Two small business farmers looking at their plants.

How to Create a Farm Business Plan

Updated January 1, 1 . AmFam Team

Creating a farm business plan will help you reach your bottom line. Take a look at some of the main components of a business plan and start creating your own roadmap to success.

When you’re in the business of farming, you’re not only thinking about your daily responsibilities, but you’re keeping the bigger picture top of mind, too. From planning the future of your farm to mapping out how to make a profit, a farm business plan is an essential tool.

Creating a farm business plan gives you a detailed account of your vision, mission, goals, strategies, operation and finances, among other things — which ultimately will help you reach your bottom line.

Take a look at some of the main components of a business plan and start creating your own roadmap to success.

What Is a Farm Business Plan?

A farm business plan is a strategy for how your farming operation is going to work and what you’re going to do to make it succeed. Typically, a farm business plan covers your goals for the first three to five years. Consider it your compass — it’ll help direct all of your business decisions.

What to Include in Your Farm Business Plan

While most business plans have common guiding principles with similar outlines, your plan length and details can be as complex or simple as you choose. The purpose of creating a plan is actually using it when you’re done, so the easier it is for you to understand, the more useful it’ll be. Below, we’ve outlined important details you’ll want to include in your plan so it serves its purpose and provides a roadmap to help you accomplish your goals and objectives.

Vision. Your vision is your first priority since it’ll be used to guide your business long term. It should reveal, at a high level, what you hope to achieve and where you hope your farm will be in the future. Consider it your “north star” — it should articulate a concise statement of the meaning and purpose of your business that guides the direction your business goes.

Mission statement. On the other hand, your mission statement is all about the now. While your vision statement is your aspiration for your farm’s future, your mission statement is actionable — what are you doing right now to drive your farm’s business forward? Your mission statement should get more specific and embody your broader vision. Focus your mission statement on the guiding values of your farm business. A good place to start for your mission statement is answering these three questions:

  • What does your farm do for your customers?
  • What does your farm do for your employees?
  • What does your farm do for its owners?

Essentially, your mission statement should distinguish you from your competitors.

Objectives and Goals. Your objectives and goals provide a framework to help you achieve the vision and mission of your farm. While goals are broader defined and help direct your business, the objectives translate your goals into detailed, measurable targets, and typically have a specific timeline to work around. Clearly defined objectives are necessary for an effective farming business strategy. Your objectives should be specific enough so they provide guidelines for all decision making, but they should also be flexible as priorities and interests often change.

To begin setting your farm’s business goals and objectives, think about what you’re trying to achieve. Dig into your vision and mission statement to build on those values and aspirations. Goals and objectives are meant to point your farm in the right direction and keep you on track. Keep “SMART goals” in mind when sitting down to craft this section of your farm business plan. SMART goals stand for:

  • Specific
  • Measurable
  • Attainable
  • Rewarding, and have a
  • Timeline

Now that you’ve determined a foundation for your plan, you’ll need to focus on three key logistical components to include: marketing, operations and finances.

Marketing. The marketing component focuses on your product and customer. Key questions you’ll want to answer include:

  • What product(s) are you selling?
  • Who will you sell your product(s) to?
  • How do you plan on selling your product(s)?
  • Is there anything unique about your product(s)?
  • Does your farm plan meet the supply and demands of the general market?
  • Who are your competitors?

Answering these questions will help you develop a marketing strategy which then can further dive into other areas, like price, placement and promotion ideas. The success of your product will be in conveying its value to your customers — and it all starts with your marketing strategy.

Operations. This part of your plan centers on how you produce your product. Consider the following:

  • Where are you located?
  • How many acres of land are you farming?
  • How many employees do you have?
  • Are you an organic or conventional farmer?
  • What kind of equipment do you use?
  • What kind of power and other sources of inputs do you have?

Anything that goes into the actual production of your product goes into the operations section.

Finances. Detailing the financial aspect of your farming operation is another critical component of your farm business plan. Start with your initial financial requirements, like income and operating expenses. Consider your daily, weekly and monthly expenses and where your money will come from. For instance, think about the cost of land, equipment, seeds, breeding animals, barns or outbuildings, fences, etc. How much will your initial finances cost? Then go back to your goals and objectives and project what’s needed for future growth and how you’ll meet any objectives in terms of capital.

Don’t Forget Your Farm Succession Plan

A farm succession plan is the process of passing on the ownership of your farm to another person — quite often the next generation of your family. A succession plan makes that transfer smoother and it’ll help determine the future of your farm. While you don’t need to vet out an entire succession plan in your original farm business plan, it is important to keep it in mind as your farm continues to thrive. Here’s some key info about a farm succession plan, including more about what it is and how you can create one.

Starting with these key components will help you create your farm business roadmap that details how you’ll get from Point A, which is where you are today, to Point B, which is where you want to be years down the road. Creating a farm business plan shouldn’t be considered a daunting task — it’ll take some time to develop, but it’s a resource for you that helps you achieve goals, stay on track and help your farm grow into a successful endeavor.

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    Catalog Your Farm Implements and Farm Tools First

    It’s time to get down to business and start pulling files. Begin by building a list of implements and equipment that are essential to your farm’s day to day operations. Here are some of the documents you’ll need.

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    • Tractors
    • Combines
    • Farm irrigation systems
    • Hay balers, backhoes, and wagons
    • Planters
    • Cultivators and disks
    • Herbicide and crop sprayers, as well as fertilizer and manure spreaders
    • Milking machines
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    • Internal combustion and electric motors
    • Water pumps and air compressors
    • Motorized post-hole diggers
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    • Original purchase orders
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    • Insurance documents
    • Financing documents
    • Maintenance records

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    The Financial Benefits of a Farm Equipment Checklist

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    Enhance Your Farm's Digital Presence

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    The Importance of Understanding the Platform and Your Audience

    Before introducing your farm to the World Wide Web, you’ll want to keep these two things front of mind:

    What content are you putting on each platform?

    From your website to your e-newsletter, your customers consume and engage with every platform in different ways. So, when you start building your online presence, you’ll want to have an understanding of each platform’s purpose. That way, when your customer interacts with your business, they’re getting the information they expect.

    For instance, someone visiting your farm’s website is going to be looking for much different information than if they were on your Twitter feed. Or if a customer follows your Instagram account, they aren’t expecting the same stories as they read in your farm’s e-newsletter.

    You can build a better experience for your customers by asking yourself what mindset your reader is in when they head to each platform you create.

    Who is your audience?

    Understanding your customer is essential to the success of your digital presence. Before delivering a message effectively, you need to know who the message is going to and why. For starters, consider the kind of farm you run. Are you a commercial farm that sells your product to big businesses for distribution, or is your customer local businesses and families? The content and its tone depends on who you’re trying to reach. Who are they, what are they looking for and what’s the most authentic way you can relate to them to get them what they want? Understand their motivation by putting yourself in their shoes.

    Building a Website for Your Farm

    Now that you have a better idea of some digital basics, let’s put that knowledge into practice — starting with your website. The internet is a powerful tool to market the product(s) your farm produces, and creating a website is a key way to harness its potential. Follow these guidelines for website best practices:

    Set goals. Spontaneity has its time and place, but building a website to market your brand isn’t the situation to jump in without a plan. It’s important to set realistic, achievable goals for round one of your website. Keep in mind, your site is a work in progress and can be improved upon in many iterations. Consider what you want your website to achieve. Are you selling products? Do you offer a CSA? Do you want to educate people on agriculture? Maybe you’ll create a gallery to show images of the fun you have on your farm. Take the time to sit down and list out a few goals for round one. With your plan in place, it’ll make the next steps that much easier.

    Creating the website. You’ll need to decide if you want to hire someone to create your website or if you plan on crafting one yourself. Many sites exist that make it super easy to create and maintain your own website — and most of them are even free to use! If you choose to have someone develop a website for you, make sure it implements a content management system so you can update the site yourself. This way, you can easily keep things relevant without always having to go back to the designer (and pay them) to make changes.

    Provide a clear description of who you are. If someone stumbled upon your website, would they be able to identify who you are and the purpose of your farming business within a matter of seconds? That’s your goal — create a homepage that’ll attract and retain your customer’s attention so they’ll stay on your page. Make sure the name of your business stands out and a summary of your products and services is included.

    Clear navigation. In order to guide your customers to discover all the great things about your business, you’ll want a navigation menu with clear links that lead to your pages. A dropdown menu offers an easy way for your visitor to see all that you have to offer, no matter which page they’re on. You’ll ultimately decide which pages you want on your page, but home, about us, newsletter, calendar, contact us, links to your social media pages and other important services you offer are common pages to include on your website. Remember, your pages will align with the goals you set at the beginning.

    How to Create a Farm E-Newsletter

    No matter what type of farming you do, an e-newsletter is a simple and effective way to promote your farm. An e-newsletter is a periodic “report” with information and news about your farm and, in this case, is distributed to your subscribers via email. This form of marketing can be very effective because it’s targeted to people who have already taken interest in what you’re doing.

    So what should you know about creating an e-newsletter? Start with these three tips:

    Newsletter content. A good rule of thumb to follow is to include content that’s 90% educational and 10% promotional. Chances are the person who subscribed to your e-newsletter wants to get to know your business better and continue to stay informed — not be pushed to buy something. Providing educational, relevant information builds trust between your reader and your business. Here are some ideas for content you might include:

    • Whether you sell meat or vegetables, recipes are a fun way to mix your product with something useful to the consumer. It may even encourage a customer to buy your product.
    • Life on the farm isn’t something everyone gets to experience. Include a fun story about how your farm runs or an anecdote about your animals. This way your reader can vicariously experience farm life.
    • Is your farm open to the public? Include visiting hours, what they can expect to experience and any upcoming special events.
    • If you offer volunteer opportunities, include how to volunteer and/or a testimony from a previous volunteer.
    • Will you be at a farmer’s market or farming expo? Be sure to list anywhere you plan on appearing as vendors.
    • Reward your subscribers with a discount or coupon every now and then to show you appreciate their business.
    • Is there something unique about your farm? Let it be known!

    There’s no end to the content you can include in your newsletter, but most importantly, make sure it’s relevant and have an understanding what your reader is looking for.

    Newsletter design. A newsletter can be sent by mail, email or included on your website. Our suggestion is to send your subscribers an email as well as include a web page for your newsletters on your website. That way non-subscribers can view the newsletter and hopefully become subscribers! Here are a few things to keep in mind for the layout of your newsletter:

    • Create a header at the top of the page that includes the title of your newsletter, your company name and logo.
    • Use subheadings to organize and break up the pieces of content. A subhead should be smaller than your main heading and bigger than the text you use for your content blocks.
    • Choose a color scheme. If you have a brand logo, defer to those colors.
    • The legibility of your newsletter is very important, so stick to one or two fonts, since too many fonts can give a disorganized look.
    • Have a balance of images and text. An image grabs a reader’s attention and offers a visually appealing element to your newsletter. It can be used to break up the page so as to not overwhelm the reader with too much content.
    • Don’t create a five-page newsletter. Keep it to a page or two. The newsletter is designed to provide quick, digestible information that grabs your reader’s attention.

    Newsletter frequency. How often should you send your newsletter? Most people choose to send a weekly, monthly or quarterly newsletter. It all comes down to your own personal goals and what your business offers. If you have a lot of events happening on your farm or are very customer-focused, sending a weekly newsletter is a good idea. If you don’t think you’ll have much time to put into a weekly newsletter, go for the quarterly and make sure to spend time filling it with all the great things that have gone over the last three months. A monthly newsletter is a good, doable balance for busy farmers who need to keep their customers updated but don’t have a lot of time.

    Just remember — your newsletter is meant to attract your target audience and give them a reason to stick with you. Do what’s realistic for your business and have fun with it!

    Social Media and Your Farm

    Facebook, Twitter, YouTube — just a few social media platforms you can use to easily promote your farm. And they are pretty simple to set up and maintain! Our advice is to focus on building out your presence on one platform and slowly work your way into creating more accounts once you get the hang of marketing through social media. Here’s a closer look at some great ways you can use social media on your farm

    A thought-out, well-run digital presence can benefit your farm in many ways. With the right goals and strategy in place, you can give your farm a digital edge. Your next steps? Go dig around the Internet and do some research. What kinds of farming websites exist? What kind of information do other farms include in their e-newsletters? Start following some successful farm’s on social media. Take a look at what already exists on the web to gain ideas on what might work or not work for your own strategy.

    Remember — it’s all about knowing your audience and what they’re looking for. At the end of the day, it’s about making your customer happy.