ÖsterReis – Benefit from Trend Towards Regionalisation

Rice from Austria? Sounds exotic, which guarantees attention. Anything else you need to be successful can be learned at the start-up ÖsterReis from the Lower Austrian town of Gerasdorf.

200 years ago, people already tried to cultivate rice on the edges of Lake Neusiedl. In Marchfeld, just outside Vienna, this was tried in the 1980s, again in vain. That is why Gregor Neumeyer and his family are proud: They are the first to have succeeded in producing and processing white rice in Austria using a sustainable cultivation method. And they are officially certified as organic since 2018.

Neumeyer is actually an IT specialist and in this capacity he is responsible for the development of apps for banks and insurance companies. But his father is a farmer, Neumeyer grew up in the Austrian countryside, there is a clear affinity.

Even before Neumeyer took over his parents’ farm in 2016, the cultivation of rice had already begun. So far, the start-up company has had little contact with investors: “ÖsterReis is de facto a branch of an existing older agricultural company, so the start-up was financed with equity capital; the investments that were necessary were taken from the existing farm,” Neumeyer explains.

The challenge of marketing and sales

In addition to agricultural questions, such as which seed is the most suitable, the young company also had to deal with questions of marketing and sales: “There are only a few companies in Austria that specialise in communication consulting in the agricultural environment” Neumeyer had to learn; marketing communication was just as much a challenge as the task of negotiating prices with the trading sector.

But apparently ÖsterReis does some things right. He organises “field days”, where people can visit the farm and take a look at the production process, reports Die Zeit. “People want to get in touch with agriculture,” he tells the weekly newspaper. Farmers need to learn to market themselves better, he is convinced, currently the food trade is marketing the farmers’ work, “but we would be much better at it.”

Direct marketing is the trump card

ÖsterReis differs from “normal” farms not only because 80 percent of the yield (in 2016 it was 1.5 metric tons) is marketed directly, the rest goes to the gastronomy sector and a fine food store in Vienna. According to Die Zeit, the target group is city dwellers with high purchasing power who find it worth their while to cook rice from Austria. In terms of marketing, Neumeyer benefits from the trend towards regionalisation: “Customers are prepared to pay more for high-quality local products,” ÖsterReis costs twice as much as premium rice from the supermarket.

Two further points are equally remarkable: Firstly, there is the work with a contract farmer model. “Other farmers receive the seeds and know-how from us and deliver the rice in its raw state at an agreed price. We then take over cleaning, processing, packaging and marketing,” Neumeyer explains to the portal DerBrutkasten.com.

And the increasing focus on further processing: “We do not only produce rice, but also processed products such as rice wafers.” But here, too, a start-up like ÖsterReis has to overcome unexpected hurdles time and again, for example when it comes to packaging: The design and sustainable production of a packaging for rice wafers has turned out to be much more difficult than expected. “Finding the right companies here is not easy,” Neumeyer had to learn, “this is a big issue.” But this too was solved with the help of interconnected friends.