# The potential economics of Beekeeping



## Gregg (Dec 22, 2003)

Hi Jeff,

Wow, there's another crazy person out there (besides myself). I started as a hobbyist in 1992 and currently run 320 hives on a part time basis. I think I could make a go of beekeeping fulltime, but I like my current position (and the security of a regular income). I don't want to scare you off, but building a commercial beekeeping operation from scratch is a lot of work (and the potential to go deep in debt, depending on how you go about it). Almost all commercial beekeepers I know are 2nd or 3rd (or more) generation beekeepers, which is a huge adavantage. And as with any form of agriculture, beekeeping can be risky as we're dependent on Mother Nature.

Having said all that, it can be done (I'm living proof). It would be helpful to know where you're located. You want to be in a good honey producing area or an area where an income can be obtained from pollination (preferably both). Honey prices are currently very good (how long will it last?) But on the flip side bees and equipment are also quite expensive. Do you want to expand rapidly (and go into debt)? Or go slower (not as much invested right away), but takes longer to get to where you want to "bee". Just some of my thoughts. Good luck.

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Gregg Stewart


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## jeffbritts (Mar 9, 2004)

Thanks for the info Gregg. 

I'm looking at re-locating in either Iowa or Wisconsin, close to family. I'm not looking to go into debt, and would start slow. Part time at first, and build from there. Would even think about building my own equipment if it was cost effective.

Can I be so bold as to ask about some specific $$ figures? We can take the discussion off the board if you like.


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## Michael Bush (Aug 2, 2002)

I've never made any money at it. I'm PLANNING to make some money at it. But it's a big investment to get where you can produce much. As mentioned, a second generation beekeeper doesn't have the startup costs. I don't think there is a LOT of money in it, but there is a lot of work.


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## Gregg (Dec 22, 2003)

Jeff, shoot me an email and I'd be happy to answer any $$ questions (if I can).

[email protected]

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Gregg Stewart


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## wfarler (Jul 9, 2003)

read Sue Hubbell's 'A book of bees' if you want to see what it's like to have a 500 hive business. very nice writing.

read 'Following the Bloom' to get an idea of what commercial beekeepers go through. Best I can find out from asking the same question is you will need at least 500 hives to make any money, a ton of capital, a big truck, and a strong back.

I've asked a lot of old timers and get varied answers to your question. A lot of it depends on your expectations. If you just want to be independant and get by you can on 500 hives, if you want some money you'll need 1000 (the max they say a 1 man operation can handle without hiring more than seasonal labor). 

The commercial guys run 2000+ hives, sell splits, drag hives all over the country chasing blooms and pollenation. Lots of risk, lots of nights working, lots of time away from home. The largest commercial operation is 60,000 hives, yes 60,000! But some of these guys will average 175lbs per hive and in a good year pull 200-300 lbs plus a pollenation contract or two. They drag semiloads to calif for the almond bloom (builds hives up in feb/mar) so they will be ready for spring, they may winter in texas or florida and summer in the dakotas. they chase the bloom all over running semi's and forklifts.

You can specialize in producing honey, pollenation, selling queens and packages, selling splits or hives. You can try to make candles and aromatherapy lipstick. You can build a strong retail business and a loyal line of resellers to get a better dollar for your honey than the packer will pay. There are a lot of ways to turn this into a real business.

Oh, and you can always have a crop failure from AFB or mites, theft is a growing problem and who knows if the price of honey will stay up.

All that said there are people supporting themselves with it, check out Allen Dicks beekeepers diary (www.honeybeeworld.com) for a look at daily life running 2,000 hives. He was pretty successful but I would say from his diary he had quite a bit of capital invested in it. He raises cows now.


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## BjornBee (Feb 7, 2003)

I suppose you can say that 90% of restaurants go under with 3 years. As with most businesses. I guess it can be said of beekeeping as well. Most of these failures in anything can be directly related to MANAGEMENT. This encompasses alot. But most ideas have merit as to "can it make money", but for some reason alot fail. The point is, what does makes one business succeed and so many others fail?

A business plan, including 1-3-5 plans are needed. Realistic start-up costs, yearly overhead, profit projections, and industry knowledge is needed. IS there local market, CAN I break into the market, WHAT is my market? are all good questions. My thoughts are if one other person is successful, than another can do it.

I look at it this way. (Rough figures for argument or making a point.) If 1,000 hives cost 100 dollars each to get started, than what is the return on this 100,000 dollars? Yearly, pollinantion at 30 each, 40lbs of honey off each hive and wholesaled at 1 dollar, and some miscillaneous profit from wax, nucs ect,....potential return on a yearly basis even calculating loss and various items such as medications, hive loss, etc, the return on this "investment" is great. What will you do on the off season? Another income source? 

Your assets would be the hives and you could always sell them at the end of the day, so from a "investment" standpoint its not that risky. I could name alot of other businesses that have lower return and higher risk.

Things like, how fast do you want to build up, how much money do you have, can you build your own equipment and do splits to keep costs down, How bad do you want this?


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## WineMan (May 16, 2003)

Awwww.....someone wants to get poor keeping bees!!!

My opinion for those of you who are risk averse but want to make money at this is to go very slow on your own and build up over time. 

If you want to go fast and go into debt and are rather risk tolerant, you need to find a commercial beekeeper to work for who is preferrably soon retiring. You get the crash course on beekeeping for money and the person has a waiting buyer because bees arent exactly a liquid asset.


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## wfarler (Jul 9, 2003)

Based on this if you average 67 lbs and can get an average of 1.35 (selling bulk) you will gross about 90k on 1,000 hives. You will need to invest in $100k+ worth of wood and another $10k in the honey house. You will need a good sized truck and probably some seasonal labor.

I figure 1/3 in base expenses, gas, replacement parts, foundation, buckets, hired labor and so forth. 

Add payments for a forklift.
Add queens and packages to that expense if you don't raise your own. 
Add insurance. 

If you can sell splits or nucs you can add several thousand in income without much cost.

If you bottle and sell you can increase your price per pound but you will also up your labor, your investment and overhead.

Most people say if you pollenate then you won't get the honey so you can make the income in one place or the other, only luck if you can get both.


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## WineMan (May 16, 2003)

coyote puts good figures out for us to see....thanks. 

however, a word of warning, look at the numbers just 3-4 years prior....bulk honey averaged price of 55-60 cents per pound. Not much above cost and actually below production costs for many producers. Short world crops and anti dumping is all that is holding the price up now. Prices swing back and forth like everything.

not trying to scare you off but the world right now seems like a bright place for beekeeping but its just a tiny glimpse. everyone is buying all the queens/bees and equipment they can get.....3-4 years ago lots were looking to sell everything they had but you couldnt give the bees or equipment away. awwww how times changes.....and im sure they will again.


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## BWrangler (Aug 14, 2002)

Hi Guys,

Big beekeeping is another form of big agriculture. You'll operate within the same political and economic climate as all of ag's primary producers. It's not been a very pleasant place for some decades.

A few rules of thumb:

Production costs will average somewhere between 60 and 80 cents/lb. 

Foreign honey can be produced and shipped at 2/3rds of your production cost.

When the day is done, never figure how many hours you worked.

And never, never, ever figure out how much you money you made per hour!!!

Make sure your spouse has a good job or don't give up your day job.

Take every advantage of opportunity costs. You can work your children for free. Then the children will yearn for an education and flee the bee operation, much as most of our fathers(if you are over 50) fled grandpas farm.

Be careful with the wife and opportunity costs. They will tend to divorce a beekeeper for a multitude of reasons. Then who will pay the capital costs?

In the good old days a beekeeper could count on 1 bad year, 3 average years, and 1 great year in 6 years. Today plan on twice as many bad years and a great year once every 10 years. 

Not all costs are scalable. If a $5/hive loss occurs with 100 hives, owning more hives may not increase the profit but rather increase the loss.

If you see another commercial beekeeper coming down the road late at night always pull over and let him pass. He's probably as tired phsically, emotionally and financially as you are. And is sure to be as much a hazard on the road :> )

Regards
topbarguy
ex-commercial bguy


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## BWrangler (Aug 14, 2002)

Hi Guys,

On a more serious note. If you are sincerely interested in commercial beekeeping I would suggest working with a commercial beekeeper in your area for a season. They are always short handed. The kids and wife tend to run away and not many others are interested in such a hot, sticky, stinging, low paying job.

Commercial beekeeping is a lot different than even a sideline operation. It's the only kind of beekeeping I knew for 35 years. 

Now, I'm a hobbiest and am adjusting to beekeeping in an entirely different way. I will confess it's not been easy and I'm not completely free from it. Sometimes I still approach and work my dozen hives just like I did when I had thousands to work. Thirty minutes later I wonder why :> )

Regards
topbarguy


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## thinkbees (Aug 29, 2010)

I love love honey bees and have so much passion for them, it consumes my days and nights.
I have been working with Bill Bishop for two years now; he has been keeping bees for 50 and has taught me much of what he knows. He has been working with Russians for two years now. This winter I lost all of my 7 hives during a two week period when the temperatures dropped below 30 degrees and stayed that low. 
I didn’t let that discourage me and I am back up to 10 hives. I know it might not be the time to give up my salary and job as a network administrator but even with Mother Nature’s erratic behavior, I want to work with bees and give back to my community. 
I would like to start to develop a business plan for selling Russian Honey Bees nuc, hives, and queens.
I also want to sell raw unprocessed chemical free honey. Your story is inspirational and I was wondering if you could give me some advice. I know this is what I want to do but I don’t know where to start. I have contacted the Russian Breeders Association and USDA for some help too.
I don’t know how many hives I will need to start with and even if they will be available after this winter.
Any help or advice would greatly bee appreciated and I think you for your time in advance.


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## Capricorn (Apr 20, 2009)

thinkbees, I think you should start working on a business plan. Look at local programs for entrepreneurs or basic business classes at a community college. Look at business plan templates on line and just start hashing something out. The work you do on it will not be wasted. I've got close to half dozen business plans I work on, maybe one day I'll free myself from this IT desk shackle..


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## thinkbees (Aug 29, 2010)

I understand being on the side of IT and users and I want to be in the feilds and the wood shop  
I found a great business plan example from Ministry of Agriculture of British Columbia to help me get started. I am apart of the NC , Mecklenburg County and EAS associations but need reports of honey bee sales and honey and a provider of Russian Honey Bees.
Thank you for you the advice !!!


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## waynesgarden (Jan 3, 2009)

Learn everything you can about overwintering nucs. In my business plan, they are my greatest asset. Think of them as your breeding stock.

Look for Michael Palmer's posts here about overwintering nucs. Or Maine Beekeeper's. I've taken workshops with both of them and it was time well spent. You can watch MP's talk online

Wayne


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## thinkbees (Aug 29, 2010)

Thanks Wayne, I lost all of my 7 hives last year during the winter. I made one too many splits are the sourwood harvest and they didn't build up enough for winter. They all died starving with a super of honey one, but they wouldn't break cluster to eat. I have built back up to 8 hives and moving them a little further south for the winter and only made splits in April so hopefully we can pull through. I will look into Michaels overwintering of hives.


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