Among folks not familiar with the industry, a common assumption is that honey is the main revenue source for a beekeeper. And that makes sense—they're called honey bees for a reason, right? Most folks know that honey bees are "pollinators," but few understand the extent of how much value they create through pollination.
In fact, commercial beekeepers generate most of their revenue from renting their hives to growers for pollination. On the recent Bloomberg Business of Bees podcast, reporters talked to beekeepers about how their services have shifted over the years. Around this time in the season, beekeepers must decide between making more hives, so you can collect more rental fees, or stronger hives, so you can collect as much honey revenue as possible.
Pollination/honey revenue calculator
This made me wonder, what’s the math on this tradeoff? How does honey and pollination revenue compare? I built this calculator to help beekeepers estimate their income potential:
A few notes
Of course, every beekeeper has unique factors to consider, so this may not capture your exact situation. I had to make some basic assumptions to make this work and there are countless variables I couldn't include. Fore example, geographic location of your sites will affect trucking costs and honey yield (see our trucking cost analysis), pollination rental fees, sale prices for honey, and how many splits you can do on each hive.
Math and assumptions I used:
Other things to note:
This calculator is just a start of a project I'd like to keep building. I think there aren't enough online resources for beekeepers and I'd like to change that. Many beekeepers operate in isolated regions and they tend to stick with what's worked in the past. My hope is to show beekeepers that better opportunities might exist if they're willing to switch things up.
Last week, I wrote about why we decided to pursue a new direction. Now I want to give you a behind-the-scenes look at how we did it. Strap yourselves in, this one’s a bit longer than usual.
Our “Aha!” moment was liberating, but it introduced a new set of challenges. Almond pollination only happens once a year, and at the time of our “Aha!” moment, the next pollination season was less than 10 months away. We had to get something out there, otherwise we’d wait 22 months until bringing new revenue in the door.
With less than a year to build something our target market was willing to pay for, we had to focus. As much as we wanted to develop that beautiful product we envisioned, complete with all the fancy bells and whistles, there simply wasn’t enough time.
We couldn’t afford to be good at all the things—we had to be exceptional at one or two important things. We narrowed in on two guiding principles: the product had to be accurate and it had to be faster than manual inspections.
Much of our time during the development phase was spent on customer discovery. We found a handful of almond growers who weren’t annoyed by our monthly phone calls. These folks were our sounding board. They would tell us if we were still on the right track or whether a course-correction was needed. Ultimately, we had to strike a balance between what they told us and what was achievable.
Accuracy is our first guiding principle for a good purpose. If it’s not accurate, it doesn’t matter how fast the product works. Before we began to think about building speedy software, we started outlining the predictive hive strength model.
The first step towards building an accurate model is to gather data. From May to November, several times a week, we’d set out at the crack of dawn to image hives under infrared. Over the course of this time, we’d end up capturing tens of thousands of infrared images. But it wasn’t as simple as taking a photo and moving on. There were a lot of variables to test in order to find what produced the best results.
That leads into a story about one of my wildest experiences in my 3+ years with The Bee Corp. In order to test the accuracy of our model over time, we conducted a handful of "marathon" data collection studies. This entailed capturing IR images of the same hives every few minutes over the course of several hours.
One muggy summer night, I was tasked with doing a marathon study all by myself from dusk to dawn. I loaded up Ellie’s car with enough sugary snacks and Red Bull to cause a heart murmur and set out to our bee yard tucked away in the rolling hills of Southern Indiana. No cell reception, no WiFi signal, no escape from the dense humidity; just me and all the bugs you can imagine.
I wish I could say it was eventful. It wasn’t. It became a dreary routine: pause my podcast, turn on the camera, grab my flashlight, exit the car, take photo 1, photo 2… get back in the car, shut off the camera, play my podcast for 10 minutes and repeat. By the time the sun came up, there was a visible rut in the grass from tracing the same path 50 plus times that night.
The worst part honestly wasn’t even all that bad. Running on 20+ hours without sleep and with tablespoons of sugar and caffeine coursing through my veins, paranoia set in rapidly. Anytime I heard a strange noise in the woods, I was certain an axe murderer or a grizzly bear was just steps away. But I had a secret weapon: my infrared camera. Equipped with the superpower of night vision, I had confidence that I’d be able to get the jump on any bears looking for a quick snack.
A fun note: I ended up doing 2 overnight marathon studies, once in August and again in October. The second time was during Game 3 of the ALDS—and I’m a HUGE Red Sox fan. In the middle of the woods I was somehow able to tune into Nate Eovaldi and the Sox dish out the most lopsided pounding in Yankees postseason history 😊.
Thanks for sticking through to the end on this one. I hope you enjoyed it. Check back next week to read about Ellie’s takeaways from the February launch.
Last month signaled the climax of nearly 10 months of radical change for our company. In February, we launched our new product: an infrared hive grading solution called Verifli.
This was not your typical product launch. We didn’t send out endless email blasts begging everyone and their mother to try our shiny new thing. We didn’t make a media push to reach millions of eyes. We didn’t slap any sexy branding around it.
In fact, we hardly made much noise at all. We kept our heads down. If you’ve only been following us publicly, you probably have no clue what our company even does anymore. Well, we’re writing this to catch our faithful followers up to speed.
Around last May, our team had a collective “Aha!” moment. In the months leading up to that lightbulb flash, we worked tirelessly trying to figure out how to scale our company, our technology and obviously, our bottom line. We landed on almond pollination.
Each February, three quarters of the nation’s beehives are shipped to California, where 80% of the world’s almond are grown. Over 2 million beehives congregate in California’s Central Valley to pollination roughly 1 million acres of almond trees. At an average fee of $200 per hive, beekeepers in the US gain a healthy influx of cash early in the season while their bees enjoy a head start to the year.
But there are a few key issues. Although bees don’t “hibernate” as we usually think of it, they close up shop for the winter—shutting down the queen’s egg laying, booting non-essential bees from the hive, conserving nutritional storage and clustering tightly to retain heat. Since many big-time bee operations are located in areas with harsh winters, most beehives are at their weakest point in the year around the start of almond pollination.
But the best pollination comes from hives that are in mid-season form, not fresh out of spring training. To compensate for this, growers reward the beekeepers who can build hives to mid-season form by paying top dollar for strong bees.
But this highlights another key issue: the only one way to verify that you’ve got strong bees is by cracking hives open and checking. If you rent thousands of hives, this process can take days, perhaps longer if the weather doesn’t cooperate (like this season). What’s worse, a strong hive can contain anywhere from 10 to 15 THOUSAND bees. There’s simply no way the human eye can distinguish an 11,000-bee colony from a 14,000-bee colony—but there’s a significant difference in terms of pollination output. At the end of the day, an inaccurate hive strength assessment means someone’s leaving money on the table.
Now, to break up the wall of text, here are some amazing photos from our first pollination season (photo credit: Deftly Creative):
We saw this disconnect between beekeepers who are doing everything they can to build strong hives and growers who are willing to pay whatever it costs to get them. We figured there had to be a better way to reconcile their interests and evoke transparency and understanding.
We decided to develop a product to help growers and beekeepers measure the strength of their bees faster and with greater accuracy and objectivity. Our product, Verifli, uses infrared image analysis to map out the heat signature given off by the bees. Using physics and data science paired with real-time weather information, we can deliver an accurate assessment of each beehive with a single infrared photo of the outside of a hive.
With Verifli, there’s no last-second panic when a beekeeper finds high winter losses in mid-January; he can check the bees throughout the winter and give a heads up to his grower if they need to rent extra hives. With Verifli, a grower can set up a true incentive program to reward his beekeeper for every high-strength hive, not just what they find in a 10% sample. With Verifli, a grower can know exactly which parts of the orchard have low-strength hives, so he can shuffle around pallets to maximize pollination.
Our goal with Verifli is to foster transparency. Growers and beekeepers depend on each other— and for the most part, they share similar goals. By creating a common language around how we measure pollination, we hope that Verifli can become a resource for growers and beekeepers to communicate expectations and avoid conflict.
Now that you see the rationale behind our decision to pivot, I want to tell you about how we came up with a plan to launch a product in under 10 months. Check back next week for part 2!
Small-scale beekeepers are part of a thriving community that so heavily relies on cooperation and mentorship. Hobbyists and sideliners go out of their way to teach others, support local clubs and help newbies get off the ground. Yet as operations scale into the hundreds, thousands and tens of thousands of hives, a different community appears to emerge. A community that doesn’t always feel so cooperative.
There are plenty of good reasons for why large-scale beekeepers hold their cards close to their chests. For one, these beekeepers aren’t doing it for fun; commercial beekeepers need to be competitive because, like any business, their livelihood is at stake. Taking an aspiring commercial beekeeper under your wing to show them the ropes could create a monster that eventually eats into your business.
Other factors have to do with the nature of the job. Beekeepers don’t spend their time in an office making calls, connecting and networking with clients and vendors. Beekeepers—even the big guys—are out working the bees every day. They need all hands on deck, otherwise the work won’t get done. It’s difficult to set aside a couple hours to show a new guy how to move through hundreds of hives in a day.
Beekeepers are isolated. Major operations are often located in the middle of nowhere. Even if one can arrange to spend a few days shadowing with a commercial beekeeper, driving up to Musselshell, Montana can be a major pain.
Beekeepers spend far more time with bees than with people. This point may sound obvious, but it’s easy for isolated beekeepers to develop a bit of tunnel vision. Working bees is a practice in observation. Spending months on end observing nothing but your bees can cause one to forget that there are others out in the trenches going through the same struggles.
How can we contribute?
Here’s my point: the commercial beekeeping community is too shut-off. We need more large-scale beekeepers to embrace the small beekeepers’ model of cooperation and mentorship if we expect the next generation to carry this industry into the future.
Here are a few simple things we can all do to pitch in:
Before I sign off, I should point out that there are many exceptions. Off the top of my head, I can spout off more than 20 big-time beekeepers whose contributions to the community far outweigh what they ask in return. Expect a follow-up post from me spotlighting some of the truly altruistic beekeepers who are devoted to building our community.
Imagine this: it’s a beautiful Thursday afternoon. You’re sitting on the porch, enjoying a cool breeze, rocking back and forth in a hand-crafted red cherry rocking chair. Suddenly, your serenity dissipates as your phone *dings* with a notification: “You’re running low on eggs in your fridge, would you like me to order another dozen?” This is the world we live in today.
The basics of IoT
The concept of the Internet of Things has been floating around since as early as 1982. Carnegie Mellon University pioneered a modified Coke machine, capable of reporting its inventory and the temperature of its drinks. At the time, this was thought of as groundbreaking technology, but now it’s everywhere. Your smart refrigerator tells you when to pick up groceries, your Fitbit alerts you when your heartrate reaches dangerous levels, and your driver assist warns you when there’s a car in your blind spot. All these items are part of a concept known as the Internet of Things (IoT for short).
At a basic level, IoT is a network that delivers information to decision-makers as soon as an event occurs. This information may be used to inform us when an issue exists (like when a traffic light is broken), collect data to help us understand processes (like how much of a certain input you’ve used), connect humans, monitor areas, you name it. Currently, there are over 8 billion connected devices on the planet, and this number is continuing to rise.
IoT or IoBee?
IoT is a major buzz word these days, and the limitless applications can be exciting, but likewise, such fast-paced advancement in technology can be overwhelming. You may have heard about how Amazon is working on IoT wristbands to track employees. Is this a scary “Big Brother” tactic designed to punish slackers, or a wise business strategy aimed at maximizing efficiency?
Despite the apparent privacy risks, IoT creates possibilities that can help to make our lives easier and make businesses more efficient. Industries that deal with gigantic stocks of inventory use IoT to find where things are stored, how much is there and how long it’s been in storage. Agriculture producers use IoT to monitor things like irrigation pumps and soil nutrients. This raises the question: how can beekeepers benefit from adopting IoT?
Think about what information helps you manage your bees. Wouldn’t it be useful to know when a nectar flow or a dearth has just started? How about if you got a notification when a honey-bound colony is about to swarm? What if you could track what kind of honey was being produced based on the nectar sources the bees were visiting? There are countless IoT applications that could help beekeepers better manage their hives.
Beekeepers today face many problems whose solutions may be just around the corner, in the form of IoT. In years past, issues like short battery life and shoddy communication networks (like 4G LTE and Bluetooth) made IoT applications too costly and unreliable for certain industries, but those issues are rapidly being solved.
We’re at a point where some of our crazy ideas—like, “what if my queens could tell me how many eggs they’re laying each day”—might actually be possible. This is an exciting time to start thinking about how we could use IoT to solve some of the problems beekeepers face on a daily basis.