#PandemicPivots Episode 1: Paul Family Farms

Missed out on the first episode of #PandemicPivots with Paul Family Farms? We've got a treat for you: here's the full episode and the transcript of our first episode of #PandemicPivots. Watch and/or read how Travis has pivoted his business from B2B to direct-to-consumer and amplified the footprints of 60+ local businesses that partner with the farm!

George Cook: Travis, I know that the business has been around for 150 years. Welcome, welcome to Pandemic Pivots. Why don't we start by telling us a little about yourself and this five generation family business.

Travis Paul: Yeah, thanks, George. Thank you guys for inviting me. This is super exciting, I admire what Honeycomb is doing. I know I have a lot of friends that have been part of it so exciting that I can be here and talk. When you look at the farm, we've actually been on the property since 1865.

This is our family's 155th year on the farm. My great, great grandfather to my great grandfather, my grandfather, and now my dad and his brothers and sisters and their spouses live on the farm where the original plot was.e've transitioned a lot over the years, and it's one of those things that the world changes, we continue to change and we're now producing maple syrup and honey, traditionally we were a dairy farm.

We say, of our 155 years, 130 of them were making milk and being a dairy farm, and also having some horses and chickens and pigs and all the other things. And, as we transitioned now that dairy farming became so difficult, we then moved into, now we're tapping maple trees, and we're making maple syrup and producing honey.

And that's really our main focus for our business. We kept the property together, which is exciting and we have about 250 acres on our farm. We've been able to keep that property now for over 150 years.

George Cook: That's awesome. So talk a little bit about your involvement with the farm. How long have you been involved? Probably since you could walk. But how long have you been involved?

I know you've been doing some really interesting things over the past few years to help adjust the business model a little bit and what is increasingly becoming kind of a commodity market for maple syrup. How do you stand out in that type of environment?

Travis Paul: Yeah. And I obviously grew up on the farm when I was 18, moved away, went to college, would come home in the summers and was involved but really from the time I was, about 18 until I was 30, was away from the farm.

I would come home a little bit involved, but not very much. As I moved to Pittsburgh for the first time with my day job, I wanted to get more involved with the farm. So, I spent quite a bit of time in corporate America, I moved seven times in nine years and a number of different projects and really wanted to do more with the farm. I moved to Pittsburgh, at this point, our maple syrup business had been growing and was moving from sort of this hobby phase to like, 'Hey, we think there's a big opportunity there'.

My dad and his brother Tim, were the ones that said, I really think this will be our next phase of the farm as we start to plan this out. And I said, ‘well, if we're going to do this, let's put a plan together and go forward’.

We look at a timeline around 2015, I'm moving to Pittsburgh for the first time, the back half of 2015, I'm back and forth, as I'm moving here, but we're saying 'Hey, for the 2016 season', so for those of you that maybe aren't super familiar with maple syrup, we make maple syrup about 30 days a year and for us, that means it is the month of March.

We want days above freezing nights, below freezing, lots of sunshine and before the maple blooms, so once the maple trees blossom for the year, we're done. We're putting in a ton of work planning. We went from a couple hundred taps, maybe 1000 taps, to up to over 5000 taps that year. We put in new equipment, built a new sugar shack, and said 'Hey, we think there's a really big opportunity'.

Come the 2016 season, we make maple syrup and for most maple syrup producers, it gets sold on a commodity market, which is similar to a lot of farming and has been for a long time. And kind of like when we had the dairy cows, the milk went into a milk truck, and I went to the milk plant, and we never saw it again.

Our first year we made this big expansion and we took maple syrup, and we took it to one of the commodity buyers for the maple syrup auction. And, we get this certified check and that day we walk away. But the prices are so tough, because you have no control over your product.

You have to make all this product, they go through it, they grade it, they test it, they say this is what it's worth, and then that's it. They write you a check and you really have no say over it. I think also what's interesting with maple syrup is 95% of the world's maple syrup is made in Canada, so you think about this pullback. Ontario is making the majority of maple syrup, Vermont makes up about half of what's left and then everybody else makes a little bit from there.

The price of maple syrup at a commodity market is really driven by 1) their volume which each year is setting record volumes but 2) currency fluctuations. If you look at the Canadian dollar versus the strength of the US dollar over the last 10 years, it's dropped significantly. So now one point the Canadian dollar was actually stronger than the US dollar.

Now it's trading 70/75 cents on the dollar, which in turn, if I'm someone that’s buying, tons and tons of maple syrup can go to Canada and get it much cheaper than I can get in the US. After our 2016 year, we said, we really think we should try to go with our own brand; we have this great story, we have this great product, we make really good maple syrup. Why should we sell it all in Canada, Vermont or New Hampshire?

We did keep a little bit of syrup back in 2016. And that's when we decided to say no, we're going to go out to the farmers market business. We're going to go after restaurants, we're going to really start our focus there.

That's where we really started to launch the brand of Paul Family Farms. That is what brought us up to why we decided to get out of the commodity market and it was really just a price driven piece. There was no way we were going to make money selling it at the auction.

George Cook: Wow so you were at 5000 trees in 2016. Approximately how big is the operation now?

Travis Paul: Now we're in between six and 7000 taps. Our largest trees will tap three times and we continue to add more and more taps. Hopefully this year, we're closer to about 8,000 trees going into the season.

George Cook: Wow, that's, that's really exciting.

Travis Paul: To put it into perspective, the largest Maple producer in the US has 465,000 trees tapped. So, we still have room to grow.

George Cook: Wow. That's very cool. Thank you for sharing that. So, March rolls around, I guess even in late February. When did it become clear to you that this business model was gonna get shaken up, that the world was changing? What were the warning signs and what were some of the first things that you did?

Travis Paul: We took a step back in 2016 and said to ourselves, ‘This doesn't really make sense for us to sell at the auctions. We're going to try to go after putting our name around it and our brand and lots of learnings through there’. As we get through that, we said, 'Okay,we don't really know a lot about the food industry or the restaurant industry, or how people buy this’.

Therefore, we started at some farmers markets. We're really fortunate. Our first ever restaurant customer when we did this was Jacqueline and Nate Schoedel at The Speckled Egg who worked with Honeycomb. They had a restaurant at that time called 'Josephine's Toast' and they brought us in and that was really where we started.

I said ‘We should really go out for these restaurant businesses’. So we were doing farmers markets, we had an online store, and we had a couple retailers. But really, we were focused on ‘How do we keep growing the restaurant business?’ because it was easy, it was consistent, it was a ton of business, and it was fun.

We were partnering with other small businesses and working together. As we look into the back half of 2019, in the first couple months of 2020, it was off the charts in terms of how much we were selling to restaurants. Hundreds of gallons of syrup every single month were going to restaurants.

And then that stopped, and it’s been really slow since then. What I would say is that it was the end of February when I started saying ‘something's happening, you're hearing all this buzz, in the US,’ we weren't really talking about it yet. But, if you're following world news, it was clear that something strange was happening.

I'd say the first week of March is when I started to get really nervous and say, 'Okay, something big is going to happen'. Going back through my notes with this right around March 15, was when I said, ‘We're going to have to figure out how to change our business. We need to plan for massive shut-downs, people won't be going to restaurants anymore, and I assumed that a restaurant would never buy syrup again’.

I said to myself, ‘If I can figure out how to make money with this business and change our model, with the assumption that I'll never sell to a restaurant again, if the restaurants when they reopen, and they start buying again, that'll just be extra business because we already knew how to sell to those’.

The first thing I did was I said, ‘Okay, I have to change our business. How do we get in touch with all of our customers? How do we get in touch with everybody that has bought from us at a farmers market?’ The first thing we did was start to utilize our newsletter. We already had one, but we really didn't use it. It sort of became one of those nice, fun hobbies as well.

I'm not a good writer. That's not a thing that I'm very good at. I'm good at putting bullet points on a page, but that's about it. I said, ‘We need to leverage this tool and get out and talk to our customers’. March 17th was the day we sent our newsletter out. And it really just said, 'Hey, we don't know what's going to happen here, but we're going to do our part'.

A couple things we did right away was on social media: we were giving away gift cards to all of our restaurant partners. For a lot of these restaurants, things were going great and then immediately, there was no cash, and the restaurant business is a very lean business to begin with.

My best friends in Pittsburgh are now all restaurateurs. I said ‘We need to do something’. Right away, we started giving out gift cards. We were buying 10 $20 gift cards, not a ton, but to all the different restaurants that we partner with.

And to put in perspective, that's about 80 different businesses that we went out and bought business cards or gift cards from. We just started giving them away on social media. So doing contests and trying to get out there helping them with a little bit of cash and keeping an excitement going.

In the same time when we did that I also said ‘We need to be part of our community right now’, thankfully for us, if you look at the maple syrup business, we already planned for March and April to be tough because essentially we're making all of our inventory in one month. By April 1, we have 365 days of inventory, and then it's our job to try to figure out how to sell it over the next year and move on with it.

We kind of planned for this cash transfer, okay, we're going to spend a ton of money to make all this syrup. April is going to be a little slow, and then March or May and June, so on starts to move up. So we had already planned for that. But as I said, we need to help our community right now. And I'm not a big fan of sales.