by Starting a farm takes more than a plot of land and a dream; it also requires a major financial investment.
When you’re working on the budget section of your small farm business plan, it can be easy to forget some key items.
That’s why we’ve created a list of some of the most overlooked small farm startup costs. In this blog, we’ll share six small farm startup costs to prepare for — plus our advice for keeping them as low as possible.
1. Farm Labor
“It takes a village.” This adage is just as true for farms as it is for families.
A team of farmhands can help you care for livestock and manage the endless cycle of planting and harvesting, and as your farm grows, you might need to hire additional employees to run your farm store, manage your finances, and pack online orders.
But hiring a solid team isn’t cheap. To attract the best of the best, you need to offer competitive pay and benefits.
How To Save on Labor Costs
Fortunately, there are ways to keep your employees happy and your bottom line healthy. Let’s take a look at a few strategies you can use to manage this small farm startup cost:
- Take advantage of government grants: The federal government offers financial resources that can help you shoulder the major costs of starting a farm like purchasing land and hiring workers. Head to the USDA’s website to see your options.
- Make your farm a family affair: Ask your family members for their help in exchange for special perks like free produce or meat. If they enjoy working on the farm, they might even decide to become a permanent, paid member of your team.
- Prioritize training: Make the most of your labor investments by providing your team with ongoing training to help them be as productive and efficient as possible.
With these tips, you’ll be able to build a stellar team without breaking the bank.
2. Farming Equipment
Farming equipment and machinery make a massive difference when it comes to your farm’s yields — but they can get expensive very quickly.
To start your small farm, you need basic tools like a shovel and wheelbarrow — but as your farm grows, you’ll need heavy-duty equipment like a tractor and harvester.
How To Save on Equipment
While equipment is an unavoidable and hefty expense, there are a few ways you can save on this small farm startup cost:
- Purchase used tools and machinery: If you’re on a tight budget, opting for used equipment rather than new can make a huge difference. To find used equipment for sale, ask around at your local farmers’ market or search online.
- Prioritize maintenance: Keep costs low in the long term by treating your tools and machinery with care.
- Share resources: Join a local farm co-op to access shared farming equipment.
With a little creativity and savviness, you can outfit your farm with powerful equipment — without spending a fortune.
3. Meat and Produce Storage
Storage is a frequently forgotten cost of running a farm. After you’ve harvested your produce and butchered your fresh cuts of meat, you need somewhere to store it safely.
Purchasing reliable refrigerators and freezers large enough to house your farm’s yields is costly but crucial for offering the freshest products. You’ll also need to budget for an increased electricity bill to keep these coolers running.
How To Save on Storage
Managing this small farm startup cost is all about inventory management.
Refrigerator and freezer space will always be limited, so it’s important to use it wisely. We recommend implementing a weight-based approach and leveraging techniques like first in, first out (FIFO) to maximize your storage space.
The right farm management software can also help you make the most of your storage space by monitoring your stock and generating labels to keep your products organized.
Mastering the art of farm inventory management will help you stretch your storage space and offer the freshest products to customers.
4. Technology
Another critical small farm startup cost to budget for is software.
A powerful software solution can make a world of difference for your farm, helping you manage inventory, monitor your finances, and even make online sales. And since this tool plays such a major role in your farm’s success, investing in the right one is key.
How To Save on Technology
One of the best ways to keep this startup cost low is to rely on one software provider for all your sales-making needs. Here are a few tips to stretch your software budget:
- Embrace e-commerce: Make the most of your software investment and boost your sales by choosing a farm e-commerce platform. This tool helps you manage your farm’s operations and expand your customer base by selling products online.
- Choose integrated hardware: You also need a scale, label printer, and maybe even a cash register to keep your farm organized and profitable. Choosing software that integrates with these tools can save you time and money.
- Choose integrated payment processing: To make farm sales, you need a payment processing solution. Usually, the most affordable way to secure payment processing is through your software provider.
If you spend wisely, you’ll be able to generate an impressive return on your software investment in the form of more sales and streamlined operations.
5. Marketing
If no one knows about your farm, you won’t be able to make any sales.
Fortunately, an effective marketing strategy can help you build awareness and expand your customer base — but it costs money.
Whether you’re creating digital ads to reach potential customers or sending email newsletters to your existing ones, you need to include marketing expenses in your small farm business plan.
How To Save on Marketing
One of the best ways to keep this small farm startup cost low is to choose a farm e-commerce platform with built-in marketing features. For example, instead of paying for a supplemental marketing tool like Mailchimp, you can use the software you already pay for to create and send your email newsletters.
Plus, your farm e-commerce software stores your customers’ contact information and purchase history, making it a breeze to send emails and SMS messages to them.
6. Product Packaging
Packaging your goods is one of the last steps on your small farm startup to-do list, but it’s essential. Proper packaging makes your products look appealing and professional, helps you comply with food safety regulations, and keeps your produce and meats as fresh as possible.
If you offer shipping and delivery, packaging is even more crucial since it protects your products from bumps in the road, rough handling, and temperature fluctuations.
But as you make more sales, the cost of packaging materials can add up.
How To Save on Packaging
Your packaging expenses will depend on your farm’s unique offerings and needs.
For example, if you only offer curbside pickup and local delivery, you can use lightweight, affordable insulation that keeps your products chilled only for a few hours. On the other hand, if you offer shipping across the country, you’ll need to invest in sturdy boxes and heavy-duty insulation to keep your products fresh for the long trip.
To make the most of your packaging budget, we recommend thoroughly researching your options and outlining your needs.
Minimize Your Small Farm Startup Costs and Maximize Your Profits With GrazeCart
Looking to give your small farm the best chance of success? Our number one tip is to invest in powerful software like GrazeCart.
GrazeCart is a farm management software solution designed to help you manage your inventory, make online sales, and tackle the day-to-day aspects of running a small farm. With GrazeCart, you can save time, expand your customer base, and make more sales — all in one convenient platform.
See GrazeCart in action by launching your free, two-week trial today.