While some producers write a business plan before they start their business, most farmers start by growing things and then reach a point where they realize that they need to clarify some things about their business to help it grow and thrive. Just because you’ve already got a functioning farm, doesn’t mean it’s too late to write a business plan.
Some reasons to write a business plan:
- It helps clarify your mission/goals. While it’s fine for a farm to evolve organically, it’s really useful to set some clear goals to work towards and some key values to guide your business decisions.
- Business plans are often a requirement for obtaining grants, loans, or investments that can help you grow your business.
- A business plan can help get everyone involved in the farm on the same page about the business and can be used to help settle disputes by coming back to core values and key objectives.
What’s the difference between a business plan and a farm enterprise plan?
A business plan covers the entirety of your farm, while a farm enterprise is an individual crop or revenue stream that contributes to your overall goal. While not all farms/ranches will need individual enterprise plans, they can be a useful way to break up the business into more manageable pieces to assess profitability, feasibility, etc. See the section on Farm Enterprise Planning for more information on enterprise budgets and plans.
How to Write a Business Plan
Before writing your business plan, it’s helpful to be clear about exactly who you’re writing the plan for, as that will change how much detail you put into each section. The primary purpose of your business plan might be to have a guiding star for you and your team, or you might be writing it to apply for a grant, loan or investor that requires it. The former can be shorter and more focused on your mission, goals and company culture, the latter will need to have more emphasis on the financial elements. Below are some useful resources for writing your business plan. Some are larger overviews, while some will guide you step by step through the process. If you’re someone who gets intimidated by writing – don’t worry, this isn’t a high school essay. In many cases the business plan is more about the process than the outcome.
- Great overview from ATTRA on why and how to write a business plan: https://www.sare.org/wp-content/uploads/The-Basics-of-Farm-Business-Planning.pdf
- This is a lis of USDA State list of Beginning Farming & Ranching Coordinators who can help you work on your business plan.
- ATTRA presentation on whole-farm-planning–balancing quality of life vs. production/profitability/stewardship, etc.
- This is a free-to-use app that helps you create your business plan, and includes sample business plans. (University of Minnesota): https://agplan.umn.edu/
- Comprehensive handbook for developing a farm business plan, which includes worksheets. (Minnesota Institute for Sustainable Agriculture & SARE):https://www.sare.org/wp-content/uploads/Building-a-Sustainable-Business.pdf
- How to build a farm business plan with worksheets (USDA): farmers.gov/your-business/beginning-farmers/business-plan
Leave a Reply