Senate Bill 711 became law on October 1st, 2018. This means that for the first time in my lifetime, herd shares are legal in the state of NC. There isn’t a lot of detail in the law concerning what is and what is not a herd share so it is left up to us farmers to implement the law as best we can. As I see it, we have several choices.
- Setup a monthly payment plan for the “purchase” of your milk cow. (i.e. $50 a month, plus extra fees like delivery, storage, container fees, refrigeration, etc.)You get a picture of your cow and you can say this is Bessie’s milk. Whether you want milk this week or not, you get your gallon.
- One time purchase of a fraction of the cow. A milk cow is worth about $1500. So we’d charge each and every person who buys in a portion of that figure. Then there would be associated fees for the milk just like the above. You’d have to purchase your milk each week, as above. The result would be the same as for ownership, but the upfront cost would be much higher. The paperwork for the farmer would be less though.
- We combine all fees, costs, etc. into an ongoing per gallon fee that works for the farmer and the consumer. We need to charge a fee for the buy in, but after that we charge based on demand. For a completely different example; if you want to go to the private bar, you pay a membership fee. Once inside, you pay for each drink you consume. If you are the designated driver, then all you pay is your membership fee. If you are the regular at the bar, you pay the membership fee plus your bar tab each night. The membership fee stays the same, the bar tab changes depending on your consumption. We would handle herd shares exactly the same. There is a membership fee, plus a cost per gallon (instead of per drink).
We did look at all three options, but in the end we’ve elected to go with option 3 for the following reasons.
- Our costs are already built into the current price of milk. That means that what you are paying now would be what you would pay going forward. Per gallon costs would not change.
- The administrative expense of maintaining our current setup, plus a list of herd share customers, is fairly minimal. We would not be adding much in the way of costs.
- We are not going to sell the entire animal to the customer, nor rights to sell fractions, or have authority of the management of the animal, including its outright sale. What we are selling is the rights to the animal through one lactation. Technically we are selling you the animal, but each lactation cycle devalues the animal as she gets older. By buying in, you are part of the herd share, but there is no need to buy you back out at the end of the lactation. We will simply retire the current list of herd share members, who forfeit their buy in price as a depreciation on the cow. We then start a new herd share list the next year with everyone who is interested buying in anew.
With all of the above in mind, here is our plan:
A gallon and a half gallon of cow/goat milk will remain at its current price for herd share members.
To buy into the herd share, we will charge the cost of one gallon of milk.
Once you have bought in, we will add your name to the herd share list and you will be free to buy milk and milk products (we have butter and yogurt coming from our cows!)
For those that do not want to buy into the herd share, we will not charge the herd share buy in fee. We will instead charge one dollar more per gallon than our current pricing. This will be to offset the cost of the pet milk label that must be affixed to the container under NC law. We will not discuss what you are doing with said milk, other than to hear how much your dog/cat/goldfish likes the milk. If you tell us you are drinking it, we will refuse the sale as it is still quite illegal to sell raw milk for human consumption outside of a herd share agreement.
We hope that you find this arrangement very easy to understand and more importantly easy to implement. As you come in expect to be queried about herd shares. We truly do not mind which option you chose, but we will try to make all options available to you, our valued customers.