The answer is YES!!!
In fact, our business model has an EBIDTA of 45%. The ROI on the capital is even higher.
These are great returns in almost any industry.
Let me explain the economics.
When a consumer buys $1.00 of vegetables, the farmer gets about ¢10. Farmers only make a great living if they have a massive farm. They do it because they love what they are doing. Any wealth, comes from land appreciation.
The retailer takes 30-50¢ of the dollar. Their margins need to be high to account for spoilage, waste and discounting.
The rest of the dollar is in transporting the vegetables the 1,500 miles from where they are harvested to the retailer. The shipping company, the distribution company. Each has costs and each needs some profit.
And the 30-50% margin needed by the retailer? That can be reduced because our product has a longer shelf life and is provided on demand. More profit.
There is a myth that the costs for the vertical farmer are higher. We don’t have tractors, losses to animals, weather, or costs like pesticides.
That’s why Indoor Vertical Farming is profitable.