How to Start a Small Farm Business [Step-by-Step Guide]

How to Start a Small Farm Business

Posted 4 years ago by Max Komonov

Starting a桂farm business might be桂a桂big dream for桂a桂young entrepreneur. There are simply so桂many questions and桂processes involved, it桂can be桂. For example, you worry about how to桂go桂about obtaining the桂land you need, getting licensed, and桂making sure your farming ambition generates money. Not to桂mention, having the桂skills as桂a桂farmer to桂make your business sustainable.

These questions might seem too daunting to桂tackle, and桂make you want to桂hang up桂your farmer�셲 hat right here and桂now. However, don�셳 let the桂complexity of桂this new undertaking get you down. Therefore, this article will be桂your complete guide on桂how to桂start a桂small farm, wherever you find yourself. It桂will explain each step using applicable scenarios to桂ease your understanding along the桂way. At桂the桂end of桂this article, you will have enough information to桂get started towards building that small farm that you always wanted. So, let�셲 dive in.

Why Do桂You Want to桂Start a桂Small Farm?

For you to桂be桂a桂successful farm owner, you should really have a桂deep understanding of桂why you want to桂start a桂small farm. This is桂the桂first thing you need to桂consider and桂it桂is桂very important. Are you starting a桂small farm as桂a桂business or桂a桂hobby?

Knowing the桂reason for桂your ambition is桂important, as桂it桂will drive your motivation and桂shape your business strategy. For example, in桂terms of桂business strategy, it桂can play a桂huge role in桂taxation and桂financial aids. Here, hobby farms�� tax implications are different from business farms.

After knowing the桂reason why you want to桂start a桂small farm, the桂next thing is桂how to桂start it. Below is桂a桂stepwise procedure on桂how to桂start a桂small farm anywhere you are. These steps have been tailored for桂any桂type of桂small farm that you have.

Step 1.桂Identify Your Niche

The first thing to桂do桂to桂make into reality your dream as桂a桂farm owner is桂to桂identify your niche. Jumping into the桂farming business without identifying your niche is桂not a桂good strategy, especially for桂those starting a桂farm business. If桂it桂is桂a桂hobby, for桂personal use, or桂any桂form not centered on桂generating profit, it桂might not be桂that important.

Are you going to桂be桂into fruits, vegetables, or桂livestock? As桂a桂potential farm owner, selecting a桂particular niche is桂good as桂it桂makes planning easier. Consequently, you will be桂able to桂do桂market research and桂draw a桂business plan based on桂the桂selected niche.

Step 2.桂Market Research

This is桂undoubtedly an桂important step when looking to桂start a桂small business farm. Having market research will allow you to桂know what your target market looks like.

Market research is桂important as桂it桂will let you plan the桂following:

Where will you sell your farm�셲 produce?
To桂whom you will sell your farm�셲 product(s).
How will you sell your farm product?

Let�셲 create a桂scenario where you don�셳 have proper market research. Let�셲 say you start a桂pineapple fruit farm in桂California. However, on桂harvesting, you 혫suddenly혬 discover that the桂demand for桂the桂fruit you are selling is桂in桂Florida. That is桂what is桂termed 혫not knowing your target market location and桂what they want혬. Assuming you did proper market research, you would have been able to桂plan against such a桂scenario. For example, you would have:

Known your target market is桂not in桂California
Chosen a桂niche that is桂in桂demand in桂California
Start your fruit business in桂Florida

Any of桂these choices would have saved you a桂lot of桂trouble and桂money.

For effective market research, you should note the桂following things:

Your potential customers.
Distribution channels.
Learn about the桂local market.
Do桂a桂survey of桂underrepresented crop or桂animal products in桂the桂farmers�� mark

Step 3.桂Business Plan

Having a桂business plan will help you project into the桂future. A桂business plan is桂important as桂it桂translates your vision into a桂blueprint, so桂other people can understand and桂support the桂vision. When doing a桂business plan, you should incorporate what you learnt during your market research and桂draft something that will seamlessly bring your dreams to桂reality.

Step 4.桂Getting Financial Aid

Financing can be桂a桂problem for桂many new entrepreneurs, thereby, making it桂challenging to桂set up桂a桂small farm. Therefore, it桂is桂important to桂get sources of桂financing. There are many options to桂get financed. Two most important methods include;

Grants And Subsidies

Most governments don�셳 offer grants for桂people intending to桂start a桂small farm. However, there are many subsidies and桂other forms of桂assistance available. You can contact the桂local state department of桂agriculture around you for桂information on桂grants, subsidies, and桂other forms of桂assistance available for桂small farm owners.

Loans

Loans are the桂quickest option of桂getting financing when setting up桂a桂small farm. However, getting a桂loan also depends on桂what type of桂farm you are running. For example, there is桂a桂low tendency of桂getting a桂loan if桂you are running a桂hobby farm. However, with a桂solid business plan, you can get a桂loan for桂business farms.

Step 5.桂Getting a桂License

If桂you are going to桂run a桂small farm business or桂a桂hobby farm, you need to桂obtain some proper licenses. Also, when getting a桂license, you should be桂familiar with the桂state and桂local regulations of桂your environment. This is桂because of桂zone restrictions on桂some farming activities which can make them not to桂be桂available. Also, some farming activities as桂a桂result of桂zone restrictions might lead to桂expensive licensing and桂inspection.

Consult the桂local state department of桂agriculture as桂they will provide you with the桂latest information about zone restrictions and桂the桂necessary licenses you need.

Step 6.桂Find the桂Right Land

Once you know what to桂farm and桂you have the桂necessary information about starting, the桂real work starts with having the桂right land. There are two options available for桂getting land for桂farming. You can lease or桂buy it.

Buying land

We桂recommend against buying land as桂an桂entrepreneur thinking of桂setting up桂a桂small-scale farm for桂the桂first time. While buying land will give you complete control, you will also have to桂assume the桂financial risk involved in桂such a桂large decision.

Leasing land

This is桂the桂most popular option for桂young farmers. There is桂a桂little financial risk to桂leasing land and桂it桂requires less upfront in桂terms of桂capital. The only thing you have to桂do桂is桂find landowners that have arable land which is桂available for桂use.

Things to桂consider when looking for桂land

Whether you choose to桂buy or桂lease, you don�셳 just spontaneously decide that this is桂the桂right land to桂get for桂your farm. There are many factors to桂consider before making such a桂decision. Below are a桂few important ones to桂consider.

Market proximity and桂land accessibility

It桂is桂important to桂get land that is桂near the桂market. Getting land in桂a桂far place will bring risks of桂financial and桂logistic issues. Since you would have completed your market research, you should have an桂idea of桂your market location and桂judge the桂viability of桂a桂space-based 늡꾈桂넨농껸넨.

After knowing how close the桂land is桂to桂your marketplace, you should also consider transportation problems and桂accessibility. You must be桂able to桂balance easy access and桂proximity when choosing your land.

Access to桂water

Access to桂water is桂another important factor to桂consider when looking for桂land. The place you should choose must have a桂steady water supply. This is桂to桂make sure that you can provide water for桂your crops, animals, and桂production process.

Water sources such as桂a桂well are widely considered the桂best, as桂it桂is桂free. However, the桂cleanliness of桂your well water depends on桂the桂environment you are living in. Using a桂municipal water supply will provide you with clean water. However, there is桂a桂price tag that you must consider.

Choosing a桂water supply must be桂based on桂a桂blend of桂accessibility, water quality, and桂price tag attached.

Soil quality

Soil quality directly influences crop production capacity and桂expenses. For example, you can make an桂accurate prediction for桂fertilizer use based on桂the桂test result. Also, the桂soil type influences the桂growth and桂health of桂the桂livestock you might want to桂rear. You can ascertain the桂soil quality by桂carrying out a桂soil test using the桂local extension services in桂your area.

Step 7.桂Selling Your Products

This is桂the桂last and桂most important part of桂setting up桂a桂small farm business. You already know how to桂start a桂farm and桂the桂little details needed. However, for桂those into farming as桂a桂business, your farm must generate profit which is桂obtainable only after selling your farm produce. There are many ways to桂sell your farm produce.

Farmers markets

These are no桂doubt the桂most popular places to桂sell your farm produce. It桂involves harvesting and桂setting up桂a桂storefront at桂a桂local farmer�셲 market to桂sell your products at. Unsure about selling in桂person? Look into an桂ecommerce platform like 붚죕쳔 that will allow you to桂accept physical payments. More information on桂that can be桂found here.

A桂farm shop

Another popular way to桂sell farm products is桂having your own proprietary farm shop. However, this method is桂only ideal if桂you have enough traffic near your farm and桂you already have a桂good track record of桂selling high-quality goods.

Create a桂united brand

You could also team up桂with other farm owners and桂sell your product under a桂United Brand.

Ecommerce

Ecommerce is桂another option to桂try for桂potential farm owners. Ecommerce has a桂global reach. Consequently, you can easily get in桂touch with a桂wide range of桂audiences and桂up桂your profit level. Setting up桂an桂ecommerce store is桂possible on桂platforms such as桂붚죕쳔, Wix, Squarespace, etc., and桂it桂is桂one of桂the桂best options there. You can also combine it桂with other methods listed above to桂help you get more sales.

Final Thoughts

Setting up桂a桂small farm can be桂challenging for桂new entrepreneurs. Therefore, this article answered the桂different questions that might make setting up桂a桂small farm problematic. By桂going through this article, you would have the桂necessary information required to桂turn your dreams into reality.

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About The Author

Max has been working in the ecommerce industry for the last six years helping brands to establish and level-up content marketing and SEO. Despite that, he has experience with entrepreneurship. He is a fiction writer in his free time.

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