In Summary
  • While writing the plan, a farmer needs to consider the overall vision and mission of the crop production investment.
  • The business plan, therefore, highlights the direction of the project and it should be specific, measurable, achievable and time-bound or simply “smart”.
  • This takes into account the acreage, location, water sources, conservational soil practices, methods of tillage and others.
  • Conduct a SWOT analysis. This means identifying your strength, weakness, opportunities and threats to your investment.

At the initial stages of any business, there is always the need to have a plan. The plan gives an overview of the activities and the expenditure the business is likely to incur.

As a tool that helps one to acquire capital in the form of loans and grants, a business plan has three main components – the investment capital, production cost and a marketing strategy.

While writing the plan, a farmer needs to consider the overall vision and mission of the crop production investment. These include the short and long-term objectives of the agribusiness.

This means one is required to highlight the steps that are expected to develop the business for a particular period, say five years.

The business plan, therefore, highlights the direction of the project and it should be specific, measurable, achievable and time-bound or simply “smart”.

Farmers need to understand the purpose of a business in order to develop the mission statement of their investments.

If, for example, a farmer is writing a tomato-business plan, he should have a goal of producing specific quantities, say, by the end of the first season and the entire production period. The mission of the farmer could be to become the leading supplier of the tomatoes in a particular region.

Before preparing the business plan, it is important to conduct a primary survey to familiarise oneself with the background information of the farm.

This takes into account the acreage, location, water sources, conservational soil practices, methods of tillage and others. The investor also needs to consider the current operating costs of the farm. How much, for example, will you spend on irrigation and what is the plan?

This then means one would need to evaluate the value of irrigation in the tomato block and how to reduce the cost while maximising production.

It is at this point that the farmer would consider pumping water using solar batteries and panels if the cost is lower than diesel or mains electricity.

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