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How to Start a Farm: Plan Your Operation
Think about your operation from the ground up and start planning for your business. A good farm business plan is your roadmap to start-up, profitability, and growth, and provides the foundation for your conversation with USDA about how our programs can complement your operation.
Keep reading about planning your business below or jump to a different section of the farmer's journey.
On This Page
Why you need a farm business plan.
A comprehensive business plan is an important first step for any size business, no matter how simple or complex. You should create a strong business plan because it:
- Will help you get organized . It will help you to remember all of the details and make sure you are taking all of the necessary steps.
- Will act as your guide . It will help you to think carefully about why you want to farm or ranch and what you want to achieve in the future. Over time, you can look back at your business plan and determine whether you are achieving your goals.
- Is required to get a loan . In order to get an FSA loan, a guarantee on a loan made by a commercial lender, or a land contract, you need to create a detailed business plan . Lenders look closely at business plans to determine if you can afford to repay the loan.
How USDA Can Help
Whether you need a good get-started guide, have a plan that you would like to verify, or have a plan you’re looking to update for your next growth phase, USDA can help connect you to resources to help your decisions.
Your state's beginning farmer and rancher coordinator can connect you to local resources in your community to help you establish a successful business plan. Reach out to your state's coordinator for one-on-one technical assistance and guidance. They can also connect you with organizations that specifically serve beginning farmers and ranchers.
It is important to know that no single solution fits everyone, and you should research, seek guidance, and make the best decision for your operation according to your own individual priorities.
Build a Farm Business Plan
There are many different styles of business plans. Some are written documents; others may be a set of worksheets that you complete. No matter what format you choose, several key aspects of your operation are important to consider.
Use the guidelines below to draft your business plan. Answering these kinds of questions in detail will help you create and develop your final business plan. Once you have a business plan for your operation, prepare for your visit to a USDA service center. During your visit, we can help you with the necessary steps to register your business and get access to key USDA programs.
Are you starting a new farm or ranch, or are you already in business? If you are already in business:
- What products do you produce?
- What is the size of your operation?
- What agricultural production and financial management training or experience do you, your family members, or your business partners have?
- How long have you been in business?
Mission, Vision, and Goals
This is your business. Defining your mission, vision and goals is crucial to the success of your business. These questions will help provide a basis for developing other aspects of your business plan.
- What values are important to you and the operation as a whole?
- What short- and long-term goals do you have for your operation?
- How do you plan to start, expand, or change your operation?
- What plans do you have to make your operation efficient or more profitable ?
- What type of farm or ranch model (conventional, sustainable, organic, or alternative agricultural practices) do you plan to use?
Organization and Management
Starting your own business is no small feat. You will need to determine how your business will be structured and organized, and who will manage (or help manage) your business. You will need to be able to convey this to others who are involved as well.
- What is the legal structure of your business? Will it be a sole proprietorship, partnership, corporation, trust, limited liability company, or other type of entity?
- What help will you need in operating and managing your farm or ranch?
- What other resources, such as a mentor or community-based organization , do you plan to use?
Marketing is a valuable tool for businesses. It can help your businesses increase brand awareness, engagement and sales. It is important to narrow down your target audience and think about what you are providing that others cannot.
- What are you going to produce ?
- Who is your target consumer ?
- Is there demand for what you are planning to produce?
- What is the cost of production?
- How much will you sell it for and when do you expect to see profit ?
- How will you get your product to consumers ? What are the transportation costs and requirements?
- How will you market your products?
- Do you know the relevant federal, state, and local food safety regulations? What licensing do you need for your operation?
Today there are many types of land, tools, and resources to choose from. You will need to think about what you currently have and what you will need to obtain to achieve your goals.
- What resources do you have or will you need for your business?
- Do you already have access to farmland ? If not, do you plan to lease, rent, or purchase land?
- What equipment do you need?
- Is the equipment and real estate that you own or rent adequate to conduct your operation? If not, how do you plan to address those needs?
- Will you be implementing any conservation practices to sustain your operation?
- What types of workers will you need to operate the farm?
- What additional resources do you need?
Now that you have an idea of what you are going to provide and what you will need to run your operation you will need to consider the finances of your operation.
- How will you finance the business?
- What are your current assets (property or investments you own) and liabilities (debts, loans, or payments you owe)?
- Will the income you generate be sufficient to pay your operating expenses, living expenses, and loan payments?
- What other sources of income are available to supplement your business income?
- What business expenses will you incur?
- What family living expenses do you pay?
- What are some potential risks or challenges you foresee for your operation? How will you manage those risks?
- How will you measure the success of your business?
Farm Business Plan Worksheets
These farm business plan worksheets can help gather information for the financial and operational aspects of your plan.
Form FSA-2037 is a template that gathers information on your assets and liabilities like farm equipment, vehicles and existing loans.
- FSA-2037 - Farm Business Plan - Balance Sheet
- FSA-2037 Instructions
Income and Expenses
Form FSA-2038 is part of the farm loan application, and shows you the type of information you should gather when preparing your plan and application materials.
- FSA-2038 - Worksheet Projected Income and Expenses
- FSA-2038 Instructions
Planning for Conservation and Risk Management
Another key tool is a conservation plan, which determines how you want to improve the health of your land. A conservation plan can help you lay out your plan to address resource needs, costs and schedules.
USDA’s Natural Resources Conservation Service (NRCS) staff are available at your local USDA Service Center to help you develop a conservation plan for your land based on your goals. NRCS staff can also help you explore conservation programs and initiatives, such as the Environmental Quality Incentives Program (EQIP) .
Conservation in Agriculture
Crop insurance, whole farm revenue protection and other resources can help you prepare for unforeseen challenges like natural disasters.
Special Considerations for Businesses
There are different types of farm businesses each with their own unique considerations. Determine what applies to your operation.
- Organic Farming has unique considerations. Learn about organic agriculture , organic certification , and the Organic Certification Cost Share Program to see if an organic business is an option for you. NRCS also has resources for organic producers and offers assistance to develop a conservation plan.
- Urban Farming has special opportunities and restrictions. Learn how USDA can help farmers in urban spaces .
- Value-Added Products . The Agricultural Marketing Resource Center (AgMRC) is a national virtual resource center for value-added agricultural groups.
- Cooperative. If you are interested in starting a cooperative, USDA’s Rural Development Agency (RD) has helpful resources to help you begin . State-based Cooperative Development Centers , partially funded by RD, provide technical assistance and education on starting a cooperative.
Special Considerations for Individuals
Historically Underserved Farmers and Ranchers: We offer help for the unique concerns of producers who meet the USDA definition of "historically underserved," which includes farmers who are:
- socially disadvantaged
- limited resource
- military veterans
Women: Learn about specific incentives, priorities, and set asides for women in agriculture within USDA programs.
Heirs' Property Landowners: If you inherited land without a clear title or documented legal ownership, learn how USDA can help Heirs’ Property Landowners gain access to a variety of programs and services
Creating a good business plan takes time and effort. The following are some key resources for planning your business.
- Farm Answers from the University of Minnesota features a library of how-to resources and guidance, a directory of beginning farmer training programs, and other sources of information in agriculture. The library includes business planning guides such as a Guide to Developing a Business Plan for Farms and Rural Businesses and an Example Business Plan .
- The Small Business Administration (SBA) offers information about starting, managing, and transitioning a business.
SCORE is a nonprofit organization with a network of volunteers who have experience in running and managing businesses. The Score Mentorship Program partners with USDA to provide:
- Free, local support and resources, including business planning help, financial guidance, growth strategies.
- Mentorship through one-on-one business coaching -- in-person, online, and by phone.
- Training from subject matter experts with agribusiness experience.
- Online resources and step-by-step outlines for business strategies.
- Learn more about the program through the Score FAQ .
Attend field days, workshops, courses, or formal education programs to build necessary skills to ensure you can successfully produce your selected farm products and/or services. Many local and regional agricultural organizations, including USDA and Cooperative Extension, offer training to beginning farmers.
- Cooperative Extension offices address common issues faced by agricultural producers, and conduct workshops and educational events for the agricultural community.
- extension.org is an online community for the Cooperative Extension program where you can find publications and ask experts for advice.
Now that you have a basic plan for your farm operation, prepare for your visit to a USDA service center.
2. Visit Your USDA Service Center
How to Start a Farm with USDA
Get an overview of the beginning farmer's journey or jump to a specific page below.
Find Your Local Service Center
USDA Service Centers are locations where you can connect with Farm Service Agency, Natural Resources Conservation Service, or Rural Development employees for your business needs. Enter your state and county below to ﬁnd your local service center and agency offices. If this locator does not work in your browser, please visit offices.usda.gov.
Learn more about our Urban Service Centers . Visit the Risk Management Agency website to ﬁnd a regional or compliance office or to ﬁnd an insurance agent near you.
Our 2023 Annual Stockholder Meeting was held on October 25. You can watch the recording and view all election materials here .
Horizon Farm Credit
How to write a farm business plan proposal.
Getting a loan for your agricultural business, no matter the size or scope, means asking the lender to have faith in your ability to manage a full-fledged operation and your finances in a healthy way. The best way to prove that is by coming prepared with a farm business plan proposal.
No pressure, right?
Do I have to create a farming business plan?
You can set yourself up for success - both in business and with your lender - by having a detailed business plan for your farming operation. It doesn't need to be pretty, but you do have to prove that you're willing to put the time and effort into creating a well thought out course of action for your operation.
Already operating but don't have a plan? That's okay! It's never too late to put extra thought into how your operation will continue to fulfill your livelihood.
What to Include in your Agricultural Business Plan
Whether you're a new farmer looking for a loan , or a seasoned grower that needs funding for a new agribusiness , there are a few things that you want to make sure you include in your agricultural business plan.
TITLE/ COVER PAGE
Keep it simple on the cover page. The most important information here is accurate contact information so your lender can get in touch with you easily. Include mailing address, phone, email, and fax if you have it.
- Your company’s logo
- Name of business, address, contact information
Although it will be the first page of your farm plan, this will be the last section that you write, since it acts as a summary of all your key points in your plan. Remember that this is the first section that your lender will read , so they’ll expect to see all of the highlights that make approving this loan a good financial decision for both you and the lending organization. Include points about expansion plans, market opportunities, financial trends and projections in a short and easy to read summary.
Treat this section as if you’re telling a stranger about your operation and you want to give them an overview of what you do and what sets you apart from other businesses in your industry.
- Brief description of the operation including what you do, what you produce, how you market it, and the size of the operation.
- Locations and facilities
- Mission Statement
- Plan Summary and Capital Request – if you’re starting a new operation, include a plan summary that describes how you’ll start the operation and the course of action you’ll take to build it.
In this part of your farming business plan, you'll touch on your products and services, and any measures you have in place for quality and compliance.
- Products and/or services and their corresponding systems
- Production practices, value-added practices
- Policies on quality control, inventory management and customer service
- Risk Management
- Licenses, permits and regulatory requirements
- Goals for production growth, expansion, etc.
For some people, this can be the most fun or the most challenging part of creating your small farm business plan. Before thinking about your tactics, think about the research you need to do to inform those decisions.
- Industry description, outlook, trends and projections
- Target market information
- Market share to gain
- Promotions, programs and marketing tools
Check out our blog on how to create a marketing plan for your farm and download a free template!
ORGANIZATION AND MANAGEMENT
This section talks about how you're going to structure your farm and your plan for hiring help.
- How your business is organized (corporation, partnership, sole proprietorship, etc.)
- Names, titles, positions of owners, managers, directors, etc.
- Organizational chart or Personnel plan – who facilitates which roles and potential new hires
- Benefits offered, rewards structure, etc.
- Contingency Plan
FINANCES (LEARN MORE HERE)
Arguably the most important part of your agricultural business plan is how you are going to finance your operation. In this section, make sure to include:
- Income earning potential, plans for growth, expansion, industry trends
- Historical performance
- Balance sheet, cash-basis income trend, breakeven analysis, and sensitivity analysis
- Asset management
- Capital Request
Creating your own farm business plan will take time and effort. As you complete sections, send them to partners or colleagues to review as you go along. If you have any questions on farm business plan examples or more specifically what loan officer’s are looking for, give us a call .
ADDITIONAL RESOURCES TO HELP YOU WRITE YOUR FARM BUSINESS PLAN
- University of Maryland Extension Farm Business Planning Workbook
- SCORE Small Business Resources
- Penn State Extension “Starting a New Ag Business”
- Penn State Extension “Example Business Plan”
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Writing a business plan
Farms that write a formal long-term business plan are more profitable than those that don’t..
Writing your ambitions down is one of the most successful ways to visualise what you want to do and so make it happen. However, only 19% of farmers have a written business plan.
Without a goal or ambition, you will not know if you have achieved what you are working towards. By sitting down with business partners and family members, you can discuss what each other wants to achieve (financial and non-financial) and ensure your aspirations are aligned. Writing them down as a more formal business plan will then help you communicate your strategy, make decisions and achieve your goals.
Business planning webinar
In March 2019, AHDB ran a webinar focussing on a bank manager's view of a business plan, which covered:
- How a business plan communicates the way forward for partners, advisers and technical specialists
- When should a business plan be prepared
- What are the basics that the business plan needs to cover
- Possible risks that could be encountered and the use of sensitivity analysis
- The importance of monitoring performance against the plan
Watch a recording of the webinar below:
In this section
- What is a business plan?
Why should you write one and what should you include?
- Introducing your business
Explaining your business vision, mission and objectives
- Market analysis
- Financial information
- Sales and operations
- Funding requirements
- HR structure
- Executive summary
Making changes to your business
- Talking things through
Plan against the risks which could affect your business
Your personal goals are just as important as your business goals
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Investigate the potential impact that Brexit will have on your farming business
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Farming Business Plan
Agriculture is the one industry that consistently does well, irrespective matter the economic conditions of the world. So, for a stable income and career farming business is a great option.
Are you looking to start writing a business plan for your farming business? Creating a business plan is essential to starting, growing, and securing funding for your business. We have prepared a farming business plan template for you to help in start writing yours.
Free Business Plan Template
Download our Free Business Plan Template now and pave the way to success. Let’s turn your vision into an actionable strategy!
- Fill in the blanks – Outline
- Financial Tables
How to Write a Farming Business Plan?
Writing a farming business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan:
1. Executive Summary
An executive summary is the first section of the business plan intended to provide an overview of the whole business plan. Generally, it is written after the entire business plan is ready. Here are some components to add to your summary:
Start with a brief introduction:
Market opportunity:, mention your services:, management team:.
Name all the key members of your management team with their duties, responsibilities, and qualifications.
Call to action:.
Ensure you keep your executive summary concise and clear, use simple language, and avoid jargon.
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2. Business Overview
Depending on what details of your business are important, you’ll need different elements in your business overview . Still, there are some foundational elements like business name, legal structure, location, history, and mission statement that every business overview should include:
About the business:
Provide all the basic information about your business in this section like:
- The name of your farming business and the type of business you are running or will run: organic farming, agricultural farming, dairy farming, commercial farming, or something else.
- Company structure of your farming business whether it is a proprietorship, LLC, partnership firm, or some other.
- Location of your farm and the reason why you selected that place.
Business history:, future goals:.
This section should provide an in-depth understanding of your farming business. Also, the business overview section should be engaging and precise.
3. Market Analysis
Market analysis provides a clear understanding of the market in which your farming business will run along with the target market, competitors, and growth opportunities. Your market analysis should contain the following essential components:
Market size and growth potential:, competitive analysis:, market trends:, regulatory environment:.
Some additional tips for writing the market analysis section of your business plan:
- Use a variety of sources to gather data, including industry reports, market research studies, and surveys.
- Be specific and provide detailed information wherever possible.
- Include charts and graphs to help illustrate your key points.
- Keep your target audience in mind while writing the business plan
4. Products And Services
The product and services section of an agriculture business plan should describe the specific services and products that will be offered to customers. To write this section should include the following:
List the products & services:
- List the products you will produce or sell, such as crops, fruits, flowers, livestock, or value-added products like cheese or jams.
- Describe each product: Explain the features of your products, such as their quality, variety, and uniqueness. Also, discuss how your products will be packaged and marketed.
Emphasize safety and quality:
Overall, the product and services section of a business plan should be detailed, informative, and customer-focused. By providing a clear and compelling description of your offerings, you can help potential investors and readers understand the value of your business.
5. Operations Plan
When writing the operations plan section, it’s important to consider the various aspects of your business operations. Here are the components to include in an operations plan:
By including these key elements in your operations plan section, you can create a comprehensive plan that outlines how you will run your farming business.
6. Management Team
The management team section provides an overview of the individuals responsible for running the farming business. This section should provide a detailed description of the experience and qualifications of each manager, as well as their responsibilities and roles.
Organizational structure:, compensation plan:, board of advisors:.
Describe your company’s key personnel and highlight why your business has the fittest team.
7. Financial Plan
When writing the financial plan section of a business plan, it’s important to provide a comprehensive overview of your financial projections for the first few years of your business.
Profit & loss statement:
Cash flow statement:, balance sheet:, break-even point:, financing needs:.
Remember to be realistic with your financial projections, and to provide supporting evidence for all of your estimates.
When writing the appendix section, you should include any additional information that supports the main content of your plan. This may include financial statements, market research data, legal documents, and other relevant information.
- Include a table of contents for the appendix section to make it easy for readers to find specific information.
- Include financial statements such as income statements, balance sheets, and cash flow statements. These should be up-to-date and show your financial projections for at least the first three years of your business.
- Provide market research data, such as statistics on the size of the agriculture industry, consumer demographics, and trends in the industry.
- Include any legal documents such as permits, licenses, and contracts.
- Provide any additional documentation related to your business plans, such as marketing materials, product brochures, and operational procedures.
- Use clear headings and labels for each section of the appendix so that readers can easily find the information they need.
Remember, the appendix section of your farming business should only include relevant and important information that supports the main content of your plan.
The Quickest Way to turn a Business Idea into a Business Plan
Fill-in-the-blanks and automatic financials make it easy.
This farming business plan sample will provide an idea for writing a successful farming business plan, including all the essential components of your business.
After this, if you are still confused about how to write an investment-ready agriculture business plan to impress your audience, then download our farming business plan pdf .
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Frequently asked questions, why do you need a farming business plan.
A business plan is an essential tool for anyone looking to start or run a successful farming business. It helps to get clarity in your business, secures funding, and identifies potential challenges while starting and growing your farming business.
Overall, a well-written plan can help you make informed decisions, which can contribute to the long-term success of your farming business.
How to get funding for your farming business?
There are several ways to get funding for your agriculture business, but one of the most efficient and speedy funding options is self-funding. Other options for funding are!
- Bank loan – You may apply for a loan in government or private banks.
- Small Business Administration (SBA) loan – SBA loans and schemes are available at affordable interest rates, so check the eligibility criteria before applying for it.
- Crowdfunding – The process of supporting a project or business by getting many people to invest in your farming business, usually online.
- Angel investors – Getting funds from angel investors is one of the most sought options for startups.
- Venture capital – Venture capitalists will invest in your business in exchange for a percentage of shares, so this funding option is also viable.
Apart from all these options, there are small business grants available, check for the same in your location and you can apply for it.
Where to find business plan writers for your farming business?
There are many business plan writers available, but no one knows your business and idea better than you, so we recommend you write your farming business plan and outline your vision as you have in your mind.
What is the easiest way to write your agriculture business plan?
A lot of research is necessary for writing a business plan, but you can write your plan most efficiently with the help of any farming business plan example and edit it as per your need. You can also quickly finish your plan in just a few hours or less with the help of our business plan software.
About the Author
Vinay Kevadiya is the founder and CEO of Upmetrics, the #1 business planning software. His ultimate goal with Upmetrics is to revolutionize how entrepreneurs create, manage, and execute their business plans. He enjoys sharing his insights on business planning and other relevant topics through his articles and blog posts. Read more
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Agricultural Business Plan Template
Written by Dave Lavinsky
Agricultural Business Plan
Over the past 20+ years, we have helped over 500 entrepreneurs and business owners create business plans to start and grow their agricultural companies.
If you’re unfamiliar with creating an agricultural business plan, you may think creating one will be a time-consuming and frustrating process. For most entrepreneurs it is, but for you, it won’t be since we’re here to help. We have the experience, resources, and knowledge to help you create a great business plan.
In this article, you will learn some background information on why business planning is important. Then, you will learn how to write an agricultural business plan step-by-step so you can create your plan today.
Download our Ultimate Business Plan Template here >
What Is a Business Plan?
A business plan provides a snapshot of your agricultural business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategies for reaching them. It also includes market research to support your plans.
Why You Need a Business Plan
If you’re looking to start an agricultural business or grow your existing agricultural company, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your agricultural business to improve your chances of success. Your agricultural business plan is a living document that should be updated annually as your company grows and changes.
Sources of Funding for Agricultural Businesses
With regards to funding, the main sources of funding for an agricultural business are personal savings, credit cards, bank loans, and angel investors. When it comes to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to ensure that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for agricultural companies.
Finish Your Business Plan Today!
How to write a business plan for a agricultural business.
If you want to start an agricultural business or expand your current one, you need a business plan. The guide below details the necessary information for how to write each essential component of your agricultural business plan.
Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.
The goal of your executive summary is to quickly engage the reader. Explain to them the kind of agricultural business you are running and the status. For example, are you a startup, do you have an agricultural business that you would like to grow, or are you operating an established agricultural business you would like to sell?
Next, provide an overview of each of the subsequent sections of your plan.
- Give a brief overview of the agricultural industry.
- Discuss the type of agricultural business you are operating.
- Detail your direct competitors. Give an overview of your target customers.
- Provide a snapshot of your marketing strategy. Identify the key members of your team.
- Offer an overview of your financial plan.
In your company overview, you will detail the type of agricultural business you are operating.
For example, you might specialize in one of the following types of agricultural businesses:
- Animal feed manufacturing: the production and sale of food formulas for farm animals.
- Agrichemical and seed manufacturing: the production and sale of agrichemicals (e.g., fertilizers, pesticides, and fungicides) and seeds to farmers that support the growth of their crops.
- Agricultural engineering: development, testing, and implementation of new agriculture tools and machinery to improve the process for farmers.
- Biofuel manufacturing: the production of energy from biomass.
- Crop production: the process of growing and harvesting a variety of crops such as fruits, vegetables, and grains.
In addition to explaining the type of agricultural business you will operate, the company overview needs to provide background on the business.
Include answers to questions such as:
- When and why did you start the business?
- What milestones have you achieved to date? Milestones could include reaching X number of harvests per year, the number of customers served, or reaching $X amount in revenue.
- Your legal business Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.
In your industry or market analysis, you need to provide an overview of the agricultural industry. While this may seem unnecessary, it serves multiple purposes.
First, researching the agricultural industry educates you. It helps you understand the market in which you are operating.
Secondly, market research can improve your marketing strategy, particularly if your analysis identifies market trends.
The third reason is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.
The following questions should be answered in the industry analysis section of your agricultural business plan:
- How big is the agricultural industry (in dollars)?
- Is the market declining or increasing?
- Who are the key competitors in the market?
- Who are the key suppliers in the market?
- What trends are affecting the industry?
- What is the industry’s growth forecast over the next 5 – 10 years?
- What is the relevant market size? That is, how big is the potential target market for your agricultural business? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.
The customer analysis section of your agricultural business plan must detail the customers you serve and/or expect to serve.
The following are examples of customer segments: individuals, schools, families, and corporations.
As you can imagine, the customer segment(s) you choose will have a great impact on the type of agricultural business you operate. Clearly, schools would respond to different marketing promotions than corporations, for example.
Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, including a discussion of the ages, genders, locations, and income levels of the potential customers you seek to serve.
Psychographic profiles explain the wants and needs of your target customers. The more you can recognize and define these needs, the better you will do in attracting and retaining your customers.
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Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.
Direct competitors are other agricultural businesses.
Indirect competitors are other options that customers have to purchase from that aren’t directly competing with your product or service. This includes other types of farmers, wholesalers, and distributors.
For each such competitor, provide an overview of their business and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as
- What types of customers do they serve?
- What type of agricultural business are they?
- What is their pricing (premium, low, etc.)?
- What are they good at?
- What are their weaknesses?
With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.
The final part of your competitive analysis section is to document your areas of competitive advantage. For example:
- Will you make it easier for your customers to engage with you?
- Will you offer products or services that your competition doesn’t?
- Will you provide better customer service?
- Will you offer better pricing?
Think about ways you will outperform your competition and document them in this section of your plan.
Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a agricultural business plan, your marketing strategy should include the following:
Product : In the product section, you should reiterate the type of agricultural company that you documented in your company overview. Then, detail the specific products or services you will be offering. For example, will you produce fruit, soy, or vegetable products?
Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your plan, you are presenting the products and/or services you offer and their prices.
Place : Place refers to the site of your agricultural company. Document where your company is situated and mention how the site will impact your success. For example, is your agricultural business located on a small or large farm near your customer base? And, will you operate one or multiple locations? Discuss how your site might be the ideal location for your customers.
Promotions : The final part of your agricultural marketing plan is where you will document how you will drive potential customers to your location(s). The following are some promotional methods you might consider:
- Advertise in local papers, radio stations and/or magazines
- Reach out to websites
- Distribute flyers
- Engage in email marketing
- Advertise on social media platforms
- Improve the SEO (search engine optimization) on your website for targeted keywords
While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.
Everyday short-term processes include all of the tasks involved in running your agricultural business, including scheduling employees, tracking inventory, accepting orders and payments, and meeting with customers.
Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to reach your Xth harvest, or when you hope to generate $X in revenue. It could also be when you expect to expand your agricultural business to a new region.
To demonstrate your agricultural business’ potential to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.
Ideally, you and/or your team members have direct experience in managing agricultural businesses. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.
If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act as mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in managing an agricultural business, or owning their own farm.
Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet, and cash flow statements.
An income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenue and then subtracts your costs to show whether you turned a profit or not.
In developing your income statement, you need to devise assumptions. For example, how many pounds of each crop do you plan to yield each season? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.
Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your agricultural business, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a lender writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.
Cash Flow Statement
Your cash flow statement will help determine how much money you need to start or grow your business, and ensure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.
When creating your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a agricultural business:
- Cost of farm equipment and supplies
- Payroll or salaries paid to staff
- Business insurance
- Other start-up expenses (if you’re a new business) like legal expenses, permits, computer software, and equipment
Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your farm’s location lease or a list of agricultural equipment and machinery used on your farm.
Writing a business plan for your agricultural business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will understand the agricultural industry, your competition, and your customers. You will develop a marketing strategy and will understand what it takes to launch and grow a successful agricultural business.
Agricultural Business Plan Template FAQs
What is the easiest way to complete my agricultural business plan.
Growthink's Ultimate Business Plan Template allows you to quickly and easily write your agricultural business plan.
How Do You Start an Agricultural Business?
Starting an agricultural business is easy with these 14 steps:
- Choose the Name for Your Agricultural Business
- Create Your Agricultural Business Plan
- Choose the Legal Structure for Your Agricultural Business
- Secure Startup Funding for Your Agricultural Business (If Needed)
- Secure a Location for Your Business
- Register Your Agricultural Business with the IRS
- Open a Business Bank Account
- Get a Business Credit Card
- Get the Required Business Licenses and Permits
- Get Business Insurance for Your Agricultural Business
- Buy or Lease the Right Agricultural Business Equipment
- Develop Your Agricultural Business Marketing Materials
- Purchase and Setup the Software Needed to Run Your Agricultural Business
- Open for Business
Don’t you wish there was a faster, easier way to finish your Agricultural business plan?
OR, Let Us Develop Your Plan For You
Since 1999, Growthink has developed business plans for thousands of companies who have gone on to achieve tremendous success.
Click here to see how Growthink’s business plan professional services can help you create a winning business.
Other Helpful Business Plan Articles & Templates
Farm and Agriculture Business Plans
Did you know each of these plans was created in LivePlan? Learn More
Agri-tourism Business Plans
- Vineyard Bed & Breakfast Business Plan
- Agritourism Business Plan
Agriculture Consulting Business Plans
- Agricultural Consultants Business Plan
Agriculture Products & Retail Business Plans
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Farm Business Plans
- Agriculture Farm Business Plan
- Agriculture Fruit Farm Business Plan
- Horse Training Business Plan
- Hydroponics Farm Business Plan
- Peach and Apricot Farm Business Plan
- Produce Farm Business Plan
Farm Machinery Business Plans
- Farm Machinery Manufacturer Business Plan
Farming and agriculture are complicated businesses. To be successful, you need more than a green thumb and the willingness to get your hands dirty. You need to know how to operate your agricultural enterprise efficiently and not just forecast your crop rotations, but your cash position and revenue. To do that, you need a business plan.
How can a business plan help your farm or agriculture business?
A good business plan will help your farm or food production business grow. It can improve your chances of receiving government grants or loans, help you manage your business through hard times, and identify additional forms of revenue like tourism or consulting. Most lenders or investors require a business plan before they even consider funding a project. When you add in the numerous elements of running an agricultural business, and the factors like weather and government regulations that are often beyond your control, a business plan becomes an essential tool for effective management, strategic planning and communication across all the key stakeholders in your business.
Find the right agriculture business plan template for your business
If you’re not sure where to begin, check out our farms, food growers, food production facilities, and other agriculture-related sample business plans for inspiration. Or to build a more modern plan that helps you easily manage your agricultural business we recommend you try LivePlan . It contains the same agriculture business plan templates and information you see here, but with additional guidance to help you develop the perfect plan.
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How to Write a Farm Business Plan
- Small Business
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Farm operations encounter many more challenges than other businesses. Considerations like production risk, weather challenges and livestock demands can quickly become a detriment to an unplanned and unorganized farm. While creating your farm business plan, you will address these potential challenges and develop strategies to counteract those diversities while maintaining success.
Create an executive summary for your farm business. Include the goals and missions of your business and explain the farm’s short and long-term goals. Provide a brief review of the farming industry’s trends, growth patterns and economic standpoints. List the legal business description of your farming business, such as sole proprietor, partnership or corporation.
Complete a SWOT analysis to identify the strengths, weaknesses, opportunities and threats of your farm operation. Identify your farm’s competition and use the SWOT analysis to determine how you can differentiate your farm from that of the competition. Identify your farm’s specialties, such as organically raised cows for organic milk and kosher beef.
Explain your farm operation’s marketing strategies. Include a forecast for the number of target customers and sales, such as 25 million gallons of milk or 100,000 crates of eggs each year. Explain the methods that your farm operation will use to generate its customers, such as government contracts, trade shows and wholesaler contracts.
Address the operations of your farm operation. Outline the equipment and materials the farm needs to run an efficient operation. Include the costs for each piece of machinery, as well as the costs for materials and supplies, such as tillers, tractors, seeds, fertilizer, barrels and every other item that is required to operate your farm.
Identify the government regulations that your farm operation will be required to meet. Address how your farm will handle operation aspects such as manure management, worker safety, zoning requirements and soil conservation.
Outline your farm’s workforce and explain the labor inputs. Create an organizational chart to explain the flow of responsibility and create a brief job description for each position. List the separate departments of your farm operation and the responsibilities of each department supervisor. Include the cost of salaries and benefits for each employee and identify the pay intervals, such as weekly, biweekly or monthly payrolls.
Explain your farm finances in written form and include the actual financial statements. Create a written explanation of how your operation intends on generating profit. Present a few tables to emphasize the financial forecasts. Use the financial section to provide the reader with a clear understanding of the forecasted profits and strategies.
Create an appendix for your business plan. Include supporting documents, such as supplier contracts, insurance policies, industry analysis, tax forms and other documentation that support the information and findings within your business plan.
- Penn State University: Agribusiness Planning
- Master Card International: The Plan
- Net MBA: Market Analysis
- U.S. Department of Agriculture: Small Farm Funding Resources
Writing professionally since 2004, Charmayne Smith focuses on corporate materials such as training manuals, business plans, grant applications and technical manuals. Smith's articles have appeared in the "Houston Chronicle" and on various websites, drawing on her extensive experience in corporate management and property/casualty insurance.
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