Even if you want to operate a small farm only as a hobby, a farm is still a business. Like any business, farmers can benefit from a proper business plan. A business plan can help you secure a loan to start or to improve your small farm, or it can simply guide you by reminding you of your goals, and of what you can and should do to achieve them.
As a farm owner, it is never too late to create a business plan if you haven’t done so already. This following guide will show you how to create a small farm business plan and make your agriculture business profitable:
1. Don’t feel intimidated
Writing down a small farm business plan can seem like a daunting task, but don’t get intimidated. You are in charge of your business plan, and it can be as simple or as complex as you want it to be.
You could start with a very simple plan, and add ideas to it as time passes. After all, your business plan will not be set in stone: all you will need is a text document, or a few sheets of paper.
2. Start with a brainstorm
Before you start writing your business plan, you could do some brainstorming. Write down what first comes to your mind about your mission, your goals, your current assets, and the way you want to operate your farm and to market your products.
You should also think about your strengths and your weaknesses as a farmer and as a business owner.
3. Define your mission and your values
Now that you have done a bit of brainstorming, it’s time to detail your ideas to make your small farm business plan. Define your mission as well as the values that are important to you as the owner of a small farm.
Why do you want to own a small farm? What is your purpose as a farmer? How do you want to serve your community?
4. Consider your finances
Starting a small farm, or improving a small farm that is already established, requires money. You also need money to operate your farm, pay your employees, and acquire insurance. In fact, farm insurance will be a large part of your financial situation. You may have to obtain a vast selection of insurance products, ranging from livestock insurance to tractor insurance. Talk to an insurance broker for more information.
In addition, consider your current income and expenses, and figure out if you will need a loan or a grant to help you achieve your goals.
5. Define measurable goals
Now that you have defined your mission, it’s time to set specific goals that are measurable. Your short-term goals can be achieved within one year, while your long-term goals should take at least a few years to achieve.
One of your goals could be, for example, to make at least 10 sales a week at your local farmer’s market, or it could be to add 5 animals to your livestock.
6. Think about your current situation
Next, you should make an inventory of your current assets. How many acres of land do you own? Do you have all the buildings and equipment you need? Do you have a team working with you? Which processes are a part of your operations?
Detailing your current situation will help you keep track of the progress you are making towards your goals.
7. Detail your farm strategies
You have defined goals, and now it’s time to define the strategies that will make it possible for you to achieve them. Spend some time thinking about your strengths and your weaknesses, about the opportunities you can seize, and about the way your farm will handle supply and demand.
Research what your competitors are doing, learn more about the different farming trends, and figure out how you can achieve and measure your goals.
8. Develop a marketing strategy
If you want to sell your products to consumers, you will also need to develop a marketing strategy. What will you sell, and which price do you think is fair for each of your offerings?
How will you market your products? How will you reach out to potential customers, and how will you convince them to try your fresh vegetables, your fruits, or your eggs?
9. Choose your type of ownership
It’s important to choose your type of farm ownership. If you are the only owner of your farm, this is called proprietorship. It’s also possible to have co-ownership or a general partnership. Learn more about the different options and figure out which one applies to you.
10. Keep reviewing your business plan
Don’t forget that your small farm business plan will never be set in stone. You should review it regularly so you can keep track of your progress, figure out which areas you should improve, or add your new goals and challenges as they present themselves.
Your business plan will help you make different decisions, and if you keep refering to it, you will never forget your mission and your values.