Starting a Business
Penn State Extension has a vast range of resources for anyone who wants to start a business in agriculture. In this section, you’ll find information relating to the legalities of running such a business, and advice on business plans, financing, pricing, marketing, and budgeting. Find ideas and opportunities including cooperatives, agritourism, and e-commerce farm businesses.
How to Start an Agriculture Business
There’s a lot of research to be done before you can start your new agricultural business. As in any other industry, the first step is to define your goals and objectives. This information is essential when you need to communicate with service providers such as the bank. A useful tool for getting an insight into your business is SWOT analysis. SWOT stands for Strengths, Weaknesses, Opportunities, and Threats).
Goals and objectives also have a key role in the development of a business plan. As a guide to the future of your business or venture, your business plan will also include the legal and business structure of your enterprise, management strategies, marketing, and financial plans.
Product pricing is also critical and is a determining factor for whether or not consumers purchase your product.
There are lots of resources to help with the first steps in starting a business. A Food for Profit workshop takes you step by step through the information necessary to start and run a small food product business. The Penn State Farm Management Handbook covers all you need to know for the successful management of your farm. For the legal side of your business, free legal services are available through Penn State Law.
Farm Planning
To manage a farm well requires careful planning. In most cases, you should plan for years, if not decades in advance. Your plans should cover the land, equipment, and resources you need, and the development of the farm business – from marketing to cashflow.
It means you need to understand the basics of budgeting. Budgets are an excellent planning tool for the upcoming season. Record keeping is critical for all farms.
If you want your business to thrive and be sustainable, you should look for ways to diversify your income. Another option is to extend your farming season. Knowing what prices to charge for your products and how to market them are also key to business growth. Strategies for successful selling should be applied throughout the year.
There are always risks involved in running a farm; for example, pests and diseases. Risk management tools can be used by new and beginning farmers. Risk management strategies include diversification, crop rotation, and the use of a variety of insurance products.
Agriculture Business Ideas and Opportunities
The opportunities for anyone wanting to start an agriculture business are wide-ranging. The important thing is to find a niche you’re passionate about that is also profitable.
Value-added ventures can be applied across most stages to further increase profits. Growth can also be increased by marketing value-added products.
Silvopasture is a farming system that integrates trees, livestock, and forage crops together to create dual income from timber and livestock. Cooperatives are a business type that is voluntarily owned and controlled by its member-patrons. Organic production is becoming more popular, but it requires lots of planning and research. Agritourism is another opportunity for would-be farmers.
Marketing your production is a key element of any farm’s success. It encompasses everything you do to promote your business and food products. How you market your crops impacts your profitability and your success when seeking outside funding.
Implementing e-commerce is a very attractive option for people interested in growing food for profit. More and more consumers are choosing to shop online, which makes e-commerce in a food or farm business very viable. A successful e-commerce business requires knowledge of payment methods and online ordering systems. You can measure your storefront’s success using a Secret Shopper Service and Network such as Under the Ground.
Farm Budgeting and Finances
For new farmers, one of the biggest hurdles is financing their business. Many businesses choose to start using personal savings, funds from family, or credit cards, but there are other options, such as a loan from a lending institution. There are lots of grant and loan opportunities if you want to start a farm. The Federal CARES Act Paycheck Protection Program is one example of a loan for forgiveness.
You can increase your chance of success when applying for a farm loan by knowing your farm enterprise and budgeting effectively.
A variety of budgeting methods can be used. Partial budgeting is a planning and decision-making framework you can use to compare costs and benefits. It helps farm managers assess the financial impact of changes such as the purchase of new equipment. Understanding the difference between markup and profit, and keeping a permanent record of receipts and expenses are also important.
Several different programs can provide small and beginning farmers with an all-important safety net. Programs include many types of business insurance, such as farm owner's insurance and crop insurance.
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Elaboración de un Plan de Negocio
Una tarea importante al iniciar una nueva empresa es elaborar un plan de negocios que sea una "hoja de ruta" para guiar el futuro del negocio o la empresa. - Articles
Value-Added Agriculture: Enhancing Farm Opportunities
Value-added agriculture offers important benefits for farmers interested in diversification of their farm operations. This article provides an overview of value-added agriculture and tips for getting started. - Articles
Starting or Diversifying an Agricultural Business
Small-scale farming can be a very satisfying lifestyle, but to be financially successful you also need to view your operation as a business. - Articles
Fund Your Farm Planning with PA's Farm Vitality Grant Program
Are you ready to invest in planning for your farm? The Pennsylvania Department of Agriculture’s Farm Vitality Grant Program will reimburse 75% of costs up to $7,500. - Articles
Marketing Poultry Slaughtered Under USDA Exemption
Are you raising poultry and wondering what rules apply to you? The following summary states where you can sell your poultry depending on how it was processed and what other regulations apply. - Videos
Introduction to Marketing
Length 7:23Marketing success drives business success. This video gives an overview of the aspects to developing a strong marketing strategy. - Articles
Inicio de su Granja
Usted hizo un estudio de viabilidad para su idea de empresa agrícola y ahora desea comenzar a cultivar. ¿Cuál es el próximo paso? - Articles
Industrial Hemp Production
This publication provides information about hemp, including production history, policies, uses, market challenges, and production practices. It also includes sample budgets for production. - Articles
Financial Lessons Learned from a Former Beginning Farmer
Many moons ago I was given the advice to "learn from the mistakes of others—it's too expensive to make all the mistakes on your own!" As a beginning farmer, I made more than a few mistakes. Here's an opportunity to learn from my mistakes. - Articles
Supporting Farmers in their Start-Up and Establishing Years
Penn State has teamed up with establishing farmers to help new farmers become more profitable, productive, and sustainable. - Tools and Apps
Herramientas de mantenimiento de registros de granjas urbanas
Muchas granjas urbanas tienen múltiples fuentes de financiamiento y una superficie limitada para producir sus cultivos. - Articles
Cultivos en pequeña escala y Presupuestos de extensión de temporada
Muchos cultivos hortícolas se prestan bien a la producción a pequeña escala. Estos cultivos pueden generar ingresos y ganancias sustanciales con un acre de producción. - Videos
Claim Your Business on Google
Length 7:18Learn how claiming your business on Google can benefit your online presence and watch a demonstration of the process. - Articles
Developing a Business Plan
An important task in starting a new venture is to develop a business plan, which is a "road map" to guide the future of a business or venture. - Articles
Identificación de mercados para productores latinos de frutas y hortalizas
La creación de relaciones con los clientes constituye un valor fundamental para alcanzar el éxito empresarial. El objetivo es ser visto como un socio, no sólo como otro vendedor de productos. - Articles
Branding Your Farm Business
Branding goes beyond designing a visually appealing logo for your farm business. Your brand becomes your image and a link to your reputation. - Articles
Food for Profit: Registering Your Business
All businesses need to comply with local, state, and federal registration procedures in order to legally operate. Food-processing businesses are no exception. - Articles
Food For Profit: Price and Pricing
There is a difference between price and pricing. Each method has own advantages and disadvantages. - Articles
Food for Profit: Marketing Your Food Product
Marketing is more than advertising. It is everything you do to promote your business and your food products from the moment you conceive of a product to the point at which customers buy it. - Articles
Food for Profit: Insurance for Food Entrepreneurs
Food business owners are held responsible for any harm that comes to employees, visitors who come to your establishment, and consumers who eat your products. - Articles
Food for Profit: Business Planning
Before starting your new food business, you need a clear vision of how you want your business to operate, such as how it will be managed, marketed, and financed, and how you expect it to perform in the future. - Articles
What's the Difference Between Markup and Profit?
Understanding the difference between markup and profit margin is critical to the success of your business. - Tools and Apps
Urban Farm Record Keeping
These tools will assist with keeping good farm records and will develop enterprise and whole-farm budgets. - Articles
Small-scale Field Grown and Season Extension Budgets
Enterprise budgets for several popular vegetable crops grown in the field and in high tunnels. - Articles
Enterprise Budgeting for Small Farms and Homesteads
Creating a budget can be a valuable experience not only for folks who are raising crops or livestock for profit, but also those who are homesteading.