How Small Farm Operators Can Improve Profits
Running a farm can be highly satisfying, but it’s not without its challenges. And this is especially true for small farm operators, who have had to contend with falling profits in recent years. These things do tend to come in cycles, so there’s a chance that things turn around in the near future. Still, in the meantime, many small farms run the risk of closure due to financial issues. The good news is that there are things that small farm owners can do to increase their profit margins. In this post, we’ll look at some tried and tested methods for doing just that.
Create Local Partnerships
Farms can have different business models, and it’s a good idea to look at utilizing multiple revenue streams rather than relying on the primary source. One often underserved method is to create partnerships with local businesses. There’s been a huge increase in the interest level of “locally sourced ingredients” in recent years, and that can provide a welcome cash windfall for small farms. Look at approaching cafes, restaurants, and stores in your local area and see if you can become their supplier — chances are, you’ll get at least one new customer.
Work More Efficiently
Time is money in all industries, and that includes the farming industry. The most efficiently that you can work, the more money you can make. After all, greater output means you’ll have more products to sell, and reduced work hours means you’ll have time to spend doing other value-boosting tasks. How you work more efficiently will depend on the type of operation you’re running. If you produce eggs, then investing in a quality egg washer could save you a significant amount of time, for instance. But it’ll vary from farm to farm. The best approach is to see what tasks are currently occupying the most time and see if there are ways to streamline the task. In all likelihood, there will be something you can do.
Host Events
If you have a big space, as you likely will if you’re running a farm, then could you consider hosting events? Your farm aesthetic may look normal to you, but to some people, it’s a trendy style — and those people could well be interested in hosting their next event there. You might need to invest in some decorative touches, but you won’t need to do as much as you might think.
You may also consider opening to the public in other ways, such as giving tours of the farm or having market days where you sell your produce.
Read the Market
It’s always good to stay agile when you’re running a business. If you’re running a farm, it’d make more sense to produce things that people are buying, rather than products that are falling out of favor. You can do this by picking up trends and then adjusting your processes based on that information. If you see that the popularity of one product is increasing, then it’ll be time to focus on that.
Originally Published on https://www.breakfastleadership.com/
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