A Business Plan?

Do you ever feel like you are out of your league. I’m a high school soccer coach at a school that doesn’t place a lot of emphasis on a sport unless it ends with ball (football, basketball, baseball, and softball). We don’t have the greatest equipment, but we make do with what we have. I know for a fact that when a team shows up at our place with matching warm-ups, bags, water bottles, shoes, and more my team feels like it is out of its league! Well, whenever I read about or start to think about a business plan I feel like I am out of my league.

But, I feel like a business plan is an important part of any farming venture that I want to be involved in. I want to have an idea of what I’m getting into, what it’s going to cost, what I need to return, what I can invest in, and how much I need to sell. So, last night I did a little “googling” to see what I could come up with. Below is a section from an article about the 2004 Practical Farmers of Iowa Conference. If you would like to read the article in its entirety you can click HERE. Below I have copied the section that specifically speaks to farming business plans in general:

How to develop a workable business plan

When you run your own farm, you’re an entrepreneur as much as a producer. That means you need to understand business planning 101, said Penny Brown Huber, program administrator for Iowa’s Growing Your Small Market Farm Business Planning Program.

“Entrepreneurs are innovators,” Huber said. “They have a strong desire to create something new. They also have a vision of how their business will grow and a plan to make it happen.”

She presented these contracts between popular misunderstandings, and what she knows about farmers and entrepreneurs:

Myth: Entrepreneurs are born, not made.
Fact: Almost anyone can learn business skills.

Myth: Entrepreneurs are their own bosses.
Fact: Entrepreneurs work for many people, including investors, bankers, customers, employees, and family.

Myth: Entrepreneurs set their own hours.
Fact: Entrepreneurs work long and hard for their success.

Myth: Entrepreneurs love high-risk ventures.
Fact: Entrepreneurs look for ways to minimize risk.

Huber gave these steps, and comments, for successful business planning:

1. The business owner assumes the lead in the business planning process. “You can’t expect an Extension agent or someone else to write your business plan for you.”
2. The business planning process must involve everyone in the family and/or business.
3. The business plan must reflect reality. “Interview other people already in the business to get their input.”
4. Develop contingency plans for worst-case scenarios. “If you get sick, a building burns down, a hailstorm destroys your vegetable crop, or your livestock get infected with disease, you have to have a plan.”
5. Set objectives and goals that are achievable. “Two to three strong, clear goals and objectives will really help you move along,” Huber said. “Your first goal can be, ‘I will write a business plan.’ Your objective can be, ‘I will write my plan by Dec. 1.’”
6. Include innovative marketing ideas. “Developing recipes that feature the foods you raise can be a great way to promote your business.”

Once your write your business plan, review it often and use it as a guide.

I thought the article brought up some good points for a total business plan beginner like myself to think about. I don’t want to make an extra long post here, but I will comeback tomorrow with some of my thoughts on the article. Let me just say the points that really hit home with me were numbers two and three. One of my major reasons for farming is the family aspect … my family and the families that we will sell to. And, I am all about learning from the experience of others. In fact, that is what a majority of the posts on this blog of mine are about, learning from others. I would appreciate any thoughts on business plans in general or more specifically farm based business plans.