling process to help small-scale urban food producers generate revenues, without the burden of attending farmer’s markets or spending too much time searching for customers.
Proximity buyers can find their products in one click, using the “What’s near me” feature. Our user experience is designed to make buying local products simpler, fresher and faster by considering both producers’ and consumers’ busy urban lifestyles.