Deep winter greenhouse enterprise analysis
Key findings for communities
- A University of Minnesota Extension investigation of seven deep winter greenhouse enterprises in the Upper Midwest found that most were operating profitably, and growers were seeing a positive return on investment.
- Study participants who marketed through winter Community Supported Agriculture (CSA) arrangements were more profitable than those who did not.
- Deep winter greenhouses cost an average of $25,500 to construct, or an average of approximately $60 per square foot of space.
- Although start-up costs were significant, study participants realized an overall return on investment (ROI) of 3 percent, ranging from -3.6 percent to 21.5 percent, with a median payback time of eight years.
About this study
Study findings suggest three success factors for operating a profitable winter greenhouse enterprise. Prospective and current operators should consider the following recommendations:
#1: Maximize use of space
The two most profitable greenhouses in this study, with the highest return on investment, maximized their space for growing. Measured as a proportion of greenhouse space to growing space, utilization rates of 88 and 80 percent corresponded to ROIs of 22 and 17 percent, respectively. Operators achieved optimal space utilization by creating maximum growing space on the floor and using hanging trays to take full advantage of vertical space.
#2: Pursue direct-to-consumer marketing channels
In addition to maximizing space, successful winter greenhouse operators also sold product through a winter CSA arrangement. Just as with summer CSA arrangements, winter CSAs provide a mix of products directly to customers on a periodic basis. Operators provided members with winter greens grown in the deep winter greenhouse, and some supplemented greens with fall storage crops, such as potatoes, winter squash, and root crops.
#3: Keep start-up costs as low as possible
A promise of deep winter greenhouses is the ability to construct an efficient building with common building materials and straightforward construction methods. The materials, labor, and design elements chosen, however, can have a significant impact on the final price tag. Higher cost, customized options can push expenses for a greenhouse well past comparable, low-cost kit options.
Reviewed in 2015