By Sharon McLoone
Monday, September 27, 2010; 28
Sometimes opportunity surfaces when times seem bleakest.
Back in the 1990s, Randy and Katie Sowers were becoming increasingly worried they might have to shut down their small dairy farm in Middletown, Md., 10 miles west of Frederick, because of declining milk prices and increased government regulations that made it tough to reap much of a profit.
That's when they happened to get a visit from a company called Pladot that made milk production equipment for farmers in Israeli villages. Pladot was trying to break into the U.S. market, and was courting farmers in the mid-Atlantic who might want to try their hand at selling directly to customers.
From that chance meeting, South Mountain Creamery was born. In 2001, the farm started to bottle milk and deliver it to 14 home customers in the nearby community out of a Ford pickup truck. Operations quickly grew and the Sowerses added their first milk truck in June of that year. By 2005, they had paid off the equipment.
Today, the farm has 6,003 clients and serves about 4,200 of them on a weekly basis on 13 routes that cover a 70-mile radius. Many of its customers are concentrated in Bethesda, Silver Spring, Capitol Hill, Arlington, Alexandria and Falls Church, although it delivers to many other localities as well.
The creamery business has been so successful that it has helped keep alive the larger, 700-acre operation, which includes two local farms and another farm the Sowerses rent in Greencastle, Pa.
"It was a huge investment but a good decision," said J.R. Byrd, the Sowers's farm manager.
Although the number of self-employed farmers is projected to decrease by about 8 percent from 2008 through 2018 due to consolidation of farms and increased productivity, an increasing number of small-scale farmers have developed successful market niches that involve personalized, direct contact with their customers, according to the Bureau of Labor Statistics.
South Mountain Creamery is an example. It offers various kinds of milk, cheese, meat and even fresh bread. In addition to the direct-to-customer business, the family continues to sell to milk co-operatives, getting about $14 for every 100 pounds of milk, which, as Byrd notes, "is not a lot of money when considering the care of the livestock, the feed and the other factors that go into making milk."
The family has built its business in part by trial and error. The creamery tested out a service selling ice cream this summer using coolers and dry ice, but the cost was higher than the business had anticipated. The ice cream would sometimes melt by the time a customer picked it up, and farmers were concerned that children, or adults for that matter, might directly touch the dry ice, which can burn skin because it's so cold.
On Sept. 13, the creamery formally started the ice cream service, using a freezer delivery truck.
The creamery's four delivery routes into the D.C. area are its most profitable because the customers' orders tend to have a higher dollar amount -- about $30 each -- and they are located close together, saving the farm on fuel costs.
Byrd said it's important to the Sowers family that the farm, which now employs about 57 full-time employees, not grow too large.
"We talk a lot about how big we can be -- and we can be bigger -- but we don't want to go away from our core values of doing everything here on our farm," says Byrd, who adds that he's switched his family over to South Mountain Creamery products. "I have a 2-year-old and a 1-year-old, and I'm much more conscious now about what goes into milk and what's good for you."
They milk about 260 cows a day and would like to add more to the herd. The creamery is applying for permits to put an addition on its building so that it can expand its cooler storage.
It costs a $25 deposit to open an account online and deliveries to a porch cooler or house or garage refrigerator occur as early as 2 a.m. or as late as 8 p.m., depending on the driver. There's a $3.75 delivery fee that pays for the driver and truck. The cost of the product is the same for delivery or purchase at the farm. For example, ground beef made from grass-fed steers raised at the farm is currently on sale for $3.99 a pound, London Broil is $8.79 a pound, a half gallon of 2 percent milk is $3.50 and six ounces of vanilla yogurt is $1.25.