Creating a farm business plan is a way for you to formalize your thoughts, ideas and goals. As such, the process can be a real eye-opener. Although a farm business plan is a formal document, it’s ongoing. Don’t get bogged down by feeling you’ve got to get the business plan exactly right, right from the start. Use our farm business plan template, and add on as needed for your specific type of farm business. The best business plans are adaptable. If there’s any business that needs built-in adaptability, it’s a farm business. Mother Nature can have an impact on farmers of all types.
How Do I Write a Small Farm Business Plan?
Don’t sit down to write the whole thing. Chip away, one section at a time. Keep in mind that the plan doesn’t have to be the definitive last word. You can make adaptations.
How do you start a farm business plan?
Start with one piece of the business plan. One of the hardest sections of a business plan to write is the Mission Statement. If you get bogged down there, continue and come back to it later.
How much do farm owners make a year?
As you can imagine, the net income varies greatly by type of farm business. The bottom line after expenses may not be high. Farmers need to consider net worth as assets grow and the farm property increases in value.
How much does it cost to start a small farm?
Getting set up to raise 100 beef cattle costs lots more than getting set up to raise 100 rabbits.
Things like property acquisition, soil preparation, equipment and machinery and the key costs. Other costs may be irrigation systems, packaging and trucking.
What is the most profitable farming business?
Poultry farming is currently the most profitable – and common – farm business in the world. It includes chicken, turkey, quail, ducks and goose, that are being raised for meat or eggs.
It’s also one of the most expensive businesses to start, requiring significant capital investment. The industry is very labor-intensive and labor costs are high.
Do I need a Business Plan for my Farm?
Any successful business has a plan that includes operations, marketing, human resources and finances. As you develop a business plan for your farm, you might be surprised by where the process leads you. Involve others, and they may chip in with small farm business ideas on how to improve production, marketing, and things you might have not thought of.
You can turn to your farm business plan and use it as a decision-making tool. When you’ve got a really top-notch farm business plan, it can be a tool that helps you get financing. Let’s start with our basics for a farm business plan template.
Writing a Farm Business Plan Template: 15+ Things Entrepreneurs Should Include
Use these 15 sections to create your farm business plan template. All tops should be included, whether your farm focus is agriculture (crops) or products. Your farm business plan template may include additional topics. Business planning is crucial, whether your farm is a start-up or you’re purchasing an existing farm business. The farm business plan template starts with an executive summary.
1. Executive Summary
The executive summary is a business profile. As part of your business plan, it defines what product or products your farm will produce, and how that will be accomplished. As part of a business planning tool, it is communication. It’s a communication between those within the farm business, and those looking at the farm from outside it. As you write the executive summary, imagine that someone is looking over your shoulder, reading it. Those people you’re imagining include potential lenders, business partners and customers.
2. Goals and Objectives
A good business plan includes goals and objectives. As with most business plans, the goals and objectives may be personal and economic. Many sample business plans for farms include goals and objectives that include environmental stewardship and community outreach.
Farmers may include preserving the farm resources for future generations so that the operation of the farm and stewardship of the land resources remains in the family.
The introduction should let others know who the business owners are It should also include information about their backgrounds and level of experience in the industry.
4. Mission Statement and Values of Your Farming Business Plan
This is the topic that gives you the chance to talk about the personal values that led you to the farm business, whether it’s agriculture or a farm-made product. The Mission Statement does this.
Things that draw people to a farm business include sustainability and conservation. As such, farm businesses are among the most important in the world.
Do you hold to certain standards, beliefs and qualities? How will you apply those things to whole farm management business planning?
5. Industry History
Are there farm businesses that have historically dominated your region of the United States? Vineyards, hops growing operation, urban farming, dairy farms, raising sheep, cattle or hogs?
A lot of business planning is researching the information that proves a long history of customer demand. Use that information to make educated projections about the future.
6. Company Background and History
If this business plan involves your family farm, talk about the history of that, including key events. And if it’s not your family farm, talk about the history of the farm leading up to your purchase. If the farm business is a startup, focus more on the business experience and background of the persons involved
7. Competitor Analysis
In the farm business – perhaps like no other business – competitor analysis is important on a unique level. A farmer has a connection to the land. Farmers are fierce competitors, but they can also be in each other’s corners in acknowledgment of surviving shared challenges. As you analyze the competition, look for common ground. Are there co-ops, equipment sharing? For example, can you rent that state-of-the-art huge corn planter? Can you share a large combine? What about help with trucking?
8. Target Market
Are you going to sell goat cheese at your farm-based Bed & Breakfast? Is your focus on fresh fruit and vegetables? Is there a demand for more organic products? What are the demographics of the surrounding population? Are there area groceries or farmers markets that would buy products from you? Or does your farm produce something that will be shipped? If you’ll be using online sales, you’ll need a website page that’s easily found with any browser. You may need to hire a professional website designer for your site so that it is linked by keywords and comes up in a search.
Your main page should include your contact information and an email address. It should link to other pages. Those pages describe each product and price. You can also provide links to articles about your product or links to articles about your type of farm. First, make sure it’s okay to use the article if it is copyright material. Copyright your website.
9. Products and Services
Describe each product or service that’s connected to your farm, even if there are many. Be sure to focus on product or service features that most appeal to your target market. For example, are you a dairy farmer whose cows are pastured? Some say that milk from pastured cows has a different taste.
10. Organization, Human Resources and Management Plans
Each of these is a separate plan but they are related. The organization describes the day-to-day operations of the farm. HR gets into how the farm full-time and part-time employees fit into operations. HR may include job descriptions and skills needed, along with wages. The management plan describes who’s in charge and chooses the work plan for the day. It may also include plans for scheduled equipment maintenance, care of animals and harvest/planting general times.
11. SWOT Analysis
SWOT stands for Strengths, Weaknesses, Opportunities and Threats. In the best-case scenario, many farm business plans find a way to match strengths and opportunities. Threats include problems with soil and weather, as well as disruptions to the supply chain.
At a job interview, applicants are often asked where they’d like to be in 5 years. Your description in this section expands this answer into more topics. What’s your roadmap for the future? Of course, you want to be financially stable. What do you want the farm operation to look like?
13. Growth Strategy
Most templates for outlining a growth strategy include paying down expenses, saving for the future and expanding the business. Keeping good farm production records is a key part of any future analysis of whether or not the strategy is working.
14. Financial Plan
Key elements of the financial plan are balance sheets, income statements, projected cash flows, loan due schedules, costs and depreciation factors. Investors who you can draw on for funding will be most interested in revenue streams.
15. Marketing Strategy
The University of Minnesota and Cornell University have tons of information about elements of a farm business plan. Both also have a wealth of information about strategies for promotion. In a nutshell, consider brochures, advertisements, and joining a co-op group.