Plainville Farm: Learning the Importance of Sales Contracts
This post is our second in Farm Commons’ “farmer profile” series, where we highlight the stories of members of the Farm Commons community to help educate, inform, and inspire. If you have a story that you think others could benefit from hearing, please email email@example.com.
Have you ever heard of bora bora squash? If not, Wally Czajkowski would like to change that. Wally is a third generation farmer and one of the owners of Plainville Farm in Hadley, MA. He has a passion for growing specialty varieties of squash, especially the dense, flavorful bora bora, and would love to see some of these less popular varieties become more commonplace.
In addition to being a squash aficionado, over the course of his farming career Wally has learned to wear many different hats. Farm Commons caught up with Wally last week to talk about his experiences managing sales and buyer relationships. So, what is Wally’s advice to other farmers? Do your homework on your buyer and set up clear communication ahead of time about the terms of the sale, especially about how and when payment is collected.
Like many of the farmers Farm Commons works with, Wally has traditionally not used sales contracts with his buyers. Many of the buyers are people Wally has known for a long time and trusts, and he has felt it would be awkward to introduce a formal sales agreement at this point in their relationship. On top of that, when Wally does bring up the subject of an agreement or contract, the buyers are often resistant. “Not only do I not have contracts, but some of the buyers I work with won’t even accept an invoice that states when payment must be made,” Wally says.
Despite the lack of formal terms, this system worked out okay until recently, when Plainville Farm acquired a new buyer for a specialty variety of squash. The farm worked with a broker to begin this relationship, and Wally assumed that the broker would handle details such as payment policies and enforcement. Instead, when it came time to collect payment, Wally learned that there was a miscommunication and the broker was not involved in anything relating to payment. Well, as it turned out, the buyer had trouble selling the squash and passed on that loss to the farm by never paying their invoice. Without a sales contract or terms to back them up, the farm had to bear the loss.
“I see a growing trend in this kind of thing,” Wally says. “I think it’s a chain reaction - the people we are selling to are having trouble moving the product or collecting payment, and then they pass that on to us.” After this recent experience, Plainville Farm is moving towards using sales agreements -- especially when dealing with new buyers.
Here at Farm Commons, we know that it can be uncomfortable to introduce a formal sales agreement to a potential buyer, and even more if this is someone you have worked with in the past. We want you to know that there are many different ways to lay out the terms of the sale and incorporate this communication into relationships that you already have. Farm Commons has many resources to help you through that process and learn some of the different options! Please consider watching our recorded webinar on Sales Contracts for Farm Produce, found here. More information and a guide for drafting a sales contract can be found in our guide to writing a sales agreement for farm products.