business plan for starting a farm

How to Start a Farm in 2024: Detailed Steps, Costs, and Considerations

Published: January 22, 2024

If you've ever wondered how to start a farm, you're not alone. In this article, we show you an opportunity to stake your claim, embracing a life rooted in the sweat of your brow and the fertility of the land.

You are about to embark on a new farming journey, and we're here to provide substantial insights into the key pieces of starting a farming business. After all, this isn't just a hobby or passing fascination. Now, let's roll up our sleeves and get down to earth.

Step-by-Step Guide to Starting Your Farm

Learn about farming goals and why they are important for success.

Selecting the right type of farm based on your ambition and your goals

Discover how to secure land and resources vital for starting a farm.

Understand the significance of a comprehensive farm business plan and its key components.

Gain knowledge on executing your plan and tips for initiating operations effectively.

Step 1: Identifying Your Farming Business Goals

Drafting clear goals is important before venturing into any business ; farming is no exception. Goals serve as your GPS, guiding your actions and decisions from inception to operation and beyond. For instance, you may aim to start a crop farm to provide organic produce for the local market.

Alternatively, you may dream of starting an animal farm, focusing on dairy or meat production. Regardless of your chosen direction, an articulated path clears ambiguities and enhances focus.

Importance of Setting Clear Goals

Clear aims provide guidelines that shape your farming operations. Outlining SMART (Specific, Measurable, Achievable, Relevant, Time-bound) farming objectives provides a strategic pathway to making informed decisions. It is this specificity that allows one to select the most suitable type of farm, choose the appropriate land, and manage resources meticulously.

Examples of Farming Business Goals

For instance, if your goal is to start an off-the-grid permaculture farm, decision-making will pivot to eco-friendly operations. If the aim is to start an urban rooftop farm, the focus may be on optimizing limited space for maximum yield.

Step 2: Choosing the Right Type of Farm

Each type of agribusiness requires unique considerations, from the soil's quality and climate conditions to market potential. Data suggests that understanding your intended farm helps narrow your options and ensures that you invest wisely.

Different Types of Farms and Their Requirements

Each has unique money-making requirements , whether a crop farm, dairy farm , poultry farm, horticultural operation, or mixed farm. For instance, dairy farms demand significant attention to livestock health and handling, while a crop farming business needs precise knowledge of soil management and plant diseases.

How to Choose the Right Farm Based on Your Goals

In determining the right farm type, you should consider your personal interests and skillset, market demand, available resources, and farming location. Doing this aligns your venture with your core objectives, making progression smoother and more fulfilling.

Step 3: Developing a Farm Business Plan

A well-crafted farm business plan is important for securing funding from lenders or investors and serves as your farming business blueprint.

Importance of a Business Plan

A business plan outlines the specifics of your farm operations, the marketing tactics, financial projections, and resource management strategies. It allows you to anticipate possible challenges and plan for them in advance.

Key Elements of a Farm Business Plan

Essential components of the plan should include an executive summary, your farming business goals, method of operations, marketing strategies, financial forecasts, and risk management plans.

Step 4: Securing Land and Resources

Once you've defined your farming business goals and the most suitable type of agribusiness, the next step is securing land and requisite resources. According to the USDA's Farmers.gov , you'll need to consider factors like creating a plan, assessing the land, find funding, among other steps, before selecting the right farmland for your venture.

How to Find and Purchase Suitable Land

Identifying the right land entails comprehensive research to ensure it meets your farming requirements. We recommend hiring an expert to perform soil tests and environmental assessments before finalizing a purchase.

Necessary Resources for Starting a Farm

Apart from land, other resources are crucial for a farm: capital, farming equipment, seeds or animals, and labor. Having a checklist of everything you need to have a successful farming operation and calculate comprehensive startup costs is important.

Step 5: Implementing Your Plan and Starting Operations

Having a successful farm business isn't just about planning. The next phase is implementation.

Steps to Implement Your Business Plan

These steps range from acquiring the necessary permits and purchasing resources listed in the plan to hiring employees and initiating operations. It's important to revisit and adjust the plan regularly as circumstances change.

Tips for Starting Operations Smoothly

Successful operation commencement hinges on planning. Develop an operation checklist, delegate responsibilities to your team, and ensure all necessary regulations are adhered to for a smooth start. A great emphasis should always be put on quality assurance.

Incorporating these steps provides a roadmap for avoiding common pitfalls and moving toward a successful venture when starting a farm. As always, make sure you conduct market research before starting your venture.

The table below shows the issuing agency for permits based on the business activity you plan on pursuing (source: sba.gov )

Next, gain a clear understanding of the costs associated with starting a farm.

Understanding the Costs of Starting a Farm

Get a clear picture of the initial and ongoing operational costs of the farming business

Learn strategies to manage these costs effectively

Initial Investment Costs

You can start a small farm for as little as $600 to over $10,000 because it depends on various decisions and factors like the type of equipment and whether you're hiring people to help. Before dipping your toes into the farming industry, it's crucial to comprehend the initial investment costs. The foundational pillars involve expenses related to land acquisition, purchasing necessary farming equipment, and introducing the desired crops or livestock to your property.

You can also see if you qualify for loan programs if you're a beginner farmer.

The land cost can vary dramatically based on the location, fertility, and size. Typically, more fertile land boasting a good location tags a steeper price. Important to note – the calculation must also include the cost of relevant insurance coverage (liability, property and crop insurance etc.).

Farming equipment follows next. Tractors, planters, plows, and irrigation systems have substantial price tags. Acquiring livestock requires immediate financial attention if you're planning on animal farming.

Less apparent costs include seed, buildings, and site improvements like fencing or driveways. Now the question becomes, how do you manage these initial costs?

One common approach is to start small and scale over time. At first, consider leasing the land or buying used equipment. Government grants and loans to support farmers can also help ease the financial burden.

Remember, it's not about cutting corners but smart investing and growing steadily.

Ongoing Operational Costs

Even after overcoming the hurdle of initial costs, farms have ongoing operational expenses that need frequent attention. These costs mostly include maintenance of your equipment, seeds for new crops, animal feed, irrigation, and labor costs.

It might surprise you, but labor, including salaries, benefits, and insurance for your employees, often represents one of the highest ongoing costs you'll face. Regular maintenance to keep your machinery in optimal condition and replacing worn-out parts are necessary.

Alongside, insurance can become a hefty annual expense. You will need to include it as a necessary expenditure that safeguards you against major losses.

As we get into the rhythm of regular farm operation, let's dive into strategies for a cost-effective farming business. Streamlined operational practices are the name of the game here.

Precision farming – using technology and data to optimize yields and efficiency – is one way to get more for your money. Properly maintaining your equipment can reduce the frequency and cost of breakdowns. Choosing the right crop or livestock based on markets and your particular farm's strengths could also lead to better profitability.

Effective cost management in farming isn't about cost-cutting; it's about value-maximizing, ensuring every dollar spent returns the best yield or benefit possible. As with most business ventures, this might involve a steep learning curve and plenty of trial-and-error, but with persistence and careful planning, a sustainable and financially stable farm is well within reach.

To help you get started, here is a list of items to consider when starting a farm.

Equipment, Machinery & Tools :

General farming tools and equipment

Primary farm housing structures

Fencing materials

Storage facilities

Harvesting equipment

Fuel for machinery

Greenhouse structure

Irrigation system

Cooling equipment

Packaging material if you're selling on farmers markets

Crop Preparation :

Soil and Fertilizers

Crop protection materials

Pest control supplies

Raising Livestock (if applicable)

Cost per animal type ( cows , chickens , horses) multiplied by the number of animals

Preventative care costs

Additional :

Marketing budget (if applicable)

Utilities (water, electricity)

Transportation (for products)

Labor (if not self-operated)

Training and Education for yourself or your staff

Legal and regulatory compliance fees

Emergency fund

Overcoming Challenges in Starting a Farming Business

Anticipate and prepare for financial obstacles common among new farmers.

Understand and navigate the maze of regulatory requirements.

Tackle environmental and climate-related risks with sustainable, resilient farming strategies.

Dealing with Financial Challenges

Many aspiring farmers often encounter a series of financial obstacles before they can even plant their first seed. It's important to familiarize yourself with these challenges and employ strategic financial management resources. A little extra research can turn up additional financial assistance just when you need it.

Common financial hurdles for new farmers

Capital investment is a critical component of starting a farm, including the procurement of land, essential farming equipment, and seeds. Additional costs include labor, packaging, transportation, marketing, and, potentially, organic certification fees. These costs can be daunting, especially for those without deep pockets or a rich agricultural heritage.

Resources and strategies for financial management

However, confronting these financial challenges requires a strategic approach. Creating a detailed, realistic financial plan is indispensable. Be sure to understand your break-even point and buffer any unexpected expenses. Crowdfunding and agricultural grants can also supplement initial capital needs.

Navigating Regulatory Requirements

Starting a farm business isn't just about tilling the land and harvesting crops. It is also about compliance with farming regulations protecting the farmer and consumer. It can feel overwhelming, but understanding these requirements can help prevent hefty penalties and maintain a farm's success.

Overview of farming business regulations

From business licenses, zoning, and water rights to safety inspections, various governmental bodies regulate different aspects of farming. These regulations can vary by geography, crop type, and farming practices. Checking with local, state, and national bodies for applicable regulations is important.

Tips for compliance and avoiding penalties

Ensuring compliance with these regulations requires comprehensive record-keeping, regular audits, and proactively keeping updated on law changes. When in doubt, get legal help to guide you through the maze of regulations.

Managing Environmental and Climate Risks

Climate change presents unique challenges to a farming business. A sustainable and resilient approach is essential for prolonged success.

Impact of climate change on farming business

Climate change can affect farming by altering rainfall patterns, inducing higher temperatures, and increasing the frequency of extreme weather events. All these factors create uncertain conditions for crop growth and livestock health, fundamentally affecting farming viability.

Strategies for sustainable and resilient farming

Successful adaptation to climate change necessitates strategic planning. Diversify your crops , use water-saving techniques, and employ climate-smart agricultural practices. Use data to understand potential climate risks, anticipate changes, and make informed decisions. Resilience is built one day at a time; it is a marathon, not a sprint. Being adaptable is key in navigating this challenge.

Overcoming challenges in starting a farm requires diligence and adaptability. But with careful planning and proactive management, you'll conquer these hurdles and ensure a thriving farm operation.

Essential Resources for New Farmers

Navigate red tape with government and nonprofit programs

Forge valuable connections within farming communities and local markets

Harness the power of the digital world with online tools specifically catered to farmers

Government and Nonprofit Programs for Beginning Farmers

Long-standing government support and fresh initiatives from nonprofit organizations provide a tailwind for those starting a farming journey. These entities offer many resources, including loans, grants, and educational programs. Brand new farmers, in particular, are incentivized towards benefits that can ease their entry into the industry.

Overview of Available Programs

A wide spectrum of programs is available, from seed funding to extensive land conservation efforts. Several departments under the U.S. Department of Agriculture (USDA), such as the Farm Service Agency and Conservation Service, offer schemes targeting budding farmers. Simultaneously, nonprofit organizations like the National Young Farmers Coalition provide the necessary advocacy and direct assistance. A thorough exploration of both can yield lucrative opportunities for new farmers.

How to Apply and Make the Most of These Resources

Applying for these programs typically involves an online application process, documentation, and patience. Detailed guidelines provided by the issuing authority ensure a smooth process. Most importantly, don’t view these resources merely as financial aid. Instead, consider them an invaluable opportunity to learn more about the industry, network with veterans, and potentially shape local farming policies.

Farming Communities and Networks

Even with modern technology, farming remains a community-centric practice. Networking within these communities can be a game-changer for those new to the field, providing rich insights from generations of farming.

Importance of Community Supported Agriculture

Farming isn't just about tilling soil and growing crops. It involves intricate knowledge about local ecosystems, market demand, and financial management. All of which can be readily provided by a robust farming community. These communities can potentially speed up your learning, mitigate common beginner's mistakes, and even offer emotional support during tough times.

How to Connect with Other Farmers and Learn from Their Experiences

Consider attending local farming exhibitions and workshops or joining farming cooperatives to meet experienced farmers. Even during family gatherings, farmers markets offer a convenient place to meet several farmers in the same area. Social media platforms also offer virtual farming communities where you can easily connect with and learn from farmers worldwide.

Online Resources and Tools

The digital revolution hasn't bypassed farming. Several online resources and applications are available to help farmers stay updated, forecast weather conditions, manage their farms, and interact with a global community.

Useful Websites, Apps, and Tools for New Farmers

Online services such as Ranchr offer a much-needed cattle management service for farmers. Using these resources optimally can keep you at the forefront of industry advancements, helping streamline farm management and supporting critical financial decision-making.

How These Resources Help in Starting and Managing a Farm

These digital tools offer multifaceted benefits. Beyond the logistics of farming, they enhance your understanding of market trends, equip you with skills to analyze data for better decision-making, and connect you with an extensive network of farmers. Coupling these digital resources with insights from local farming communities can provide an optimal blend of traditional knowledge and modern efficiency. But remember, nothing beats connecting with your fellow farmer face to face. Don't hesitate to pick up the phone.

Planting the Seeds for Your Future

Venturing into farming this year could signify a step towards sustainability and entrepreneurship. It involves careful planning, budgeting, and navigating the potential challenges of crop failure, pests, and changing market conditions.

The value of this endeavor lies in improving food security, growing a sustainable business, fostering a deeper connection with nature, and offering value to your community.

Now, armed with this roadmap, your journey begins. Consider your starting capital, scout locations, select your crops, and engage with local farming communities for mentorship.

We hope these steps and strategies have illustrated and given you inspiration on how to start a farm.

Remember, the earth beneath us is teeming with possibilities - it's time to dig in and cultivate your own!

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How to start a farm: grow your farming business from the ground up.

Why Found a Farm?

How much do farmers make, where should you establish a farm, different types of farm businesses for different types of farmers, 8 steps to starting a farm from the ground up, get started on your farm.

Agriculture is one of the most important industries in the world. Aside from producing nutritious food, farms are sources of other products we use and consume daily. Farms also provide places to go for leisure or entertainment.

The structure of the agricultural world has really shifted in the past century. These days, it has become more popular to found a farm business even if you were not born into a farming family. 

Here, we are going to discuss how to start a successful farm. We will also cover some important information regarding types of farms, how much farmers make and more.

Grab your work boots and your pitchfork, because we’re about to jump into the world of farming.

People usually establish a farm business for the same reasons they’d start any business. Maybe they have an innovative idea that puts a new twist on an old concept. Or perhaps they see a void and they know they can fill it. Farming could be one person’s lifelong dream. 

Some small farms are born of a deep desire to connect with the land. From an environmental ethics standpoint, some people feel that starting a farm gives them a way to contribute to the protection of biodiversity. There’s really no right or wrong reason to want to start a farm business.

The United States Department of Agriculture Economic Research Service (USDA ERS) broke down the net cash farm income forecast in the U.S. for 2020. Its reports suggest that a farm in the livestock industry is slated to net between $5,900 and $347,000, whereas a cash crop farm can expect to net between $68,500 and $192,500.

Clearly, there is a wide range of possible net incomes for a farm business. How much you make as a farmer will depend on the types of crops you grow or products you provide, the area you live in and a variety of other factors.

Since many crops are seasonal and many animals only breed at certain times of the year, farmers have to be strategic with their offerings if they are looking to maximize their profit.

Where you start your small farm will depend on what you want to produce. To learn about ideal crops for various locations and climates, visit the USDA website or compare crop production maps online.

When it comes to plants, where you live will play a major role in the types of crops you can grow on a small farm. Some fruits and vegetables are suited for temperate climates while others are suited for hot and dry climates. 

If you’re raising animals, it is a bit easier to choose a location since most popular livestock—like chickens, cows and pigs—can grow in a wide variety of climates. However, you’ll still want to research the ideal climate for each type of animal for your farm business. 

Are you looking to start a small farm on your existing plot in the suburbs? Or do you imagine growing a larger farm in a more rural area? Consider your short- and long-term goals when choosing the ideal location for your farm.

As you can imagine, there are many different types of farms. You can find farms large or small, and those cultivating plants, livestock or both. For simplicity, we’ve organized the most common types of farms into a few main categories. 

If you walk into the produce section of the grocery store, you’ll see dozens of different kinds of fruits and vegetables. If you go to a farmers market, you’ll likely find even more specialty items. 

This is the best way to demonstrate how many types of produce farms are possible. From cucumbers to tomatoes, squash to onions, the options are endless when you decide to start a produce farm and sell at farmers markets. 

Dairy and Livestock 

Although the dairy and livestock industry is predicted to experience a sharp decline over the next decade due to the slow cultural shift towards plant-based lifestyles, it could be the right choice for your farm business. 

These industries are still alive and well. The livestock industry is seeing new types of demands as health-conscious people are starting to lean towards meat that is hormone and antibiotic-free. 

Meat and dairy producing farms that are mindful of their animals’ welfare before they are butchered are preferred by consumers . If you feel inclined to create a meat or dairy farm business, perhaps you can find your place in this niche.

Fish farming is a unique type of farming that raises fish in either tanks or contained bodies of water. Most often, these fish are raised for food.

Since fish live in water, they absorb the toxins and chemicals that they are living in. Farming in tanks gives producers more control over the fish’s environment. It is reported that half of the fish consumed in the world is raised in fish farms.

Did you know that flower farming is one of the most profitable types of farm business?

Flowers are very seasonal and require specific growing conditions. A farmer who owns land suitable for flower farming can make up to $30,000 per acre of land every harvest.

As a flower farmer, you can do so much with your product. You could become a regional, national or even international supplier for florists. You also have the option to offer your own florist services. From there, you can specialize in delivered arrangements, weddings, funerals and more.

Specialty Farms

There are a few types of farms that are very, very specific in their offerings. Many specialty farms offer an experience to learn about farming in addition to their products. 

This may look like a small shop on the farm or a fine dining experience. It could also be farmer-led behind-the-scenes tours.

Here are a few types of specialty farms :

• Bonsai farms
• Cannabis farms
• Chocolate farms (dairy farms that specialize in chocolate products)
• Apiary (bee yard)

Many specialty farms become tourist destinations since they typically offer a niche experience that attracts customers both far and wide. 

Energy 

One type of farming that is rarely talked about is energy farming. This type of farm can look a few different ways.

Some energy farms grow energy crops, and others are designed to generate wind or solar energy. Energy crops are things that are grown to replace coal and other fossil fuels. These crops are not meant to be eaten but are meant to be burned to produce energy. Some examples include corn, clover and different types of grasses.

When it comes to solar and wind farming, nothing is being grown or raised, per se. Typically, a solar farm is a large lot of land in a sunny area that is filled with solar panels. Similarly, wind farms have windmills in windy areas, typically near the ocean or on top of hills.

The purpose of energy farms is to create sustainable energy that has a net negative carbon dioxide production. 

Entertainment

Farms are often the setting of fond memories that last a lifetime. It could be a pumpkin patch on a small farm that your grandma took you to every fall as a child, or perhaps a pony stable you once visited on a trip.

As a farmer, you can create a small farm that brings those same lovely memories to others. Some examples of farms geared towards entertainment include: 

• U-pick farms (strawberries, blueberries and more)
• Petting zoos
• Fall farms (pumpkin patches, corn mazes, hayrides, etc.)
• Horse stables (for horseback riding)

A few of the specialty farms we mentioned before that offer experiences could also fall into this category.

The process of starting a farm is very straightforward, but it is not something that happens overnight. This industry can be quite lucrative, but it takes months of learning how to run a small farm, planning your crops and marketing your products.

Here are eight actionable steps that will walk you through how to start farming like a pro.

1. Choose Something to Produce

As a farmer, the first step in starting a farm is deciding what you want to produce. We’ve covered quite a few types of farming, but the options don’t end there.

You can grow or raise just about any plant or animal you’d like on your small farm as long as the circumstances are right.

What you plan to produce will weigh heavily on your preferences and interests as a farmer. It is also important to point out that there are a lot of ethical questions that arise when you decide to found a small farm.

Agriculture, in general, relies greatly on the land and other creatures. If sustainability is important to you as a farmer, you’ll likely want to start leaning towards growing crops in a fashion that promotes biodiversity. 

Ultimately, you will want to consider what sort of agricultural products will provide the return on investment that you are hoping for with your small farm.

2. Learn the Ins and Outs of Your Product

There are many layers to farming, especially since there are variables that are out of small farmers’ control. 

For most types of farming, learning as you go is simply not an option. There are many ways farmers can learn. Some trade schools, colleges, and universities offer degrees and certificates in agriculture. 

A quick Google search of “grants for agricultural education” will bring up tons of programs that will actually pay you to first learn how to farm, and then plan a career in agriculture.

If the formal education route isn’t interesting to you, you can first work alongside a seasoned farmer as an apprentice or farmhand to learn about farming.

Your local 4H and other similar organizations should have resources available on how to start a small farm, as well. Choose the agricultural education option that makes the most sense for your preferences and lifestyle. 

3. Figure Out Your Finances

Like any small business, you’ll need to find the funds to get started. A small farm is a business that requires quite a bit of overhead.

You’ll need land, equipment, labor, licensing, insurance and more. There is also the option for farmers to buy a functioning farm, but that still requires quite a bit of capital to get started.

Starting a small farm is said to cost up to about $10,000 . However, starting a commercial farm can cost millions .

There are a few ways to fund a small farm. The simplest way would be buying it in cash if you can find the capital. If you don’t have a couple million dollars lying around, there are other options to make your dream a reality. You could get a commercial loan or seek out investors. You could also tap into scholarships and grants for farmers offered by local and national organizations. 

4. Purchase Your Property

So, you know what you want to produce, you’ve learned everything you need to know to get started with this type of farm and you’ve got your funding figured out in your business plan. Now it’s time to find and purchase some land.

Purchasing property for a farm is something that must be well thought out. If you will be raising livestock, you need to make sure the climate is appropriate for the type of animals you’ll be raising. 

However, finding land to plant crops opens a whole other can of worms. Plants can be very finicky. The conditions have to be just right for a successful harvest. Here are a few things to consider:

• What type of climate is best for my crop?
• Which regions have this type of climate?
• Is the land fertile and rich in the appropriate nutrients?
• How much rain does the area get? Does it flood easily?
• If it’s dry, is it possible to irrigate the land?
• How easy will the fields be to work in?
• Is the land safe for all of the employees and animals (if applicable)?

There is another layer to the land selection that many farmers are starting to take into consideration: is the land classified as organic ?

You’ll want to check local legislation for the specifics of organic farming. But this is definitely something to keep in mind if you plan to take the organic route.  

5. Strategize and Prepare 

How you plan to prepare the land on your small farm will depend on what you are growing, raising or producing. 

If you are growing crops, you have to ensure the fertility of your land. You may spend a few years fertilizing your land naturally with compost and manure. Alternatively, you can use chemical fertilizers. Choosing how to enrich your soil will go back to your thoughts on sustainability.

During your agricultural education for your small business, you will learn about crop rotation. If you are buying land that has been farmed for years, you will need to determine which crops to plant next. You will likely plan and strategize a few years out based on crop rotation patterns. 

Irrigation is something to take into consideration when you’re starting, as well.

If you are raising livestock, you must build the appropriate stables. Whether you’re raising livestock for meat, or for eggs, milk, wool or other byproducts will determine what sort of structure you will build.

Other details to consider are whether or not you’ll have additional animals on the farm. For example, many farmers choose to have cats on the farm since they keep rats and mice out of the feed.

In this step, you can also take a look at everything from a business perspective.

6. Implement Your Farming Business Plan

You’ve created your business plan, and now it’s time to take action. It is important to go into this journey with some flexibility. Remember to have back-up options so that you’re covered no matter what happens.

7. Develop Your Product

Even if you specialize in growing or raising one thing, you may develop several related products for your small business.

Let’s say you decided to grow beets. You could choose to sell beets by the bunch. You could also produce and sell cold-pressed beet juice, beet root powder, beet jam or any other beet-based product.

Decide on the direction you want to take and develop your product accordingly. Determine how you will package your product, how you can make it last the longest (if it is a perishable item) and figure out how you will price it.

At this stage, you will want to develop your brand, as well. This goes beyond an aesthetically pleasing logo for your business. Get started by establishing who you are as a business and what sort of value you can plan to provide for your customers.

8. Market Your Products

How you market your products will be determined by who you plan to sell them to. 

Here are a few things to consider when identifying the target audience for your business:

• Will the product be sold as an ingredient to a manufacturer?
• Will you be selling to stores or directly to consumers?
• Can your customers buy the product online? 

As we mentioned before, your farm could offer an experience, so this would be “packaged” and sold differently.

There are so many ways to plan starting a farm. Every farmer’s business journey will be a bit different, and that is OK. That being said, the eight steps we’ve discussed for building a farm from the ground up are a great starting point. It’s a solid plan for farmers who are completely new to the game and want to start learning how to farm.

Now that you’re equipped with the information you need to start your farming journey, it is time to take some action. Are you ready to start farming ?

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12: Business Plans

What is a business plan.

A business plan is a document that helps you to organize and succinctly summarize the vision you have for your business. The plan contains the operational and financial objectives of a business, the detailed plans and budgets showing how the objectives are to be realized.

A good business plan will contain the following:

• Your business vision, mission statement, key values, and goals
• Description of the product(s) you intend to produce
• Strengths, Weaknesses, Opportunities and Threats the business may experience are described
• Production plans
• Marketing plans
• Estimated start-up costs
• Information on your legal structure and management team
• Current financial statements or projected financial statements.
• Resume or brief explanation of your background and relevant experience
• Less than 10 total pages so that people actually read it

Helpful Publications for Writing a Business Plan

General Business Resource Publications:

• Starting an Ag-Business? A Pre-Planning Guide http://publications.dyson.cornell.edu/outreach/extensionpdf/2004/Cornell_AEM_eb0408.pdf
• Business Transfer Guide: Junior Generation http://publications.dyson.cornell.edu/outreach/extensionpdf/2016/Cornell-Dyson-eb1605.pdf
• Producing a Business Plan for Value-Added Agriculture http://publications.dyson.cornell.edu/outreach/extensionpdf/2007/Cornell_AEM_eb0708.pdf
• Business Planning for the Agriculture Sector: A Guide to Business Plan Development for Start-up to Mid-size Operations http://publications.dyson.cornell.edu/outreach/extensionpdf/2010/Cornell_ pdf
• Building a Sustainable Business (Sustainable Agricultural Research Education (SARE)Publications) sare.org/publications/business.htm 280 pages of education and practical exercises to guide you through the financial, management, and interpersonal skills needed to start a successful farm business. Order hard copy for $17 or download PDF online for free.

Cornell Cooperative Extension Publications for Specific Commodities:

• Landscape Business Planning Guide http://publications.dyson.cornell.edu/outreach/extensionpdf/2003/Cornell_AEM_eb0313.pdf
• Writing a Business Plan: A Guide for Small Premium Wineries http://publications.dyson.cornell.edu/outreach/extensionpdf/2002/Cornell_AEM_eb0206.pdf
• Writing a Business Plan: An Example for a Small Premium Winery https://ageconsearch.umn.edu/bitstream/122203/2/Cornell_AEM_eb0207.pdf

Getting Help Writing a Business Plan

Details of a Small Farm Business Plan

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Writing a farm business plan can be a tool for you to plan your farming business. It can also be a requirement of securing grants and loans for your farm business. The process of writing a farm business plan may seem overwhelming and intimidating at first, but if you break it down into its component steps, it becomes much more manageable.

What Is a Business Plan?

A business plan is a roadmap for your small farm . It is both process and product. During the writing of a farm business plan, you'll develop an overall vision and mission for your business. You will think about your short- and long-term goals. You'll define the steps needed to achieve those goals. You'll set the direction for your business to develop over the next five years.

If you're already an established business, your new business plan will show where you're going next. A good business plan should be:

Mission Statement

Your farm’s mission statement is your overarching purpose for your business:

• Why does your farm exist?
• What purpose does your farm serve?
• Where is your farm headed?

This is beyond “make money.” This mission statement is based on your values and your core identity as a small farm.

The goals in your business plan are the specific, measurable “things” you will achieve with your small farm. Short-term goals are defined as those that you will complete within one year. Long-term goals are those that take longer than one year to complete.

SMART Goals are:

• Rewarding, and have a

Background Information

In this section of your business plan, take inventory of what you have right now:

• Where are you located?
• How many acres of land are you farming?
• When did you begin farming?
• How are you currently operating?
• What general practices do you use for such things as conservation, tillage, environmental impact, and marketing?

Farm Strategy

This is where your business plan gets to looking forward. You are going to formulate your farm strategy from now into the next five years or so.

• Gather information and research markets. Make sure that your farm plan fits into the general market in terms of supply and demand. Investigate and analyze industry trends, identify competitors, and define buyers.
• SWOT Analysis. This is an analytical tool that can be used in making decisions. SWOT stands for: strengths, weaknesses, opportunities, and threats. As a business, analyze your internal strengths and weaknesses. Then look externally at what opportunities and threats exist - competitors, new markets, government regulations, economic conditions, and so forth.
• Create alternative strategies. Looking at the information you've gleaned and the analysis you just did, think through options for your farm strategy. Don't rely on price alone; economies of scale are challenging on the small farm level.
• Don't jump to one conclusion immediately. Really spend some time fleshing out the specifics of some of the strategies and looking at their advantages and disadvantages. Try to find options that combine your internal strengths with opportunities in the external environment.
• Look at all your strategies, then reread your mission statement. The ideal farm plan will fit your mission best.
• Write an implementation plan. This is where you write a plan that will make your new strategy happen.

Marketing Strategy and Plan

In the next part of your farm business plan, you develop and outline a marketing strategy for your products and services. This can build on the research you did in the previous step. For each product, include ​the price, placement, and promotion ideas. Consider how you will convey real and perceived value to your customers.

Management Summary

This part of your business plan details your farm business’ structure. Everyone who is involved in the management of the business should be listed here. External resources are listed here as well.

Financial Analysis

In this section, you will need to detail the financial aspect of your farming operation. List your current finances in detail, including all income and operating expenses. Referring to your new strategy, you will forecast what is needed for future growth and to meet the goals you have outlined in terms of capital. Include what your future operating expenses will be.

Pulling It All Together

Writing a farm business plan is a big project. Don’t let that put you off. Your plan can be as simple as it needs to be for right now. Begin with your mission statement and goals. Do your homework by analyzing markets and researching competitors and trends. Have fun brainstorming alternative strategies and let them marinate a while. Take it one step at a time.

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Small Business Trends

How to create a farm business plan.

Crafting a comprehensive farm business plan is a crucial step towards transforming your agricultural visions into tangible realities. This plan serves as a blueprint, enabling you to formally articulate your thoughts, ideas, and aspirations. Engaging in this process can lead to profound insights, illuminating the path to a thriving agricultural enterprise.

Even though the term ‘farm business plan’ might evoke a sense of formal rigidity, it’s important to remember that this document is, in fact, a living, evolving entity. Just like a seedling that sprouts, grows, and changes with the seasons, your business plan is not meant to be static.

It’s something you nurture, revise, and expand as circumstances dictate and as your farm business matures. Feeling pressure to perfect your business plan from the outset could be paralyzing. Instead, we suggest you view this document as a foundation that can be continuously built upon.

To get you started, we offer a detailed farm business plan template. This invaluable resource can be tailored and expanded to suit your unique agricultural venture, whether you’re cultivating a sprawling wheat field or nurturing a boutique organic herb garden.

The most effective business plans are those that exhibit flexibility and resilience, characteristics that are at the heart of any successful farm business. Agriculture, by its very nature, is a domain subject to the whims of Mother Nature. From unpredictable weather patterns to seasonal variations, farmers of all kinds grapple with an array of external factors.

Therefore, your farm business plan should not only anticipate these challenges but also prescribe adaptive measures to navigate through them. It’s this inherent adaptability that transforms a good farm business plan into a great one.

Writing a Farm Business Plan Template: 15+ Things Entrepreneurs Should Include

A farm business plan, like any strategic document, should be comprehensive, encompassing all aspects of your operation, be it agricultural (crops) or product-based. Utilize these 15 key sections to shape your farm business plan template.

Do bear in mind that while these sections are integral, they are by no means exhaustive. Your farm business plan may necessitate additional topics based on your specific farming operations.

Creating a robust business plan is of paramount importance, whether you’re kickstarting a farm venture or acquiring an existing one. Our farm business plan template starts off with an executive summary.

Executive Summary

The executive summary provides an essential overview of your farm business. It helps to streamline communication and understanding between various stakeholders, such as internal team members, potential lenders, business partners, and customers. When drafting your executive summary, consider the following key components:

• Business Profile : Provide a snapshot of your farm business, describing its nature and scope. Are you into crop cultivation, livestock rearing, or any specialized farming practices?
• Products : Clearly outline what product or products your farm will produce. These could range from dairy products to specific crops or even services like agrotourism.
• Production Methodology : Describe how you plan to achieve your production goals. This could involve discussing your farming techniques, usage of technology, or unique methodologies.
• Target Audience : Identify the individuals or groups who will be interested in your farm products or services. These might be local consumers, restaurants, farmers’ markets, or even online customers.
• Key Strategies : Highlight the strategies you plan to implement to run and grow your business. This could cover marketing techniques, sustainability practices, or partnerships.
• Mission and Vision : Briefly outline the mission and vision of your farm business. This helps to convey your long-term objectives and core values.

Remember, your executive summary is essentially the first impression of your business plan. Making it comprehensive, clear, and compelling will help attract interest and support from stakeholders.

Goals and Objectives

A well-crafted business plan should encapsulate both personal and economic goals and objectives. Many successful farm business plans also address environmental stewardship and community outreach. You may want to include goals around preserving farm resources for future generations, ensuring that both the operational and stewardship aspects remain within the family.

Introduction

Your introduction should provide information about the business owners, including their backgrounds and levels of industry experience.

Mission Statement and Values of Your Farming Business Plan

This section enables you to express the core values that led you to the farming business, whether it’s an urban farming venture or a homemade product-based farm. Your mission statement should reflect these values. Sustainable practices and conservation are often key motivations that draw people to farming, so don’t be shy to share your commitment to such principles.

Industry History

Understanding your place within the wider agricultural landscape is key. Be sure to research farms that have historically dominated your region, whether they specialize in vineyards, urban farming, or livestock rearing. Use this research to make educated projections about the future.

Company Background and History

Share the history of your farm if it has been a long-standing family venture or the journey leading up to your purchase if it wasn’t. If your farm business is a startup, focus on the business experience and backgrounds of the involved parties.

Competitor Analysis

Understanding your competition is crucial. In the agricultural sector, farmers often share resources, such as a high-tech corn planter, or cooperate in marketing endeavors. Factor in such synergies when analyzing competitors.

Target Market

Clearly define your target market. This can include area groceries, farmers’ markets, or online customers. If you’ll be relying on online sales, ensure your website is professionally designed, keyword optimized, and easily discoverable.

Products and Services

Describe each product or service offered by your farm, highlighting those features most appealing to your target market.

Organization, Human Resources, and Management Plans

These interconnected elements cover your farm’s day-to-day operations, employee roles and responsibilities (including their job descriptions ), and overarching management plans.

SWOT Analysis

Conduct a SWOT analysis to identify your farm’s strengths, weaknesses, opportunities, and threats. This will help you strategize on how to leverage your strengths, mitigate your weaknesses, exploit opportunities, and neutralize threats.

Your vision is the roadmap for your farm’s future. It should express not just your financial aspirations but also your plans for the farm operation in the long run.

Growth Strategy

A comprehensive growth strategy should outline your plans for debt reduction, savings, and business expansion. Keeping detailed farm production records is key to evaluating the effectiveness of your growth strategy.

Financial Plan

Your financial plan should include elements like balance sheets, income statements, projected cash flows, loan repayment schedules, and depreciation factors.

Marketing Strategy

A robust marketing strategy is essential for your farm’s success. Look into brochures, advertisements, and joining co-op groups. Resources from institutions like the University of Minnesota and Cornell University offer comprehensive insights into effective marketing strategies for farm businesses.

Establishing a Farming Business Entity

Discuss the legal structure of your farm business. Will it be a sole proprietorship, a partnership, an LLC, or a corporation? Outline the pros and cons of each and why the chosen structure is the best fit for your farm business.

Detailed Description of Farm Operations

Include a section that provides an in-depth look at your day-to-day farm operations. This can cover everything from crop rotation plans, livestock breeding programs, to the use of technology and machinery in your farming activities.

Risk Management Strategies

Address potential risks and challenges your farm might face, such as natural disasters, market fluctuations, or pest infestations. Discuss the strategies you plan to implement to mitigate these risks, like insurance coverage, diversification, and emergency response plans.

Sustainability and Environmental Impact

Highlight your farm’s approach to sustainability and its impact on the environment. Discuss practices like organic farming, conservation techniques, and renewable energy usage, which demonstrate your commitment to environmental stewardship.

Community Involvement and Social Responsibility

Describe how your farm business plans to engage with and contribute to the local community. This could include hosting educational farm tours, participating in farmers’ markets, or supporting local food programs.

Supply Chain and Vendor Relationships

Detail your farm’s supply chain and vendor relationships. Explain how you plan to source inputs like seeds, feed, or equipment, and any partnerships with local suppliers or distributors.

Technology and Innovation

Discuss the role of technology and innovation in your farm business. This could include the use of precision agriculture, innovative irrigation systems, or the adoption of farm management software to enhance efficiency and productivity.

Training and Development Plans

Explain how you intend to train and develop your staff. Include plans for ongoing education, skill development, and potentially, leadership training for future farm managers.

Expansion and Diversification

Outline your long-term plans for expansion and diversification. This could involve adding new crops, branching into agrotourism, or exploring value-added products like farm-produced jams or cheeses.

Exit Strategy

Consider including an exit strategy for your farming business. This could be a plan for succession, selling the business, or transitioning to a different type of agricultural operation.

Wrap up your business plan with a conclusion that reiterates your farm’s core mission and vision, and express your enthusiasm and commitment to making your farm business a success.

Frequently Asked Questions

Include a FAQ section at the end of your business plan to address common questions potential investors or partners may have about your farm business. This can include queries about your business model, funding needs, or market potential.

Provide an addendum for additional documents that support your business plan. This can include resumes of key team members, detailed financial projections, market research data, or letters of support from future customers or partners.

Do I Need a Business Plan for My Farm?

Even if you’re knee-deep in the dirt, tending to your crops or livestock, every farming enterprise has the core elements of a business at its heart. These include aspects such as operations, marketing, human resources, and finances. When you embark on developing a farm business plan, it might astonish you to see where the journey takes you. You could end up discovering facets of your farm business that you hadn’t previously considered.

One of the many advantages of constructing your business plan is the opportunity it affords to involve others. Employees, family members, even your loyal farm dog might have innovative small farm business ideas that could significantly enhance your farm’s productivity and marketability. A different perspective can often yield solutions for issues you might not have even been aware of. Therefore, encourage an open exchange of thoughts and ideas. Who knows, the next great idea could be lying right under your hay bale!

More than just a document outlining your farm’s structure, your farm business plan should serve as a valuable decision-making tool. With it, you can confidently navigate the varied terrain of farm management, from daily operations to larger strategic initiatives. When you’ve got a meticulously crafted, robust farm business plan, it doesn’t just narrate your farm’s story, but also provides you with a roadmap to future growth and success.

Beyond this, a top-notch farm business plan can also be a lever that helps you access critical financing. Lenders and investors are more likely to support your venture when they see a well-structured, thoughtful business plan that articulates your vision, illustrates your understanding of the market, and demonstrates your commitment to fiscal responsibility.

So, where to begin? Let’s dive into our fundamental guide to crafting a farm business plan using our adaptable template. This resource has been designed to help you capture every aspect of your agricultural venture, laying a strong foundation for a bountiful future.

How Do I Write a Small Farm Business Plan?

Don’t sit down to write the whole thing. Chip away, one section at a time. Keep in mind that the plan doesn’t have to be the definitive last word. You can make adaptations.

How do you start a farm business plan?

Start with one piece of the business plan. One of the hardest sections of a business plan to write is the Mission Statement . If you get bogged down there, continue and come back to it later.

How much do farm owners make a year?

As you can imagine, the net income varies greatly by type of farm business.

The bottom line after expenses may not be high. Farmers need to consider net worth as assets grow and the farm property increases in value.

How much does it cost to start a small farm?

Getting set up to raise 100 beef cattle costs lots more than getting set up to raise 100 rabbits.

Things like property acquisition, soil preparation, equipment and machinery and the key costs. Other costs may be irrigation systems, packaging and trucking.

What is the most profitable farming business?

Poultry farming is currently the most profitable – and common – farm business in the world. It includes chicken, turkey, quail, ducks and goose, that are being raised for meat or eggs.

It’s also one of the most expensive businesses to start, requiring significant capital investment. The industry is very labor-intensive and labor costs are high.

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You Asked, We Answered!

Starting a Small Farm: A Complete Beginner’s Guide

Starting a small farm can be a challenging and rewarding experience. As someone who has started their own small farm, I can tell you it takes a lot of hard work and dedication.

Still, it is also incredibly fulfilling to see your crops grow and your animals thrive. ,,

Whether you’re looking to start a small farm for personal consumption or to sell your products at local markets, there are a few key steps you’ll need to take to get started.

The first step in starting a small farm is to identify your niche. What do you want to grow or raise? Are you interested in sustainable agriculture, organic farming, or specialty crops?

Once you’ve identified your niche, you’ll need to find suitable land to start your farm.

This can be challenging, especially if you’re on a tight budget. Still, various resources are available to help you find affordable land.

Once you’ve secured your land, you’ll need to develop a business plan and figure out how you’ll finance your farm. This may involve applying for grants or loans or finding investors interested in supporting your vision.

You’ll also need to consider marketing your products and building relationships with local consumers and businesses. With the right plan and hard work, starting a small farm can be fulfilling and profitable.

Assessing Your Goals and Resources

Defining Your Goals

Before starting a small farm, it is essential to define your goals. Ask yourself what you want to achieve by starting a farm. Do you want to grow crops, raise animals, or both?

Are you looking to make a profit or just have a self-sustaining homestead? Do you want to sell your products locally or nationally?

Defining your goals will help you determine the size and scope of your farm, what resources you will need, and what steps you need to take to achieve your goals.

Assessing Your Resources

Assessing your resources is also an important step in starting a small farm. You need to determine what resources you have available to you, such as land, water, equipment, and capital.

Start by evaluating your land. Do you own land or will you need to lease or purchase it? Is the land suitable for farming, or will you need to make improvements? Consider the soil quality, drainage, and access to water.

Next, evaluate your equipment needs. Do you have the necessary tools and machinery to operate a farm? If not, what equipment will you need to purchase or lease?

Finally, assess your financial resources. Starting a small farm can be expensive, so it is important to determine how much capital you have available and how you will finance your farm.

Consider applying for grants or loans from organizations like the USDA or local banks.

READ ALSO: How Farmers Can Earn Money From YouTube (Complete Guide)

Choosing a Farming Method

Conventional Farming

When it comes to conventional farming, the focus is on maximizing yield and minimizing costs. This method relies heavily on synthetic fertilizers, pesticides, and herbicides to control pests and maximize crop yields.

Conventional farmers also use genetically modified seeds engineered to resist pests and diseases.

While this method can be effective in producing high yields, it can also negatively impact the environment and human health.

Organic Farming

Organic farming is a method that relies on natural processes to cultivate crops and raise livestock. This method avoids the use of synthetic fertilizers, pesticides, and herbicides and instead focuses on building healthy soil through the use of compost and other organic matter.

Organic farmers also avoid using genetically modified seeds and instead rely on natural methods to control pests and diseases.

While organic farming can be more labor-intensive and may result in lower yields, it has many benefits for the environment and human health.

Permaculture

Permaculture is a method of farming that focuses on designing sustainable ecosystems that mimic natural systems.

This method involves using a variety of plants and animals that work together to create a self-sustaining ecosystem.

Permaculture farmers focus on building healthy soil through the use of compost and other organic matter, and they avoid the use of synthetic fertilizers, pesticides, and herbicides.

This method can be highly effective in creating a sustainable and resilient farm ecosystem. When choosing a farming method, it’s essential to consider your goals and values as a farmer.

Conventional farming may be a good choice if you’re looking to maximize yields and minimize costs, but it can negatively impact the environment and human health.

Organic farming may be a better choice if you’re looking to build healthy soil and cultivate crops in a way that is sustainable and environmentally friendly.

Permaculture may be the best choice if you’re looking to create a self-sustaining ecosystem that mimics natural systems.

Ultimately, the choice of farming method will depend on your goals, values, and resources as a farmer.

READ NEXT: Farm Insurance vs. Homeowners Insurance: A Quick Comparison Guide

Selecting Your Farm Site

When starting a small farm, choosing the right location is crucial to success. Here are some factors to consider when selecting your farm site:

Climate and Soil

The climate and soil of your farm site will determine which crops and livestock you can raise. Research the average temperature, rainfall, and growing season length of your area.

You can also test your soil to determine its pH level, nutrient content, and texture. This information will help you decide which crops will thrive on your farm.

Water Resources

Access to water is essential for any farm. Look for a site with a reliable water source, such as a well or a nearby stream.

You should also consider the quality of the water, as it can affect the health of your crops and livestock. If you plan to irrigate your crops, make sure your site has the necessary infrastructure in place.

Access to Markets and Customers

Consider the proximity of your farm site to potential markets and customers. If you plan to sell your products at farmers’ markets or to local restaurants, you’ll want to be within driving distance.

You should also research the demand for your products in your area to ensure a viable market for your farm.

By taking these factors into account, you can select a farm site that will set you up for success in the long run.

RELATED: Is Farm Insurance Necessary? Here Are The Answers!

Planning Your Farm

Developing a Business Plan

To start a small farm, it’s crucial to have a clear idea of what you want to achieve and how you plan to achieve it. Developing a business plan is an essential step in this process.

A business plan is a written document that outlines your goals, strategies, and financial projections for your farm. It can help you secure funding, attract investors, and make informed decisions about your farm’s future.

When developing a business plan, consider the following questions: What crops or livestock will you produce?

Who is your target market? How will you market your products? What are your start-up costs and ongoing expenses? What are your projected revenues and profits?

Creating a Farm Layout

Creating a farm layout is another important step in planning your farm. A farm layout is a map or diagram that shows the location of buildings, fields, and other features on your farm.

It can help you optimize your use of space, improve efficiency, and reduce costs. When creating a farm layout, consider the following factors: What is the size and shape of your land? What is the topography and soil type?

What are the climate and weather patterns in your region? What is the water source and availability? What are the zoning and land use regulations in your area?

Choosing Crops and Livestock

Choosing the right crops and livestock for your farm is crucial to success. You need to consider factors such as market demand, climate suitability, and profitability.

Here are some tips to help you choose the right crops and livestock for your farm:

• Research market demand and trends for different crops and livestock in your area.
• Consider your climate and soil type when choosing crops. Choose crops and livestock that are well-suited to your level of experience and resources.
• Consider the profitability of different crops and livestock, including the cost of production and potential revenue. By developing a business plan, creating a farm layout, and choosing the right crops and livestock, you can set yourself up for success when starting a small farm.

READ NEXT: The Key to Safe Towing: Understanding Trailer Tongue Weight

Financing Your Farm

Finding Funding Sources

As a small farmer, it can be challenging to find funding sources for your farm. However, there are several options available to you.

The USDA offers various programs and services to help farmers get started or grow their operations, including farm loans, crop insurance, conservation programs, and disaster assistance.

Additionally, there are private lenders, grants, and crowdfunding platforms that you can explore. When researching funding sources, it’s essential to consider the eligibility requirements, interest rates, repayment terms, and any other fees associated with the loan or grant.

It’s also crucial to have a solid business plan to demonstrate to lenders or grant providers that you have a clear vision for your farm’s success.

Applying for Loans and Grants

Once you’ve identified potential funding sources, it’s time to start the application process. Applying for loans and grants can be a time-consuming and challenging process, but it’s essential to be thorough and accurate in your application to increase your chances of approval.

When applying for loans, you’ll need to provide financial statements, tax returns, and other documentation to demonstrate your ability to repay the loan.

You must also provide a detailed business plan outlining your farm’s goals, objectives, and financial projections.

When applying for grants, you’ll need to provide detailed information about your farm and explain how the grant will help you achieve your goals.

You may also need to provide financial statements, tax returns, and other documentation to demonstrate your eligibility for the grant.

In conclusion, finding funding sources and applying for loans and grants can be a challenging but necessary process for small farmers.

By researching your options and being thorough in your application, you can increase your chances of securing the funding you need to start or grow your farm.

Managing Your Farm

One of the most important aspects of running a successful farm is managing it effectively. This involves managing your finances, marketing your products, and managing your land and livestock. In this section, I will discuss each of these areas in more detail.

Managing Your Finances

Managing your finances is crucial to the success of your farm. You need to keep track of your income and expenses and ensure you stay within your budget.

This can be done using financial software or by hiring an accountant.

It is also important to have a solid business plan in place. This will help you stay on track and make informed decisions about your farm. Your business plan should include your goals, marketing strategy, and financial projections.

Marketing Your Products

Marketing your products is another key aspect of running a successful farm. You need to identify your target market and develop a marketing strategy that will reach them.

This can include advertising, social media, and attending farmers’ markets and other local events.

You should also consider offering CSA (Community Supported Agriculture) shares. This is a great way to build a loyal customer base and secure a steady source of income.

Managing Your Land and Livestock

Managing your land and livestock is essential to the success of your farm. You need to ensure that your land is being used efficiently and that your livestock is healthy and well-cared for.

This involves regular maintenance and upkeep of your farm, including fertilizing, planting, and harvesting. You should also have a plan in place for managing pests and diseases.

When it comes to livestock, it is important to provide them with proper nutrition, shelter, and medical care. You should also have a breeding plan in place to ensure the sustainability of your herd or flock.

Jack is the owner, chief editor, and senior writer of this website.

Machinery, engines, and farming have always been a passion of his since he was a young boy. Growing up on a small farm in rural America, he learned the value of hard work and dedication from an early age.

After completing his degree in Engineering, he decided to follow his dream and became a farmer in 2009.

Since then, he has gained a wealth of knowledge and experience in the field. He has grown a variety of crops, tended to farm animals, and worked with all sorts of farming machinery. Continue reading…

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The Ultimate Guide to Starting a Farm

Steps to starting a farm

If you’ve decided to become a part of the new food system, you’re in the right place.

This is your step-by-step guide to starting a farm. Use the checklists and resources in each section to make sure that you’re diligently planning for a profitable farm business!

Step 1: Decide to Put in The Work

No matter how much technology you plan to use, farming still requires a lot of time and perserverance to be successful. There is no “easy” farming business!

Today’s Farmers are:

Self-motivated.

• Driven to reach a goal.
• Always humble enough to know there’s always more to learn.

Not willing to give up when things don’t go their way the first time.

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“How to Stop Talking & Start Farming”

Step 2: Find Community

Community & Mentorship: No farmer starts and runs a farm entirely on their own. Getting connected to those with experience, as well as other aspiring farmers like yourself, will help you stay on track and avoid mistakes.

Anyone starting a business should look for three types of mentors:

The first type of mentor may be the people whose blogs you follow or whose books you read.

• The second are people who will eventually be your compadres; fellow farmers like Ryan Sweeney, Matt Marsh, and Tom Deacon (all of whom you can follow on social media).
• The third type of mentor is the direct mentor. This could be an experienced farmer, a knowledgable account manager, etc.

Step 3: Set Goals & Draft a Plan

In this phase:

• Draft a business plan
• Feasibility Study

Initial Planning:  It’s time to set some goals and draft your business plan!

One of the biggest mistakes would-be entrepreneurs make is procrastinating on their business plan.  Another important role of the business plan is to aid in securing funding; many banks and other lenders won’t even consider applicants that don’t have a business plan.

Learn how to write a business plan with this guide .

Get real-life insight into running a modern farm through these tips .

What is a feasibility study?

The feasibility study is the group of research and estimations that answer the question, “Can I make money with my farm?” It covers…

Revenue projections

Fixed and variable costs

A market survey

A conservative pricing strategy

A capital expense budget

A look at your energy costs

• Detailed pro forma projections covering cash flow, net income and balance statements

Step 4: Learn to Grow

• Learn from Upstart University
• Start a pilot system

Even though we’ve focused a lot so far on the business side of things, it’s critical aspiring farmers start a pilot system as early as possible to learn the in’s and out’s of soil-less growing. This is where you’ll learn all about growing healthy plants and work through some beginner system mistakes before you have any customers.

We highly recommend Upstart University to anyone starting a modern farm. You can get signed up here and choose your first courses.

As you learn more about different growing techniques and crop management, you’ll start to form preferences for your farm. After taking courses like these , you’ll be able to make good decisions about how to grow and what to grow.

The Importance of a Pilot System

To amplify and accelerate  your grower’s education, start a test farm. You can take all the courses and read all the blog posts you want, but if you’re not applying what you learn, it’s not sticking like it could.

A “pilot system” is a smaller version of your future farm that allows you to test the waters, make mistakes, and start developing processes and best practices that allow you to scale seamlessly into your full production farm.

The other BIG benefit of starting a pilot system is you can use it to grow sample crops for approaching customers and proving demand. Having real produce in hand when talking to chefs and produce managers has helped many of today’s top farmers close their biggest deals. Prospective customers fall for the flavor and freshness instantly!

Step 5: Find Your Customers

• Market research & sales planning
• Putting market research to use

Market Research & Sales Planning.  You can have the freshest, most flavorful crops in your city or town, but if you don’t have customers to buy them, you might as well close up shop. market research is where you define profitability.

You’re going to complete two types of market research: General research and local research

The most important part of local market research is getting face-time with potential clients. This is the only way to get truly accurate local sales and pricing data.

To get started, use this worksheet. It helps you cover all your bases and keep all the information you find in a useful format. Modern Farmer’s Guide to Local Markets (Worksheet PDF)

How to put local market research to use

The most immediate thing that market research allows you to do is find an entry point.

A key part of your entry point will be deciding on a sales model. Simply put, a sales model is the set of processes and tools that you use to get produce from your farm into the hands of the consumer. Live Sales is a popular model for ZipGrow farmers like Lukenbill.

Review your sales model, target markets, and everything you’ve learned about your growing technique and crops so far. As you do that, you’ll notice certain strengths and values that give you an advantage over the other producers active in your market.

These strengths are your value propositions- the reason that people buy your produce over others. You’re going to want to play them up in your marketing.

Up Next – Learn about Funding & Debt

Step 6: Estimate Funding & Debt

• Able farm planning software

If you don’t have much experience with funding, you may feel like you are shooting in the dark.

Don’t worry; we’re here to help. Before you start searching and applying for funding, take these three steps:

1. Know your goals and starting size

2. Demonstrate how much demand there is for your crops

3. Get your financial house in order

Learn more here.

When you’re ready to start looking at funding, you have several options:

• Private investment/venture capital
• Equipment leasing
• Crowdfunding

Learn More:

• The 20 Minute Guide to Financing
• Applying for the USDA Microloan
• 5 Grant Writing Tips
• Funding Your Farm Course

Debt is an inevitable result of lending and the baggage of many types of funding. That being said, many farmers have started farms without debt (or with very low debt)

Either way, farm owners must be comfortable with the level of debt that they are pursuing before starting their farm! To make the best debt decisions for your farm, you need to understand the types and factors of debt.

There are eight types of debt that new farmers might incur:

2. Unsecured

3. Fixed interest rate

4. Variable interest rate

5. Fixed payment term

6. Variable repayment period

7. Deductible

8. Non-deductible

• The Fair Debt Collection Practices Act
• Summary of the Fair Debt Collection Practice Act

Step 7: Plan Your Facility

• Choosing the right facility
• Common trends

Choose the right facility. Modern farmers are using all types of facilities, from greenhouses and warehouses to basements and backyards. Different types of equipment and production methods work differently in different facilities. Your production methods will dictate to a significant extent which type of facility you use.

Here are the common trends we see:

DWC (Deep water culture)  systems are typically run in greenhouses in tropical areas. The high labor requirements and large footprint of the technique are best suited to places where labor is cheap and space isn’t too cramped.

NFT (Nutrient film technique) systems are run either in greenhouses or in stacked systems in greenhouses or warehouses. The first facility is best suited to this technique.

ZipGrow Towers are used in greenhouses, backyards, and homes. Since they are so modular (each Tower is separate), they can fit into almost any space in any quantity.

ZipFarms are ZipGrow-based systems specially designed for warehouse use. They consist of ZipGrow Towers on a rolling rack with a light rack overhead; they are pre-configured but set-up can still vary by quantity and orientation.

Media beds are best for outdoor or greenhouse facilities. Media beds tend to be heavy with high thermal mass and a large footprint. Media bed growers don’t move their equipment, and stacking is out of the question. That makes them a good fit for places that aren’t tight on space.

Bato buckets are primarily used in greenhouses, with some indoor facilities. Most hydroponic tomato systems are bato systems (or “bag systems” which function similarly). Most of these systems are in greenhouses.

If you aren’t sure which grow method is right for you, take the Upstart University Course “Choosing Your Production Method” .

Modifications to the facility will have to be made on a case-by-base basis but could include:

• Electrical additions
• Chiller installations

Of course, some facility characteristics need to be in place before purchasing.

For example:

• Adequate ceiling height
• Minimum dimensions
• Exit access
• Wall protrusions

Step 8: Implement Sales & Marketing Plan

The main tasks of Sales & Marketing are:

1. Creating a brand

2. Creating action plans for your markets

3. Getting payment plans ready

Branding includes core language like a farm name , values , and mission statement language , as well as the design of your packaging , web site , social media , etc. In all, the farm branding is the way that your farm presents itself to the world.

The difference between poor branding and good branding can often be the difference between good market cap and low market cap, high-quality leads and poor-quality leads, etc.

Bright Agrotech offers help on small farm branding, complete with templates and custom help on:

• UPC Barcode Creation
• Business Cards
• Website Design
• Social media: SHOW UP and start documenting !

7 Myths About Using Social Media on the Farm

Social Media Marketing for Farmers Course

• Know your packaging needs
• Upstart U  Law 3- Intro to Food Labeling and Weighing

Learn More on choosing markets:

Upstart U: The Four Markets

• The Grower’s Guide to Markets (Bundle)

CSA Resources:

Marketing Your CSA

The CSA Contract

What To Do Before Starting a CSA

Grocery Store Resources:

Approaching and Selling to Grocery Stores

Restaurant Resources:

Benefits of Growing For Restaurants

Disadvantages of Growing for Restaurants

Farmer Tip: How to Make a Great First Impression on Restaurants

Commercial Hydroponics: Finding Local Restaurant Demand

Farmers’ Market Resources:

• The Challenges of Farmer’s Markets for Hydroponic Growers
• The Benefits of Farmer’s Markets for Hydroponic Growers

Collecting payment

Have payment methods ready and accounting practices in place to keep your farm accounts organized and easy to assess.

1. Set up bank accounts for your farm business

Set up a separate bank account for your business. This is one indicator to the IRS that your farm is an actual business, which will make taxes and audits much smoother down the road.

2. Set up payment tools like Square and Quickbooks

Some farmers use plain old cash and checks to receive payment from customers, but in some situations it’s good to have other options. For example, many market goers only carry a card for payment. By limiting payment to cash or check, you may be missing out on significant business!

In addition to accessible payment, many payment tools like Quickbooks are combined with other account management tools that can make accounting much easier.

Your accountant may have recommendations and preferences for payment systems! Be sure to consider their preferences, since they will often be the main person using the system.

Step 9: Organize Business Operations

During this phase, you will research and plan:

• Your business structure
• Insurance needs
• Employment & taxes
• Zoning requirements
• Certification processes
• How to choose a good business partner

BUSINESS STRUCTURE

Choosing a business structure helps you determine who’s accountable for each component of your business’s operation. It also helps to give investors and banks a clear picture of who you are and who’s leading the team.

The three most common types of businesses for small farmers are sole proprietorships, partnerships, and corporations.

Sole Proprietorship

A business organized as a sole proprietorship is owned by a single individual or family and is not organized as a corporation. This is common, especially in agriculture, and it gives the owner of the business a ton of control/responsibility.

Partnership

A partnership is owned by two or more people. We recommend having a written partnership agreement so that each partner knows what their responsibilities are. Oral partnership agreements are legally valid, but they are more difficult to defend in the face of a dispute.

Corporation

A corporation provides owners with protection from losing more than what they invested if the business fails. It is a special legal entity endowed by law with the powers, rights and liabilities of a person.

** It is important to note that there are other ownership forms out there. Before officially declaring and filing for your form of ownership, we rfecommend that you consult with a lawyer. This page does not constitute legal advice.

Read more about the advantages and disadvantages of each of these models in the Upstart University Course Intro to Business Planning.

Even if you’re selling solely to markets that don’t require proof of insurance, you still need to cover your farm’s liability. Selling to a market that didn’t require proof of insurance doesn’t mean that you can’t be sued.

Upstart Farms should carry a general liability or umbrella policy on their farm.

You want to have insurance that protects:

• The product liability of your produce and food items
• Your farm assets

Additionally, your may need other kinds of insurance, like auto insurance for farm vehicles (think about what car/truck you use to transport your towers live to market ).

Use an insurance broker.  When searching for insurance for your farm, it helps to use an insurance broker. A broker will go out and get quotes from dozens of insurers, coming back to you with the best policy.

Get plenty of coverage!  The amount of coverage that you obtain depends entirely on your farm. At the bare minimum (and seriously – this is the absolute minimum), a farm will want at least $50,000 of insurance coverage.

Consider what kind of business your farm is doing. If you expect to do $200,000 in sales this year, have your insurance cover $200,000 to $400,000. Your broker and agent may be able to offer a specific recommendation for your farm – use their advice!

Learn More here.

EMPLOYMENT & TAXES

There are several things you need to do with your farm before hiring. It’s not a bad idea to research these, even if you don’t plan on hiring right away!

** We are not a substitute for a certified accountant! Please hire an accountant to make sure you’re following regulation and laws for your state.

• Register your business
• Get your employee identification number (EIN)
• Get workman’s compensation and unemployment insurance set up
• Register to file taxes ( start here )
• Research labor laws

Hiring & HR

• Fill out a W4
• Fill out an I9
• Safety training

Other Considerations:

Non-disclosure agreements

Sexual harassment training

Fire & evacuation training

*HR platforms can be helpful for keeping information straight and creating a professional processes. A few examples are Zenefits and Greenhouse Software. There are several free programs.

You can pay employees whenever works well for you and your bank, as long as it adheres to your State’s / the Federal Minimum Wage,

Payroll systems are highly recommended. Some examples are Quickbooks, Paychex, ADP, and (only accessible in some states) Zenefits .

You’ll pay taxes when you do payroll. In addition, you’ll have to submit a 9-41 form quarterly, and 9-40 and W-2 forms at the end of the year to the IRS.

Certain states also apply a state income tax.

Hiring an Accountant

A certified accountant can help you keep your finances and legal obligations orderly. They will be able to coordinate tax forms and make sure that you don’t miss deadlines, payroll, and other tasks!

Be sure that:

• They are familiar with your business and sales models
• Their rates are within your budget
• They are experienced with the specific services you need

CERTIFICATION & COMPLIANCE

HAACP, sanitation procedures, GAP compliance, and Food Defense.

These certifications indicate that your farm is up-to-standard in areas of safety and sanitation across your farm:

• worker health and hygiene
• water and sewer quality
• air quality
• pest control and wild/domestic animals
• nutrient systems
• state and federal traceability
• harvesting sanitation
• storage and transportation

Start with Upstart University Course: Farm Compliance & Food Safety.

Zoning, a land-use planning system used by cities and counties, plays an important role in siting a farm. Urban farmers want to grow in a zone with favorable regulations and which doesn’t eliminate any of their farm processes. See an example here .

There are five basic zones:

• Agricultural
• Residential
• In-field development zone (can be used for all kinds of purposes)

The best first step is looking up the  zoning regulations for urban farms or for a specific zone in your area. Most cities list their zoning maps and laws online.

Learn more about how an urban farmer can navigate zoning regulations.

PARTNER CONTRACTS

Your business partner will be a critical part of the business equation, and can either be a very strong point or a very weak point in the business structure.

Despite the relationship being important, many new business owners don’t plan the partnership very carefully, preferring to lean on trust and “gut instinct” than sterile contracts. This plays into the myth that a legal setup spoils a friendship.

It’s smart to communicate responsibilities and expectations up front. A few things to consider when choosing a business partner:

1. Get experience with them first. The best way to test a. working relationship is to have work experience with your prospective partner.

2. Choose complimentary strengths. A business partner should help fill out your weaknesses and vice versa.

3. Look for a good track record. Do some research on your future business partner and encourage them to do the same.

4. Use a partner agreement / contract. It’s important to have an in depth conversation about roles and responsibilities prior to formalizing any relationship.

5. Don’t choose someone who you would rather just hire. Consider hiring them as a consultant later on.

*Before moving on to the planning your facility and ordering equipment: Do a quick review and reworking of your feasibility study.

Step 10: Get equipment

• Farming equipment
• Growing equipment

FARMING EQUIPMENT

After checking your layout with advisor, source your equipment. Here are our recommendations for hydroponics, aquaponic, and indoor farming equipment:

Plumbing: Most plumbing parts like PVC, fittings, and glues can be sourced from a local Home Depot or Lowe’s. Some of the more obscure fittings are available online.

Lighting:  Lighting is a complicated equipment type to choose. The most popular types of lighting are HID, LED, and fluorescent lights. (Learn the pros and cons of each here.)

Purchase lighting from well-known sources like GE or Phillips.

HVAC:  Commercial farms should consider a professionally-fitted HVAC system . Consultants like Doctor Greenhouse are well worth their fee in this regard. Click here to take the Upstart University HVAC Course.

Structure & Infrastructure:  Different growing techniques and climates require different facilities. Greenhouses, indoor spaces, warehouses, and containers are the most popular facilities for modern farmers.

• Greenhouse Equipment
• Compare Greenhouse & Indoor Farms
• Considerations of Container Farming
• Modular Farms – Our only recommended Container Farm Manufacturer
• Considerations of a Warehouse Facility

GROWING EQUIPMENT

DWC (Deep Water Culture) –  We recommend Bigelow Brook Farms for DWC-specific products. You can also hand build DWC systems, but this can be difficult on a commercial scale.

NFT (Nutrient Film Technique) –  Crop King offers quality NFT supplies . NFT systems can also be built by hand, but this again becomes difficult at a commercial scale.

Media Bed –  Media bed systems are easy to build from hand using lumber and parts. A convenient media bed kit that we recommend is the My Aqua Farm .

Bato buckets (or Dutch buckets) –  Bato buckets can be built on a DIY level. Commercial growers are better off using a manufactured product like these buckets .

ZipGrow –  ZipGrow Towers can be used in greenhouses, in warehouses (the ZipFarm), and containers.

Media –  Hort Americas offers a wide variety of media for hydroponic and aquaponic growers. For help deciding which media is the best fit for your farm, go through the Choosing Your Substrate course on Upstart University .

Pesticides –  Pesticide legality and effect differ by facility type, growing method, and location. For specific pesticide recommendations and information about licenses, talk to your local Extension Office .

Step 11: Start Growing & Delivering Crops

• Growing crops
• Delivering crops
• Managing customers
• Housekeeping & maintenance
• Step 1: Decide
• Step 2: Get Connected
• Step 3: Identify Strengths
• Step 4: Learn & Grow
• Step 5: Find Your Customers
• Step 6: Estimate Funding & Debt
• Step 7: Plan Your Facility
• Step 8: Sales & Marketing
• Step 9: Business Operations
• Step 10: Get Equipment
• Step 11: Start Growing

How to use this guide:

Today’s aspiring farmers have more technology, education, and support than ever before. All farmers need now is a roadmap to starting a farm.

To use this guide as your roadmap:

• Read through the overview of each step.
• Download the checklists for each section.
• Check in with your mentors every few weeks.

This is your step-by-step guide to starting a farm. Use the checklists and resources in each section to make sure that you’re diligently planning for a profitable farm business! 

Step 1: Decide to put in the work

Your journey to owning a local farm starts when you raise your hand and declare, “I’m serious about starting a farm and I’m willing to put in the work!”  

It’s important to note that no matter how much technology you plan to use, farming still requires a lot of time and perserverance to be successful. There is no “easy” farming business!

Curious if farming is for you? 

Learn more about how to do each of these here!

Farm Business Plan Template

Written by Dave Lavinsky

Business Plan Outline

• Farm Business Plan Home
• 1. Executive Summary
• 2. Company Overview
• 3. Industry Analysis
• 4. Customer Analysis
• 5. Competitive Analysis
• 6. Marketing Plan
• 7. Operations Plan
• 8. Management Team
• 9. Financial Plan

Farm Business Plan

You’ve come to the right place to create your farm business plan.

We have helped over 5,000 entrepreneurs and business owners create business plans and many have used them to start or grow their farms.

Below are links to each section of a small farm business plan template. It can be used to create a vegetable farm business plan, fruit farm business plan, agriculture farm business plans or many other types of rural businesses.

Sample Business Plan For Farms & Agricultural Businesses

• Executive Summary – The Executive Summary is the most important part of your business plan. It is a brief description of your farm, its products and services, potential market opportunity, and competitive advantage.
• Company Overview – Also called the Company Analysis, here, you will provide a detailed description of your agriculture business history, its products and other services, and business structure.
• Industry Analysis – In the Industry Analysis, you will provide an in-depth analysis of the industry in which your farm operates including industry trends, market size and growth, and government regulations.
• Customer Analysis – In the Customer Analysis, you will identify your target market and provide insights into their purchasing habits. You will also create customer segments and discuss your marketing strategy for reaching them.
• Competitive Analysis – In the Competitive Analysis, you will identify your direct competition and provide insights into their strengths and weaknesses. You will also discuss your competitive advantage and how you plan to stay ahead of the competition.
• Marketing Plan – The Marketing Plan includes a discussion of your marketing strategy and tactics along with your pricing strategy. You will also provide a budget for your marketing activities including attending farmers’ markets or advertising a farm stand.
• Operations Plan – In the Operations Plan, you will discuss your farm’s day-to-day operations. You will also provide your business goals that you plan to achieve and a budget for your operating expenses.
• Management Team – In this section, you will provide a brief overview of the farm owners and farm management team, their experience in the agricultural industry, and the organizational chart.
• Financial Plan – In this section, you will provide three-year financial statements for your farm. This will include your income statements, projected balance sheets, and cash flow statements.

Next Section: Executive Summary >

Farm Business Plan FAQs

What is a farm business plan.

A farm business plan is a plan to start and/or grow your farm business. Among other things, a good agriculture farm business plan outlines your business concept, identifies your target audience , presents your marketing plan and details your financial projections.

You can  easily complete your farm business plan using our Farm Business Plan Template here .

What Are the Main Types of Farms?

There are many types of farms. Some have commercial farms that produce crops and agricultural products for sale. Others have cooperative farms owned by people who pool their resources together and share profits among themselves. There are also vegetable farms, dairy, micro, organic, poultry, subsistence, or urban farms.

What Are the Main Sources of Revenues and Expenses for a Farm?

The primary source of revenue for a farm is the sale of its farmed goods such as rice, corn, milk, beef, chicken, depending on the kind of farm a business is.

Some key expenses for a farm are labor expenses, production costs like irrigation, fertilizer, water, and machinery maintenance.

How Do You Get Funding for Your Agriculture Business?

Farm business plans often receive funding from bank loans. Financing is also typically available from grants offered by local and state governments. Personal savings, credit card financing and angel investors are other funding options. This is true for starting any agricultural business.

What are the Steps To Start a Farm Business?

Starting a farming business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

• Develop An Agricultural Business Plan - The first step in starting a business is to create a detailed agriculture business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast.  It should also include your business goals and mission statement. You can quickly complete your farm business plan using our Farm Business Plan Template here .
• Choose Your Legal Structure - It's important to select an appropriate legal entity for your farm business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your farm business is in compliance with local laws.
• Register Your Agriculture Business - Once you have chosen a legal structure, the next step is to register your farm business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws. 
• Identify Financing Options - It’s likely that you’ll need some capital to start your farm business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms. 
• Choose a Business Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations. 
• Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events. 
• Acquire Necessary Farm Equipment & Supplies - In order to start your agricultural business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation. 
• Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your farm business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Learn more about how to start a successful farm business and agribusiness planning:

• How to Start a Farm Business

Where Can I Get a Farm Business Plan PDF?

You can download our free farm business plan template PDF here . This is a good farm business plan template you can use in PDF format.

How to Start a Farm Completely From Scratch (2023 Guide)

• Post published: January 21, 2020
• Post category: How to Start a Farm
• Post comments: 13 Comments

Last Updated on July 16, 2023

If you want to learn how to start a farm completely from scratch, this farming guide is for you. How would I know that? Because I have personally bought and started two farms from scratch, farmed them using sustainable, organic, and permaculture farming methods, and sold goods produced from the farms direct-to-consumer. I want to share everything I know with you in this one complete guide and make it easier than ever for you to buy a farm, learn how to farm it, (whether it’s to provide for your family, to make a business out of it, to homestead, or just as a hobby) and to show you the tools you’ll need to get started.

How I Became a Farmer

I grew up in a agricultural family but only around conventional farming as a kid. That type of farming requires thousands of acres and big expensive machinery to make it successful. I knew from that experience that I had no interest in that type of farming.

The idea of having a small farm, however, has always intrigued me. It wasn’t until later in life that I started to learn more about sustainable agriculture, organic agriculture, homesteading, and hobby farming. The more I learned about these the more I wanted to buy my own farm and practice these things with my family.

I knew I had to experience this type of farming first-hand to understand exactly how it worked so I decided to intern on a sustainable and organic farm for a year. It was there that I learned how to farm the land in a way that didn’t deplete the land nor destroy the environment but, instead, stewarded the land well, leaving it in a much better condition than it was before it was acquired. Best of all, it provided healthy food for the people that were fed from it.

I learned how to manage animals through pasture-based systems that didn’t confine them but let them thrive in nature while eating from the land and giving back to it so it produced more abundant pastures each following year.

I learned more about gardening in a way that didn’t require synthetic pesticides or other harsh chemicals but instead gave the plants an environment to thrive in an ecosystem where these types of things were not needed.

I learned how to sell your farm goods directly to the consumer using direct the Community Supported Agriculture (CSA) model, farmers markets, and direct sales.

After all of this, I took my experience and ran with it. I have purchased two different farms over the years and applied these things to my own farms. If I were going to write a book on how to buy a small farm and start farming it, this would be it.

Why Should I Start a Farm?

In order to start a farm from scratch you need to know why you want to start farming in the first place. This is a question I can’t necessarily answer for you personally because we each have our own ideas, convictions, and desires but I can give you some things to think about.

For me personally, I have convictions about how we are treating the environment and stewarding the land. I want to farm in a way that stewards the land well and provides healthy food for the people that are fed from it. I don’t want to deplete the land but, instead, leave the land in better condition than it was when I acquired it.

Others are just interested in starting a small hobby farm for fun or, at the very minimum, to provide good food for their family. Again, this is good too and my farm falls into this category as well.

Some people want to homestead which means they want to try to be as self-sufficient as possible and live off the land as much as they can. The homesteading movement has grown like crazy over the past 10 years as more and more people are wanting to disconnect from the rat race and live more meaningful lives by being connected to the land they are fed from.

There is also a huge movement of people that just want to farm in their backyard and I also think this is awesome. At the bare minimum, most people have at least enough room for a garden and some chickens. Working in your backyard farm can be a very life-giving experience.

Whatever your reason is for wanting to start a farm will directly affect the type of farm you need to acquire. Make sure you are settled on this before you begin.

What Are the Different Types of Farms?

Surprisingly, there are lots of different types of farms. Below I hope to define the most common farm types that you have probably heard about. Keep in mind that some of these farm types will overlap and I will try to show you why that is the case.

• Conventional Farm : Sometimes called industrial agriculture or commercial farming, conventional farming involves large amounts of inputs including the use of synthetic pesticides and fertilizers on both genetically modified (GMO) or non-genetically modified crops. The crops are usually grown in a monoculture system where one type of crop is grown in a very large area. For animal management, conventional farming typically utilizes Concentrated Animal Feeding Operations (CAFO) where a large number of animals are typically confined in small areas and fed intensively from a single feed source to increase profitability. Conventional agriculture usually requires lots of land, expensive equipment, and a large infrastructure to be profitable.
• Sustainable Farm : Sometimes considered beyond organic, regenerative agriculture, or a part of permaculture, sustainable agriculture is a farming system that manages plant and animals in an environmentally friendly way, requires low inputs, attempts to be as self-sustaining as possible, and seeks the well-being of animals under its care. Sustainable farming typically uses pasture-based systems for animals where they receive a large portion of their diet from nature, are rotated through paddocks, and not confined in a small area or enclosure. Gardening is done using organic methods and employs rotational crop systems that give back to the soil instead of depleting it. Sustainable farmers typically sell their goods directly to the consumer through direct sales, Community Supported Agriculture (CSA) memberships, and farmers markets. The goal of sustainable agriculture is to steward the land well while feeding people healthy food. Check out our articles on the latest sustainable farming statistics and permaculture statistics to see the latest trends.
• Organic Farm : Organic farming is a type of farming system that doesn’t utilize synthetic pesticides or fertilizers and doesn’t grow genetically modified (GMO) crops. In the U.S., the word Organic is controlled by the USDA. Because of this, the USDA must certify your land and your farming methods in order to use the Organic label. Contrary to popular belief, organic farming can still fall under the umbrella of conventional farming and industrial agriculture. This is especially true if crops are raised using a monoculture system where a single type of crop is grown over a large area. The Certified Organic label also doesn’t completely take into account animal welfare. Certain animals can still be confined in small areas as long as they are fed organic feed that doesn’t contain animal byproducts or growth hormones. (Note: In the U.S., you can still utilize organic methods on your farm even if you aren’t certified organic. You just can’t say your farm is Organic. You can say, however, you farm using organic methods or your crops are organically grown. See the difference?) Check out our article on the latest organic farming statistics to see the latest trends.
• Hobby Farm : A hobby farm is a farm that is not a primary income source but provides supplemental income or is operated purely for pleasure. Hobby farming can still utilize the above farming systems but is typically done with less acreage.
• Mini Farm : A mini farm is a very small farm usually done in your backyard or in a small open lot. Mini farming can still utilize the above farming systems as well but, because of the small space, farmers are typically limited as to what they can grow and raise.
• Urban Farm : An urban farm is a farm located in a city, typically in an urban environment, that cultivates, processes, and distributes food in the area in which it is located. Urban farming can be very creative and can be a great way to reclaim spaces like abandoned lots where buildings may have been previously located.
• Homesteading : The act of homesteading is an agrarian lifestyle that seeks to live as self-sufficiently as possible and live off of the land that you live on. While homesteading can utilize the above farming methods, it typically extends beyond that. In addition to farming, homesteading can also involve food preservation, textile production, carpentry, and other trades for home use or to make items to sell.

How Many Acres Do I Need to Start a Farm?

The answer to this question largely depends on what type of farm you are going to start. It also depends on several other factors like climate type, hardiness zone, soil type, landscape (hillside or flat), access to water, (ponds, creeks, springs, well, county water, cistern, rain catchments), and zoning restrictions. Because of all of these different factors, there is no one size fits all answer. However, I will do my best to give you some general guidance.

First things first, if you were to start a conventional farm, you may need a thousand acres and lots of expensive equipment to be profitable. This is not the type of farm we are covering in this guide.

Sustainable farms typically need a lot less acreage because they are not built around one type of crop or one type of animal, the reliance upon expensive machinery, or the commodities market. They are usually biodiverse and use a mixture of plant and animal systems to be as self-sustaining as possible and sell their products directly to the consumer.

Some examples of sustainable farms would be Joel Salatin’s farm called Polyface Farm. Joel’s farm is about 550 acres in total size but only has about 100 acres of open land. Joel has been quoted saying that it depends on where you are located but they are generating one salary off of 25 acres.

My last farm was 51 acres total and about 20 of that was open land. I used some of the woods for my pastured pork operation and my goats.

As far as organic farms go, if you are thinking of a USDA certified organic farm then this may fall under the same umbrella as a conventional farm. Again, it depends on how you plan to farm it. If you plan to row-crop it using organic methods, you may need hundreds of acres and expensive equipment. If you plan on farming it sustainably but using organic methods, it would be the same as a sustainable farm above.

If you just want to start a hobby farm or a homestead, I would consider something around 10 acres. In general, if you have livestock, you need more land than if you are just raising a garden. And the type of livestock will also determine what size farm you would need. Cattle require more land than pigs and pigs require more land than chickens. The size of the farm you would need can fluctuate depending on what you are doing. For me personally, at least 10 acres would be an ideal size for a hobby farm based on what I would do with it.

Here is something else to consider. Where I live, if you own 10 acres or more it is taxed as a farm which has a much lower tax rate than if it were all taxed as residential. So that is an added bonus for us here to buy something over 10 acres. Check with your county tax office to find out if they have similar laws.

How Do I Buy a Farm?

When you are ready to buy a farm you are probably wondering how do you buy land, especially if I don’t have a lot of capital? There are several things to consider.

If you wanting to buy a farm with lots of acreage and you plan on deriving your sole income from the goods you produce on your farm, the first thing to do is to consider leasing one. Why you might ask? Here are a few reasons.

The first reason is that it’s the easiest way to get started. There are lots of farms out there that aren’t being used for actual farming anymore and you can lease them for a great price.

Another reason is what if you find out that farming is not for you? Once you have purchased a farm, you are stuck with the mortgage at that point. Leasing a farm can be a much easier way to ease into farming and you can always not renew the lease if you change your mind.

Also, you may just simply not be able to afford a mortgage for the amount of land you will need for your farming endeavors. Leasing land can give you time to build your farm revenue up to a place where you can eventually afford to buy your own land. And by then, you may have a totally different idea on what type of farming you want to do.

If you are wanting to buy a hobby farm or homestead then I would consider buying a small farm instead of leasing one. Since your primary income will come from off the farm, you will be able to support your mortgage from your day job.

When you are ready to buy your farm, be sure to apply for a farm loan through several different institutes so you can explore all your options.

Farm Credit is my personal favorite farm lender. They offer several different options and have one of the longest fixed interest rate options for farms out of all the lenders out there.

You should also check with local and regional banks in your area. By local, I mean banks that are either local to your town, area, or maybe even just your state. Local banks typically have more consumer friendly and flexible lending programs than large national banks do. In other words, there can be a lot less red tape to go through using a smaller bank when seeking financing for a farm.

The USDA offers several different types of loan programs as well. I’ve personally never used any of them but that’s what they are there for.

You can try to seek lending through all of these institutions to find the one that has the best options based on what you are wanting to do and your current financial situation.

Where Should I Start a Farm?

Deciding on where to start a farm depends primarily on what type of farm you are wanting to start. If you plan on deriving an income from your farm and you plan to sell your farm goods directly to the consumer, you will probably want to start a farm somewhere near a metropolitan area. The truth is that people in larger cities are typically more open to direct to consumer purchases from farmers, participating in CSAs and buying from farmers markets. Larger cities typically have better farmers markets as well.

It is possible to sell directly to consumers in smaller towns but keep in mind that you will have to work much harder to create a market for yourself. You may also need to drive more to reach all the cities around you to give you access to a larger market.

If you are wanting to start a hobby farm then you will probably want to be somewhere near your place of work or the city that you work in since your day job will still be your primary source of income. And since you will probably be looking for less land, this will open up a lot more options for you.

If you are wanting to start homesteading then you will obviously have a lot more options as far as where you can start a farm. There is a lot of cheap land out there but most of it is pretty remote. Just keep in mind that the farther out you are the harder it will be to purchase items you need, visit with friends, and see your family.

What Are Some Things to Look for When Buying or Leasing a Farm?

There are several things to look for when buying or leasing a farm. One of the most important things to look for is a farm with a good water source. How are you or your animals going to survive without water? Does the farm have access to a public water source, a well, or a cistern? You will need at least one of these, especially if you are planning on drinking from this water source yourself.

Does the farm have a creek, pond, or spring? These can be great additional water sources for your animals, especially when your animals are far away from your central water source. Ponds can be easier to deal with for the simple fact that you can put a fence all the way around them. Creeks can be a little more difficult, especially if the water rises and falls which makes fencing around it hard. Creeks can also run dry during certain times of the year while a large pond can hold water all year long. A spring that runs all year long would be an amazing addition to any farm. Free, fresh flowing water that can be controlled is always best.

Another thing to consider is how much open pasture does the farm have? While it is true you can use some of the woods for certain farming systems, open pasture is what you’ll primarily rely on. Your ruminant animals will need the pastures and you will need open space for your gardens.

I personally like to have a farm primarily with open pastures but with at least some woods. Certain animals like chickens and pigs can also utilize parts of your woodlots. If you plan on having a wood burning stove or milling your own lumber, woods can provide a source for that as well.

If the farm is hilly it can make things difficult if you use portable coops, chicken tractors, or hoop houses. Also, hillside soil is typically more rocky and not as good for growing things. It is possible to build better soil over the years depending on your farming systems but it can take quite a while to achieve.

You should consider what type of soil the farm has and if it’s good for growing things. In the U.S., the USDA has a free tool to check what type of soil the land that you are interested in has and help you understand what that soil type means. If you are going to be primarily crop based, soil type will be even more important to you.

Also, you’ll want to know if the soil on this land is typically more wet or dry. Does the land drain well? Our first farm had very flat pastures but the soil stayed wet longer because it was located in a bottom. This can cause lots of issues for growing things or livestock use.

You’ll also want to consider if the farm has good road access. There would be nothing worse than not being able to get onto your farm because your road is washed out or the easement you need to access it is blocked. Also, road frontage can help with marketing your farm because you’ll have a great place to put a sign up advertising what you are selling.

What Type of Farm House Should I Buy or Build?

When you start a farm, are you planning on living on it? If so, you obviously need to have this question figured out before you buy or lease any land. If you aren’t sure if you should live on your farm then I would just like to say that it will make your life much easier if you can. Being able to walk out of your house and check on your animals or garden will make life a lot easier than driving over every day to do so. You are ultimately the eyes and ears of your farm so being on the land itself will help you deal with things like predators or escaped animals more quickly.

If the farms you are looking at don’t have a home on them then you have several options. Here are a few to consider.

Traditional Stick Built Home : A stick built home is simply a home framed with wood and built on-site. Almost every home you see in the U.S. is built using this type of construction. This is obviously the most expensive option but can be the easiest to get financing for compared to other types.

Pole Barn Home : This is a newer idea and one we chose on one of our farms. A pole barn home or a pole barn with an apartment can be cheaper than traditional building methods. The idea is to build a pole barn and then frame a home inside of it.

There are a few downsides to consider though. A pole barn home is typically built on a slab so you have to make sure your plumbing exactly where you want it before the slab is poured otherwise you will be ripping up concrete to change it. You also have poles every 10 to 12 feet in the exterior walls so you have to plan your doors and windows around that. And finally, it can be much harder to secure financing for a pole barn home because it is considered non-conventional.

Mobile Home : A mobile home is another option for your farm. We bought and set up a used mobile home on our first farm so we could move onto the land much faster and cheaper than building. There are some downsides to mobile homes though. First, you are limited to certain sizes. Single-wide mobile homes are pretty small but double-wide mobile homes can give you more space and feel like an actual house.

Mobile homes are typically built cheaper than other homes which can mean it doesn’t hold up as well and won’t last as long. Depending on how you set yours up, they can be also be exposed underneath creating issues for freezing pipes. Banks typically won’t consider them in the appraisal value if you decide to sell your farm. It can also be hard to use them as equity if you decide you need a line of credit. However, if you don’t care about these things they can be a quick and cheap option depending on how you buy and set yours up.

Camper Home : I personally would never recommend this as a long-term solution but it could be an option for the short-term, at least while you wait for your house to be built or set up. Some things to consider would be that you will need access to water, electric, and septic unless you want to be constantly hauling water and waste or running a generator. Campers also lose value after you purchase them so keep that in mind if you are wanting to sell it after you use it.

Non-Conventional Homes : There are other types of alternative building methods that you could consider for your farm like log cabins, cob homes, cordwood homes, and strawbale homes. The biggest downside to these is the amount of time and labor it would take you to build them. There is probably no way to get any type of traditional financing for them as well. These types of homes, in my opinion, would only be for someone who has a lot of time on their hands and can build them slowly over time when they buy a farm.

What Kind of Animals Should I Raise on My Farm?

Deciding on what kind of animals you should raise on your farm depends on what you are wanting to do when you start a farm. If you are planning on implementing sustainable farming practices and selling your farm goods directly to the consumer then chickens, pigs, and cows make a lot of sense since eggs, chicken, pork, and beef are all very popular items to sell. There are also smaller markets for turkey, goat, rabbit, duck, and duck eggs.

You should also consider choosing one of these animals to be your farm’s centerpiece. I recommend that you choose an animal that you enjoy raising and like to eat the most. If you can’t sell your meat then you will be the one eating it so choose something you like.

This will also be the one that you spend most of your energy on as far how you raise it, how much you raise, and how you market it. Having something that you are passionate about really helps the selling process. My farm’s centerpiece is pork. I enjoy raising pigs on pasture and love the taste of good pork.

What I’m not saying is to only raise this one kind of animal. On the contrary, a good farm needs a polyculture of animals that are all being utilized to continually improve your land together. Raising only one type of animal can increase the chance of disease and cause a lopsided ecosystem where that animal lives. Instead, consider rotating or co-grazing several different kind of animals throughout your farm to improve the soil and keep diseases in check.

What Kind of Produce Should I Grow on My Farm?

Similar to the previous section, deciding what kind of produce you should grow on your farm also depends on what you are wanting to do when you start a farm. If you are wanting to farm it sustainably and sell your goods directly to the consumer, consider a wide variety of diversified plants that you can rotate throughout your garden during different seasons.

Some top sellers are typically things like organically grown tomatoes, lettuce, kale, sweet corn, carrots and strawberries. Other popular items can be cucumbers, squash, peppers, peas, broccoli, beans, spinach, turnips, onions, watermelon, pumpkins, and cantaloupe.

Consider growing herbs like cilantro, chives, basil, parsley, mint, rosemary, and sage. There are lots more than this but I wanted to give you an example of some of the popular ones.

You should also consider planting perennials such as blueberries, blackberries, raspberries, apple tress, pear trees, cherry trees, plum trees, peach trees, fig trees, and various nut trees. Planting perennials early on is important because it can take a few years or more before they ever produce their first fruits.

If you are more of a garden-centric farm then you can choose a few different types of produce to be your farm’s centerpiece. Remember, pick something that you enjoy growing and eating. If you can’t sell it, you’ll be the one eating it.

I have also created an article where I cover more than 105 ways to make money farming a small farm . It also includes links to additional resources that will help you get started.

What Farm Tools Do I Need?

The nice thing about sustainable farming and hobby farming is that the amount of tools you need up front aren’t nearly as much as what you would need if you were planning on running a conventional farm. When you are ready to start a farm, there are a few farming tools to consider in the beginning.

The obvious tools you’ll need are a good set of hand tools like hammers, screwdrivers, wrenches, pliers, a socket set, and a good toolbox to hold it all. A good electric screwdriver will be one of your best purchases. You will be building a lot of stuff yourself by hand so these tools are necessary.

There are also various other types of tools you’ll need to just make life easier on the farm such as a headlamp, dust mask, sweatband, and a pocket knife. You can even get some walkie talkies to get in touch with others at the house, especially, if your phone service is spotty.

There are some farming clothes that I recommend as well such as a coat, bib overalls, coveralls, gloves, rubber boots and a good hat. Keep old jeans and shirts around in case you need to get muddy.

For fencing, I recommend step-in posts, polywire, poultry netting, and a good energizer. Temporary fencing is great in the beginning because it’s cheaper, easier and much faster put up and take down.

You’ll likely need a chainsaw, a weed wacker, and loppers to take care of the trees and brush. This is especially true when you start setting up your fences and clearing your garden space.

Keep in mind you can utilize some of your animals to help with this process. For example, pigs and goats can be great for clearing out rough areas. I have used mine plenty of times for this purpose.

For a more complete list of essential farming tools, check out this article on what farming tools you need for a small farm .

How Do I Sell Produce, Eggs, and Meat From My Farm?

The three most common ways to sell your farm goods directly to the consumer are direct sales, community supported agriculture (CSA) memberships, and farmers markets.

Direct sales are pretty much what they sound like. You have customers that either come to your farm or meet you somewhere and you sell them your farm goods for cash or using a credit card. These are typically one-off sells and can be useful when you are selling items in bulk.

Community Supported Agriculture, or CSA for short, is way for customers to sign up for a farm share which entitles them to a portion of the goods produced from your farm each season. Having this income up-front can be a really big help, especially, when you need money before the season starts for your crops, inputs, animals, and other infrastructure needs. This also helps you predict how much farm goods you will need to produce since you know exactly how many shares have been sold. CSAs create a good relationship between the farmer and the customers. It allows the local community to lock arms with you as a farmer and support your farming endeavors.

Farmers markets can be another great way to sell your farm products. They typically require you to purchase a booth which gives you a space to set up once a twice a week when the market is open so you can sell your goods to the public. Farmers markets can provide an additional revenue stream on top of a CSA. This is especially true if you produce more than you need for your CSA shareholders and need to sell it somewhere else. An added benefit to doing a farmers market is that it puts you and your farm in front of more potential customers which may result in more people joining your CSA.

Before you start selling your farm goods, you need choose a farm name or use a farm name generator to get some ideas. Having a good farm name can really help sell your products. Start thinking about this even before you start a farm.

What Farm Organizations Should I Join?

When you start a farm there are several organizations that you should consider joining. My personal favorite is Farm-to-Consumer Legal Defense Fund.

The Farm-to-Consumer Legal Defense Fund is an organization that protects the rights of farmers and consumers who engage in direct commerce. In other words, they are here to look out for your best interest. Membership is cheap and you get unlimited consultations with attorneys, access to contractual documents such as herdshare contracts, buyers club agreements, and they will represent you in court if necessary on matters that are withing their mission statement at no additional cost.

Another great organization to join is the Farm and Ranch Freedom Alliance . They are an advocate for independent farmers, ranchers, livestock owners, and homesteaders. It’s easy to understand that by you selling your goods directly to consumers, you are taking money out of the hands of much larger organizations and corporations who lobby lawmakers to pass laws in their favor. The Farm and Ranch Freedom Alliance is here to represent you to those same lawmakers. They want to protect the safety, quality, and availability of our food by protecting independent producers like yourself.

Closing Thoughts

I really hope this guide and all the resources I have linked to have been helpful to you. I will continually be adding more information to it over time. I consider it a living document on how to start a farm from scratch and I truly desire to help you succeed. If you have questions, please post them in the comments below and I will try my hardest to answer them for you. Thank you for reading my guide.

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This post has 13 comments.

Muy buena información, gracias.

Hi, this guide is fantastic, thank you for taking the time to put it together. I have always wanted a farm, since I was a little kid. I want to do sustainable farming. My main animals being alpaca, angora goats for fiber, and then a plethora of other animals. ducks, quail, chickens, turkeys, pigs, a few sheep, and a steer or two just through the spring, summer, and fall. I also have plans for an orchard, as well as a hot house with year round vegetable production, and fruit I can’t grow in my zone otherwise. For me I’m really just starting to look into what’s required, financing, etc in my area. Leasing sounds good, except my orchard is pretty permanent and a huge commitment that takes years to build and mature, and would be a loss if I moved from the leased farm. what’s your advice?

Hi Lynae, glad to hear this guide was helpful. Here’s something else to consider. If you can’t afford a larger farm that would allow you to do all of these things, you could buy a smaller farm or house with a small amount of acreage where you can do more permanent things like growing an orchard. Then, you could lease land that either borders or is near your home to give you enough room to do everything else on like keeping livestock. You’d obviously need to be strategic about buying property near other land that could be leased. Hope this helps.

Hi Casey, Thanks a lot for this very mind refreshing guide! I knew nothing about farm since I have grown up in cities until moved to suburbs due to Covid-19. I find that I totally fall in love in the peace and the health that the nature brings. Do you have any suggestion on where would be the best place to invest in farms in the U.S., please? Since I am also a researcher in management science. I am very interested in your entrepreneurship journey and also your ideas on sustainable consumption. Hope that we have a chance to chat in the future. Best wishes,

Hi Danni, glad my guide was helpful. As far as where to buy a farm in the U.S. goes, it mainly depends on your goals. There are lots of places in the U.S. that have cheap land but these areas typically have a low population. So if you are planning on selling your farm goods locally, it may be harder in those areas than if you were near a large city. So I would encourage you to put together a plan and figure out your goals for your farm. Then, as you look around for land you’ll have a better idea of what type of land you need and where it can be located. Hope this helps.

Thank you for this article. My wife and I at almost 50 have decided it’s time to live our dream of farming. We have been called back to landers but I like farmer/rancher better. We have some work to do. We spent some time helping on a Barbados black belly sheep farm. We would like to find other experiences for learning. So here is my burning question…… is there a place where people go to find help? We both work ft so we can’t be there 24/7 but we do have a lot of flexibility. Just thought I’d ask.

Yes, there are a few different ways to find farms that you can work at. The largest organizations is Worldwide Opportunities on Organic Farms (WWOOF). https://wwoof.net/ You can find worldwide opportunists there. You can also reach out directly to local farms and ask them if they need help. LocalHarvest is a great resource for finding them. https://www.localharvest.org/

Hope this helps.

I am an African. This is an interesting site. I am just starting.And am 77 years ! I have a small parcel of land.Given to me by our traditional Chief.On what we call Reserve land.

To cut the story,my six sons will complete the work where I will not complete. Yah,will leave it to them when I have passed on ! Blessings to you and your family, Peter.

Hi Peter, this is great! I love that you are thinking multigenerational about your farm. I really hope that some of what I’ve shared here on my site will help you as you get started. Blessings to you and your family as well.

Hi Casey, Thank you so much for putting this website together. It is great. We purchased 11 acres with a large pond. It already had an old tobacco barn and a 7 stall stable on it as well. We have started with chickens and are trying to decide on the next animal to start. Do you have any suggestions? We also have an organic strawberry patch that we started as well as 20 blueberry bushes of differing varieties. We do have a vegetable garden, but it isn’t that large as yet. We do everything organic. I was wondering what we need to do to register as a farm and be considered a farm for tax purposes. Thank you, Jana

Hi Jana, congratulations on your farm purchase! That’s very exciting. Regarding what animal you should raise next, it depends on a lot of factors. Here are some things to think about.

Do you have enough room to rotational graze animals?

Is your land primarily pasture or forest? Certain animals need almost 100% pasture (ex. cows) while others can be rotated through the woods as long as they also have some access to pasture and supplemental feed (ex. pigs and goats).

What do you like to eat in case you can’t sell it?

Is there a USDA inspected meat processor near you where you can take the animals to be processed if you want to sell them?

I would start by answering these questions and go from there. Let me know if you have any other questions.

Ty you so much. My wife n I are both disabled and are unable to work outside of the home anymore. The only thing I can come up with is work out of the home. I grew up old school, to live off the land and take of one self. Been enjoy tons of homesteaders and ranchers channels. But I have lots to learn. We want to make this dream come true. Been handicap n disable is going to be difficult to get income, capital. But I was taught to keep going. Ty for the help and I will do my best to use some of wisdom.

Thank you for sharing your story!

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How to Start a Farm: Build Your Business

Lean on USDA and others to equip yourself with the business knowledge to build your operation. After your USDA Service Center visit, establish your operation by registering your business and obtaining licenses, permits, and a tax ID number. You should also consider educational opportunities, business management components, and insurance. 

Keep reading about establishing your business below, get an overview of the beginning farmer's journey , or jump to a different section of the farmer's journey.

On This Page

Grow your business knowledge.

Attend field days, workshops, courses, or formal education programs to build necessary skills to ensure you can successfully produce your selected farm products and/or services. Many local and regional agricultural organizations, including USDA and Cooperative Extension, offer training to beginning farmers.

• Cooperative Extension  offices address common issues faced by agricultural producers, and conduct workshops and educational events for the agricultural community.
• extension.org is an online community for the Cooperative Extension program where you can find publications and ask experts for advice.
• SCORE offers free mentoring, workshops, and online resources for entrepreneurs, small business owners, farmers, ranchers, and agribusiness.

Determine the Legal Structure of Your Business

A business structure refers to how a business is legally organized and can affect how a business is regulated, taxed , and more. Deciding the best structure for your business is one of the most important decisions you will make.

Decide which form of business ownership is best for you:

• sole proprietorship,
• partnership,
• Limited Liability Company (LLC),
• corporation,
• S corporation,
• cooperative.

The structure of farm business you choose may affect eligibility for certain USDA programs and will determine how and where you will need to register your business and which taxes you must pay.

The Sustainable Agriculture Research and Education (SARE) program provides guidance to help farmers decide which legal structure is best for your farm operation as well as detailed information about the characteristics and requirements of each legal structure. Review SARE's Farmers' Guide to Business Structures to learn more about business structures for farm operations.

Register Your Farm Business

Once you determine your business structure, you will need to obtain the necessary federal and state tax identification numbers to register your business . Registering your business and becoming familiar with your federal and state tax responsibilities will help you file your taxes accurately, make payments on time, and avoid potential penalties.

USDA has financial information and resources related to USDA program payments, asset protection, and the important relationships between federal and state income taxes and USDA farm programs.

Federal Tax ID Number (EIN)

As a beginning farmer you will need a federal tax ID number , also known as an Employer Identification Number (EIN). An EIN is used to identify a business entity, hire employees, apply for business licenses, permits, and more. The EIN is necessary for reporting to the IRS. You may apply for an EIN online .

The IRS provides an Agricultural Tax Center with numerous useful documents, including the Farmer’s Tax Guide that explains how the federal tax laws apply to farming.

State Tax ID Number

Tax requirements vary by state. Visit the SBA website to learn about your state’s laws regarding taxes and for specific steps on how to get a state tax ID number.

Obtain Business Licenses and Permits

Obtain the federal, state, and local licenses and permits required for your business. Licenses, permits, and other types of registrations vary by state and locality. Licenses and permits needed may also vary depending on the farm business activity and how those activities are regulated at a federal or state level. Review SBA’s Apply for licenses and permits page for more information. It’s also a good idea to contact your State Department of Agriculture to ask which licenses and permits may apply to them.

Purchase the Insurance You Need

Agriculture is an inherently risky business. Some risks are everyday business risks; some risks are brought on by natural disasters. Producers need to regularly manage for financial, marketing, production, human resource, and legal risks.

There are many types of insurance to consider for the business, employees, and the crops and livestock you may be producing. The following examples are some types of insurance to consider, but not all operations might need these. For example, if there are no employees in their business, they won’t need workers’ compensation insurance. Additionally, the laws requiring insurance vary by state so you will need to check your state website for any additional insurance you might need.

Liability insurance protects against claims resulting from injuries and damage to other people or property. Liability insurance policies cover any legal costs and payouts from the insured producer if they are found legally responsible.

Property insurance provides financial reimbursement to the landowner or renter of a structure and its contents in case of damage, theft or if someone else is injured on the property.

Crop insurance provides financial protection against losses due to adverse events including drought, excess moisture, damaging freezes, hail, wind, disease, and price fluctuations.

Workers' Compensation and Unemployment and Disability Insurance is required by the federal government for every business that has employees.

Health insurance can be purchased for yourself, family members, or as part of a benefits package for your employees. HealthCare.gov and USA.gov make available tools to help you understand what you need to know about new insurance options and other health care changes to help you find health-care related resources.

Life insurance can help protect your farm and help keep it in the family by providing money to pay for various farm expenses, from livestock to crops to new facilities.

USDA Crop Insurance

USDA’s Risk Management Agency (RMA) offers crop insurance to help you manage risk across your operation. Crop insurance helps mitigate production and revenue risks and supports a healthy rural economy. There are many types of insurance products available for a wide variety of production practices, including organic and sustainable agriculture. Beginning farmers and ranchers are also eligible for certain benefits designed to help as you start your operation.

Use RMA’s Agent Locator to find a crop insurance agent near you. Crop insurance may be required to receive loans.

Insurance is required when applying for a loan with FSA. Additional insurance and coverage period may differ depending on the type of loan.

Understand Employer Responsibilities

If you plan to hire employees for your farm operation, you will need to understand employer responsibilities and learn the legal steps you will need to take to hire employees. Then, you should establish a farm work plan to hire and schedule farm labor.

The US Department of Labor administers laws that protect several types of farm workers, including:

• Fair Labor Standards Act
• Migrant and Seasonal Agricultural Worker Protection Act

There may also be relevant state-based laws. For more information, visit your State Department of Agriculture .

H-2A Visa Program

The H-2A provisions of the Immigration and Nationality Act (INA) authorize the lawful entry into the United States of temporary, non-immigrant workers (H-2A workers) to perform agricultural labor or agricultural services of a temporary or seasonal nature. Learn about hiring agricultural workers through the H-2A Visa Program .

Occupational Health and Safety

The Occupational Safety and Health (OSH) Act is administered by the Occupational Safety and Health Administration (OSHA). Employers covered by the OSH Act must comply with the regulations and the safety and health standards promulgated by OSHA. Employers also have a general duty under the OSH Act to provide their employees with work and a workplace free from recognized, serious hazards. OSHA enforces the Act through workplace inspections and investigations. Compliance assistance and other cooperative programs are also available.

Find health and safety requirements and resources for employees on the Occupational Safety and Health Administration’s website . Be sure to also check your state-based laws.

An Agricultural Guide to Federal Labor Law

This video guides agricultural employers and advocates through compliance requirements under the applicable laws, and provides real world examples of compliant and non-compliant employment conditions and practices.

Video: Cultivating Compliance - An Agricultural Guide to Federal Labor Law

Once you have set up your business, it’s time to start producing your products and growing your business. USDA has tools to help producers grow their businesses and build new markets for their products both at home and abroad.

5. Sell your farm products

How to Start a Farm with USDA

Get an  overview of the beginning farmer's journey  or jump to a specific page below.

Find Your Local Service Center

USDA Service Centers are locations where you can connect with Farm Service Agency, Natural Resources Conservation Service, or Rural Development employees for your business needs. Enter your state and county below to find your local service center and agency offices. If this locator does not work in your browser, please visit offices.usda.gov.

Learn more about our Urban Service Centers . Visit the Risk Management Agency website to find a regional or compliance office  or to find an insurance agent near you.

Farm and Agriculture Business Plans

Agri-tourism business plans.

• Vineyard Bed & Breakfast Business Plan
• Agritourism Business Plan

Agriculture Consulting Business Plans

• Agricultural Consultants Business Plan

Agriculture Products & Retail Business Plans

• Butcher Shop Business Plan
• Feed and Farm Supply Business Plan
• Garden Nursery Business Plan
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• Recycling Waste Materials Business Plan

Farm Business Plans

• Agriculture Farm Business Plan
• Agriculture Fruit Farm Business Plan
• Horse Training Business Plan
• Hydroponics Farm Business Plan
• Peach and Apricot Farm Business Plan
• Produce Farm Business Plan

Farm Machinery Business Plans

• Farm Machinery Manufacturer Business Plan

Farming and agriculture are complicated businesses. To be successful, you need more than a green thumb and the willingness to get your hands dirty. You need to know how to operate your agricultural enterprise efficiently and not just forecast your crop rotations, but your cash position and revenue. To do that, you need a business plan.

How can a business plan help your farm or agriculture business?

A good business plan will help your farm or food production business grow. It can improve your chances of receiving government grants or loans, help you manage your business through hard times, and identify additional forms of revenue like tourism or consulting. Most lenders or investors require a business plan before they even consider funding a project. When you add in the numerous elements of running an agricultural business, and the factors like weather and government regulations that are often beyond your control, a business plan becomes an essential tool for effective management, strategic planning and communication across all the key stakeholders in your business.

Find the right agriculture business plan template for your business

If you’re not sure where to begin, check out our farms, food growers, food production facilities, and other agriculture-related sample business plans for inspiration.

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Starting a Farm: Business Planning

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Select Register a Group to register someone else other than yourself. Learn more about registering a group in this online guide .

If you are planning to start a farm or agriculture business, or if you already have one, you will need a business plan. A well-written business plan can help you secure funding from lenders. It will help you start and manage your business.

This self-paced course will help you develop your own business plan. Using educational videos and readings, you will learn about the process of researching and compiling the information needed to form a successful business plan. This course also includes a series of worksheets (to download and/or print) that will guide you through this process. By the end of the course, you will have developed a detailed written plan that defines your business strategies.

You can take section quizzes throughout the course and earn a certificate of completion.

• People with an idea for an agriculture or food business
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• Current business owners who do not have a written business plan

You will learn how to:

• structure your plan and conduct research
• describe your enterprises and industry and write mission and vision statements
• conduct a SWOT analysis for your business and set goals and objectives
• evaluate business structures, identify team members, and understand legal requirements
• describe your products and develop a marketing strategy
• develop a risk management plan
• understand budgets, start-up funding sources, financial statements, and recordkeeping systems
• write a business plan

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Personalize your experience with penn state extension and stay informed of the latest in agriculture..

How to Start a Cattle Farm

Starting a cattle farming business can be very profitable. With proper planning, execution and hard work, you can enjoy great success. Below you will learn the keys to launching a successful cattle farm.

Importantly, a critical step in starting a cattle farm is to complete your business plan. To help you out, you should download Growthink’s Ultimate Business Plan Template here .

Download our Ultimate Business Plan Template here

14 Steps To Start a Cattle Farm :

• Choose the Name for Your Cattle Farm
• Develop Your Cattle Farm Business Plan
• Choose the Legal Structure for Your Cattle Farm
• Secure Startup Funding for Your Cattle Farm (If Needed)
• Secure a Location for Your Business
• Register Your Cattle Farm with the IRS
• Open a Business Bank Account
• Get a Business Credit Card
• Get the Required Business Licenses and Permits
• Get Business Insurance for Your Cattle Farm
• Buy or Lease the Right Cattle Farm Equipment
• Develop Your Cattle Farm Marketing Materials
• Purchase and Setup the Software Needed to Run Your Cattle Farm
• Open for Business

1. Choose the Name for Your Cattle Farm

The first step to starting a cattle farm is to choose your business’ name.  

This is a very important choice since your company name is your brand and will last for the lifetime of your business. Ideally you choose a name that is meaningful and memorable. Here are some tips for choosing a name for your cattle farm:

• Make sure the name is available . Check your desired name against trademark databases and your state’s list of registered business names to see if it’s available. Also check to see if a suitable domain name is available.
• Keep it simple . The best names are usually ones that are easy to remember, pronounce and spell.
• Think about marketing . Come up with a name that reflects the desired brand and/or focus of your cattle farm.

2. Develop Your Cattle Farm Business Plan

One of the most important steps in starting a cattle farm is to develop your cattle farm business plan . The process of creating your plan ensures that you fully understand your market and your business strategy. The plan also provides you with a roadmap to follow and if needed, to present to funding sources to raise capital for your business.

Your business plan should include the following sections:

• Executive Summary – this section should summarize your entire business plan so readers can quickly understand the key details of your cattle farm.
• Company Overview – this section tells the reader about the history of your cattle farm and what type of cattle farm you operate. For example, are you a beef, calf, or a dairy cattle farm?
• Industry Analysis – here you will document key information about the cattle industry. Conduct market research and document how big the industry is and what trends are affecting it.
• Customer Analysis – in this section, you will document who your ideal or target customers are and their demographics. For example, how old are they? Where do they live? What do they find important when purchasing products like the ones you will offer?
• Competitive Analysis – here you will document the key direct and indirect competitors you will face and how you will build competitive advantage.
• Marketing Plan – your marketing plan should address the 4Ps: Product, Price, Promotions and Place.
• Product : Determine and document what products/services you will offer 
• Prices : Document the prices of your products/services
• Place : Where will your business be located and how will that location help you increase sales?
• Promotions : What promotional methods will you use to attract customers to your cattle farm? For example, you might decide to use pay-per-click advertising, public relations, search engine optimization and/or social media marketing.
• Operations Plan – here you will determine the key processes you will need to run your day-to-day operations. You will also determine your staffing needs. Finally, in this section of your plan, you will create a projected growth timeline showing the milestones you hope to achieve in the coming years.
• Management Team – this section details the background of your company’s management team.
• Financial Plan – finally, the financial plan answers questions including the following:
• What startup costs will you incur?
• How will your cattle farm make money?
• What are your projected sales and expenses for the next five years?
• Do you need to raise funding to launch your business?

3. Choose the Legal Structure for Your Cattle Farm

Next you need to choose a legal structure for your cattle farm and register it and your business name with the Secretary of State in each state where you operate your business.

Below are the five most common legal structures:

1) Sole proprietorship

A sole proprietorship is a business entity in which the owner of the cattle farm and the business are the same legal person. The owner of a sole proprietorship is responsible for all debts and obligations of the business. There are no formalities required to establish a sole proprietorship, and it is easy to set up and operate. The main advantage of a sole proprietorship is that it is simple and inexpensive to establish. The main disadvantage is that the owner is liable for all debts and obligations of the business.

2) Partnerships

A partnership is a legal structure that is popular among small businesses. It is an agreement between two or more people who want to start a cattle farm together. The partners share in the profits and losses of the business. 

The advantages of a partnership are that it is easy to set up, and the partners share in the profits and losses of the business. The disadvantages of a partnership are that the partners are jointly liable for the debts of the business, and disagreements between partners can be difficult to resolve.

3) Limited Liability Company (LLC)

A limited liability company, or LLC, is a type of business entity that provides limited liability to its owners. This means that the owners of an LLC are not personally responsible for the debts and liabilities of the business. The advantages of an LLC for a cattle farm include flexibility in management, pass-through taxation (avoids double taxation as explained below), and limited personal liability. The disadvantages of an LLC include lack of availability in some states and self-employment taxes.

4) C Corporation

A C Corporation is a business entity that is separate from its owners. It has its own tax ID and can have shareholders. The main advantage of a C Corporation for a cattle farm is that it offers limited liability to its owners. This means that the owners are not personally responsible for the debts and liabilities of the business. The disadvantage is that C Corporations are subject to double taxation. This means that the corporation pays taxes on its profits, and the shareholders also pay taxes on their dividends.

5) S Corporation

An S Corporation is a type of corporation that provides its owners with limited liability protection and allows them to pass their business income through to their personal income tax returns, thus avoiding double taxation. There are several limitations on S Corporations including the number of shareholders they can have among others.

Once you register your cattle farm, your state will send you your official “Articles of Incorporation.” You will need this among other documentation when establishing your banking account (see below). We recommend that you consult an attorney in determining which legal structure is best suited for your company.

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4. Secure Startup Funding for Your Cattle Farm (If Needed)

In developing your cattle farm business plan , you might have determined that you need to raise funding to launch your business. 

If so, the main sources of funding for a cattle farm to consider are personal savings, family and friends, credit card financing, bank loans, crowdfunding and angel investors. Angel investors are individuals who provide capital to early-stage businesses. Angel investors typically will invest in a cattle farm that they believe has high potential for growth.

5. Secure a Location for Your Business

The best way to find a location for your cattle farm is to consider the climate, soil type, and availability of water. You’ll also want to find a place with enough space to accommodate your herd and infrastructure like fencing and barns.  

6. Register Your Cattle Farm with the IRS

Next, you need to register your business with the Internal Revenue Service (IRS) which will result in the IRS issuing you an Employer Identification Number (EIN).

Most banks will require you to have an EIN in order to open up an account. In addition, in order to hire employees, you will need an EIN since that is how the IRS tracks your payroll tax payments.

Note that if you are a sole proprietor without employees, you generally do not need to get an EIN. Rather, you would use your social security number (instead of your EIN) as your taxpayer identification number.

7. Open a Business Bank Account

It is important to establish a bank account in your cattle farm’s name. This process is fairly simple and involves the following steps:

• Identify and contact the bank you want to use
• Gather and present the required documents (generally include your company’s Articles of Incorporation, driver’s license or passport, and proof of address)
• Complete the bank’s application form and provide all relevant information
• Meet with a banker to discuss your business needs and establish a relationship with them

Finish Your Business Plan Today!

8. get a business credit card.

You should get a business credit card for your cattle farm to help you separate personal and business expenses.

You can either apply for a business credit card through your bank or apply for one through a credit card company.

When you’re applying for a business credit card, you’ll need to provide some information about your business. This includes the name of your business, the address of your business, and the type of business you’re running. You’ll also need to provide some information about yourself, including your name, Social Security number, and date of birth.

Once you’ve been approved for a business credit card, you’ll be able to use it to make purchases for your business. You can also use it to build your credit history which could be very important in securing loans and getting credit lines for your business in the future.

9. Get the Required Business Licenses and Permits

A cattle farm requires a number of licenses and permits to legally operate. These include a business license, zoning permit, health certificate for the animals, and a license to operate a slaughterhouse.

10. Get Business Insurance for Your Cattle Farm

The type of insurance you need to operate a cattle farm will vary depending on the location and scope of your operation. 

Some business insurance policies you should consider for your cattle farm include:

• General liability insurance : This covers accidents and injuries that occur on your property. It also covers damages caused by your employees or products.
• Auto insurance : If a vehicle is used in your business, this type of insurance will cover if a vehicle is damaged or stolen.
• Workers’ compensation insurance : If you have employees, this type of policy works with your general liability policy to protect against workplace injuries and accidents. It also covers medical expenses and lost wages.
• Commercial property insurance : This covers damage to your property caused by fire, theft, or vandalism.
• Business interruption insurance : This covers lost income and expenses if your business is forced to close due to a covered event.
• Professional liability insurance : This protects your business against claims of professional negligence.

Find an insurance agent, tell them about your business and its needs, and they will recommend policies that fit those needs. 

11. Buy or Lease the Right Cattle Farm Equipment

The equipment you will need for raising cattle will depend on the size of your farm, the type of cattle, and the facilities. Some basic equipment you will need includes a cattle prod, feed troughs, water troughs, and fencing to keep your cattle from wandering off the property. 

12. Develop Your Cattle Farm Marketing Materials

Marketing materials will be required to attract and retain customers to your cattle farm.

The key marketing materials you will need are as follows:

• Logo : Spend some time developing a good logo for your cattle farm. Your logo will be printed on company stationery, business cards, marketing materials and so forth. The right logo can increase customer trust and awareness of your brand.
• Website : Likewise, a professional cattle farm website provides potential customers with information about the products you offer, your company’s history, and contact information. Importantly, remember that the look and feel of your website will affect how customers perceive you.
• Social Media Accounts : establish social media accounts in your company’s name. Accounts on Facebook, Twitter, LinkedIn and/or other social media networks will help customers and others find and interact with your cattle farm.

13. Purchase and Setup the Software Needed to Run Your Cattle Farm

To run a cattle business, you will need software to track the animals and their movements. You will also need software to manage the finances of the farm. This software can help you keep records of sales and expenses, and make projections for the future. Finally, you may want software that can aid in marketing your cattle products.

14. Open for Business

You are now ready to open your cattle farm. If you followed the steps above, you should be in a great position to build a successful business. Below are answers to frequently asked questions that might further help you.

How to Finish Your Cattle Farm Business Plan in 1 Day!

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With Growthink’s Ultimate Business Plan Template you can finish your plan in just 8 hours or less!

How to Start a Cattle Farm FAQs

Is it hard to start a cattle farm.

Raising beef cattle or other cattle farms is not difficult . In fact, there are many government programs and resources available to help you get started. The most important thing is to do some research and develop a plan that fits your goals and the needs of your cattle.

How can I start a cattle farm with no experience?

There are a few ways that you can start a cattle farm business with no experience. One way is to look for a mentor who can help you get started. Another way is to read books or articles about cattle farming, and apply what you've learned. Finally, you can watch videos or attend workshops about cattle farming.

What type of cattle farm is most profitable?

A successful cattle farmer that is the most profitable is one that specializes in beef cattle. To be profitable, this type of cattle farm needs to produce a high quality product that can be sold at a premium price. Additionally, this type of cattle farm is able to take advantage of economies of scale, which allows them to produce a larger quantity of beef cattle and dairy cattle while still maintaining a low cost per unit.

How much does it cost to start a cattle farm?

The cost of starting a cattle ranch varies depending on the size and scale of the operation. Generally, startup costs will range from $10,000 to $50,000. Some of the major expenses include land or pasture fees, livestock purchases, fencing, and feed.

What are the ongoing expenses for a cattle farm?

There are a few ongoing expenses necessary for a cattle ranch. One of the main expenses is feed for the cows. This can be in the form of hay, silage, or grains. Another expense is veterinary care. Cows need to be vaccinated against various diseases, and may need to be treated for parasites or other health issues as well. Other ongoing expenses can include fencing, water, and electricity.

How does a cattle farm make money?

Cattle ranchers can make money in a few different ways. One way is by selling the cattle to meat processors. Another way is by renting out the cows to other farmers for milk production. Finally, some cattle farmers sell their bulls to other farmers for breeding purposes.

Is owning a cattle farm profitable?

Yes, owning a cattle farming business can be profitable because the demand for beef is high, and people are willing to pay a good price for it. Additionally, cows can be raised to slaughter weight relatively quickly, so the farmer can bring in a good profit fairly soon after starting the operation. Finally, dairy cows are able to graze on pasture land, which is relatively cheap and easy to come by. This means that the farmer can keep costs low while still bringing in a good profit.

Why do cattle farms fail?

Cattle farm businesses can fail for a variety of reasons, such as a lack of planning, poor management, inadequate capitalization, or unrealistic expectations. Other common causes of failure include the high cost of feed and fuel, drought, disease, and pests.

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