It’s a dream for some, but one that comes true for others. Starting a farm takes ambition but if you have it, you can make it very successful. Like with most business areas, you could ask ten different farmers how profitable it is to run a farm, and you will likely receive ten very different answers. The profitability potential across farms varies hugely and there is a long held assumption that farming isn’t particularly profitable.
It takes some time, some very sound business decisions and the ability to develop excellent production to be profitable as a farm. So, what should you be considering when running your own farm and how can you make your farming business a roaring success?
- Research. Knowing your stuff is so important when it comes to farming. It’s not just knowing that it’s red diesel and not white that goes into the tractors. It’s knowing that running a rural farm is going to take a lot of hard work and an adjustment in salary expectations. If you’re used to earning a good crust while sat at a desk, know that you will be the driving force behind your farm and if you don’t know the business properly, it will fail.
- Learn. Gaining an insight about farming is important if you hope for your farm to be a success financial. Be reasonable about what you can learn on paper – much of farming is on the job. You need to learn about the quality of life you will have, running a farm. You take on a lot of risk in the job, especially if you are farming livestock and large animals.
- Define. One of the biggest parts of running your own farm is deciding how you will make your profit. Making this decision about your farm will help you to understand whether you will be able to sustain your current outgoings. You need to assess what your enterprises will cost, what it will cost to keep up the family you already have and how much money you will spend on your outlay.
- Competition. Understanding your competition is important when you are in farming. You are a small farm, and you will likely supply to small and local business instead of the wider country or big name brands. It’s important to see where you could be considered an asset and capitalise on that. If you can offer something the bigger names can’t, your name will spread and people will come to you for regular supplies of wheat/milk/cheese take your pick.
It was decades ago that farming was a highly profitable industry, as all food was supplied by the local farmers and the money they could earn seemed limitless. After all, people have to eat! With the influx of larger companies dominating the regular food market, farms have slipped down the pecking order. That doesn’t mean your farm couldn’t be profitable. Understanding where profit is made and with the support of local buyers, your farm could be a complete success.