MAKING LAVENDER PAY
DETERMINING THE COST OF PRODUCTION
(DOING THE MATH)
Get your facts first, then you can distort them as you please.
Mark Twain
VARIABLES IN LAVENDER PRODUCTION
 Is it ‘stand alone’ or part of another enterprise?
 Does lavender absorb 100% of the costs?
 Are costs shared with other enterprises?
 What will you sell?
 Buds
 Bundles
 Oil
 Value-added
 How will you sell it?
 Retail from the farm
 To wholesalers
 At farm markets
 Internet sales
LET’S LOOK AT 2 EXISTING BUDGETS
 Colorado State University
 British Columbia
COLORADO STATE UNIVERSITY
 PRODUCTION ONLY
 Start up costs
 Annual maintenance costs
 Harvest costs (bundles only)
 ASSUMPTIONS
 8 ft (2.4 m) by 100 ft (30.5 m) planting area (2 rows)
 46 plants per row (230 bundles @ $4.00/bundle)
 All numbers based on 1 row
CSU – GETTING STARTED (1 row)
ITEM
COST
Enclosed drying shed
1,800.00
Irrigation system (installation & materials)
150.00
Soil test
25.00
Soil prep (labour & amendments)
100.00
Weed fabric (labour & materials)
250.00
Mulch (labour & materials)
85.00
Lavender plants ($2 x 46 plants)
92.00
Misc supplies (pins, sickles, rubber bands,
torches etc.)
125.00
TOTAL PROJECTED START-UP COSTS
$2,627.00
CSU ….. ESTIMATED ANNUAL COSTS
OPERATION
(1 row = 46 plants)
UNIT
S
UNIT UNITS
COST /ROW
(YR 1)
COST/RO
W
(YR 2 +)
COST/ROW
Labour
hours
10.25
weeding
hours
10.25
24
246.00
246.00
irrigation
hours
10.25
2
20.50
20.50
harvesting bundles
hours
10.25
6 - 12
61.15
102.50 – 123.00
hanging bundles
hours
10.25
6 - 12
61.15
102.50 – 123.00
marketing
hours
10.25
2-4
20.50
30.75 – 41.00
Irrigation expenses
row
50.00
1
50.00
50.00
Replacement plants
plants
2.00
5
10.00
10.00
EST ANN. COSTS
469.30
562.25 – 613.50
EST ANN. REVENUES
460.00
920.00 – 1,380.00
NET (???) RETURNS
-9.30
357.75– 766.50
STARTING POINTS WILL VARY
Sometimes it is useful to know how large your zero
is. ~Author Unknown
B.C. Planning for Profit
http://www.agf.gov.bc.ca/busmgmt/budgets/herb_specialty.htm
 ASSUMPTIONS
 Buds only
 ¼ acre
 First 2 years
 Does not consider general farm inputs


General labour costs, general marketing costs, irrigation fees, repair and
maintenance, certification fees
Does not consider indirect expenses

Interest, insurance, administration, legal/accounting
B.C. EXPENSES/INCOME (1/4 acre)
COST
Planting labour
Qty-YR 1 Qty-YR 2
UNI
T
AVG $
24
hr
10.25
hr
10.25
0.50
Harvest labour
40
Cost of plants
1,600
each
Tractor fuel
14
litres 1.20
Tractor oil/lube
Yr 1
Yr 2
246.00
410.00
800.00
16.8
1.05
bags
50
each
0.03
1.50
Corrugated boxes
2
each
2.50
5.00
Advertising/faxes/
phone
irrigation
100.00
.25
.25
acres 60.00
TOTAL Exp
INCOME
15.00
15.00
1,078.85 531.5
50
lb
44.00
2,200.00
USEFUL REFERENCE NUMBERS (???)
compiled from other lavender-growing areas





150 stems/bundle
4 – 7 bundles/plant ….. 14,000 – 25,000/acre
12 – 15 bundles yield 0.5 kg dried buds (500 gm)
100 – 225 gm dried buds/plant (454 gm=1 lb)
@ 4,000 plants/acre (6’ x 24” = 3,630 plants per acre)

http://www.headstartnursery.com/vegetable_transplants/plants_per_acre
_calculator.php

Lavenders produce ~ 12,000 dried bunches/acre
Lavendins produce ~ 16,000 dried bunches/acre
Buds/acre ~ 1,000 lb (454 kg) – 1,500 lb (680 kg)


 Oil production:
 Lavenders: 2.8 – 14 L/acre
 Lavendins: 18 – 90 L/acre
 Depends on variety, harvest method, pruning, weather, plant health
THE TRUTH BEHIND THE NUMBERS
Mathematics are well and good but nature keeps
dragging us around by the nose.
~Albert Einstein
THAT’S MY STORY AND I’M STICKING TO IT