The Capital Press released an article last month detailing the top ten crops in Washington State by value in 2020 according to NASS statistics. The total production value was $10.2 billion, an impressive figure! This blog post is a spotlight on agriculture in Washington as we wrap up another “fruitful” year of farming.

Here are the stats:

There is no question that the official state fruit should remain the apple. Red Delicious, Gala, and Fuji varieties still make up half of the total production. However, more and more “boutique” and club varieties are making their way onto grocery store shelves. If you haven’t tried an Ambrosia, Opal, Lemonade, or SugarBee, those are a few of my favorites.

Production value may have risen by 7% from 2019 to 2020, but expenditures rose 15% over the previous year. That is a significant jump! As for many industries and businesses, labor costs topped the charts for Washington growers as the number one expense, making up 27% of expenditures, according to NASS.

As a farm labor software provider, we try to keep up with the rules related to agricultural workers One challenge is every state plays by different rules. The second biggest challenge, these rules seem to be constantly changing. Our Washington farmers are up against complex employee labor laws—especially if they pay workers piece rate. Starting January 1, 2021, agricultural operations in the Evergreen Statue must track the following:

Minimum Wage

Washington State will top the nation with the highest minimum wage. In less than two months, minimum wage will jump from $13.69 to $14.49, a 5.8% increase. Back in 2012, just 10 years ago, the state minimum wage was only $9.04. In a decade, the minimum wage increased by 60%!

Paid Breaks

Many growers are now accustomed to tracking paid break time for piece rate workers to ensure that they are getting compensated for rest breaks. This calculation can get complicated since the rate of pay varies per employee. The rest break pay is based on the worker’s average weekly hourly piece rate. The logistics of having employees log break time is a challenge itself. Accurately tracking break time and performing the complex calculations can make payroll a headache. For farms that have not upgraded to digital tracking and comprehensive payroll software, it can be a real nightmare!

Nonproductive Time

Tracking nonproductive time applies to piece rate workers. When fruit pickers, for example, must move to a different field or perform work related to the harvest that does not directly earn them pieces, the farm must compensate them for this time at the state’s minimum wage rate. This time must be tracked separately, adding another layer to track for field and office staff.

Overtime

Starting January 1st, Washington State farms must start paying all agricultural workers for overtime. Any hours that exceed a 55-hour work week will be compensated at time and a half. The new rule will phase in over three years. They ensure overtime pay for any time worked over 48 hours a week in 2023 and 40 hours a week by 2024.

Washington farms and orchards are up against a lot. In recent months, fertilizer prices and other input costs have increased dramatically as well. Labor is only one piece of the puzzle, and growers will have to get more creative and efficient to meet the new and continued challenges of farming. However, I am impressed, and proud to live in a state that provides so much food for the country and even outside of our borders. At 2nd Sight, we hope to support and collaborate with farms of all sizes to ensure the success of the industry as we move forward.

I received an email this week from an organization that offers free webinars about trade and export fundamentals. The first video that piqued my interest was, “Selecting the Best Logistics Partners in Global Trade.” Two weeks ago, we shipped two pallets with 10 FairPick scales to a blueberry grower in Chile. In two more weeks, we will send five more pallets of FairPick’s down for the 2021 South American berry harvest. We would not be able to transport these harvest scales successfully without a freight forwarder--especially right now with such large shipping challenges and delays.

It is critical that shipping and customs goes smoothly for this implementation. When blueberries are ready to harvest, they will not wait for a late truck or customs clearance. Cost is an important piece of the logistics puzzle, but reliability and trust are equally important factors in this transaction. This webinar emphasized the word “partner” when choosing a global freight forwarder. The idea of finding “partners” in business versus simply suppliers or vendors is an important topic that made me reflect on how our team at 2nd Sight wants to do business.

Not every relationship has the potential to become a partnership. However, when the product or service is integral to the success of your business (like shipments to our new customer in Chile), it is important to make intentional decisions about who you work with to reach your organization’s goals. Here are some elements to consider when deciding on your next product or service supplier.

Trust

Trust is an important foundation in any personal or professional relationship. Being honest and transparent can help establish a good partnership. As a vendor, sometimes you must turn down a sale if you know the products will not meet expectations or the time frame to deliver is unachievable. Trust must be earned. Do you trust that the company is telling you the whole truth and has your back when, not if, things go awry?

Respect

Respect is another attribute, like trust, that is earned. Working with a company that aligns with your values, goals, and mission ensures a culture of cooperation. Doing the right thing should be rooted in the company’s culture. Do you feel that the company respects your time, your employees, and other stakeholders in your business transactions?

Grow Together

There is a value to a company to retain customers. Repeat business is the best kind of business, limiting the cost and time of onboarding. It is also a win for the customer to continue working with the same vendor because it keeps the learning curve low. In some cases, conceding on a short-term proposal is a necessary step in winning the long-term business and you want to work with a company that comes into negotiations with this mindset. It really comes down to helping each other when necessary so business is mutually beneficial. Will this business be able to grow and adapt to your needs in the short- and long-term?

Communicate

Mutual, regular, and constructive feedback allows partners to maintain a healthy relationship. Nothing is more frustrating than needing help and being unable to reach somebody. Poor communication leads to a lack of trust and respect. Delayed or impersonal support may make even the best product or service undesirable. As mentioned above, do you trust that this supplier will be there to pick up the phone when, not if, things go wrong?

Fair Price

The traditional bidding method to select a supplier works well when the relationship ends with the transaction’s end. However, if the product or service is an important aspect of your business that is used frequently, selecting a business based solely on the lowest price does not guarantee you will have a partner that cares about your success. Do both parties have shared risk, or “skin in the game”? Price should be a factor in considering your next partner, but make sure it is not the sole reason you selected the supplier.

At 2nd Sight, we aim to establish trust by not over-promising, being transparent with what we offer, and when we can deliver. We strive to evaluate whether our labor tracking software or nursery caliper are good fits for growers who are interested before making a sale. As a startup, it can be a challenge to emphasize that our company and team is in this relationship for the “long-haul”. We plan to be around to support our customers and products after the sale and adapt to changing times, needs, and rules. Our company values quality and reliability in every aspect of our business. And, when there is a problem, our 24/7 support line gets you to somebody who can help resolve the issue. We want to grow with our growers because we know that our farm management software can only improve with the feedback and insight from our customers who take our systems out to the farm and orchard. We hope to continue building strong partnerships with farmers in mutually beneficial business relationships.

Living in the town of your college alma mater has its perks. Writing as a Whitworth alum in Spokane, WA, I have participated in several activities hosted by the Whitworth’s Women's Leadership Network. This month, I benefited from attending a small group dinner discussion around the topic of negotiation.

Kristen Watts, Senior Vice President of Forest Products Lending at Northwest Farm Credit Services in Airway Heights, WA, was our discussion host and facilitator. I would like to thank her for an engaging discussion and providing her insight around the topic of negotiation. We all negotiate in our professional and personal lives. Becoming good at negotiation is a skill that must be developed, practiced, and performed. Here are some important things to keep in mind when considering a negotiation.

Negotiation vs. Persuasion

If you are simply trying to convince the other party that your offer, opinion, or idea is the best, then you may be persuading, not negotiating. Evaluate whether the parties involved have vested interests in the outcomes of the decision. Everyone must achieve something from the interaction. If your mind is made and you are unwilling to make concessions, you are persuading!

Determine Your Goals

Before a negotiation, determine your priorities. What are the most important “wins” that you want to take away? Next, think about the other party’s priorities. If your top priorities differ, you can leverage this. However, if your priorities align exactly, know that you may have to make more concessions, have a contingency plan, or be ready with some additional tactics in your back pocket.

Establish Your Tolerances

Before you go into the conversation, know your thresholds. Shoot for the ideal and determine how low you will go without “losing” the negotiation. Negotiations can be long and drawn-out, so knowing your bottom line before you start will be important to make sure you don’t cross it when a conversation gets complex or heated.

Start High and Focus on the Whole

Remember to start at your target goal so you have room to negotiate. If you don’t start high, you will likely walk away feeling unhappy with where you end up. Think about that acceptable middle ground being about half-way between your best case and worst-case scenarios. If you find your opponents beginning to nitpick every detail of the offering, direct the conversation to what they are receiving as a whole. Avoid getting wrapped up in a detail by moving onto the next point, then circling back around and framing it as a part of the whole package.

Prepare and Practice

Treat a negotiation like an exam. You might have some knowledge without studying that would get you a satisfactory grade; however, it’s unlikely you will ace the test walking into it without preparing and studying. Practicing will also give you the confidence you need to successfully promote the value that you have to offer and keep you from crossing your bottom threshold.

Three Things to Avoid

1. Throwing in too many “freebees," it weakens your value proposition!
2. Being too afraid of no, “You miss 100% of the shots you don't take” (Wayne Gretsky).
3. Assuming a quick negotiation was a win, you may have left something on the table!