The following is a column about my experience in the field.
There are some stories that make you say, “Eh, that happens!?”, but feel free to read it. People working in plant factories may be able to relate to it.
[Merits for Workers] You can work comfortably.
Around 2011, when I started working at a plant factory, there was a plant factory boom, and plant factories were being built one after another.
Even back then, plant factories had the image of being at the “cutting edge of agriculture.”
Well, there was no information on the internet about what the actual situation was like, so I felt like I was “jumping in for the time being.”
When I worked at such a plant factory, I felt the following benefits:
Stable income unaffected by the weather: Crops are not affected by natural disasters. Compared to open-field cultivation, you can expect stable harvesting and income throughout the year. Basically, there are no cases of sales not being made due to natural disasters, or no work in winter.
Comfortable working environment: Almost all work is done indoors, so you don’t have to worry about heavy outdoor labor or heat and cold. Compared to open-field agriculture, the working environment is comfortable, right?
Exposure to the latest technology: It is an environment where you can acquire the latest technology and improve your skills, such as crop management using IT and automation technology.
It’s not bad as a workplace environment to be able to work in a room with a stable temperature, right?
By the way, do you get the impression from the PR and media of each company in the industry that AI, IoT, and automation are used quite a lot inside plant factories?
In reality, that’s not the case.
It is true that it is being used, but in reality, it is still an industry that relies heavily on human hands.
Even at sites that are quick to promote research and introduction, it is still a process of trial and error, little by little.
There are still many areas that cannot be said to be “cutting edge.” For example, FAX machines are still frequently used in the industry…
However, the use of technology has steadily progressed since I started working in the industry more than 10 years ago.
[Disadvantages for Workers] There is a lot to learn.
Rather than disadvantages, there are also burdens for people working at plant factories.
For example,
High level of expertise required: A wide range of skills are required, including not only cultivation techniques but also equipment management and environmental control. If the skills of the on-site staff are low, the vegetables may not grow properly. The know-how and skills of the on-site staff have a large impact on the overall profit of the factory.
Need to keep learning: Since new technologies and equipment are being developed one after another, it is necessary to have a constant learning attitude.
The part that requires constant level-up can be said to be a disadvantage.
This is because the on-site know-how is directly linked to profits, so if the level remains low, the business will eventually become unsustainable.
I have been supporting producers at many plant factories for many years. In fact, it is difficult to acquire these skills at any plant factory.
In particular, when companies enter from different industries, there are many cases where the people on site do not have knowledge of vegetable cultivation.
The know-how required for plant factories is not cultivation knowledge, but a wide range of things to learn such as industrial production management and hygiene management.
I believe that one of the reasons why companies that have newly entered the market fail is due to a lack of technology.
Also, as a more serious disadvantage for workers, the salaries of the staff may not be comparatively high… (Note) This is my opinion.
By the way, On this site, we provide content aimed at increasing the profits of plant factories.
What about the Plant Factory Business in the First Place?
Now, next, I will explain from the perspective of what about plant factories as a business?
First, let’s organize the characteristics of plant factories, open-field cultivation, which is the conventional form of agriculture, and facility cultivation.
Plant factories can control the environment, so stable production is the biggest advantage.
In addition, the risk of pest outbreaks is low and the amount of pesticides used can be significantly reduced, contributing to reducing the environmental impact. Furthermore, multi-tiered cultivation allows for the effective use of limited space, making it attractive in terms of high land productivity.
On the other hand, the biggest disadvantage is the high initial and running costs.
This is actually a serious problem.
This is one of the reasons why even major companies withdraw quickly. I wrote about this in detail in the following article.
Advantages and Disadvantages of Plant Factories from a Business Perspective
Now, I will explain in detail the advantages and disadvantages of plant factories from a business perspective, based on my experience.
It is important not to make an easy decision to introduce it by only looking at the advantages, but to carefully consider it based on the disadvantages as well.
[Merits of Business] Stable Cultivation
In a word, the advantage is “stable cultivation.” As long as the basic crop management is in place, the production system will not collapse so easily.
Even in situations where there is a shortage of vegetables in the market due to bad weather, you can maintain the same amount of shipment as usual.
But sometimes this happens.
When you are on-site, you may hear stories such as “Recently, the production system of ~~ Company (rival company) is bad and the shipment volume has decreased.” In other words, the shipment volume is not sufficient for the orders received.
This is because the on-site manager is inexperienced, or the factory’s production volume has decreased due to a simple mistake. Such a situation happens surprisingly often.
However, other than human factors, it is more stable than other agricultural forms because it is not affected by the weather. There are also the following advantages.
Stable supply of high-quality crops: By maintaining the temperature, humidity, CO2 concentration, etc. in the optimum condition, high-quality crops can be produced stably throughout the year.
Resolution of labor shortage: By introducing an automation system, efficient work can be done without relying on manpower, contributing to the resolution of labor shortage.
Reduction of environmental impact: The amount of pesticides used can be significantly reduced, and sustainable agriculture with a low environmental impact can be realized.
High added value through branding: By promoting branding that emphasizes “safety and security” and “high quality,” sales at high price ranges can be expected.
[Disadvantages of Business] Costs
On the other hand, the disadvantage is “cost.” It all comes down to this.
This is the source of all the worries of plant factory operators. There is no doubt about it.
The cost has been rising steadily for more than 10 years since I started working at plant factories.
The disadvantages are as follows.
High initial costs: A large amount of money is required for the construction of facilities and equipment investment. In particular, completely artificial light types tend to be expensive.
High running costs: Operating expenses such as electricity bills and air conditioning costs are also high. In particular, utility costs account for a large percentage.
Limited crops that can be cultivated: In the case of artificial light type plant factories, crops that grow tall or have deep roots are difficult to cultivate.
Advanced technology and knowledge are required: It is necessary to acquire specialized knowledge and technology such as cultivation environment control and equipment management.
In particular, the increase in raw material prices and electricity rates is serious.
This is a challenge for plant factories, but I have written about it in detail in the following article.
I have written about both the good and bad things about plant factories. However, it seems that many people are concerned about the bad things.
But I want you to know properly.
Plant factories can generate profits steadily if operated properly.
Well, my site that you are currently viewing is providing information for that purpose.
Here, I will briefly introduce 5 points to avoid failure in the plant factory business.
This is not about detailed on-site stories, but about business stories.
Thorough Market Research in Advance
Find crops with high needs: Choose crops that are not easily influenced by trends and that can be expected to have stable demand.
Be aware of differentiation if there are many competitors: Emphasize high quality, rarity, functionality, etc. to differentiate yourself from other farmers.
These are the basics.
In particular, companies entering from different industries may have a strong product-out perspective. Be sure to have a market-in perspective.
You cannot sell vegetables that are not demanded by the market.
And add your own unique features. In Japan, cheap and high-quality vegetables are easily available, so products that are not differentiated will not sell.
Have a Sufficient Financial Plan
Balance of Equity and Loans: Create a financial plan that considers not only initial costs but also working capital.
Use of Subsidies and Grants: Actively use the systems of the national and local governments.
Plant factories have high initial investments, so it is difficult to achieve profitability at the beginning of the business.
However, there is nothing more unreliable than a business plan for several years from now.
It is common for the profit margin to be worse than expected.
In particular, in the case of large companies that seek short-term profits, it means that they have the risk of having to withdraw early.
Construction of the Optimal Cultivation Environment
Selection of Plant Factory Type: Choose the optimal one from the fully artificial light type and the sunlight combined type according to your financial strength and crops to be cultivated.
Equipment Introduction and Operation Know-how: Actively introduce the latest technology and establish efficient operation methods.
Cultivation technology is the key to plant factories. It is necessary to operate the correct know-how on-site.
What I think after seeing many plant factories is that the skills and know-how of the on-site staff determine the profitability.
Some people mistakenly believe that they will succeed because they have the latest equipment, but this is wrong.
Securing Experienced Personnel
Expert Knowledge of Crop Management: It would be reassuring to have personnel with knowledge of plant physiology, pest control, etc.
Equipment Management Skills: It would be reassuring to have personnel who can maintain equipment and respond to troubles.
It is “people” who use know-how on-site.
There are very few people who have a wide range of knowledge and experience such as cultivation, Production Management, and hygiene, and have the skill set to be active in the field of plant factories.
Basically, you can’t hire such people at any plant factory.
That means you have no choice but to educate them.
Information Gathering and Skill Improvement
Latest Technology and Market Trends: Always be aware and participate in seminars and study sessions to obtain the latest information.
Success Stories of Other Companies: Learn from success stories through visits to companies that are undertaking advanced initiatives.
Information gathering is important. However, there is little practical know-how related to profitability and efficiency improvement that the site really needs.
There are books, information, and seminars on basic management methods for plant factories, but that alone will not improve on-site capabilities.
It has to be live information that can be used on-site.
If you are looking for such know-how, please use our site.
I Declare It. The Most Important Thing for Plant Factories
In plant factories, the latest equipment and systems are certainly important.
However, what is needed to make the most of them and continue to stably supply high-quality crops?
I can declare that “human power” is the most important thing.
However, there is a shortage of experienced personnel.
Therefore, what is important is investment in human resource development.
However, there are almost no places where you can learn live know-how that is directly linked to the profitability of the site.
On this site, we provide know-how specialized in “profitability” that systematizes my many years of experience. If you are interested, please check the following.
Summary｜Plant Factories are an Investment in the Future
I have explained the advantages and disadvantages of plant factories and the points for success.
Plant factories are by no means an easy business model. However, with the right knowledge, preparation, and passion, it is not a dream to achieve great success.
I hope this article will be a compass for those who are challenging plant factories.
In addition, you can learn a wide range of topics from basic to applied from the contents of our site.
Plant factories face the challenge of high initial investment and running costs. Data suggests that completely controlled facilities can cost 10 times more than greenhouse cultivation and 100 times more than open-field cultivation.
On the other hand, plant factories are suitable for cultivating leafy vegetables like lettuce that have a high price per unit. The production of vegetables with high added value, such as functional ingredients, is expected to improve profitability.
In the future, cost reduction and productivity improvements will be required through human resource education and the use of AI and robotics.
Why Are Plant Factories Gaining Attention?
Plant factories are attracting attention for the following reasons:
Advanced environmental control technologies allow for year-round, planned production, leading to stable yields.
Pesticide-free cultivation is possible, enabling the production of clean vegetables.
Well-suited for cultivating high-yield leafy vegetables like lettuce.
The production of vegetables with high added value, such as functional ingredients, is anticipated.
They are attracting attention from the perspective of urban agriculture and food security.
Comments