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A Farm of My Own:  Business Plan for Your Farm  |
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paradiseplantation
True Blue Farmgirl
1277 Posts
julie
social springs community
Louisiana
USA
1277 Posts |
 Posted - Oct 02 2007 : 07:32:39 AM
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Do any of you have a Business Plan for your farm? My DH and I bought ours three years ago, and our goal is to be 85% self sufficient. Because we want the IRS to recognize it as a business and not a hobby, we are required to keep records of everything. Our CPA recommended a Business Plan, and I put together a rough draft of a five-year plan, but I'm not really sure if I'm on track or not. Just curious, if you have one, if you have any tips on what needs to be included. I've added a budget section on mine, and put a page behind it for actual expenses. I've listed everything we need to do and want to do. Any other thoughts or ideas?
from the hearts of paradise... |
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therealshari
True Blue Farmgirl
235 Posts
Shari
Beryl
UT
USA
235 Posts |
Posted - Oct 02 2007 : 10:58:44 AM
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We don't have a specific written business plan for our farm. However, we do maintain a farm accounting and are working our way towards a high level of self-sustainability, as well as creating some positive cash flow.
Our two cash crops are from the sheep (meat and wool) and chickens (eggs).
As far as budgeting, be sure to separate the capital expenses from the regular operating expenses. For example, because we've had to build a chicken coop, that can be considered a capital expense to be amortized over several years. Check with your accountant for the actual schedule. We can do the same with the tripling of our stable.
Don't assume because something only costs a few hundred dollars, it isn't worth it. If you're not yet making a profit, it's best to push as much to the future as possible, so be sure to see how much you can call "capital expense".
Be sure to see if there are ways to "farm the sun and wind" by using solar or wind energy and reselling your excess to the local power company. While the initial costs are a little steep, you can generally recoup your entire investment in 15 to 20 years. If you can resell your excess, you can improve your ROI considerably.
Shari Thomas
farmer, web copywriter, blogger
Shari's Gone Country
Vote for me at "Blog for a year" |
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corporatefarmgirl
True Blue Farmgirl
389 Posts
Tamara
Pikeville
TN
USA
389 Posts |
Posted - Oct 05 2007 : 12:19:05 PM
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We have a business plan for our farm. You need to have a where you are where you want to be in 5 years plan. What products are you going to sell. Were are your customers. How do you plan to let them know about your products. What is your marketing plan. How much growth do you expect to have per year, etc... I highly recommend getting a book from the library on writing business plans. You really only need a few pages.
PLEASE remember that when you make your farm a business ( land home ect as part of business) you could lose your farm if there is ever a lawsuit from a customer. What we have is a Limit Liablility company that happense to be on our farm. Our company "rents" the land and building from us personally. The LLC company then takes all liability and we are not personally liable nor is our farm.
Please note that this is not intended to be complete legal advise. I would check to see what liability laws are for your state. I dont mean to scare you but I have seen people lose personal property because of businesses and the fact they were not set up to protect their homes. It is sad we have to look at this but it is part of business 
there is a seed to plant in every heart |
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therealshari
True Blue Farmgirl
235 Posts
Shari
Beryl
UT
USA
235 Posts |
Posted - Oct 05 2007 : 1:10:05 PM
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One other thing, be sure to check with your Insurance company as you will want to hold a "farm policy" as opposed to a "homeowners policy".
In the past, I've written a number of business plans and have found the most valuable sections to be the narratives of your marketing plan. If you don't have a viable plan to sell your products, you don't have a business.
Being self-sufficient doesn't make you a "farm" as in a business. What makes you a business in the eyes of the IRS is an intent to make a profit. The IRS taxes your net profit.
If I think of more, I'll return and add it
Shari Thomas
farmer, web copywriter, blogger
Shari's Gone Country
Vote for me at "Blog for a year" |
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Alee
True Blue Farmgirl
22941 Posts
Alee
Worland
Wy
USA
22941 Posts |
Posted - Oct 05 2007 : 7:33:08 PM
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The small business bureau of your state should be able and willing to help you create a workable business plan and will also help you determine if you are on track or not. You can get their number by calling your state capital or Googling your state's directory.
Alee
The amazing one handed typist! One hand for typing, one hand to hold Nora!
http://home.test-afl.tulix.com/aleeandnora/ |
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A Farm of My Own: Business Plan for Your Farm |
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Business Plan for Your Farm
