Case 6.3: Wapnö Farm - sustainability and the circular economy example in a Swedish farm - Sweden
Name of the company: Wapnö Farm
Country: Sweden
Size of the business: 85 employees
Website: https://www.wapno.se/gaarden/english/
Background
Wapnö Gård is an estate with an old history dating back to the 14th century. The current owner’s family has owned Wapnö since 1741. Today, Wapnö is organized as a limited company with one owner. Lennart Bengtsson, the CEO, started to work at Wapnö in 1991, having previously worked at the Swedish Agricultural University, and with the owners diversified Wapnö’s Business Model by expanding from regular milk production and from the being the primary producer at the onset of the agri-food value chain into processing and advancing in the agri-food value chain and getting closer to the end consumer.
The milk production was integrated with the wide variety of activities in the farm. The farm opened its dairy in 1998 and further developed processing and activities onsite with farm shop, brewery, restaurant, greenhouses, etc. The farm has added biogas production for more circular production and in 2020, Wapnö is building a slaughterhouse at the farm. Wapnö has also applied for a permit to produce methyl esterbased on animal fat.
Farm opened its production to public through series of events and festivals such cow release day in May, Christmas market, etc. Wapnö is an open farm and has around 60 000 visitors every year. The visitors are welcome year-round to get a closer look at the animals, barns and dairy. Wapnö’s claim that it wants to be a place that restores the relationship between agriculture and the consumer’s plate. The Wapnö focuses on animal welfare, taste experience and sustainable development with prioritization of reasonable use of natural resources and environmental responsibility. Over the years, Wapnö has received several awards, including the Taste Developer of the Year in the food industry and the Environmental Award of the Year. An important challenge for Wapnö is to continue to develop the farm’s own production cycle in order to provide a more sustainable food production and at the same time make the food taste more and better. Wapnö claims that this strive makes Wapnö not only an interesting place, but also one of the most important ones.
Main activities
Wapnö is developing a circular economy with a diversified sustainable Business Model that included dairy and crop production, forestry, processing, sales and marketing. The farm has its own dairy, charcuterie, brewery, greenhouse and restaurant that refines everything that the farm provides.
Wapnö has about 2 500 hectares of farming land that provides food for both the farm’s animals and people. Wapnö’s assortment of cereals contains e.g., wheat and malt. For the last 25 years, Wapnö has not added sludge to the fields in order to avoid risk of heavy metals, remains from medicines, etc. Instead, the biogas plant additionally provides fertilization, which improves the fertility and value of the farmland. Wapnö also has 450 hectares of forest.
Wapnö Farm has grown from 90 to 1 400 milk cows over the years that are kept free range and grazing outside during summer. The animals feed is produced in the farm. To achieve a sustainable production of meat and milk, Wapnö has four different breeds. Wapnö applies rotation on the fields and maintain the fertility of the fields, minimizes diseases and keep the landscape open. The animals contribute to biological diversity.
Since Wapnö farm is a large farm in comparison with ordinary farms in Sweden, Wapnö has been able to create a sustainable small-scale and artisanal food production for consumers. The dairy is an important activity at Wapnö Farm. Wapnö is producing milk, cream, cheese and other milk-based products. The milk flows only 30 meters in a tube from the cowshed to the dairy farm. In order to show the organic cycle, Wapnö signs the milk packages with the actual milking time, not just the date. Wapnö organic meat comes from the farm’s cattle, which are free range and never given antibiotics. In the charcuterie, sausages are soured with buttermilk from the dairy.
Wapnö has a 12 000 m2 greenhouse, plantations and an apple garden. Wapnö grows tomatoes, peppers, chili, kale, cabbage, onions, apples, etc. in soil with added nutrients from the farm’s organic manure. The products are delivered to the restaurant and the farm shop and sold to consumers. The greenhouse is heated with renewable energy generated on the farm.
Thanks to the relatively large primary production at the farm, it has been possible for Wapnö to create an environmentally efficient biogas plant. Wapnö farm’s biogas, produced from cattle manure, contributes to renewable energy in the form of electricity, heat and cooling, which is needed year-round in the food premises. Wapnö only uses manure from animals on the farm for biogas production and has cut the energy consumption with more than 90%. The biogas also provides high quality digestate which improves the fertility and value of the farmland.
In the brewery, Wapnö brews beer from the farm’s water and grains, which are malted on the farm. The farm’s brewery is growing fast and today Wapnö has a large range of different beers. In some special beers, leftover tomatoes or kale from the farm are used. Mash from its own brewery and from another large local brewery is used for the production of RME.
Wapnö has a restaurant in the castle and they have registered a trademark: Farm Dining®. The ingredients are coming from the farm. In the restaurant’s bakery, bread is baked from malt leftovers.
The farm shop is situated at the farm, and a web shop on the internet is used, where all the farm’s products can be bought (dairy products, beer, lemonade, vegetables, flour and meat, charcuterie products from the farm’s beef). Wapnö also sells cakes, jams, sauces and other goodies from the farm kitchen in the shops. Wapnö also has a farm hotel and a conference centre that can accommodate 300 people.
Wapnö arranges three large fairs on a yearly basis. The Beer & Whiskey Fair, The Home & Garden Fair and the Christmas Fair. All the fairs are well-known and have visitors from large parts of the country.
Market
Wapnö sells different products. With the open farm strategy, strong focus is on sales and engagement with local customers, but products are also sold through national chains. Through the development of a sustainable diversified Business Model, Wapnö has climbed the value chain, got closer to the end consumer and developed a very strong brand. Therefore, Wapnö is able to sell its products at a higher price, which reflects the value end-customer put on the products. Wapnö Farm has built and communicated its brand for almost 30 years. Wapnö is focusing on all customer segments. Wapnö is a small company in comparison with the big companies in the food value chain as the market in Sweden is dominated by a few very large food retail companies. Today, the Wapnö Farm brand is very strong. However, nowadays it is much more expensive to use media to build a brand than it was during the early years of the Wapnö Farm development. Thus, it is important to market the company and the place, not the specific product.
Challenges and solutions
A crucial challenge for Wapnö, as for other food companies, is the food value chain. There are a few strong actors in the value chain who are close to the end customer. These big actors catch a large share of the total value generated in the food value chain. Wapnö has managed this challenge by ascending in the value chain. Nowadays, Wapnö is closer to the end customer and has built a well-known brand.
A prerequisite for other companies to handle the challenges and develop a Business Model in line with Wapnö’s, is that they regard a sustainability-focus as a possibility to build value for customers, and not as a cost-raising barrier.
Wapnö is a large farm, even though Wapnö is a very small actor on the market. Other large farms can be inspired by the case of Wapnö and develop a circular sustainable Business Model which brings them closer to the end customers themselves. However, it is a larger challenge for smaller farms. One solution can be that smaller farms cooperate in a network structure and create the same solution as Wapnö has created itself.
Another challenge is the supply of human competence. Wapnö often must train and develop the staff after they have started to work at Wapnö. This is especially important if a company, as Wapnö, has many different business activities and good managerial competences are needed for the different activities of the farm.
Funding
Today, Wapnö is run as a limited company with one main owner. Over the years, a part of the Wapnö area is been sold from the farm when the current main owner bought the other owners’ parts of Wapnö. Wapnö has also bought neighbouring farming land over the years.
The company has used bank loans for financing. Wapnö Farm is a capital-intensive company. Further, when a company like Wapnö wants to raise production volumes, the company reaches investment steps, where the company must invest large amounts of money. Hence, it is very important to have good relations with banks. The potential strength is that the value of the farm and the land is high, making it an attractive customer for the banks. However, the potential risks related with external capital are costs that have to be considered. Wapnö has received some financial support from the EU Rural Development Program over the years.
What makes this case innovative?
For more than twenty years, Wapnö has developed its own ecological cycle directly on the farm. The case represents a good example of circular production and integration of variety of activities to achieve higher sustainability. The focus of the farm is on animal welfare, openness to consumers, sustainable farming and reducing the energy consumption.
Other related Business Cases
Case 6.1: Energifabriken – fossil fuel free circular economy – Sweden
Case 6.2: Ziedi JP – circular economy in a Latvian farm – Latvia