Three Common Misconceptions When Starting A Small Farm

In the enthusiasm to start a farm or food business, you might rush past some stepping stones that can save you time and headache down the road.  Avoiding these common miscalculations will help pave the road to success.

#1  Build it and they will come.

You’ve worked really hard to plant and harvest.  You have unique varieties and can’t wait to have customers taste your product.  But if no one knows about your farm, or they don’t know what’s special about your products, you’ll have a hard time getting off the ground.  You’ve got to get out there – differentiate your offerings, market and sell!  Small businesses that engage in marketing, especially online, are 2.8 times more likely to survive.  Read more about the fundamental of marketing for small farms to help you get off on the right foot.

#2  As long as you are selling stuff, you’ll survive.

You have customers! And they are buying your product!  Awesome, but are you making any money?  Sure, you may survive the first season with an initial investment and some cash from customers.  However, in order to build a sustainable business and thrive, you’ll want to have a handle on the cost to bring your product to market.  Knowing your cost is an important input to setting your prices.  And then knowing the price the market will bear for your product will help you set a price that allows you to make a reasonable margin and stay in business for the long haul.  Read more about price setting and margins relative to food in the Pricing section of this article.

#3  You don’t need a business plan.

Thinking you might just wing it, start small then build out your farm?  An important and often overlooked part of launching any business is going through a planning process.  Writing a long and complex business plan might not be necessary, especially if you are not seeking external investment or loan.  But the simple process of thinking through marketing, operations, finances and competition is worth the effort.  This upfront effort may help avoid pot holes and achieve a smooth(er) lift-off as your operations get underway.  Read more about business planning for small farms.