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The United Nation's forecasts the World's population to grow to 9 billion by year 2050. This statistic, coupled with the fact that current organic food production yields average near 40% lower than conventionally grown crops, indicates that current methods of "sustainable" agriculture are sure to strip the planet of more

The United Nation's forecasts the World's population to grow to 9 billion by year 2050. This statistic, coupled with the fact that current organic food production yields average near 40% lower than conventionally grown crops, indicates that current methods of "sustainable" agriculture are sure to strip the planet of more wildlife habitat in order to feed so many mouths. Plus, erratic weather causing inconsistent crop production will leave vulnerable groups highly susceptible to famine. Agriculture today has a very complex supply chain that pulls resources from around the world to take to market. The Vertical Farm, LLC (TVF) seeks to change this reality and make 100% chemical free product, available locally to all major markets. The Vertical Farm, LLC is much different than a typical farm and operates on a soil-less hydroponic growing system. This system uses up to 95% less water and less than 50% of the fertilizer that an open-air organic farm would consume, by delivering all of the necessary nutrients directly to its crop's roots and recycling the solution in a closed loop system. TVF seeks to operate in unutilized warehouses and retail spaces, which will serve to control every aspects of the growing environment. This entails replacing sunlight with specially designed LED lights for horticulture applications and an HVAC system that creates the perfect growing conditions for plants to transpire. All of these capabilities translate into TVF being able to grow consistently year-round, regardless of weather, and produce quality local vegetables 30% faster than a conventional farm. In order to determine the economic feasibility of this business model, a prototype first had to be designed, which can be seen on Appendix A, B, & C. This system, designed in collaboration with University of Arizona's Controlled Environment Agricultural Center's Director, Gene Giacomelli PH. D., has determined that the roughly 1.75-acre system is capable of producing over 2.5 million pounds of lettuce every year. The footprint of the building includes all 3 major aspects of produce production, growing, harvesting, and packaging, and this vertically integrated business model allows The Vertical Farm to capture the most value, while taking its product to market. The net operating income of this prototype design is estimated to be 11.94%, with revenue in excess of $5.7 million and the largest costs being the LED lights and electricity. The Vertical Farm has mitigated its potentially largest cost, labor, by streamlining all processes of production in addition to employing the use of high-tech materials handling robots to transport crops within the facility. The Vertical Farm's production facility is not designed with human comfortability in mind (aisles are only 3' wide), but instead maximizes floor space utilization in order to produce as many pounds of product as possible. As a result, The Vertical Farm's prototype not only demonstrates the economic feasibility of indoor vertical farming today, but also gives significant merit to its growth potential to capture a portion of the $20 billion American vegetable market.
ContributorsNickerson, Michael Scott (Author) / Eaton, Kathryn (Thesis director) / Schlacter, John (Committee member) / Department of Management and Entrepreneurship (Contributor) / Barrett, The Honors College (Contributor)
Created2016-12