Backyard Aquaponics
A place to discuss aquaponics

I see all these commercial systems running artificial lighting trying to maximize greenhouse space, just looking at the numbers on that does not make alot of sense to me, by time you build the vertical racks, pump the water to the higher head 24 hr a day, and burn hundreds of lights 18hr a day $5 a sq foot initial investment does not sound so expensive after all. I plan to one day have a commercial system of my own, but my design focuses on being highly energy/labor efficient rather then seeing how many plants i can cram in a sq ft. The business model for my commercial crawfish business was very simple with remarkably low expenses and hence was very profitable. No I did not have a fancy boat, 50 employees calling me boss, or loaded out F350 truck to deliver product with but I was in the black every single month. I think the KISS (Keep It Simple Stupid) principal is as valid today as it ever was.

BTW for those of you at home that want to do the math on stacked structures and grow lights consider this. Just 1 standard HPS grow light draws 600W. Usual recommendation is 1 per every 12-16 sq feet, at local electrical rates that is $49 in electricity PER SQ FT EVERY YEAR! OK yeah they don't run them 24 hr a day so lets say they only go 12 that is still almost $25/sq foot. So to save on a one time cost of aprox $5 for an extra sq foot of greenhouse you spend five times that much every year on electricity. The whole concept seems silly to me, growing a head of lettuce in that sq ft on a 4 week rotation means you would have to get about $2 a head just to break even with electrical, again we are not even talking labor and let's not forget that extensive structure is not cheap either. Even if the new LED grow lights deliver as advertised and they cut electrical costs in half as promised it does not seem like a good idea to me. Just my $.02

Yep... it's a complete nonsense...

And then most chuck in marketing blurb about "sustainability"....

For AP to be competitive on the open market it needs to be more efficient to operate then soil farming, and we will never get there running hundreds of HPS bulbs, we have this thing called a sun and it does the same thing for free. Now I am not knocking all vertical integration, there are some ideas that can be worked in on a larger scale, but you do eventually run into the point where you are getting all available sunshine within a given structure and complicating it further is an expensive hobby.
Sorry my inner engineer had to rant.

Yes, often it can work out to be FAR more efficient to grow your leafy greens some distance away and transport them. Transportation of food products isn't all bad, not if you're going to use a less efficient method to try and grow them using an area and method that's not ideal.

Less efficient does not directly translate to not profitable depending on individual circumstances. There is a tipping point that has to be assessed. Take conventional field crops. It's possible to use soil testing and gps mapping to determine application rates for fertilizer. That allows for targeted application in the areas needed. That is a more efficient use of the fertilizer. The cost of implementing such a system has to be weighed against the amount of savings on fertilizer. More often than not I suspect that it won't be an overall savings when the cost of annual soil testings and equipment requirements is compared to a relatively minor reduction in bulk fertilizer costs. These operations are not purchasing 50 kilo bags in bulk, they are buying tons in a towable hopper full from the local ag supply so packaging costs are reduced. Any reduction in usage will have to be measured in tons applied to see a major cost benefit other than perhaps qualifying for some ag grant from the government on reducing nitrate usage or stream water management.

Someplace like a desert or country such as Qatar where domestic production is minimal a stronger market exists for less importation from foreign sources than say in the US or Aus where commercial ag could feed the populations even though not fully cater to their desires of having things fresh out of season. In such markets a less efficient model done domestically would have a higher inherent value to that market for food security reasons than in a different region with enough arable land to produce volumes of food required.

You're assuming that they are paying the same electric rates that you are...
They aren't....no where close.


This is pretty crappy for anyone trying to get a bank loan for AP in the US. I am sure this will be one of the first cases that pops up.

Granted there are commercial rates for electricity in many areas, but let's assume they pay half what you or I do, say 7 cents a kwh, over the coarse of a year that is still about 2.5 times more expensive then the initial one time cost of an extra sq ft of greenhouse space, and again that is not even figuring in extra pumping energy, extra cost of vertical infrastructure, and additional labor since they are working at different heights.
The most interesting vertical integration I have personally seen are the walls and towers, both work on natural light and don't appear to be excessively labor intensive.

Electric rates for a given utility can be had with a simple query to their office. If someone is doing a larger hobby sized operation they may require a seperate service ran just for that operation depending on energy requirements. If it is going to be more than a minor sideline operation and set up as a business they are definitely going to want a seperate service installed. But the cost of installing the electric service would be no different than setting up the same thing hydroponically. The disparity arises in energy consumption to production rates between the two. Choosing a species of fish with a minimal or no return exacerbates this. I can go in the supermarket and get tilapia filets retail for less than it would cost for me to grow them. The number of trout hatcheries in my region reduces the margin on them. I like the AP concept but realistically weighing the numbers in the markets close to me a hydro operation or soil based organic operation is much more viable.

Even if getting a loan for AP through a bank were easier I would be reticent to start a venture off with funding it through that avenue. For the majority of people I see online wanting to start a commercial AP system I feel they would be better served doing a backyard system kinda like Rupert's "mega system" to gain experience operating on a schedule then expanding as they can afford into the niche of a farm market or high end restaurant supply if the market shows that there will be a positive return on the investment. That was the major problem with Sweetwater. It did not matter the size they got to with the embedded overhead in that situation, sprouts and microgreens appear to be the only thing that would prove profitable and that could have been done far cheaper on a smaller location outside of the city itself but close enough to allow for inexpensive timely transport. Paying for the amounts of water used in a city system and the subsequent treatment for re-use or disposal through sewer is going to be far higher than a suburban/rural well from that region with a grey water system running into an irrigation pond to be utilized by other soil based crops. So even though those two things look profitable on paper it only takes a guy setting up a similar operation 20 miles out of town where overhead is lower and he either undercuts you or gains a higher return for selling at the same price.

Back in the 90's I was able to rent an old mushroom single local to me, grow a variety of sprouts, pay the pallet fee to have them shipped the 100 mile drive to the DC market through a producer who had accounts in the market for less than it would have cost to set up the same system in a commercial/industrial site for a 40 mile radius of the market where the product was dropped. I could have bought a used six skid refrigerated truck, paid a driver and had a higher margin than growing within the city even if the convenience of using someone else who had room on their truck already going there didn't exist.

Exactly, instead they tried to "green wash" people with the notion that they were using recycled unusable space, building vertical space saving system and using sustainable systems. Many times throughout their website they state that their systems are "Sweet Water's sustainable aquaponics system". Not only are they not profitable, but they are not sustainable either.

Green washing doesn't always relate directly to sales and profits, I think their business was seriously flawed from this aspect. Pushing the image of employing lots of local people, being green and recycled and sustainable, a "community" type business might generally be a good business image when selling to the end user. When selling to other businesses, they don't tend to have as much of as environmental conscious as an end consumer. Other businesses are generally more concerned about cheaper product, if a restaurant can buy the same quality product for a cheaper price, they will..

No, I think it is excellent! A viable business doesn't need a bank loan and will finance itself. Although it looks initially very attractive to have a bank loan and go BIG, the plain fact is that the interest to be paid on these loans will increase the price of products and conditions of the bank leave little room to be flexible. One could ask himself; why pay x% to some loan shark, year in, year out, when I can keep it for myself if I just have a little more patience in business? You don't want another captain on your ship, do you? Well, by involving a bank in your business you unknowingly got yourself one.

I agree with Kachok's vision to keep things KISS as possible and concentrate on efficiency and minimum input of labour. Keep costs low, and you will be able to make a decent living. A bank loan will only increase your costs, being interest to pay.

Yep, EB. After all said and done, it all comes down to common market sense. Lots of paper tigers are produced, only few are viable. It's all too easy to start believe in your own spreadsheet exercises.

" What I cant understand though, as already mentioned,... is how this buisness proposal got through"

Both proposer and proposed had no clue...

Sweetwater's model could not have even been a paper tiger. A spreadsheet would have shown that. Something like the free version of quicken for household budgeting would have shown a continual accrual of losses without ever seeing a profit. Even if they were able to defy physics and grow more plants than the space allowed, the overhead cost per unit being higher than the price the got per unit simply meant the bigger they grew the more money they would lose. There was never a volume where a positive margin would be seen outside of the sprout/microgreens operation which are not AP, and have lower embedded cost of production. How saturated the market for that product is in the area would dictate the amount the could have expanded those lines. I noticed on their website they produced oyster mushrooms. Depending on their their production methods oyster, shiitake, and a couple other varieties would prove profitable in that setting.

Judging solely on google earth pics and other random photos of their operation on the net a better model for them would have been to focus production inside the warehouse on the production able to be done profitably in that setting (sprouts,microgreens, exotic mushrooms) and setup the outdoor areas for hothouse organic soil based production. Once the operation was solvent adding a better designed AP system in a seperate greenhouse funded through profits on the main operation would be a better strategy. The novelty of the system would still have drawn the media attention it did and most likely brought in more foot traffic to their storefront. It would still have operated at a loss or break even point but it would have been able to be absorbed by the profitable processes and considered a marketing expense.

I don't get that, I would think a business model would have to show significant profit potential to get any traction. You cannot get by on thin percentages because crap happens in business just as in life and if you are on razor thin margins to begin with you are sunk.