As previously mentioned, we gathered requirements, purchased equipment, assembled equipment once it arrived, priced and sourced bees, ordered bees, and the list seems to go on from there. The bees have been ordered; six packages of Carniolans and two packages with Russian queens and Italian workers (the idea being the Italian workers will eventually be replaced with Russian workers). Brood boxes have arrived and have been assembled and stained with a nice mandarin orange color. All of these capital costs (business-speak for total cost required to bring a project into an operable and functional state) add up; as of this writing, each hive is having an average cost of about $208.00 (€ 153; £129). This amount will rise as we still need to purchase honey supers, bulk cane sugar for initial feeding, pollen patties, and as winter approaches, homasote board and insulation wrap and, possibly, more cane sugar. We are also relatively certain there will be other, small costs along the way.
In the chart, we used an average cost of $275 (€ 202; £171) per hive for a break-even point. There are a few assumptions – cost recovery is only over one season and not amortized over several years; carry-over costs from last year (I had expenses from the purchase of the hives, safety equipment as well honey processing equipment) are also not included. There is also the assumption that honey is the only product produced, which is not entirely correct. We produce beeswax soaps, as well.
The chart shows that if we decided to sell each pound of honey for only $1.00, we would need to produce 275 pounds of honey per hive. Pretty unreasonable. Last season, we sold honey for $8.00 per pound and there was still demand for it after we sold out. At $8.00 per pound, our break even point for honey production goes to a little over 34 pounds of honey per hive. Eight of our ten hives will be new this season, and this means the bees will be diverting energy toward drawing out honeycomb wax; this takes away from the storing of honey (you cannot have honey stores until the honeycomb is built). As long as we can average a little over 34 pounds of honey per hive, we will be golden (much like honey).
We run an incredibly small operation; where commercial beekeeping operations have thousands of hives at multiple locations and, often, migrate throughout the southern US during the winter months, we will be running ten hives at just two locations and will not be driving them around the South during the winter. We are trying to do something that is economically self-sustaining, has a small environmental footprint, and is something that I am very interested in and passionate about.