Beekeeping for Profit
Most of the people I know who keep honey bees do it to make money. Many started out looking for something to do, an activity that would benefit the the garden, help the environment, and provide them with a needed activity. But somewhere along the way they found out that they could make money from keeping bees or from bee products. The home brewers got into beekeeping because they wanted their own honey for home-made beer, mead, fruit drinks and even hard stuff. They wanted to produce their own honey to control the quality of the product, and, in theory, to reduce the cost of one of their raw ingredients.
Oklahoma beekeeper Greg Hanniford will speak at the Serious Sideliner Symposium in January, 2013 on $500 per colony per year. Many profit-focused beekeepers find that a challenge, but it is worth a serious discussion and your consideration in the upcoming year.
We have discussed the concept of Two and a Half Hives over the past year or so, and this is a major focus of my latest book, Bee-sentials: A Field Guide. In case you are new to this conversation, I advise new beekeepers to start with two hives during their first year, using package, nucleus, swarm or purchased bees. This provides them with a quick fix for many of the problems new beekeepers experience, such as replacing a failing or absent queen, a colony that is weak and needs a frame of brood or a frame of honey. It is a simple way to increase your chances of getting at least one hive through the winter, rather than resting all of your new beekeeping talents on a single hive.
From these two colonies, during the first season, you can develop an Increase or Nucleus hive, which I advise you put into a five-frame nucleus colony. Use this small colony to house a queen with genetic resistance, or just as a backup for the two full-sized units. At the end of the season, you may decide to combine the nucleus with the weaker of the two colonies, giving it a boost and requeening it in the process. Or overwinter the nucleus, especially if it is vigorous and has adequate honey or stored syrup reserves. If you do not want to keep a third colony next spring, this overwintered nucleus can generate anywhere from $80 to $250, depending on where you live and what the market for these colonies is like. I personally charge more for overwintered nucleus colonies than newly made nucleus units for the simple reason that it has survived the winter.
It was a good year for my bees at my backyard city apiary this year. From a single overwintered nucleus (just five frames in a polystyrene box), and a purchased package of bees from California, I now have four full-sized colonies and one booming nucleus at the last inspection for the season. The former overwintered nucleus colony is now in three-deep 8-frame brood boxes, and I cannot lift it from the back of the hive because it is crammed with honey. My joy of beekeeping is the fact that bees will grow so well when they have the forage, the weather, and the management that minimizes swarming and maximizes honey production. My frustrations in beekeeping are when I find disease or mite problems, or the weather is very uncooperative, or I am on the road so much that I am not able to take care of the bees.
Back to the economics of the situation, using the overwintered nucleus and the package colony as my starting point for the season, and using Greg Hanniford’s argument, I should generate $1,000 from these bees. Here is how I see my situation:
1. Value of new colonies (book value, as I have not sold them, but could have several times this past season)—
a. Two full-sized double-deep colonies I could sell for $250 each $500
b. One booming nucleus $200
2. Honey. With the extracting help of my son and brother, I have 74, 9-ounce hex jars of honey with the Zip 49001 label, promoting the local aspect of the honey. People ask for MY honey, which I sell $8 per bottle or 3 for $20. $494 to $592
If I were so motivated, I could have removed every frame of honey from each of these colonies and increased my honey production by as much as three or four times more. The colonies would then require heavy syrup feeding. Economics favor this: Costco is selling sugar for $0.47 per pound. But this is work, and it increases the risk to the colony. Also, by leaving the surplus honey, it will be there to help the colonies through the winter, and will be good in the spring, should I want to extract more honey from the combs and money from the hives.
It has been an exceptionally good year in the apiary, the best in the past three years. A potential income of $1,200 from two hives shows me that it can be done. I know my prices are high, but I never undermine the local market. Instead, I try to set the price for local beekeepers and they quite often follow the leader when a price goes up. I know that there are beekeepers who still sell honey for as little as $3 per pound at the local farmer’s market, but most sellers are closer to my prices. I have never found that lower prices increase my sales. Years ago I learned that there are always name-calling bottom feeders who are looking for a deal, but as rude and vocal as these people are about prices, they rarely purchase at any price.
If you do not want to go to all the bother of selling honey, a donation of this honey to a local food bank or kitchen could generate a tax deduction you may want to use. And if you gift your honey to all your friends and family with a jar at the holiday season, consider the savings you made over a purchase of another gift for each person. You have the cost of the container and a label, so you have saved a few dollars, in theory.
Other income from bees
Here are some of the ways friends of mine make money from their bees. Granted, it takes time to learn each of these skills, and not all people are equally suited for some of them, but it should get you thinking about what you want to do with your bee colonies in 2013.
Queen cells, virgins and queens—Northern beekeepers want northern queens without African genes. Texas beekeepers want Texas queens without African genes. A few beekeepers in African areas want queens from African queens that have been selected for less swarming and more honey production. I have written extensively about using mite-resistant and survival stock for queen production, and many readers are in agreement, producing queens for themselves and for sale to other local beekeepers.
Dr. David Tarpy of North Carolina has written about micro-breeders, modeled after micro-brewers. The concept is to have a locally produced product, made from local materials and sold locally to reduce transportation costs. I have embraced this concept, since it is not difficult to raise queens once you get suitable training. It takes time and effort, though, to develop a market for local queens, as strange as that sounds.
Local beekeepers learn new things at their local bee club meeting, if they participate. Most beekeepers at local clubs do not subscribe to a national magazine. Some use the Internet as their sole source of information which explains why they have so many half-baked questions.
Getting to these potential queen users is difficult. Few new beekeepers are able to justify advertising in a publication that local folks are unlikely to read, and I strongly suggest you not get into the shipping of queens until you have lots and lots of experience, since queens will die because of the shipping process.
Our approach has been to go slow, and to gift queens and cells in an effort to promote our efforts. Our best success seems to be from the beekeepers who have obtained nucleus colonies with queens we raised. When they call, email, or come up to you at a meeting and tell you how well the nucleus has done, you can be sure that you have a future repeat customer.
Many new beekeepers are eager to try new local queens, but frankly lack the beekeeping skills to ensure they will be successful at introducing a cell or queen and seeing it through the mating process. As a result, we spend an hour or more with each customer to make sure he or she understands what needs to be done. Just be aware that you must do this or later face the beekeeper’s complaint that your queen was no good.
Sideliner beekeepers, who do not want to raise queens, are a customer you want. Promote to someone who knows a bit more than the new beekeeper, and who is focused on the growth of their beekeeping business. You may want to discount these queen cells, virgins, or mated queens to these individuals because they will increase the volume of your production.
Other income sources
My friend, Sheldon Schwitek, likes to make lip balm, hand cream and other items for sale at the farmer’s market, along with his honey. While these are not unnecessarily complicated items to make and sell, it does take time. However, the markup is often healthy, and there is a possibility to make some profit.
Detroit beekeeper Rich Weiske is making and selling products that contain propolis. Most of us curse the stuff as we are working hives, especially the darker strain bees. But with a little discipline collecting propolis from the hive, you can dissolve the material in 95% alcohol and sell it as a tincture.
Weiske also collects and sells pollen, including a pollen+honey+propolis mixture. While we cannot make health claims about our products, this is a pretty impressive product that requires some careful promotion. I personally do not want to consume pollen from an urban or farming area because of the risk of low levels of pesticide contamination. But if you have a mountain-top apiary, or are situated in an isolated area (like the deserts of the Southwestern United States), then this pollen can be collected, cleaned, and sold as is (but always as frozen), or made into an artificial bee bread as Weiske is doing.
Others do bee sting therapy. They do not charge, but will not refuse a donation to their research fund. I support apitherapy in its many forms, but especially find the venom treatments to be exciting. However, there are risks as well as liability issues that you need to come to grips with before you set up shop across the street from a medical center. Many beekeepers let the venom users come to them, and some have a waver they ask the person to sign before the first sting.
Some folks will set up a business and offset their expenses against their income. See a good accountant who works with cottage industry clients, as many will dismiss you as being too tiny if you only have a few bee hives. But at $500 per hive, you should think about the finances, taxes and insurance issues as well.
See Greg Hanniford and others at the Serious Sideline Symposium in Hershey, PA on January 10 and 11. Contact the American Beekeeping Federation for registration information.