BUILD A PLAN

The soil now gets a rumpling soft and damp,
And small regard to the future of any weed.
The final flat of the hoe's approval stamp
Is reserved for the bed of a few selected seed.

— Robert Frost, "The Strong Are Saying Nothing"

Long before the first seed is planted and the cool earth turned to create the furrow, a farmer conceives the idea to produce a crop and make something edible from the land. This annual act of turning the soil and planting the seed, so commonplace to those of us who know agriculture, is in fact something of a miracle. Every spring, the earth renews itself, and those involved in gleaning the goods of Mother Nature's bounty play a role in this eternal cycle.

Very few people now ever get to know the daily joys and trials of building their lives from the land and homes where they live. Today, farmers make up roughly two percent of the population of the United States. The agrarian way of life is being replaced by new technology, industrialization, and sheer economies of scale. Fortunately, small farmers, or those who desire to be small farmers, have many chances at success. There are opportunities in the marketplace to remain viable and thrive, and these opportunities don't require becoming enormous to survive the commodity-market system. But you need to do more than buy a few cows or plant some soybeans and field corn. To be a successful small farmer, you must have a measure of ingenuity, a surplus of determination, the understanding of a targeted niche market, and, frankly, a high tolerance for the trial and error of entrepreneurship. If you're serious about building a company, changing your destiny, and making a living from home, your first step is drafting a business plan.

You may think you don't need a business plan if you're not ready to get started or if you're unsure if your idea will even work. Farmers tend to be doers, however, not planners. We're often the type who rises early and works hard, being task-oriented and not feeling satisfied until the job at hand is done. These are wonderful qualities, but sometimes we might not see the forest for the trees. In my view, an orderly business plan and the discipline to execute it are essential tools for success with a small-farm venture.

The more organized you are from the start, the better. A formal business plan will help you streamline and solidify your ideas; clearly visualize what works and what doesn't; organize your ideas from the start to ensure a solid approach; and gather financing from lenders or private investors.

Components of a Business Plan

A business plan may have many names, including strategic plan, operational plan, and business-direction document. This document can be extremely detailed with tables, graphs, and projections, or it can be created in a word-processing format using only text. It defines what your business is, who is involved, the goals and objectives, and the direction for the company.

Numerous resources can be found online; at the bookstore or library; from organizations like the US Small Business Administration (SBA) and Cooperative Extension Services; and other places (see Resources, page 170). I encourage you to view several of these resources, as well as those that are specific to your industry. For the purposes of this book, we'll focus on a basic business plan that will provide a sound basis for organizing your thoughts, setting your goals and your budget, and seeking financing. To provide concrete examples, sections of my original business plan have been excerpted in the following text. My entire business plan is in the Appendix (see page 157). Our business plan includes:

Tips for Writing Your Business Plan

If you aren't a good writer, please don't let this dissuade you from developing a written business plan. Hire or beg someone who is qualified to draft this for you. Or, try to fill in the blanks on a business plan template from an organization like the Small Business Administration. When writing your business plan, keep the following in mind:

• Use correct grammar, punctuation, and style. When you're applying for a loan or proposing your ideas to venture capitalists, you will be evaluated on the neatness and professionalism of the document.

• Don't feel you have to use the exact titles and headings noted in plans you may review. I encourage you to be creative with the format, as long as the basic elements are included, the information is structured sensibly, and the narrative is easy to read.

• Modify the plan and add sections that pertain to your company or that are specific to your industry. This customization will help to organize your thought process and make your business more marketable to potential investors and bankers.

• Review the document when you're done and let someone else take a look. This plan reflects you and your future; be certain it comes across as well as possible.

I. Company Name, Location, Owners, and Business Type

II. Mission Statement

III. Board of Directors/Advisors

IV. Business Vision/Executive Summary

V. Product Description and Pricing

VI. Market Segments and Target Customers

VII. Business Goals

VIII. Start-up Capital Needed

IX. First-Year Budget

X. Company Management and Roles

I. COMPANY NAME, LOCATION, OWNERS, AND BUSINESS TYPE

Comparable to a title page, this section can be as simple as listing on the front page the name and location of your company, including complete physical address, phone, fax, and e-mail, as well as the owners' names. If you haven't thought about how you will title the business and who in your family will be involved, this is the place to think through those important elements. For some, choosing a business name is as simple as using your farm or last name, but others may wish to consider developing a trade name that's unique but still conveys what you sell.

What's in a Name?

Consider selecting a name for your business that somehow describes what you do. This will make it easier for people who use search engines on the Internet to find you. This is especially important if you want people to locate you online for ordering, purchasing, and delivery.

You'll also include here the type of business you have decided to organize, whether it be a sole proprietorship, a corporation, a partnership, or a limited liability company (LLC). See chapter 4 for more information on business structure options.

II. MISSION STATEMENT

The mission statement is a series of sentences akin to the kind of statement at the top of a...