Don't start gardening for money without a Market Gardening Business Plan

A market gardening business plan is absolutely necessary, if you are seriously thinking about making money from your garden. You're business plan will help you figure out if your garden will pay you back for your time and effort expended. And it is a must-do if you are looking for financing to start a market garden.

What goes in a market gardening business plan? While different financial institutions may have different formats they expect to see in a business plan, here's how we built the New Terra Farm business plan.

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Components of the New Terra Farm Market Gardening Business Plan

We wrote the New Terra Farm business plan both to clarify our business goals and objectives for the farm, and also to satisfy the requirements of potential investors. Here's what's in it:

  1. Background
    This section introduces the plan, and explains the origin of the business idea i.e. the 'how' and 'why' you decided to start a market garden.

  2. The Team
    Here's where you identify all the players in your start-up market garden, and give their relevant background. You want to demonstrate that you have the necessary personnel resources to carry out your plan.

    Explain how this team has acquired or will acquire the necessary skills and knowledge to run your market garden business. Your team may also include partners or advisers whose experience you can use to supplement your skill set; e.g. you nay have a neighbour who is an experienced market grower, and can provide advice.

  3. Growth Objectives
    This section explains how big you plan to grow the business over the next five years. This is generally explained in terms of how many customers you plan to acquire and/or how much revenue you expect to generate over the period. This will be explained in more detail in the Cash Flow Projections late in the market gardening business plan

  4. The Marketing Plan
    This section details how, where and to whom you will sell your market garden goodies. Your plan might include sales to restaurants, at a farmer's market, or through a Community Supported Agriculture program

    You need to explain the system you will use to contact and 'make the sale' to each of these potential markets. If you are planning to sell at a farmer's market, contact the market to make sure they have a spot and to find out market rules.

    With restaurant sales you will want to talk to the owners or head chefs to find out what they might buy from you. Do this well in advance of the season, so you can adjust your growing plans if required.

    The CSA program is the easiest to document a revenue and marketing plan for; once you have set an income target and a price per share, you just need a likely pool of prospects and a way to contact them. See Market Gardening Marketing for more about marketing a CSA program.

  5. Success factors
    In this section you explain the internal and external factors that will contribute to your success. This includes identifying your competitors, and any competitive advantage you may have over them - e.g. superior skills or knowledge, or unique access to a market.

    You will also want to demonstrate the growth potential in your area for your type of product. For example, here's a quote from the New Terra Farm business plan:

    "Current statistics indicate that 55% of consumers try organic food at least some of the time; the market in North America is growing by 20% annually."

  6. Risk Management
    Identify and explain how you plan to manage the risks of starting your market garden. This includes both production risks - e.g. what steps are you planning to manage and protect your market garden from drought, flood, bugs, wild dingos, etc - and business risks e.g. low sales, or the loss of key customers. You need a contingency plan to deal with these eventualities.

  7. Cash Flow Projections
    This section contains projected income and expenses for the next 5 year period. Cash flow is driven by your marketing and business expansion plans, and has to make sense in terms of the rest of the plan. We developed a Cash Flow Planner spreadsheet to help us with that.

    You will need to 'play around' with income and expense figures to get a projection that makes sense (and makes a profit!). You can see more about this here Farm Income Planning
They say that the troubles you plan for never happen. The time you spend building your market gardening business plan will save you much turmoil down the road.

See also: Bootstrap Market Gardening. This is the book (and supplementary planning spreadsheets) I wrote to help other new market gardeners figure out how to make their business a success. The book explains starting-up, marketing, and managing a CSA market garden.

And, it contains my small farm Business Planning Guide and Workbook, based on the business plan I wrote for New Terra Farm

The Bootstrap Market Market Gardening Pack also includes my Cash Flow Planner and Market Garden Planner. These planning tools can help you create your own market gardening business plan.

Get the Bootstrap Market Gardening Pack with the Business Plan Guide

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