Guy Watson: how I mastered organic growth

Farmer's son Guy Watson set up his organic vegetable business on three acres of land. Now his company, Riverford Organic, turns over £33m a year.

Guy Watson, 49, was born onto a 500-acre farm in Devon, and has always felt most at home on the land. Even a well-paid job as a management consultant in New York couldn't cure him of his love of a life "spent mucking around with pigs and throwing straw bails around", he says. In 1986, fed up with helping other people with their business ideas, he found himself "screwing up a piece of paper, chucking it in the bin and stomping out of the office" to make a go of things on his own.

His plan? To set up a business selling vegetables from three acres of land. "My father was pretty supportive of the idea." But his brother, who had taken over the farm, "was a bit more sceptical". Twenty-three years on, the avid tightrope walker "I have a line tied between two trees in the orchard" has proved his brother wrong. Riverford Organic now turns over £33m a year and is Britain's biggest organic vegetable box scheme.

Wary of pesticides "I'd got sick as a kid from spraying the corn" Watson wanted to make his farm entirely organic. It nearly bankrupted him. Having hired his three acres of land and a "David Brown 880 tractor that was always covered in cow shit", he was nearly finished off by a crop of leeks. They were infested with a stubborn fungal rot. "There were times when the devil was wittering into my ear, telling me to reach for the chemical container." In the end, a very cold winter killed off the rot and the leeks recovered. "But I'd come very close to abandoning organic. As I learned, though, not all your answers are lying at the bottom of an agri-chemical bucket."

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Watson made a £6,000 profit on £12,000 of sales in the first year, selling mostly leeks, lettuces and courgettes, before moving into the supermarkets and bigger wholesalers. "But it was so unpleasant, unrewarding and wasteful dealing with them." They pushed him down to his last penny, he says. "I knew I could do better." In 1991, Watson bypassed the big chains and started selling his own boxes of vegetables at £6 a crate. Delivering them himself in a rickety old Citroen, he started with 30 customers, mostly friends and neighbours. By the end of the first year, he had 200. Three years later, purely through word of mouth, he had grown his customer base to 800.

He began to think about franchising the business, to enable it to grow faster. Most of his delivery drivers were musicians with vans, who played in bands on weekends and made extra money by delivering for Riverford during the week. "Because they were overlapping with each other, I asked them each to operate in a specific area. That would make them more efficient and less confusing to the customer."

In 1999, with the business turning over more than £1m, he set up his first pilot franchise scheme. "We simply got people to carry our brand and deliver the vegetables for us." The full scheme was launched in 2001. A franchise costs around £16,000. But after training and equipping staff, Watson says Riverford doesn't actually make any money from selling franchises. "The best business deals are where you share the benefits of a common goal. That is to sell vegetable boxes, not franchises."

Jody Clarke

Jody studied at the University of Limerick and she has been a senior writer for MoneyWeek for more than 15 years. Jody is experienced in interviewing, for example in her time she has dug into the lives of an ex-M15 agent and quirky business owners who have made millions. Jody’s other areas of expertise include advice on funds, stocks and house prices.