Business Planning

Example SWOT Analysis
Example SWOT Analysis from the USDA Risk Management Agency

 

No matter where you are in your farm business endeavor, either new or experienced, and no matter what type of business you operate, having a business plan in place helps you think objectively about your business and establish short and long-term goals, with specific strategies for managing financial, operational and human resource aspects of your farm business. You may construct a business plan as a proactive approach to starting your farm business, or you may develop a plan to help you transition into a new production system or expand on your existing operation. An excellent resource for learning about the components of a good business plan is the Sustainable Agriculture Research and Education (SARE) publication Building a Sustainable Business.

Before you begin developing your farm business plan, it’s important to take some time to consider lifestyle changes that may come with a career in farming. The USDA New Farmers webpage is a great resource for new and beginning farmers and they pose the following questions for those interested in a career in farming:

  • Have you considered the economies of seasonal earnings?
  • Are you able to take on the physical rigors of the job?
  • Can you learn to make do and fix things yourself?
  • Can you handle setbacks with determination?
  • Are you prepared to work long hours, including weekends, early mornings, and late nights?
  • Do you have the support of your partner or family? How will this decision impact your children?
  • Do you have the patience to start a career with a steep learning curve and a long road to finally getting established?

Once you have carefully thought through these considerations, it’s time to make your business plan that will serve as a guide for your current and future farm business. A few important topics to include in your business plan are suggested below. These topics are taken from an online resource called AgPlan, which offers a more extensive framework for developing your business plan.

Executive Summary

  • Give an overview of your farm business including current location, acreage, land use history, and your plans for the future of the business.
  • What facilities and equipment do you currently have available?
  • Is your farm business a sole proprietorship, partnership, corporation, cooperative, or LLC?

Operations

  • What are you producing and how much do you produce? Do you need to comply with certain regulations or obtain any permits? See our section about Licenses & Regulations for more information.
  • Think about the risks of farming - what potential risks exist and how can you make sure you are prepared for them? Using a simple SWOT analysis can be a helpful way to begin fleshing out the main ideas of your business plan. A SWOT analysis helps you analyze the strengths, weaknesses, opportunities, and threats that may affect your farm business.
  • Will you have any employees? How will you manage personnel issues? See our section on Human Resources for more information.

Marketing

  • What market avenue will you choose for selling your product?
  • Who is your customer base and how will you advertise to reach them?
  • How will you determine the price of your product?
  • See our Marketing section for more information on addressing these questions.

Finances

Resources to Help You Get Started Building Your Business Plan

If you are looking for additional information on business planning, please see our Resources page to find other publications and useful tools.