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Business Planning

Purdue Extension > Small Farms > Business Planning

Business Planning

One of the most important aspects to a successful farming enterprise is the planning process, particularly how your agribusiness will be managed. Farmers in the past did not seem to view their farm as an enterprise, even though they had to learn all of the aspects of running a business. A successful farm has developed a business plan and is being carried out in order to maximize marketing opportunities and increase efficiencies and production. One of the best steps to becoming a sustainable farming enterprise is to start planning for success on your farm.

Purdue University's New Ventures in Food and Agriculture website helps small farmers start to understand the business side of their farm enterprise. One of the links on the website brings you to resources on how to write successful grant proposals. This is a perfect spot to go if you want to start or expand your business.

The Agricultural Innovation and Commercialization Center at Purdue University offers a free online business-planning tool through INVenture. The site supports entrepreneurs that want to assess the potential of a new business, which could be a value-added agricultural product or starting a new small farm. The tutorial shows how the self-assessment tool will guide you, page-by-page, through the business planning process by asking simple questions, then compiling the answers into a business plan.

There are numerous links to different aspects of business planning in a farm enterprise. We have tried to highlight some of the best websites that you can go to get information to specific issues.


Financing

Fortunately for you, as a small, sustainable farmer, there are more and more grants becoming available to you to help you finance your new endeavors. We have highlighted a few of the different places you can go to find financing or grants to get you started. These change rather quickly and usually there are specific dates on when to find funding, so keep checking back to see what new opportunities are out there for you.

The USDA offers, through their Rural Development program, grants for value-added producers. These grants may be used for planning activities and working capital for marketing value-added agricultural products.

The Sustainable Agriculture Research and Education (SARE) is a USDA supported organization that provides grants and education to advance innovation in agriculture. Indiana is part of the North Central SARE. This website provides information on grants that have been provided to sustainable agriculture throughout the USA. There is also information on how producers might be able to get a grant for innovation. You can also find a wealth of information in books, bulletins, fact sheets, and others on sustainable agricultural practices.

The New Ventures in Food and Agriculture project at Purdue University provides resources on how to write successful grant proposals. This is a perfect spot to go if you want to start or expand your business.

The Agricultural Marketing Resource Center, out of Iowa State University, highlights grant opportunities for farmers that are starting out.


Business Plan    

The Agricultural Marketing Resource Center's website also has resources for developing a business plan. They go step by step through the process and offer numerous other sources of information that they have collected off of the web. They have information on all aspects of planning a business.

 

Liability

A very good overview out of Cornell University talks about risks and liabilities on a small farm.  It also has links to other sites with information on aspects of business planning.

 

Although this comes from a personal blog, it offers quite a bit of general information on small farm liability and some of the issues you need to be thinking about on your farm if you offer products or farm tours.

 

Budgeting

Working with budgets on small farms can sometimes be problematic. It is hard to determine where expenses should be applied, especially if one part of the farm doesn’t seem to be doing so well. Even if it seems to be overwhelming, creating a budget for your farm can be one of the most helpful ways of understanding what is going on, on your farm. 

There are a variety of websites out there that give crop production budgets for numerous crops and in different areas of the USA and Canada.

Ohio State University has a webpage for small/new farms with a section on Enterprise Budgets, however I did not find the site to be very helpful because it is a list of links and many of them not working. It seems like they may be redoing this site so it might be helpful to check back in the near future if this wasn’t too helpful to you.

The University of Vermont also has a website for a variety crop production budgets in different regions of the USA and Canada. These can be quite helpful to understanding the costs involved in producing a specific crop. You sometimes have to click through the website to get what you want but you can find good real life examples of farm record keeping for many crops.

Out of the University of Kentucky a webpage on new crops has been developed, named Crop Diversification and Biofuel Research and Education. They provide production and marketing information on a variety of crops.  Most of the budgets are for Kentucky but they have links to other websites (some not working!) on farm budgets where you might be able to find other examples that match your needs.