Canadian Export Idea Ventilated Bee Hives

Sarah Hendriks
University of Guelph
AGR 1110
November 28th/2017
Brief introduction to bees importance

Many crops important in the agriculture industry rely on bees as a pollinator such as

apples, squash and peaches (Ontario, 2014). Currently in the United States they are taking

some action against the declining bee populations (Ontario, 2014). Since the implementation of

these actions there has not been very large changes in the American bee population, current

methods are not as successful as expected to restore pollinator populations (Ontario, 2014).

Previous research has proven that when the temperature outside of the hive increases, the rate

of airflow inside the hive drops (Sudarsanetal, 2012). It is necessary to have sufficient ventilation

in beehives to encourage oxygen replenishment in the bees habitat, as well as the elimination

of carbon dioxide from the bees respiration (Thompson, 2012). Although research has proven a

high importance for airflow within bee hives little is known about how if at all humidity is

regulated in a bee hive (Human et al., 2006).

Firstly, bees are important to society because they are the method of pollination for

many plants which essential for plants to produce seeds/fruit (Klein et al, 2012). As well the

more pollination that takes place the higher the crop yields are, this yield increase is a benefit

to the nation from the greater food supply and lowering food insecurity (Klein et al., 2012).

Having sustainable healthy honeybee colonies using ventilated hives will provide a benefit to

the environment. With these hives the bee population would have fewer losses from

thermoregulation (Thompson, 2012). This is a benefit because of the lower chance for

diseases in the colonies, which will help the honey bee population (Thompson, 2012).

Product details
 Current overwhelming problems with declines in the bee populations suggests that

exporting bee hives to the US can prove to be a profitable venture (USDA, 2017). In specific bee

hives adapted to the warmer climates and contain special ventilation which would promote air

flow through hives in warmer climate areas (Thompson, 2012). Sufficient air flow through the

hive would counter act issues with bees from lack of airflow allowing bee populations to thrive

in warmer climates (Thompson, 2012). The final design for these bee hives has not yet been

determined. Current tests are being done to modify standard Langstroth hives, by adding

multiple openings to the front near the top and adding special top covered have been tried

(Sudarsan, 2012). These tests have not been successful, with changing bee behaviours the

modifications end up having less effective ventilation. The placement of ventilation areas is

difficult because of the tendency of bees to interfere with air flow covering holes with propolis.

There is currently little published information about the flow of air in bee hives and bee

behaviours even though air flow is of large importance (Sudarsan, 2012). It might also be useful

to consider that bees in the natural environment have been known to survive temperature

variations because they nest in logs which provide good insulation (Greco et al., 2010). From

this lack of current useful information currently nothing can be decided about a design

(Sudarsan, 2012). Once a design has been chosen it will need to be patented. This patent would

be essential to the success of this design since there are few limitations for other companies in

the United States from making bee hives with the same design.

Where to?

At start up this product would be marketed to California for their pollination needs

(CDFA, 2017). For further expansion into other warmer climate states it would be a good idea to
market to Texas, Iowa and Minnesota. These states would be good places to expand into

because they are all contained in the top ten agricultural producing states (USDA, 2017).

Although this product could appeal to people in any state these ones in specific there could

potentially be more demand in. These hives most effective use would be in the very warm

states since thats the intended purpose. This ventilation method might also work helping bee

populations in more mild climates. The current effects are still unknown but research of the

necessity of hive ventilation strongly suggests that a new hive ventilation system will be

effective (Thompson, 2012). For now, it can be concluded that ventilated hives will be helpful in

warm climate areas and might prove to help with the oxygen levels of hives at all temperatures

(Thompson, 2012).

Production Logistics

There are many styles of hives out there, the market is dominated by two types of hives

wooden and PVC hives. The PVC hives do have their benefits such as they will not mould or

have damages due to moths (Better bee hives, 2017). The wood bee hives are very comparable

to the PVC hives currently the market is dominated by wooden hives (Better bee hives, 2017).

Since the hive production will happen in Canada it would be best to use wood rather than

synthetic material because of the ability to source wood from Canada. Wood was also chosen

over the synthetic materials because using this type of material would not be optimal for a low-

cost production system.

One important thing with the production and exportation of these bee hives would be

where they are produced and how they are processed. A good place to produce these hives
would be in southern parts of Alberta, British Colombia and Ontario. These locations are very

close the American boarder which would be optimal to reduce the shipping costs and the

environmental impacts of the shipment. Preferably these hives would be made by hand to

provide superior quality hives to consumers. This high labour production process would allow

there to be very low start up costs but this in turn would create a high level of variable costs.

These variable costs are caused by there being several of workers needed to start the

production process. In addition to the labour required machinery needed for this start up would

include staple machinery such as nail guns, electrical saws and other wood shop materials.

The amount of general labourers required and the regular hours of these workers would

depend on the number of monthly hive sales that are made. Along with the people needed in

production there would be many other people required to make the businesses successful,

such as a production supervisor, someone to run the purchasing department, sales personnel, a

general manager and people in the accounting department. All the positions mention would be

more permanent jobs with little variation in the hours and need for these positions. The

demand for the hives would be considered to be seasonal since there is a general trend to start

bee colonies in the spring and summer rather than in the colder months. This seasonality and

uncertainty about the monthly sales would cause issues with the production of the hives and

the sustainability of the business.

Competition in the Global Market

The bee industry has become very competitive recently, there are many potential

competitors in both the U.S. as well as Canada (Stats Can, 2017). Some Canadian competitor
companies include Canada beehives, ApiHex and bee works. Ontario Beekeepers association

gives a list of 19 different companies in Ontario for beekeeping supplies. Some US competition

include beebuilt.com, dadant.com and heritagebee.com. All the competitors outlined produce

products that are relatively the same to the hives proposed for export. They all are advertising

in generally the same way, trying to promote hive health and growing a healthy bee colony. The

hives currently being produced in Canada are also being produced in the United States by

different companies. The production of hives produced in Canada and the United States creates

difficulty with exporting products since there are similar competitors in the United States.

Other Products In The Market

Currently the bee hives that are sold in Canada and the United State are very similar in

design, price and quality. The hives being proposed for export would also be quite comparable

to other hives that are currently in the market. Listed below are hive designs that are currently

being manufactured across North America, with information about their relative price and the

companies that make each design. Most of these hive designs are made at multiple locations,

the Langstroth hive is by far the most popular and widely produced (Better Bee Hives, 2017).
Company Design
Beebuilt.com Langstroth hive
Hive price: $359 medium hive
Amazon (Popsport)
Hive Price: $400

(Beebuilt.com)
Canadabeehives.ca Warre Hive
Hive Price: $320
Beebuilt.com
Hive Price: $399

(Canada Beehives.com)
ApiHex bee keeping supplies
Hive Price: $150 unassembled

(ApiHex Bee keeping)

 Beeworks.com The D.E Hive - Passive ventilated hive
Hive Price: $200

(Beeworks.Com)
Zhiyin -plastic thermos hive Langstroth hive made from PVC
Hive Price: $175
OHFU
Hive Price: $200

(Alibaba.com)

Contact Information for Existing Companies

Competitor company Contact person Contact method

Canada bee hives Mike Trotter 519-808-1046
canadabeehives@gmail.com
ApiHex Contact via Websites 855-666-3233
Bee works David or Jean 705-326-7171
Better Bee Hives Eric 0414-501-578
Comparison of Products
Hive design Benefits
Wooden A lot of resources for using this type of
Langstroth hive because of its popularity. You can
hive choose to do foundationless or not. Hives
are easy to harvest the honey from and
they provide large amounts of honey.
Warre Hive Bee hive are foundationless, the bees
need to draw the natural honey comb
(Bajer, 2014). Not reusing the comb takes
away the opportunity for disease. The
Warre Hive takes advantage of bees
natural tendency to build from the top
down. The hives can be expanded at any
point since they are foundationless (Bajer,
2014).
Langstroth These types of hives are made out of a
PVC hive synthetic PVC material. From the material
they are made from they are not affected
from moths and beetles like wooden hives maintain.
(Better Bee Hives, 2017). They can easily
be washed and reassembled. One other
benefit they have is since they can be
taken apart there are adaptations that
can be made to the hives (Better Bee
Hives, 2017).
Disadvantage
Susceptible to damages from
moths and beetles (Better Bee
hives, 2017). Reuse the comb
creating a possibility for
disease (Bajer, 2014).
Standard equipment does not
work as well with this type of
hive (Bajer, 2014). Made of
wood and susceptible to
damages from moths and
beetles (Better Bee Hives,
2017).
Not made from a natural
renewable resource. More
expensive to purchase and
Benefits to Canada

Some direct benefits to Canada would be from the need of a large amount of human

inputs. Canadian citizens working producing these hives would gain many benefits beyond

monetary compensation. Having a full-time job would also provide people in disadvantaged

communities with health benefits that would other wise not be available. As well as the obvious

benefits of starting up a new company there are some indirect benefits to consider. They

include the benefits to the logging industry in Canada. More business for local transportation

companies for delivering the wood to the factory and hives to the United States. The

community surrounding the factory would benefit from the factory being in the town by

providing many citizens with in the town a source for a sustainable income. An income which

they can spend reinvesting in other businesses in the community. Other initial benefits to the

Canadian economy to consider are the start up costs of the supplies needed for production. A

new building and warehouse would also give rise to jobs in local construction, plumbing,

electrical and construction supply stores. Overall this production in Canada will affect many

different people and businesses who are all positively benefiting from the business.

Potential Demand

Potential demand changes with the economic demand of clients that this product

appeals to. These economic variations are not easily quantifiable, in a general sense we know

the purchasing potential of different types of clientele. Individual farmers in California and

other warm states would be interested in this product to have a honey bee colony for

recreation on a very small scale having very few hives. This type of hive would allow farmers to
have success with bee keeping with their little knowledge of keeping bees. There could

potentially be high demand for these hives from a start up company. They would be high

demand for this product from start up companies because as the business starts up they need

to decide the specific type of hive to implement. New businesses implementing these hives

would bring large sales of hive depending upon how large the business would be. There would

be low potential demand with marketing to established companies. Established companies

would already have enough hives for the bees they keep. Bee hives would be one of the large

investments of companies, so it would take a lot of resources to convert hive types. This is

marketable to companies who are established who want to expand with more hives and a

larger production system. So there is potential to market to established companies looking to

expand or try something new but this potential is quite low.

The goal would be to market to retail stores to sell such as stores like TSC, co-ops and

other stores like this. These retailers would attract the specific customers that would be

interested in buying bee hives for recreation or a business. These stores are already very

agricultural oriented so there is a large chance for current clients would be interested in

purchasing a hive. Marketing the product in retail stores is the proposed main way to sell the

product so realistically they should be attracting the most customers. Overall it would be

expected that most of sales would come from individual farmers or to start up companies. In

both situations there would be few units sold each time of a sale. This would be a low volume

high cost product and the sales would highly reflect this. It is also likely that there will be low

sales because of the high competition and many other hive designs that the competitors offer.

Competition is a very large obstacle but the differentiation of this product and the immense
benefits to the bee populations and the environment will allow this product to be highly

marketable.

Agricultural Industry Competition

Agricultural production in the 21st century has changed compared to the early 20th

century (USDA, 2017). We now have agricultural practises concentrated to a small number of

large farms. Currently there are about 2.06 million farms in operation with on average 440

acres. Technological improvements are a major factor which have been creating changes such

as farm size, yield per acre and less inputs for the same output (USDA, 2017). All the

technologies are very helpful with production but there are a few natural factors technological

change can not help with such as, extreme weather and the amount of pollinators. Pollinators

serve a very important role in agriculture throughout history. Bees are responsible for the

pollination of a third of food products (USDA, 2017). The agricultural industry is very large and

world-wide bee pollinated commodities account for 217 billion dollars. In the US alone bee

pollinated commodities account for $20 billion although there are other pollinators bees are

very important for the income of many US citizens (USDA, 2017). Not only are pollinators

important but the market for keeping these pollinators has grown, since the need for bees is

high the demand for bee keeping materials is also high (USDA, 2017). As far as the market for

this specially designed hive there are many buyers who would want these hives for warm

climate areas. There are currently many places that sell bee hives, and this is becoming a larger

industry (Stats Can, 2017). It has become increasingly popular to own a hive and produce small

amounts of honey as a hobby farm. Since this recent adaption in consumer behaviour there will

be many buyers creating an increasing demand in the market (Stats Can, 2017).
Where to produce

This product if implemented will provide benefits to communities that production

facility is placed in. One potential community to put the production plant is in British Columbia

along the border of the United States is Balfour, BC. Production in this small comminity would

prove to have many benefits to the entire community by providing jobs and an income to many

people in the small community. There will also be benefits to the wood industry in Canada since

there will be large amounts of wood used in the processing. This small growth of the

manufactuing sector in smaller communities promotes environemental stustainability because

the supplies can come locally. From this option of gatering the supplies locally there would not

be a flood in the market demand for supplies, like there would be if this product was produced

in a city with many manufactureres.

Transportation Logistics

Shipping would be one of the highest costs of this type of production, since there are

large inputs needed for each product. Shipment would be done by truck because of the

relatively short distance between all the locations the materials need to move from. The

materials would move from the logging area to the factory. In the factory the wood would be
cut assembled and stored in the warehouse until there was an order. Once an order is placed

the finished products would be stacked/packaged for shipping and go on trucks to their retail

destination.

With any method of transportation there would be concerns with potential damages

before the products arrived at their final location. With this type of product there would also be

concerns with how to ship them because of the shape of the hives. Hive tend to have pointed

roofs which makes them not easily stackable and there would need to be precautions taken to

ensure the hives are not damaged. Without proper precautions there would be a high

possibility in the shipment they would be damages to the hives. With the right stacking method

there should be limited issues with shipping, this is one factor that needs to be researched with

detail. One way to reduce potential damages would be to wrap the hives in plastic once they

are stacked reducing the amount of potential movement in shipping.

Costs for Production

Without implementing this idea and not having a secured design for these hives makes

quantifying the costs a very ambiguous job. In a single hive there would be approximately be 36

feet of wood used. The wood would be 1 thick wood 6 in wide. From home depot to get a

price approximation 36 of this wood would cost approximately $55 (Home depot). If the wood

is bought in bulk the price per foot of wood could decrease significantly. To make one bee hive

it would take approximately 3 hours from cutting the wood to completion. The cost per hour

should be about $15/hour for the direct labours and there would also be indirect labour that

would need to be accounted for (managers wages), another 5/hour (the wage is allocated over
many workers in the factory). There would be many fixed costs included in the production that

would raise the cost of production per unit dependent upon how many units are produced each

month. As a very general approximate there is going to be $20 allocated to each unit for fixed

costs. This allocation assumes the production system is a low cost high volume operation.

Overall this product would be costing about 54 + (15x3) + (5x3) + 20 = 135/unit +/- $40 for a

margin of error with these approximations.

This product needs to be priced competitively to other products in Canada, a good price range

to charge for these hives would be from $300-350. It is necessary to be within this price range

to remain competitive in the bee hive market in the United States. If the costs incurred do not

allow for there to be a large enough profit margin to charge within the proposed price range,

then there needs to be adjustments made to the production system to lower the costs.

Although there would be many given benefits to having production in Canada this production

method would be costly and that might be one thing that could be adjusted. In comparison to

other products in the industry the hives produced in Canada would be expensive and involve a

high amount of shipping costs. So to reduce these costs the majority of the work could be done

where labour costs are lower.

Need in The United States

There is a need in the importing nation for a better method of bee keeping. Current

practises are not optimal, and they are bringing in bees each year to help with the pollination

(Klein, 2012). Having this hive type should realistically lower the costs of operations for a

apiculturists as well allow the bee populations to thrive (Thompson, 2012). Pollinators are

needed in the United States since they produce many products that require bees as pollinators
such as peaches, cherries and apples (Ontario, 2014). These products are all very important to

the economy and the trees would not be able to thrive without the pollination from bees

(Ontario, 2014).

One thing that Canadians can do to market their product is to convince farmers that

having bees is an investment opportunity. Many farmers and business minded people would be

interested in knowing the benefits of beekeeping as a profitable opportunity to invest in. Their

investment would stem from the nature of their jobs and reliance on the bee population. If they

invest in a hive with better ventilation they will have a better chance at sustaining a healthy

honey bee colony (Thompson et al., 2012). These hives would provide a better environment for

the bees and potentially lower the costs of maintaining bee colonies.

Barriers of Trade

There are many laws in place for regulatory implications of exportation. These hives

would fall under the classification of a wood product and would require documents for their

exportation. These products would fall under the U.S. Department of Agricultures APHIS which

provides regulations for wood product importation (U.S. Customs). Before import the products

the importer would be required to have the products undergo phytosanitary procedures. These

procedures are important for limiting the risk of bringing new diseases and non-native species

into the US. There are a few treatment options that can be taken to prepare the wood for

export, it is imperative to meet these regulations, so they can be exported easily (U.S.

Customs).

Benefits to The United States

 Bees are important to the environment and the agricultural industry because they are

the only pollinators that some plants have, and pollination is required for plants to produce

seeds/fruit (Klein et al, 2012). Having sustainable healthy honeybee colonies using ventilated

hives will provide benefits to the environment. These benefits include having fewer losses from

thermoregulation and a lowered chance for disease in bee colonies (Thompson, 2012). In

addition to the benefits that the Unites States bee colonies would receive there would be other

benefits. There would be lower costs of maintaining bee populations from lower bee death

rates (Thompson, 2012). There would increased yields of crops with the placement of bees

around the crops. As well as yield increases they bees would produce honey which can be sold

as an additional benefit to keeping bees.

Future Research Recommendations

There is some information that would prove to be important to gather before

implanting this export plan. Firstly, there needs to be more research done on the locations of

ventilation areas to minimize the amount of propolis that could happen. Other research that

could be helpful would be to know the optimal amount of oxygen replenishment required in

the hives. Depending upon the oxygen level needed would help determine the amount of

ventilation required. According to research preformed through this report these are the

unknowns that do not have significant research done on them. Even though this information

can not be found now in the future this information may become available and would be

important to consider.
 There are a few final things that should be considered which might help people in the

future who want to implement this idea. The cost alternatives should be considered, including

adding this product onto an existing companys product line could be cost effective. Before

starting the venture, there needs to be research done. It is suggested that the person starting

the venture have the research performed or to wait a few years so there is more information

available on bee hive ventilation and the requirements for it. Another thing to consider is the

market and other factors that changed before this idea is implemented. Overall this idea could

prove to be profitable if carried out in the right way with more research backed behind the

idea.
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