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Agricultural Microeconomics Lesson 9: Developing a Business Plan

Agricultural Microeconomics Lesson 9: Developing a Business Plan.

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Agricultural Microeconomics Lesson 9: Developing a Business Plan

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  1. Agricultural MicroeconomicsLesson 9: Developing a Business Plan This course developed by The Environmental Finance Center at UNC Chapel Hill for The North Carolina School of Science and Math and NCDPI is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License

  2. “The business that fails to plan, plans to fail.”

  3. Why Does Your Farm Need a Business Plan? • Serve as a guide for your farm’s future needs. • Helps to develop a marketing and promotion strategy for products. • Facilitates the cost/benefit analysis of future innovation. • Required for financing a new project or expansion of business.

  4. Key Components • SWOT analysis • Management team • Description of product(s) • Marketing plan • Customer assessment • Competitor analysis • Financial summary (actual and projected)

  5. What is a SWOT Analysis? • Strengths • Weaknesses • Opportunities • Threats

  6. Completing a SWOT Analysis Take a look at your personal and business strengths: • Your advantages over your competition • Your current production and management capabilities • Your location • Your personal philosophy • Your access to or ability to secure capital • Your knowledge and skills • Your product’s value to consumers • Your customer’s perception of your products’ quality

  7. Completing a SWOT Analysis Be honest about your weaknesses: • Lack of experience • Lack of knowledge • Unknown or poor reputation • Lack of financing • Current production schedule • Access to processing facilities • Production timelines • Marketing challenges • Limited, or no, farm help • Distribution • Pricing

  8. Completing a SWOT Analysis Find the opportunities you can take advantage of: • Market trends • Consumer preferences • Unfilled niches • New or emerging markets • International potential • Competitors’ susceptibilities • Innovations and developments • Partnerships

  9. Completing a SWOT Analysis Recognize the threats to your business: • Market instability • Competitors with lower production costs • Negative health claims about product • Legal considerations that may affect your operation • Weather • Lack of market awareness • High market-entry costs

  10. Your Own SWOT Analysis

  11. Marketing Plan • Who are your customers? Who are your competitors? • What are you selling? At what price will you sell each product? • Where are your customers located? • When are your customers most likely to purchase your products? • How will you reach your customers? (farmers market, stores, online, farm)

  12. Marketing Strategies • Define your market niche • Know your customers and assess your competitors • Price your products appropriately • Create your marketing message • Adjust strategy as needed

  13. Your Own Marketing Plan

  14. Financial Summary • Net Earnings (Income) Statement • Balance Sheet • Cash Flow Statement • Three-Year Income Projections

  15. Next Class: Successful Business Planning This course developed by The Environmental Finance Center at UNC Chapel Hill for The North Carolina School of Science and Math and NCDPI is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License

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