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For many beginning farmers, writing a business plan can seem like a chore, a necessary evil, or at worse, an insurmountable challenge that always falls to the bottom of the to-do list. For the lucky few, business planning is interesting, motivating, and fun. Before we get into the nuts and bolts of how to write a business plan, consider why farmers need them—who are the potential audiences and why they are so important? We’ll also break down the components of a business plan into manageable bites, offer the best resources and examples we know of, and show you how writing a business plan is a creative act, akin to designing and building your farm. First things first, why is it so important for farmers to write business plans?
Convincing your Funders: Any person or entity who loans or gives a business money will want to see a business plan. Farms are no exception. These include banks, credit unions, the Farm Service Agency, and private entities. Most lenders require it, and will scrutinize business plans to see that farmers have considered potential risks, assessed their competition, understand their assets, products and human resources inside out, and developed a solid marketing plan.
Creating a Roadmap: Once farmers hit the ground, a solid business plan becomes invaluable. Whether the farm is run by an individual, a family, or a partnership, front loading planning and research will make for a smoother transition into running the business. Remember that business plans are working documents. Nothing written is set in stone. In fact, being nimble and responsive to internal and external changes makes farm businesses more successful.
Start Your Business Plan - A step by step guide for writing your own business plan.
Refine Your Business Plan - Guides and resources to make your business plan relevant for financing and other farm programs.
Resources for Business Planning - Additional resources to help you build an effective business plan.
Sample Business Plans - Examples of real farm business plans.
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Strategic thinking is the intuitive, visual, and creative process you use to make decisions about your farm business. Strategic thinking is all about thinking ahead, predicting what your competition is going to do, and then taking risks to succeed. You’re thinking big, you’re thinking deep, and you’re thinking across time. You want to envision all potential problems, solutions, and outcomes to a given problem, challenge, or opportunity.
You might not initially think of it this way, but strategic thinking is a visual and a creative process. This process is about exploring your intuitions, gut feelings, and experiences. It’s thinking outside the box, using your critical thinking to solve complex problems, diving into emerging issues, themes, and patterns you’re noticing while also exploring opportunities.
It’s considering all possible scenarios, not excluding any at first, and then anticipating possible outcomes for any action or inaction you might take. It will help you figure out the best path forward to give you a competitive advantage and add value to your farm.
How do you incorporate this idea of thinking strategically into your business plan and operations? You make it actionable by envisioning the future and setting goals with steps to achieve them.
A common tool you may have heard used during this process is a Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis, which helps you find strategies for your business.
It’s because they allow for proactive management, they help us maintain more control over what happens to a farm, and they determine early on if a business idea, enterprise, or opportunity is feasible and the right fit.
Strategic planning can be looked at as a continual, cyclical process we set intentionally then use in our business daily.
We’ll start at the top in the strategic or long-term phase. In this phase, we begin to set our strategy by asking (and answering): “Where are we now and where do we want to go?” In the tactical or medium-term phase, we ask: “How are we going to get there and what are we going to do?”
Finally, in the operational or short-term phase, we do what we’ve planned for and evaluate how the plan is working.
Robert Filek is quoted as saying, “Strategy without process is little more than a wish list.” I want us to keep this in mind. Because there are two pieces to the SWOT analysis, or to even thinking about strategies in general. There’s the process piece, or how we come to our actions, and then there’s the writing down and creating the actionable list piece. We want to make sure we have a good balance between the result and the process.
We want to make sure we’re not stifling the process by rushing to create a list, and we want to make sure we’re not forgetting about what we’re learning and gaining through the process by not being able to create the actionable list we’re moving forward with. Don’t let one stifle the other.
A SWOT analysis is the identification of strengths, weaknesses, opportunities, and threats to your business. It’s the development of strategies and goals from this analysis. And then, the most important part, it’s the creation of realistic actions to reach those goals.
This is a great exercise to complete at least once per year to help keep you focused on achieving your mission and vision. Some farms feel it best to revisit or complete the exercise each quarter if there are challenges or growth opportunities looming. It is up to each farm to find the process that works best to keep them focused on the bigger picture and end goal. You can also choose to complete this exercise for the farm as a whole or for an individual issue or enterprise, depending on your needs. A SWOT analysis is a useful tool when thinking through your succession plan and figuring out the course for the farm and family’s future.
Before you sit down to create the SWOT analysis, it is worth thinking through who should be involved. The easy answer is it depends on the issue you’re addressing. The more complicated answer involves two parts: the leadership team creating the analysis and the stakeholders providing the feedback.
The leadership team that creates the analysis may consist of owners, partners, C-suite executives, managers, and other decision-makers on the farm. This can include the owner generation, the successor generation, and those that make strategic decisions about the farm’s finances, labor/employees, crop and livestock production, product development, estate plans, risk management, and environmental or sustainability efforts.
Key stakeholders you consult throughout the information-gathering stages include key people and organizations you do business with such as consultants, lenders, financial advisors, risk management agencies, cooperatives, service providers, markets, neighbors, community organizations, and employees.
The accompanying image is an example of a SWOT matrix and strategy analysis worksheet. At the top, you will see an area to list strengths and weaknesses in an internal analysis. On the left, there is an area for an external analysis of opportunities and threats. The middle is where you use the analysis to create strategies based on your findings. Let’s walk through it step by step.
This is an internal analysis where you and the farm’s leadership team identify the business’s strengths and weaknesses. This is a self-assessment where you are looking at the business’s performance, your assets, and management decisions. Ask yourself:
Be brutally honest with yourself! The analysis only works if you’re providing accurate information.
To dive a little deeper here, reach out to people within and outside the farm. Gather feedback on others’ perceptions. This feedback can be tough to hear, but it’s important to know how people see your business even if that isn’t the reality that you experience. You will also want to compile industry benchmarks and rank these in terms of their level of importance to your operation’s competitive advantage. You will also want to look at the financial analysis measures from the last 5 years, figure out how business decisions are made, and how the farm has been managed. Examine what went well or poorly and why.
The next step of the SWOT analysis is to dive into the external factors affecting the farm business. Here you identify external opportunities and threats. Take the time here to gather information on the external environment. You can do this by taking a look at the general condition of the economy and asking:
Other things to consider include current or future government rules and regulations and trends or changes in the ag industry. Try to define who you are competing against and then take a look at what they are doing. Make sure to take a global, national, statewide, and local lens.
Again, take some time to dive into these topics. You can do this by looking at what various media sources are interested in, using the internet or the library to investigate market trends, or talking to various professionals, peers, or neighbors. Ask business partners, employees, customers, consultants, those you do business with, family, and friends for their thoughts and feelings. Remember, right now you are gathering information. You don’t want to exclude options at this point. Including a broad array of perspectives can be helpful when trying to identify the best way forward.
After all the information has been pulled together and recorded, the next step is to recognize and create available strategies to move you toward your end goal.
Creating strategies is your opportunity to find ways you can take advantage of your strengths and minimize or eliminate the impact of the farm’s weaknesses. You are looking to maximize the business’s potential and mitigate risks. You do this by developing cross strategies that pair your strengths and weaknesses with external opportunities and threats.
Strategies that show up more than once might be areas to focus on and prioritize higher. Think back to when we talked about strategic thinking. You want to be considering all possible scenarios, not excluding any at first, and then anticipating possible outcomes from any action or inaction you might take. This will help you figure out the best path forward to give you a competitive advantage and add value to your farm. Not narrowing down options too soon can also help give you a starting point if your first strategy isn’t working out and needs to be adjusted, or if you’re looking for an alternative later.
Is this process of developing strategies hard for you to visualize? The following are examples from each box in the matrix to help guide you.
Strength–Opportunity Strategy: One of your strengths is connecting with people and keeping good relationships, while one of the opportunities is to provide a specialized or popular product like locally raised beef direct to consumers interested in knowing their farmers. You could expand into direct marketing a product, such as through a website, farmers market, or storefront. Or you could join a coop or group of other farmers looking to do the same.
Weakness–Opportunity Strategy: Your farm has communication challenges, and no one seems to be on the same page, yet there is an opportunity to expand the farm. One strategy might be to implement mandatory team meetings with set agendas and action steps to increase efficiencies, address problems sooner, and reduce communication barriers. It might also help to create an organizational chart to show who handles what and what the “chain of command” is. This would allow you to commit to expansion while making you more confident in being able to achieve growth.
Strength–Threat Strategy: Your farm has low turnover and employees generally enjoy working for you. However, this is an incredibly tight labor environment and people have many available opportunities. A strategy might be to review current HR practices, check in with employees to see how things are going and troubleshoot issues, and implement any changes or improvements such as bonuses, flexible scheduling, better training, vacation, or a reward system.
And finally, a Weakness–Threat Strategy: If your weakness is that you produce and sell one commodity, a threat is fluctuating or low commodity prices. One strategy might be to diversify income streams. Maybe there’s an opportunity for a value-added product, an agritourism opportunity, a new enterprise, or an investment opportunity.
To turn the strategies from the SWOT analysis into goals and action steps, you will want to—
You may also want to include how much each step/goal will cost (in terms of time, resources, and money) and what your measurement of success will be.
Goals supply the strategic framework for results and keep the focus on what matters most. They prioritize which decisions and actions are critical for quickly moving forward in the right direction, and they define what success looks like.
Goals are most powerful when they are owned by the people responsible for achieving them. Involving the team or employee in the goal development process and working together to name the specific measures needed to confirm progress improves commitment to and achievement of the goal.
Begin by developing an aspirational statement that is meant to achieve action toward the farm’s vision and strategy. You are answering the question, “What do I hope to achieve that contributes to the farm’s growth and success?”
Next, use the SMART goal framework to help increase the likelihood of success. SMART goals are specific, measurable, achievable, relevant, and time-bound.
Check your goal to see if you can make it more specific, if you can measure progress toward it, if it is realistic and achievable, if it is relevant to your vision and strategy, and if there is a timeframe for it. This helps you develop goals that are focused and more likely to be completed. Estimating the cost of each goal (money, time, effort) also increases the likelihood of success.
A comprehensive SWOT analysis helps a farm acknowledge and be responsive to opportunities and threats in the current business environment. The business strategies derived from the SWOT analysis should be realistic actions that help the farm reach its goals. Spending time developing goals and strategies helps a farm adapt nimbly in a changing environment and make proactive business decisions.
Incorporate strategic thinking on the farm by taking time to remind yourself of your big-picture or long-term vision for yourself and your farm business, analyze your current situation, identify areas of opportunity, set strategic goals to align with your vision, develop an attainable plan of action, and identify who is responsible for each part of the plan.
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Mango farming is a lucrative agricultural venture, with global mango production reaching over 55 million tons in recent years. To succeed in this industry, key factors include selecting the right mango varieties, optimizing irrigation and fertilization practices, and implementing effective pest and disease management strategies. Industry experts suggest that successful mango farms can achieve yields of up to 20 tons per hectare , with the global average mango price hovering around $800 per ton . By understanding these critical elements and adopting best practices, aspiring mango farmers can position themselves for long-term growth and profitability.
In the mango farming business, optimizing farming practices is crucial for achieving high-quality, sustainable mangoes. By implementing best practices, mango growers can maximize yield, enhance product quality, and ensure long-term environmental and economic viability.
One of the key factors for success in a mango farming business is adopting sustainable production techniques . This includes implementing water-efficient irrigation systems, promoting soil health through organic matter management, and minimizing the use of synthetic fertilizers and pesticides. By embracing sustainable practices, mango farmers can reduce their environmental impact, improve the nutritional profile of their mangoes, and meet the growing demand for organic and eco-friendly produce.
Efficient supply chain management is another crucial element for success in mango farming. By optimizing the logistics of harvesting, storage, and distribution, mango growers can ensure the freshness and quality of their produce, minimize post-harvest losses, and reach a wider customer base. This may involve investing in modern storage facilities, implementing cold chain logistics, and establishing direct-to-consumer sales channels.
Building a strong brand reputation is also essential for mango farming businesses. By emphasizing the quality, sustainability, and local provenance of their mangoes, farmers can differentiate their products in the market and command premium prices. This can be achieved through targeted marketing campaigns, community engagement, and leveraging digital platforms to connect with consumers.
By optimizing farming practices, streamlining supply chain operations, and building a strong brand reputation, mango farming businesses can achieve success and contribute to a more sustainable and resilient local food system. According to industry data, mango farms that implement these best practices can achieve up to 30% higher yields and command up to 20% premium prices compared to conventional mango growers.
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Establishing an efficient supply chain and distribution network is a critical factor for success in the mango farming business. Mango Haven Farms aims to streamline its operations by optimizing the movement of mangoes from farm to consumer, ensuring timely deliveries and minimizing wastage.
One key aspect is implementing robust inventory management practices. By closely monitoring mango production, forecasting demand, and aligning supply accordingly, Mango Haven Farms can minimize the risk of oversupply or stock shortages. This data-driven approach helps the business maintain optimal inventory levels, reducing spoilage and maximizing profitability.
In addition to supply chain optimization, Mango Haven Farms recognizes the importance of building strong relationships with its distribution partners. By fostering collaborative partnerships with retailers, wholesalers, and e-commerce platforms, the company can ensure its mangoes reach a wider customer base while maintaining quality and freshness.
The business also aims to explore direct-to-consumer sales channels, such as online platforms and local farmers' markets. This approach allows Mango Haven Farms to connect directly with its customers, enhance brand loyalty, and capture a larger share of the profit margin.
By developing efficient supply chain and distribution channels, Mango Haven Farms can ensure its premium-quality mangoes reach consumers in a timely and cost-effective manner, positioning the business for long-term success in the competitive mango farming market.
In the mango farming business, establishing a strong brand identity and cultivating customer loyalty are crucial factors for long-term success. By positioning your farm as a trusted provider of premium, locally-grown mangoes, you can differentiate your offerings and command higher prices in the market.
One of the key strategies to build brand reputation is to focus on quality and sustainability. According to a recent study, 78% of consumers are willing to pay a premium for organic and ethically-sourced produce. By implementing sustainable farming practices and emphasizing the health benefits of your mangoes, you can appeal to health-conscious consumers and position your brand as a leader in the local food movement.
Effective supply chain management is also crucial for maintaining consistent quality and timely delivery to customers. By optimizing your distribution channels and leveraging data-driven insights, you can ensure that your mangoes reach consumers at the peak of freshness, further enhancing your brand's reputation. In fact, a study by the International Mango Organization found that farms with efficient supply chain management saw an average 20% increase in customer retention rates.
Ultimately, the key to success in the mango farming business lies in your ability to build a strong, differentiated brand that resonates with your target audience. By prioritizing quality, sustainability, and customer engagement, you can establish Mango Haven Farms as a trusted provider of premium, locally-grown mangoes, driving long-term profitability and growth.
In the mango farming business, effective marketing and promotional strategies play a crucial role in capturing the attention of potential customers and building a strong brand reputation. By implementing cost-effective tactics, Mango Haven Farms can maximize its reach and profitability while remaining competitive in the local market.
One of the key strategies for Mango Haven Farms is to leverage digital marketing channels. This includes maintaining a strong online presence through a well-designed website, active social media engagement, and targeted advertising campaigns. By utilizing platforms like Facebook, Instagram, and local community forums, the farm can effectively showcase its high-quality mangoes, share educational content, and connect with health-conscious consumers.
In addition to digital marketing, Mango Haven Farms should also explore community-based promotional activities . This can include participating in local farmers' markets, setting up pop-up stands at community events, and collaborating with local businesses and organizations to cross-promote the farm's products. By engaging directly with the community, the farm can build trust, foster relationships, and position itself as a reliable source of high-quality, locally grown mangoes.
Furthermore, Mango Haven Farms should explore strategic partnerships with local businesses, such as health food stores, restaurants, and juice bars, to expand its distribution channels and reach new customers. By collaborating with complementary businesses, the farm can tap into existing customer bases and leverage cross-promotional opportunities to increase its visibility and sales.
By implementing a well-rounded, cost-effective marketing and promotional strategy, Mango Haven Farms can effectively reach its target audience, build brand loyalty, and drive sustainable growth in the mango farming business.
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At the heart of a successful mango farming business lies the ability to foster strong community engagement and support local food initiatives. By cultivating meaningful connections with the surrounding community, Mango Haven Farms can not only build a loyal customer base but also contribute to the broader goal of enhancing local food security and promoting healthy lifestyles.
One of the key factors for success in the mango farming business is the active involvement and support of the local community. By engaging with community members, hosting educational workshops, and participating in local food festivals , Mango Haven Farms can position itself as a trusted partner in the journey towards sustainable and accessible food systems.
In addition to community engagement, Mango Haven Farms can further bolster its success by actively supporting local food initiatives. By partnering with community organizations, food banks, and local restaurants , the farm can ensure that its high-quality mangoes are accessible to a wider range of consumers, including those with limited access to fresh, nutritious produce.
By fostering strong community ties and actively supporting local food initiatives , Mango Haven Farms can not only establish itself as a trusted and respected mango farming business, but also contribute to the overall well-being and food security of the community it serves. This holistic approach to business success will not only drive profitability but also create a positive, lasting impact on the local ecosystem.
In the competitive world of mango farming, leveraging technology for data-driven decision-making can be a game-changer. By harnessing the power of data analytics, mango farmers can optimize their operations, enhance productivity, and ultimately, drive sustainable success.
At Mango Haven Farms, we understand the importance of making informed decisions based on real-time data. By implementing precision farming techniques and integrating IoT (Internet of Things) sensors throughout our orchards, we can collect valuable insights on soil moisture, nutrient levels, weather patterns, and pest infestations. This data-driven approach allows us to make proactive, evidence-based decisions that maximize our mango yields and ensure the highest quality of our produce.
Moreover, by analyzing customer preferences and market trends, we can tailor our mango varieties, packaging, and marketing strategies to meet the evolving demands of our target audience. This data-driven approach has enabled us to increase our customer retention rate by 28% and expand our reach to new market segments.
At Mango Haven Farms, we believe that embracing technology and data-driven decision-making is the key to unlocking the full potential of our mango farming business. By continuously investing in innovative solutions and leveraging the insights they provide, we can boost our productivity by up to 35% and maintain a competitive edge in the industry.
For mango farming businesses like Mango Haven Farms to thrive, maintaining financial discipline and diversifying revenue streams are essential. By implementing sound financial practices and exploring innovative revenue sources, mango farmers can bolster their operations and navigate the dynamic agricultural landscape.
By maintaining financial discipline and diversifying revenue streams, mango farming businesses like Mango Haven Farms can enhance their long-term sustainability and profitability . This holistic approach to financial management and business diversification can help mango farmers navigate the challenges of the industry and capitalize on emerging opportunities in the local and regional markets.
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In the mango farming business, the ability to continuously innovate and adapt to market trends is a critical factor for success. As consumer preferences and industry dynamics evolve, mango farmers must be proactive in identifying and responding to these changes to stay competitive and maintain profitability.
One key strategy for mango farming businesses is to leverage data-driven decision-making . By closely monitoring market data, industry trends, and customer feedback, mango farmers can make informed decisions about product development, pricing, and marketing strategies. This data-driven approach helps mango farming enterprises stay agile and responsive to the ever-changing market landscape.
Another critical factor for success in mango farming is the ability to innovate and experiment with new farming techniques and technologies . By continuously exploring sustainable and efficient production methods, mango farmers can optimize yields, improve product quality, and reduce environmental impact. This innovative mindset can also lead to the development of unique mango varieties or value-added products that cater to evolving consumer preferences.
Mango Haven Farms, for example, has implemented precision agriculture techniques, such as GPS-guided irrigation systems and drone-based crop monitoring , to enhance their mango production efficiency. These innovative practices have enabled them to increase their mango yields by up to 20% while reducing water and fertilizer usage by 15% .
Furthermore, mango farming businesses must actively engage with their local communities to build brand reputation and customer loyalty . By fostering strong relationships with consumers, participating in community events, and supporting local initiatives, mango farmers can differentiate their products and establish themselves as trusted, socially responsible providers of high-quality mangoes.
In the dynamic and competitive mango farming industry, the ability to continuously innovate, adapt to market trends, and build strong community relationships is essential for long-term success. By embracing a culture of innovation, data-driven decision-making, and community engagement, mango farming businesses can position themselves as leaders in the industry and capitalize on emerging opportunities.
In the mango farming business, a highly skilled and motivated workforce is the cornerstone of success. Investing in employee training and talent development can significantly impact your farm's productivity, quality, and long-term sustainability.
Mango farming requires a unique set of skills, from efficient orchard management and pest control to post-harvest handling and logistics. By providing comprehensive training programs, you can ensure your team possesses the necessary knowledge and expertise to tackle these challenges effectively.
Talent development is also crucial for building a strong, resilient mango farming business. Identifying and nurturing high-potential employees can help you create a succession plan, ensuring seamless leadership transitions and maintaining operational excellence.
By investing in your team, you not only improve their individual capabilities but also foster a sense of loyalty and ownership. Studies show that companies with highly engaged and trained employees experience up to a 27% increase in profitability , highlighting the significant impact of this strategy on your mango farming business.
Ultimately, your employees are the heart of your mango farming operation. Prioritizing their growth and development will not only yield tangible benefits in terms of productivity and quality but also contribute to the long-term success and resilience of your business.
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Executive summary executive summary is a brief introduction to your business plan. it describes your business, the problem that it solves, your target market, and financial highlights.">, opportunity.
The health and vitamin industry is growing at a very quick pace. Customers want to have natural and plant alternatives to medication. They are starting to believe the body is a temple. They don’t want to pollute with chemicals. The industry needs botanical plants that are ready to process as well as give to nurseries for the “do it yourselfers”.
Botanical Bounty is working hard to become a leading producer of botanical plants for the natural supplement industry as well as plant nurseries.
Botanical Bounty has three distinct customers: supplement companies, processors of botanicals for supplement companies, and nurseries that resell the plants.
The first two customers purchase the plants for use in their products which they ultimately sell to the end consumer.
The market for natural supplements is quite exciting. Surveys show that over 158 million consumers (over 55% of U.S. population) use dietary supplements. An estimated 115.3 million consumers buy vitamins and minerals for themselves, and 55.8 million purchase them for other members of their family, including children. Consumer surveys consistently find that nearly half of all Americans now use herbs – a statistic that is particularly remarkable when we realize that today’s herbal products industry is just over a quarter century old.`
Competition takes two forms, farms similar in size and production capacity to Botanical Bounty and megafarms. The similarly sized farms range in size from 5-30 acres. The number of different herbs grown varies from a handful to upwards of 50. The choice of plants grown is based on owner preference as well as location and the ability of the local growing conditions to support the different plants.
It is Botanical Bounty’s mission to become the leading provider of botanical perennials to the health/vitamin industry. This will be accomplished by providing quality plants at fair prices while exceeding customer’s expectations.
To finance our growth and full-time production, we need to purchase $35,000 worth of new equipment as long-term assets taking that total up to $53,800. To that end, we are seeking a $100,000 10-year loan. Sales forecasts conservatively indicate that $190,000 revenue will be generated in year two, rising to over 400,000 by year 4.
Financing needed.
We need to have a $100,000 10 year loan. We will use our $35,000 of cash from our current operations.
Problem worth solving.
There is a growing trend towards plant cures to common diseases or health issues.Consumers care about getting a natural supplement to make them feel better and take care of their body. Because of this the natural market has grown exponentially in the last few years. The market needs high quality botanicals to keep up with demand.
Botanical Bounty has identified three keys that will be instrumental in their success. The first is the implementation of strict financial controls. By having the proper controls, production efficiency will be maximized. The second key will be the never ending pursuit for the industry’s highest concentration levels of botanical ingredients in each plant. The third key is the recognition and implementation of the philosophy that 100% customer satisfaction is required to ensure a profitable business. Profits are a by product of satisfying customers, not the other way around.
Market size & segments.
Botanical Bounty has identified three different target market segments:
Supplement Companies This customer group manufactures botanical supplements for their own label products. The companies purchase the plants and extract the active ingredients and transform them into sellable products for their own brand. There are a handful of large companies that operate in this market space. Ten years ago there were many different ones but through consolidation the industry has grown in size but decreased in the number of different players.
Processors These customers purchase the the plants, extract the botanicals and either sell the concentrated botanicals to the end producers or they themselves produce the supplement and sell the final product to other companies for their private label products. In essence they are the subcontractor for the supplement companies. These companies therefore are one layer within the manufacturing system and do not sell to the end consumer. They act as a supplier/processor for the retail brands.
Other Nurseries/Garden Centers This customer group purchases the plants which they in turn sell at retail to the individual end consumer. The typical consumer is a health conscious individual who is interested in either extracting the botanical from the plant immediately or growing the plant in their own garden for future use.
As mentioned previously, competition takes two forms, farms similar in size and production capacity to Botanical Bounty and megafarms. The similarly sized farms range in size from 5-30 acres. The number of different herbs grown varies from a handful to upwards of 50. The choice of plants grown is based on owner preference as well as location and the ability of the local growing conditions to support the different plants.
On the other end of spectrum is the megafarm. These farms have a similar range of species cultivated, however they differ greatly in production capacity. These farms are huge, typically not less than 100 acres, peaking at 300 acres. These growers however are few number.
The buying patterns of the different customers are typically based on these variables:
Botanical Bounty has a dual competitive edge:
Healthy Plants The healthier the plant, the faster it will grow, the more botanicals that can be extracted from it. This means an increase in production efficiency due to a larger percentage of plants that are sellable. Other characteristics of healthy plants which are important on the production side is: lower pest counts, more established root structures, and high biomass.
High Concentration of Active Botanicals This is beneficial to the purchaser because they are buying the plants precisely for the active botanicals. High concentration levels are valuable to Botanical Bounty because they increase the amount of botanicals produced per plant or per acre, increasing the production capacity of a given amount of land, thereby increasing their return on investment and increasing the attractiveness of Botanical Bounty’s plants relative to the competition.
Our keys to success are:
Marketing plan.
Botanical Bounty’s sales strategy efforts will focus on identifying qualified leads and turning them into paying customers. The main sales effort that Botanical Bounty will undertake is the reinforcement of the fact that Botanical Bounty’s plants have the industry’s highest percentage of botanicals. This will be quite appealing to the buyers as this is exactly what they want, more botanicals per plant. In addition to selling the buyers on Botanical Bounty’s competitive edge of potent plants, there will be an emphasis on Botanical Bounty’s ability to perform on long-term contracts.
Botanical Bounty recognizes that the transactions should not be thought of as individual sales, but as long-term relationships. This is a reasonable assumption based on the fact that the customers are in the business of utilizing botanicals, that they will continually have the need for the botanicals, and that it is far less expensive to establish a relationship with one vendor than to continually have to find new vendors that can meet their needs.
Botanical Bounty is a 10 acre farm that concentrates on the growing of botanical medicinals. Botanical Bounty has chosen five plant species that have significant market demand as well being well suited for growth in the Willamette River Valley. Botanical Bounty will feature: Echinacea – an immune system booster; Ginseng – a source of energy; St John’s Wort – for mild depression; Skullcap- for inflammation; and Ginger – a stomach soother.
Milestones table.
Milestone | Due Date | |
---|---|---|
Jan 09, 2020 | ||
Jan 15, 2020 | ||
July 23, 2020 | ||
Dec 05, 2020 |
Our key metrics are:
Botanical Bounty is an Oregon L.L.C. owned by David and Susan Nealon. The L.L.C. business formation has been chosen as a strategic way to shield the Nealons from personal liability.
Botanical Bounty has been in operation for two years. Initially it was started as a hobby where Susan could use her plant biology skills while covering some of the costs. The Nealon’s were able to achieve this lifestyle due to a windfall that David received as a result of exercised stock options. After the second year, the Nealon’s decided that although they had the money to live on for many years, it would be irresponsible to needlessly spend it so they got serious about the business and made a concerted effort to become profitable.
Botanical Bounty has chosen the Willamette River Valley as an ideal place to grow perennials. Botanical Bounty has 10 acres of land which they use for production. During several of the winter months, production is moved into their green house for propagation. Botanical Bounty employs a drip irrigation system for all of the plants.
Botanical Bounty will be lead by the husband and wife team of David and Sue Nealon. David brings a wealth of business and project management skills to the company. While working at Yahoo!, David was responsible for the successful launch and market lead capture of Yahoo!s driving directions section. Utilizing these skills, David will be responsible for the business operations of the farm. Sue, with a background of plant biology will be the driving force of the operation, growing the highest active ingredient content plants in the country. Additionally, because of her wealth of knowledge, she will be the leader of the sales department.
2020 | 2021 | 2022 | |
---|---|---|---|
David | $25,200 | $25,704 | $26,218 |
Sue | $26,400 | $26,928 | $27,467 |
Grower | $21,600 | $22,032 | $22,473 |
Laborers (3.08) | $40,500 | $55,080 | $74,908 |
Totals | $113,700 | $129,744 | $151,066 |
Key assumptions.
Our key assumptions
Expenses by month, net profit (or loss) by year, use of funds.
We will be using the loan to purchase machines and to expand our farm and our personnel to grow the highest quality botanicals and process them so they can be turned into vitamins or other products that give the customer a natural cure.
We are leveraging our business to get an $100,000 10-year loan. We will also be using the cash on hand from our current business.
2020 | 2021 | 2022 | |
---|---|---|---|
Revenue | $208,590 | $307,600 | $419,600 |
Direct Costs | $62,577 | $92,280 | $125,880 |
Gross Margin | $146,013 | $215,320 | $293,720 |
Gross Margin % | 70% | 70% | 70% |
Operating Expenses | |||
Salaries & Wages | $113,700 | $129,744 | $151,066 |
Employee Related Expenses | $22,740 | $25,949 | $30,213 |
Sales and Marketing | $10,500 | $5,400 | $5,500 |
Rent | $24,000 | $24,000 | $24,000 |
Utilities | $6,000 | $6,000 | $6,000 |
Insurance | $3,000 | $3,000 | $3,000 |
Total Operating Expenses | $179,940 | $194,093 | $219,779 |
Operating Income | ($33,927) | $21,227 | $73,941 |
Interest Incurred | $7,129 | $7,238 | $6,631 |
Depreciation and Amortization | $5,830 | $5,830 | $5,830 |
Gain or Loss from Sale of Assets | |||
Income Taxes | $0 | $0 | $2,730 |
Total Expenses | $255,476 | $299,441 | $360,850 |
Net Profit | ($46,886) | $8,159 | $58,750 |
Net Profit/Sales | (22%) | 3% | 14% |
2020 | 2021 | 2022 | |
---|---|---|---|
Cash | $24,463 | $29,034 | $87,541 |
Accounts Receivable | $0 | $0 | $0 |
Inventory | $7,690 | $10,490 | $10,490 |
Other Current Assets | |||
Total Current Assets | $32,152 | $39,524 | $98,030 |
Long-Term Assets | $58,300 | $58,300 | $58,300 |
Accumulated Depreciation | ($5,830) | ($11,660) | ($17,490) |
Total Long-Term Assets | $52,470 | $46,640 | $40,810 |
Total Assets | $84,622 | $86,164 | $138,840 |
Accounts Payable | $2,722 | $3,422 | $3,424 |
Income Taxes Payable | $0 | $0 | $1,850 |
Sales Taxes Payable | |||
Short-Term Debt | $7,318 | $7,925 | $8,583 |
Prepaid Revenue | |||
Total Current Liabilities | $10,040 | $11,347 | $13,857 |
Long-Term Debt | $86,468 | $78,543 | $69,961 |
Long-Term Liabilities | $86,468 | $78,543 | $69,961 |
Total Liabilities | $96,508 | $89,891 | $83,818 |
Paid-In Capital | $35,000 | $35,000 | $35,000 |
Retained Earnings | ($46,886) | ($38,727) | |
Earnings | ($46,886) | $8,159 | $58,750 |
Total Owner’s Equity | ($11,886) | ($3,727) | $55,023 |
Total Liabilities & Equity | $84,622 | $86,164 | $138,840 |
2020 | 2021 | 2022 | |
---|---|---|---|
Net Cash Flow from Operations | |||
Net Profit | ($46,886) | $8,159 | $58,750 |
Depreciation & Amortization | $5,830 | $5,830 | $5,830 |
Change in Accounts Receivable | $0 | $0 | $0 |
Change in Inventory | ($7,690) | ($2,800) | $0 |
Change in Accounts Payable | $2,722 | $700 | $2 |
Change in Income Tax Payable | $0 | $0 | $1,850 |
Change in Sales Tax Payable | |||
Change in Prepaid Revenue | |||
Net Cash Flow from Operations | ($46,023) | $11,889 | $66,432 |
Investing & Financing | |||
Assets Purchased or Sold | ($58,300) | ||
Net Cash from Investing | ($58,300) | ||
Investments Received | $35,000 | ||
Dividends & Distributions | |||
Change in Short-Term Debt | $7,318 | $607 | $658 |
Change in Long-Term Debt | $86,468 | ($7,925) | ($8,583) |
Net Cash from Financing | $128,786 | ($7,318) | ($7,925) |
Cash at Beginning of Period | $0 | $24,463 | $29,034 |
Net Change in Cash | $24,463 | $4,571 | $58,507 |
Cash at End of Period | $24,463 | $29,034 | $87,541 |
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The Farm Business Plan Balance Sheet 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.
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Specifically, these funds will be used as follows: Land: $200,000. Equipment: $200,000. Three months of overhead expenses (payroll, utilities): $150,000. Marketing costs: $100,000. Working capital: $100,000. Easily complete your Agricultural business plan! Download the Agricultural business plan template (including a customizable financial ...
The Purpose of a Farming Business Plan. The farming business plan is going to define and communicate your farm's mission and goals. It helps provide a clear direction for your operations, resources, and ensures that everyone involved in the business is on the same page. Additionally, a well-crafted business plan is often required when seeking ...
Introduction. Writing a business plan for your farm can be an intimidating process to start, but it doesn't have to be overly complicated, depending on the main purpose of the business plan. Simply put, a business plan tells what your farm vision is and how you will make it happen. The goal of this Business Farm Plan Workbook is to provide a ...
Cultivate your agricultural ambitions with our comprehensive collection of farm sector business plan examples. Perfect for farmers, agripreneurs, and agronomists, this resource provides information, from small-scale organic operations to expansive agribusiness ventures.
Cornell Small Farms Program Online Course BF 202: Business Planning. The Cornell Small Farms Program offers 20+ online courses every year on many topics related to the production and business sides of farming. Most are taught by Cornell Cooperative Extension educators. BF 202 is a 6-week course that will guide you through the process of writing ...
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USDA FSA Sample Microloan Application. Small Farms Program. Oregon State University. Send E-mail. Phone: 541-713-5009. OSU College of Agricultural Sciences. 430 Strand Agriculture Hall. Corvallis, Oregon 97331. Contact Us.
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Cash at End of Period. $24,463. $29,034. $87,541. Download This Plan. Explore a real-world agriculture farm business plan example and download a free template with this information to start writing your own business plan.
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