There is no perfect formula for starting a business in agriculture but these 15 tips will come in handy.
1. Don’t Limit Yourself to Planting and Rearing Animals
Some people limit agriculture business to crop cultivation and animal rearing but there is more to agriculture than that. There are so many agricultural business opportunities that you can explore. For instance, in farming alone, the small farm business ideas are endless. Outside farming, you can start a rental business, a juice business, or even invest in agri business.
2. Check For Available Market
As stated earlier, agriculture is quite broad. However, this doesn’t mean that every area has a market large enough to sustain a business. Before you venture into any agri- business, it is necessary to research the available market and examine its potential of scale as well as feasibility. For instance, venturing into a business with year – round demand such as rice may have a larger market than someone who sells Christmas trees. This doesn’t mean that you should completely shy away from businesses with a small market, but when starting out, let there be enough demand to sustain your business.
3. Identify and Reach Out To Your Target Market
It is one thing to know you have a market, but an entirely different thing to identify and reach out to them, especially in the midst of competition. This is why it is necessary to research your target market so you can come up with a marketing plan on how best to get your product across to them. It is important to have a solid marketing plan before your product or service is ready to be sold.
4. Analyze Potential Risks
Every business has its risk and as you may have heard before, “no risk, no reward.” In agriculture business, there is always the possibility of environmental and natural hazards. For instance, if you are rearing chickens, you could have a high mortality rate or rodent infestation. Therefore when starting a business in agriculture, you need to properly analyse potential risks and come up with a risk mitigation plan.
5. Licensing And Registration
In every sector, there are rules and policies which guide the operations of that sector. To avoid penalties, you must ensure you’re duly registered with the right bodies and organizations. For instance, if you want to venture into agriculture exportation business, there are certain items that are contraband and you need to be aware of them so that you don’t fall victim to the law.
6. Seek Professional Help
When starting out a business, it’s normal to have a strict budget. For this reason, you could be assuming the role of customer service, marketer, and many others. However, if you are not an expert or aren’t well versed in certain areas, you should consider the services of a professional. For instance, if you want to write up a contract, you should hire a lawyer.
There are also online resources such as virtual assistants or startups whose services you can use. For instance, platforms such as Fiverr are online marketplaces where you can hire services at affordable prices.
7. Manage Your Cash Flow
This is very important especially if you can’t afford an accountant. You need to keep track of your income and expenditures so you can know if you’re making a profit or running at a loss. You need to keep all your receipts, invoices, and other financial documents so you can easily track your transactions and financial progress. This will also help you find out when you are doing exceptionally well so you can take note of what you did to get that result.
8. Have Reasonable Goals
When setting goals, use the SMART approach to make sure your goals are clear and reachable. SMART is an acronym for Specific, Measurable, Achievable, Relevant, and Time. This will help you obtain clarity, focus, and the motivation needed to achieve your goals.
You should also celebrate your little wins as you go. This will help keep you motivated to reach your ultimate goal.
9. Be A Solution
Many successful businesses today were started just because someone wanted to create a solution to a problem. This is very important especially if you’re going into agricultural startup business. Farmcrowdy was birthed because a visionary saw that there was a problem with farmers obtaining funding for their farming business. Similarly, your business idea should be a solution to a problem. It is a lot easier to get a customer base when your business is offering them a solution to their problem.
10. Research Your Competitors
No matter how small your market is, you are likely to have a competition in your business venture. Even if no other business is selling exactly what you’re selling, there may be businesses offering similar goods and services. To succeed, you need to research your competition not just when you’re starting out, but also while your business is running. This will help you keep abreast with their actions and plan for yours. When researching your competition on the web, tools such as Google Alerts and Spyfu can be very helpful.
11. Know, Like, and Trust
People like to do business with someone they know, like, and trust. It will be easier for your agriculture business if you have already created a reputable brand for yourself. You can do this by attending agriculture related events and networking with people in your venture or volunteering for agricultural projects. After your business is up and running, you need to keep the ball running and keep growing your base.
12. Create A Business Plan
It is imperative to have an agriculture business plan in relation to your business. A business plan serves like a map which will guide you to your destination.
Without a plan, you may have to make things up as you go and this could be detrimental to your business. Having a plan will also help you carry out a SWOT analysis which will be helpful to your business.
13. Start Small
As stated earlier, people like to dream big. While there is nothing wrong with that, it is better to test your idea on a small scale before widening your scale. Just like how babies learn to walk before they run, your agriculture business needs to start small before it speeds up. If not, you could end up raking in expenses and losses. For instance, if you’re starting an agri tech company, you’re not going to start out with multiple offices in different countries, you’ll likely start with one office and let it grow naturally. If the business shows promise and it’s scalable to have branches abroad, you can then have multiple offices in different countries.
14. Get Feedback
When a new app is built, it is not just released to the market. They carry out a beta test which helps them get honest opinions from users, tweak where necessary, before releasing it to the general market. Similarly, it is not the first version of your product or service that should be released to the market. Let people test your product or service and get feedback from them. They may help you point out a problem you may have missed. If the product or service is of good quality, they could also carry out word of mouth marketing for you.
15. Start The Business
Many people dream of starting a business in agriculture but some never do. Due to the fear of failure, they come up with many excuses to keep themselves from trying. While some of the excuses seem valid, there will always be many reasons why you shouldn’t start a business, especially when you think of the risks involved. However, clouding your mind with these fears will only stop you from achieving your goal.
Do you have any other tips which helped when you were starting your agri-business? Share your experience in the comment section below.