Backyard Aquaponics
A place to discuss aquaponics

There is an economy of scale that can be applied to a proven, stable process. Say I make widget x and my margin after costs is $.01/unit. That is a very thin margin but if I can move a volume of units to supply one unit to 75% of the population in china per year the it would be something that may be worth pursuing. Problems arise when trying to not only incorporate an economy of scale into an unproven process that has no historical data sets to forecast accurately but to do so in a niche market where the market share is not going to support the volumes required. Compound that with a product like organic produce that has a very short shelf life compared to a plastic or metal widget and it is a recipe for failure. But even discussing thin margins is a moot point when applied to Sweetwaters model because simply looking at overhead cost to avg market price for their AP products show a deficit not a thin margin. An economy of scale would not have been possible because their overhead was never going to drop as expansion occurred. The input costs would have still remained higher than market price and the once the labor costs attached to the city loan kicked in there was no way that enough volume could be produced to cover employees cashing paychecks with a reasonable margin let alone cover other costs. Even allowing that margin to have covered all other overhead than salaries still led to a volume that was not feasible just for enough cash flow for the payroll checks not to bounce.

The guys here have done a really good analysis of what went wrong but in my opinion it is more basic than that - you can't start a business with the goal of creating jobs. Also no city council in the world is responsible for creating jobs. Their role is to create an environment where businesses can flourish and then let nature take it's course.

To create a business with the goal of creating jobs is a big waste of time. You create a business because you are desperately passionate about delivering a certain product or service. If that is successful you try and cope by hiring more people.

A business with a false goal will never succeed.

Regards, Martin.

I have to disagree with you to some extent. Even things I do as a sideline employs other people at least part time. Call me lazy but I'm too old to toss a few hundred bales of hay by myself anymore. The difference is when I looked at doing it I factored in the cost of that labor in. The whole labor part of the discussion came from Sweetwater's willingness to take advantage of a local small business development program that had goals in it which were impossible to meet. A different business may have been able to meet the standards set forth in the loan but there was no way they could produce the amounts required.



I agree with you on this point.



I have hobbies because I am passionate about something. If I am in business I am there to earn a profit. I have found delivering only quality products and services leads to better profits. Reworked, returned, and rejected product only costs you money. Dumping off slightly out of spec or over ran product to cover costs or gain a minimal margin means your process needs examined and you are just competing with yourself at a lower price...

Flogging a dead horse??

http://www.bizjournals.com/milwaukee/ne ... tml?page=1

While blindfolded... and with one hand tied behind their backs...

Reading the article.. it suggests that either the system/operation... will need to be relocated....

Or... the rent re-negotiated... and substantial upgrades required....

As well as the council will be looking very hard at any business proposal/plan... and the question of unpaid loans....

Why would you sink further money into an already failed indoor facility....

If financial backing is available.... why wouldn't look to build a facility somewhere else.... even if with some of the "equipment"...

"Also no city council in the world is responsible for creating jobs. Their role is to create an environment where businesses can flourish and then let nature take it's course."

Really? I had always thought their role was to act in the best interests of their voting ratepayers.

Well lending money to dodgy business proposals..... just doesn't seem to fit within that definition....

Try the labour party in aust they will put money into it

Easier to flog a dead horse than a live one. Dead ones have less of a kick.


I could do a honest review of two Australian produced podcasts about commercial aquaponics pointing out places they cover disadvantages themselves by mentioning major impediments to commercial aquaponics systems in their own podcast promoting the viability of a commercial AP venture.

http://m.jsonline.com/more/business/sweet-water-organics-seized-equipment-might-be-used-again-fj9u9pr-207305851.html

200k+ on a small loader, compost mixer (most likely a modified cement mixer), and a couple hoop houses?

They could have gotten all the same equipment for around 60k here.