Business Owner: Jeff and Cindy Sykes
Business Name: Sykes Farm
Location: Mebane, NC
How did you hear about Slow Money NC?: We heard about Slow Money from a neighbor farmer.
Tell us your story. What is your business idea? Tell us your plan.
We were dairy farmers milking 100+ cows in Orange County NC for 70 plus years but due to the low milk sales, we had to sell our milk herd last year. This has been a difficult adjustment because farming is not just a job, it’s a way of life. We love working with the cows. We wanted to continue this legacy of taking care of the cows and the land and we found an opportunity to continue milking cows and provide a wonderful product to our community. We decided to start a cow share program because we recognized a need that people want real , raw milk from cows that are grazed on untreated grass with small scale traditional processing. Earlier this year the North Carolina legislature passed a bill containing a provision that ended a 14-year ban on cow share agreements in the state. Cow share agreements are private contractual arrangements in which someone purchases an ownership interest in a dairy cow and pays a fee to a farmer for boarding, caring for, and milking the cow. We feel that selling cow shares could afford us the opportunity to once again milk and cows and offer a quality product we feel that people are looking for.
Please briefly describe your commitment to sustainable food systems in North Carolina.: We recognize the need to preserve land which supports sustainable food systems. Our farm has participated in the Conservation program which restricts development of farm land and we have put our land in the Voluntary Agriculture District program. Jeff serves on a couple of boards which promotes the care of the land and promotes agriculture. He serves on the Orange County Preservation Board and on the Orange County Farm Bureau board.
What will your sales be? What do you anticipate your profits/your margins will look like? How will you make the money to pay this loan back?: We anticipate our initial sales will be around 50 gallons a week/ 2600 gallons a year. The price of joining will cost $150 which buys ownership into the cow and then the price per share of milking one gallon of the Owner’s milk from the cow is $9 . This equates to around $31,000 for our first year. Our yearly cost for producing 50 gallons a week / 2600 gallons a year would be $4000. Since we are already set up as a dairy, the upfront cost would be minimal. We need to switch to a smaller milk tank , buy a commercial refrigerator, order jugs, buy a couple of Jersey cows to supplement some Holstein cows we currently have, and upfit the barn to enable tours to see the milking process.
Have you borrowed money before? How much did you borrow? From where? How long was the term? Is there a balance still due on that loan?: We borrowed money with our previous dairy farm from Farm Credit. We borrowed around $100,000. The term was for 5 year and we have paid it all off. We have not borrowed any money for this new cow share program.
Do you have people who would vouch for your credit worthiness? Who are they?: Yes we have our family members who will vouch for our credit worthiness.
Tell us about your business background. Have you been in business before?: We ran a successful dairy business until the low milk prices forced us out last year. We would generate a budget each year and carefully monitor our expenses. When we went out of business last year, we had very little debt that was due to our money management. Cindy’s background is in finance and she would help do the bookkeeping of the farm and to make sure the farm was in compliance with the federal and state requirements.
Are there other lenders involved in your project or business?: No
What is your timeline for this project? Would you like it to start in a month? 6 months? A year?: We are ready to start milking in a month. We are currently getting our website up and running and have started giving out informational packets to interested parties. We have gotten quotes for the milk tank, Jersey cows, and commercial refrigerator. We just need the capital to help us get these things.