How To Write A Small Farm Business Plan

Small Farm Business Plan
Business Plans PDF

Developing a roadmap on how you will run a successful farm business is an investment you should not take for granted. It helps you develop a clear vision for your business and come up with ways to effectively run your farm operations. In the process, you can develop your short and long term goals. If you already have an existing farm business, a business plan will help you determine where to go next and if you plan on setting up a farm business a business plan will help you create structure and find effective ways to make profit. Developing a business plan for a farm business is not different from writing up any other type of business plan. The process is the same and the components of any other kind of business plan are similar.

Types of Small Farm Businesses

There are several types of small farm businesses which include :

Goals/Objectives And Mission Statement

First things first, as a farm owner you should think about and write down your goals and objectives. These will determine where you are headed, what you want to achieve and how you will achieve it. It is important to think about what your mission is and where you want to be in the next 5 years or so years to come. Keep in mind that these goals and objectives must be “SMART” that is specific, measurable attainable, realistic and timely.  In this section, it is also important to include your short term goals that you plan to have achieved in under a year for direction.

Background Information

After writing up your goals and objectives, the next thing would be to write up a brief summary of your management team especially if you intend to use the business plan to get funding. This summary should have your educational qualifications including those of other directors or managers you will bring on board. You should also include where your farm is located as well as any other relevant information that an investor may want to know. In this part of the business plan, you must also include your farm business structure.


After the background information is laid out, you must now come up with a farm strategy. You should have this separate section for your operational strategy, sales and marketing strategy, as well as your financial strategy. Your overall business strategy should be based on market conditions and the farming industry. It is imperative that you research your current industry thoroughly. Determine who the big industry players are in the farming business especially those that are already producing what you want to sell. You must also conduct a thorough market analysis to see if there are available buyers for your product. Determining if there is a demand for your produce early on will prevent you from making losses. In addition, you should segment your market in order to determine who your ideal customer is. Your strategy section requires a lot of time and research. This section will also help you see if your business is feasible or not. Based on the market conditions and industry analysis you can be in a better position to make good business decisions.

Farm Products

This section outlines all the small farm products that you offer. For examples, if you are engaged in crop and vegetable farming, your products may include cabbages, maize, tomatoes, onions, broccoli and spinach. If you are engaged in poultry farming, your products may include broiler chickens, quails, free range chickens and eggs. For livestock farm businesses, products include cattle, goats, milk, pigs and rabbits. A mixed small farm may include products from all the above categories. Ensure that all products which are produced by your small farm are included in the business plan.

SWOT Analysis

A SWOT analysis an important section when writing up any kind of business plan. When writing up your farm business plan you must do an assessment of your strengths, weaknesses, opportunities and threats. That way you can see where your strengths lie and capitalise on them. A SWOT analysis also helps you figure out what your weaknesses are and what you need to do to improve them. Opportunities and threats are external and can be discovered when an industry analysis is carried out. This way you can create ways to take advantage of the present opportunities and find ways to tackle any threats.

Risk Analysis

Another important section when preparing a farm business plan is a risk analysis. This part of the business plan also requires you to do a thorough research on the possible internal and external risks that may be associated with running a farm business. You need to know what your production risks, market risk, financial risk and personal risks are. With production risks, you must understand that there are pests and diseases associated with growing certain crops or rearing certain animals. As such, you must plan how you will tackle such risks. Since farm produce prices change with seasons you should also have contingency plans in place to prevent losses. There must be ways to prepare for any financial risks and ways to address operational issues that may affect the farming profits.


After you are done writing up your vision, strategy, assessing your capabilities and opportunities the next thing is to create your budget. You must have sales, operational and marketing  budgets together with revenue forecasts. Consider creating projected cash flows for a period of 5 years or so as well as forecast income statements. If you have been operating a farm already you can use your current data to determine what the future holds. It is important that your financials are reasonably estimated and not overstated or understated. Your financials section is one of the most important part of your farm business plan and it should be done with caution. If you intend on getting funding you must also include a funding request in your business plan. This funding request should simply state how much money you need as well as the amount of money that you will be investing in the farming business.

Writing a farm business plan can be a big task but with enough time and research it can be done. Do not rush the process and ensure that you do enough market and industry research to put you in a much better position as a farmer. Try as much as you can to come up with various ways to achieve your goals without relying on a few strategies. Ensure that you breakdown each section accordingly to avoid getting overwhelmed when preparing your farm business plan.



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