business plan for farmers

Farm Business Planning

Farm Business Planning is key to beginning farmer success.

It helps beginning farmers :

• Plan for the economic sustainability of a new farm enterprise.
• Obtain funding to purchase land, equipment and other resources from lending institutions, investors and/or grant making agencies.
• Articulate what their farm will look like.

On this page, we compiled free farm business planning resources to help you understand what a formal business plan is, and how to start planning your farm business. Sections include:

• Developing a Farm Business Plan
• Enterprise Budgeting

Enterprise budget resources are included on the farm business planning page because such tools are usually essential in helping you to develop your business plan.

Planning your farm business involves more than is outlined on this page alone. You’ll probably also be interested in funding (loans/grants) , farm incorporation , and risk management . Our  starting a farm page is worth visiting first. Also, you might find the following article helpful, because it touches on many farm business planning topics: Farm Products, What to Charge: Marketing, Price, Calculating Costs, Strategy and Much More .

1. Developing a Farm Business Plan

A  business plan  is a decision making tool that takes the form of a formal document. It states your business goals, why you think you can achieve them, and lays out your plan for doing so. Farm business planning is also a process, not an end product. A business plan is a work in progress, which farm business owners or operators will want to revisit regularly. 

Planning and Funding Your Farm Business  from the Cornell University Small Farms Project has lots of important and useful farm business planning resources.

Rural Businesses  is a web and print publication from the Minnesota institute for Sustainable Agriculture (MISA).

Building a Business Plan for Your Farm: Important First Steps  is a 20 page farm business planning publication that discusses the initial steps to help you move toward writing a formal business plan.

The Center for Agroecology has a Small Farm Business Planning publication that goes over many of the basics in a step by step format.

Building a Sustainable Business: A Guide to Developing a Business Plan for Farms and Rural Businesses is a farm business planning publication available from SARE.

Do I need a Business Plan for my Farm? is a web resource from the New England Small Farm Institute. It’s a great place to get started.

AgPlan  from the University of Minnesota helps rural business owners develop a business plan for free, while also offering sample business plans for ideas, and a way to print or download your plan.

Developing a Farm Business Plan includes several helpful resources from the USDA National Agricultural Library’s Rural Information Center.

Organic Farm Business Planning Page  from North Carolina State University features a number of publications and links related to financial planing for organic farmers.

Agricultural Business Planning Templates and Resources   is an ATTRA publication most relevant to smaller-scale or alternative agricultural entrepreneurs.

Beginning Farmer and Rancher Resources offers comprehensive resources on Bookkeeping and Other Basics ; Cash Flow Budgeting and Managing Debt ; Small Farm and Ranch Income Taxes , and more.

Purdue University’s Center for Food and Agricultural Business  has educational resources to explore, such as the New Ventures in Food and Agriculture in Indiana , which offers business planning assistance.

Purdue University Cooperative Extension offers strategic farm business planning tools for commercial farm producers.

Penn State University College of Agricultural Sciences has many Business Planning tools and information.  Penn State Cooperative Extension has a Developing a Business Plan page. Penn State also has a Farm Business Plan Template that allows you to plug in your information and create a basic business plan.

The U.S. Small Business Administration  works with local partners to counsel, mentor and train small businesses. It is worth getting to know their programs and connect with your local office.

The Martindale Center Reference Desk has an extensive  compilation of links to calculators, applets, spreadsheets, courses, manuals, handbooks, simulations, animations, videos and more. Martindale’s Agriculture Center can be of great use to farmers making business plans.

2. Enterprise Budgets

Enterprise budgets project costs and returns for a particular farm production practice. You can use enterprise budgets to make smart business management decisions, and to help you develop a viable business plan.

Enterprise Budgeting Tools of all sorts from the Agricultural Marketing Resource Center, including organic crop budgeting tools, many vegetable budgeting tools, the crop conversion tool for side-by-side crop comparisons, specialty crop and livestock budgets, hydroponics budgets, wind calculators, composting calculators, manure calculators, distillers grain budgets, biomass calculators and specialty foods calculators.

Introduction to Farm Planning Budgets for New and Beginning Farmers (Virginia Tech)

Importance and Use of Enterprise Budgets in Agriculture   (University of Nevada)

Enterprise Budgeting (Kerr Center)

Organic Specific Enterprise Budgets

• Enterprise Budgets and Production Costs for Organic Production (ATTRA)
• Organic Crop Production Enterprise Budgets and Information   (Iowa State)
• Organic Enterprise Budget (Kansas Rural Center)

More Enterprise Budget Pages and Information

• Enterprise Budgets List (Virginia Cooperative Extension)
• Dairy Sheep Enterprise Budget (Center for Integrated Ag Systems, UW-Madison)
• Crop Budgets (University of Maryland)
• Farm Management Enterprise Budgets (Ohio State)
• Alabama Enterprise Budget Summaries (Alabama A&M and Auburn) 
• Start developing your business plan with the resources at   https://www.beginningfarmers.org/farm-business-planning/
• You can find more gr eat farming resources at   https://www.beginningfarmers.org/additional-farming-resources/

12: Business Plans

What is a business plan.

A business plan is a document that helps you to organize and succinctly summarize the vision you have for your business. The plan contains the operational and financial objectives of a business, the detailed plans and budgets showing how the objectives are to be realized.

A good business plan will contain the following:

• Your business vision, mission statement, key values, and goals
• Description of the product(s) you intend to produce
• Strengths, Weaknesses, Opportunities and Threats the business may experience are described
• Production plans
• Marketing plans
• Estimated start-up costs
• Information on your legal structure and management team
• Current financial statements or projected financial statements.
• Resume or brief explanation of your background and relevant experience
• Less than 10 total pages so that people actually read it

Helpful Publications for Writing a Business Plan

General Business Resource Publications:

• Starting an Ag-Business? A Pre-Planning Guide http://publications.dyson.cornell.edu/outreach/extensionpdf/2004/Cornell_AEM_eb0408.pdf
• Business Transfer Guide: Junior Generation http://publications.dyson.cornell.edu/outreach/extensionpdf/2016/Cornell-Dyson-eb1605.pdf
• Producing a Business Plan for Value-Added Agriculture http://publications.dyson.cornell.edu/outreach/extensionpdf/2007/Cornell_AEM_eb0708.pdf
• Business Planning for the Agriculture Sector: A Guide to Business Plan Development for Start-up to Mid-size Operations http://publications.dyson.cornell.edu/outreach/extensionpdf/2010/Cornell_ pdf
• Building a Sustainable Business (Sustainable Agricultural Research Education (SARE)Publications) sare.org/publications/business.htm 280 pages of education and practical exercises to guide you through the financial, management, and interpersonal skills needed to start a successful farm business. Order hard copy for $17 or download PDF online for free.

Cornell Cooperative Extension Publications for Specific Commodities:

• Landscape Business Planning Guide http://publications.dyson.cornell.edu/outreach/extensionpdf/2003/Cornell_AEM_eb0313.pdf
• Writing a Business Plan: A Guide for Small Premium Wineries http://publications.dyson.cornell.edu/outreach/extensionpdf/2002/Cornell_AEM_eb0206.pdf
• Writing a Business Plan: An Example for a Small Premium Winery https://ageconsearch.umn.edu/bitstream/122203/2/Cornell_AEM_eb0207.pdf

Getting Help Writing a Business Plan

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How to Write a Farming Business Plan: Template and Guide

americanfarmfi

May 22, 2023

Starting and running a successful farming business requires careful planning and strategic decision-making. One essential tool that every farmer should have is a well-crafted farming business plan. A comprehensive business plan serves as a roadmap for your agricultural venture, guiding you through the various stages of development and ensuring that you stay focused on your goals. We will provide you with a step-by-step guide on how to write an effective farming business plan and start you off with a template. 

Overview of a Farming Business Plan

Before diving into the specifics, let’s take a moment to understand what a farming & agriculture business plan entails. Essentially, a farm business plan is a written document that outlines your farming objectives, strategies, and financial forecasts. It serves as a blueprint for your farm’s operations, helping you make informed decisions and communicate your vision to potential investors, lenders, or partners.

The Purpose of a Farming Business Plan

The farming business plan is going to define and communicate your farm’s mission and goals. It helps provide a clear direction for your operations, resources, and ensures that everyone involved in the business is on the same page. Additionally, a well-crafted business plan is often required when seeking financing or partnerships. Lenders and investors use it to evaluate the viability and profitability of your farming venture.  

Key Elements of a Farming Business Plan

Let’s explore the elements that make up the Farming Business Plan. 

Executive Summary

The executive summary is a brief overview of your entire plan. It should summarize your farm’s mission, goals, target market, and competitive advantage. While it appears at the beginning of your plan, it is often written last to ensure that it accurately reflects the content of the document.

Market Analysis

A thorough market analysis is crucial for understanding your target market, identifying potential customers, and evaluating your competition. This section should provide detailed information about market trends, customer demographics, and demand for your products or services. Conducting market research and gathering data from reliable sources will strengthen the credibility of your analysis.

Products and Services

In this section, describe the specific products or services your new farm will offer. Provide details about their features, benefits, and how they meet the needs of your target market. Discuss any unique selling points or competitive advantages that set your offerings apart from others in the industry.

Marketing and Sales

Outline the strategies for promoting and selling farm products. Explain how you plan to promote your farm and reach your target market. Include information about your pricing strategy, distribution channels, and any partnerships or collaborations that may enhance your marketing efforts. Developing a comprehensive marketing plan will help you attract customers and generate sales. 

Describe the operational processes and workflows involved in running the farm, including land preparation, planting, harvesting, livestock care, and post-harvest handling. Highlight the management structure, key personnel, and their roles and responsibilities.

Financial Plan

The financial plans are a critical component of your farming business plan as it demonstrates the financial viability and sustainability of your farm. It should include projected income statements, cash flow statements, and balance sheets for the next three to five years. Additionally, outline your funding requirements and any existing or potential sources of financing. 

American Farm Financing offers many financing options to fit your needs: operating loans, cash rent loans, farm mortgages, refinances, and equipment loans. See all AFF loan options .

Setting Financial Goals

Forecasting expenses is critical when starting a farming operation. List out the main buckets of expenses (inputs, machinery, labor, land, interest, and consulting services). Where possible, get pricing quotes to formalize your expenses as much as possible for what you would like to grow.

After you’ve forecasted expenses, you can set a goal for how much profit, or margin, you intend to make. Use futures sales prices to project what you can sell your crop for. The difference between your sales price and your expenses will become your profit. Ensure that this income matches your expectations and can cover any personal expenses you hope the money will be used for.

While a one-year operating plan is critical to get started, remember that farming is a long-term pursuit. Depending on how many upfront expenses you need to make, it may take multiple farming seasons to turn a significant profit. 

Conducting Market Research

Before you can develop a solid business plan for a farm, it is essential to conduct detailed market research. Conduct an analysis of the target market, including its size, growth potential, and trends. Identify the target customers, their needs, preferences, and buying behavior. This assessment will allow you to be an expert on the market and differentiate you from the rest of the competition. 

Writing a Farming Business Plan

Now that we have covered the key elements of a farming business plan, let’s dive into the process of writing one.

Creating a Timeline for Implementation

This timeline can be as specific to your needs as possible. You want to make sure that every necessary box is checked before launching your farming operation. This is a suggested timeline for implementing your plan, but coordinate as you see fit and adapt to things that may pop up:

Preparation: 1-6 Months 

• Complete all sections of the farming business plan, including market analysis, financial projections, and operational strategies.
• Seek funding options, such as loans, grants, or investors, and secure the necessary financing for your farming venture.
• Identify suitable land for your farm and negotiate the purchase or lease agreement.
• Conduct necessary soil testing and prepare the land for farming activities.
• Source and purchase farming equipment, machinery, and inputs (seeds, fertilizers, livestock, etc.) required for your chosen agricultural activities.
• Hire key personnel, such as farm managers, laborers, and administrative staff, as per your business plan’s organizational structure.
• Establish relationships with suppliers and vendors to ensure a steady supply of inputs.

Operations: 6-12 Months

• Initiate planting or livestock management based on the farming plan.
• Implement appropriate cultivation techniques, crop rotation, or livestock management practices.
• Monitor and adjust farming operations to optimize production.
• Develop marketing strategies to promote farm products to target customers.
• Implement sales channels, such as direct sales, farmers’ markets, online platforms, or partnerships with retailers or small restaurants.

Below is a helpful template from fsa.usda.gov to get you started. Download your farming business plan template here.

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Farm Business Plans

Written by Dave Lavinsky

Cultivate your agricultural ambitions with our comprehensive collection of farm sector business plan examples. Perfect for farmers, agripreneurs, and agronomists, this resource provides information, from small-scale organic operations to expansive agribusiness ventures. Navigate the complexities of the agricultural industry with these detailed plans, designed to help you grow a thriving, resilient, and profitable farming enterprise.

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Small Business Trends

How to create a farm business plan.

Even though the term ‘farm business plan’ might evoke a sense of formal rigidity, it’s important to remember that this document is, in fact, a living, evolving entity. Just like a seedling that sprouts, grows, and changes with the seasons, your business plan is not meant to be static.

The most effective business plans are those that exhibit flexibility and resilience, characteristics that are at the heart of any successful farm business. Agriculture, by its very nature, is a domain subject to the whims of Mother Nature. From unpredictable weather patterns to seasonal variations, farmers of all kinds grapple with an array of external factors.

Writing a Farm Business Plan Template: 15+ Things Entrepreneurs Should Include

Do bear in mind that while these sections are integral, they are by no means exhaustive. Your farm business plan may necessitate additional topics based on your specific farming operations.

Executive Summary

Goals and objectives.

A well-crafted business plan should encapsulate both personal and economic goals and objectives. Many successful farm business plans also address environmental stewardship and community outreach. You may want to include goals around preserving farm resources for future generations, ensuring that both the operational and stewardship aspects remain within the family.

Introduction

Mission statement and values of your farming business plan, industry history, company background and history, competitor analysis.

Understanding your competition is crucial. In the agricultural sector, farmers often share resources, such as a high-tech corn planter, or cooperate in marketing endeavors. Factor in such synergies when analyzing competitors.

Target Market

Products and services, organization, human resources, and management plans, swot analysis.

Your vision is the roadmap for your farm’s future. It should express not just your financial aspirations but also your plans for the farm operation in the long run.

Growth Strategy

Financial plan, marketing strategy, establishing a farming business entity, detailed description of farm operations, risk management strategies.

Address potential risks and challenges your farm might face, such as natural disasters, market fluctuations, or pest infestations. Discuss the strategies you plan to implement to mitigate these risks, like insurance coverage, diversification, and emergency response plans.

Sustainability and Environmental Impact

Community involvement and social responsibility, supply chain and vendor relationships, technology and innovation, training and development plans.

Explain how you intend to train and develop your staff. Include plans for ongoing education, skill development, and potentially, leadership training for future farm managers.

Expansion and Diversification

Exit strategy, frequently asked questions.

Provide an addendum for additional documents that support your business plan. This can include resumes of key team members, detailed financial projections, market research data, or letters of support from future customers or partners.

Do I Need a Business Plan for My Farm?

So, where to begin? Let’s dive into our fundamental guide to crafting a farm business plan using our adaptable template. This resource has been designed to help you capture every aspect of your agricultural venture, laying a strong foundation for a bountiful future.

How Do I Write a Small Farm Business Plan?

How do you start a farm business plan, how much do farm owners make a year, how much does it cost to start a small farm, what is the most profitable farming business.

Poultry farming is currently the most profitable – and common – farm business in the world. It includes chicken, turkey, quail, ducks and goose, that are being raised for meat or eggs.

• Sample Business Plans
• Retail, Consumers & E-commerce

Small Farming Business Plan

Want to transform your small land into a farming business? Indeed, a brilliant business venture to undertake. After all, all sorts of farming businesses enjoy a vast market.

Anyone can start a farming business. However, a detailed business plan is essential to drive this business to its desired potential and secure funding if required.

Need help writing a business plan for your small farm? You’re at the right place. Our small farming business plan template will help you get started.

Free Business Plan Template

Download our free business plan template now and pave the way to success. Let’s turn your vision into an actionable strategy!

• Fill in the blanks – Outline
• Financial Tables

How to Write A Small Farming Business Plan?

Writing a small farming business plan is a crucial step toward the success of your business. Here are the key steps to consider when writing a business plan:

1. Executive Summary

An executive summary is the first section planned to offer an overview of the entire business plan. However, it is written after the entire business plan is ready and summarizes each section of your plan.

Here are a few key components to include in your executive summary:

Introduce your Business:

• This section may include the name of your small farming business, its location, when it was founded, the type of small farming business (E.g., vegetable farming, bee farming, aquaculture, organic farming), etc.

Market Opportunity:

• For instance, you may include fruits, vegetables, herbs, and spices as products and mention organic produce, exotic fruits, and local produce as some of your USPs.

Marketing & Sales Strategies:

Financial highlights:, call to action:.

Ensure your executive summary is clear, concise, easy to understand, and jargon-free.

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2. Business Overview

The business overview section of your business plan offers detailed information about your company. The details you add will depend on how important they are to your business. Yet, business name, location, business history, and future goals are some of the foundational elements you must consider adding to this section:

Business Description:

• Vegetable farming
• Bee farming
• Aquaculture
• Organic farming
• Describe the legal structure of your small farm, whether it is a sole proprietorship, LLC, partnership, or others.
• Explain where your business is located and why you selected the place.

Mission Statement:

Business history:.

• Additionally, If you have received any awards or recognition for excellent work, describe them.

Future Goals

This section should provide a thorough understanding of your business, its history, and its future plans. Keep this section engaging, precise, and to the point.

3. Market Analysis

The market analysis section of your business plan should offer a thorough understanding of the industry with the target market, competitors, and growth opportunities. You should include the following components in this section.

Target market:

• For instance, farmers’ markets, specialty retailers, and local customers would be an ideal target audience for smart farming businesses.

Market size and growth potential:

• For instance, the global smart farming market is expected to reach 53 billion dollars by 2032, so it is crucial to define the segment of your target market and its growth potential.

Competitive Analysis:

Market trends:.

• For instance, agrotech and automation have a booming market; explain how you plan on dealing with this potential growth opportunity.

Regulatory Environment:

Here are a few tips for writing the market analysis section of your small farming business plan:

• Conduct market research, industry reports, and surveys to gather data.
• Provide specific and detailed information whenever possible.
• Illustrate your points with charts and graphs.
• Write your business plan keeping your target audience in mind.

4. Products And Services

The product and services section should describe the specific services and products that will be offered to customers. To write this section should include the following:

Describe your farm products:

Describe the type of products your small farming business will offer. A vegetable farming business may include a detailed description of crops and their varieties here.

Mention products:

Provide a list of products that will be available at your small farm. This list may include,

Value-added services:

Quality measures:.

• This may include quality control processes, clear service standards, regular maintenance, and training.

Additional Services

In short, this section of your small farming plan must be informative, precise, and client-focused. By providing a clear and compelling description of your offerings, you can help potential investors and readers understand the value of your business.

5. Sales And Marketing Strategies

Writing the sales and marketing strategies section means a list of strategies you will use to attract and retain your clients. Here are some key elements to include in your sales & marketing plan:

Unique Selling Proposition (USP):

• For example, organic and sustainable practices, fresh local produce, and exotic products could be some of the great USPs for a vegetable and fruit small farm.

Pricing Strategy:

Marketing strategies:, sales strategies:, customer retention:.

Overall, this section of your small farming business plan should focus on customer acquisition and retention.

Have a specific, realistic, and data-driven approach while planning sales and marketing strategies for your small farming business, and be prepared to adapt or make strategic changes in your strategies based on feedback and results.

6. Operations Plan

The operations plan section of your business plan should outline the processes and procedures involved in your business operations, such as staffing requirements and operational processes. Here are a few components to add to your operations plan:

Staffing & Training:

Operational process:, equipment & machinery:.

• Explain how these technologies help you maintain quality standards and improve the efficiency of your business operations.

Adding these components to your operations plan will help you lay out your business operations, which will eventually help you manage your business effectively.

7. Management Team

The management team section provides an overview of your small farming business’s management team. This section should provide a detailed description of each manager’s experience and qualifications, as well as their responsibilities and roles.

Founders/CEO:

Key managers:.

• It should include, key executives(e.g. COO, CMO.), senior management, and other department managers (e.g. farm manager, sales manager.) involved in the small farming business operations, including their education, professional background, and any relevant experience in the farming industry.

Organizational structure:

Compensation plan:, advisors/consultants:.

• So, if you have any advisors or consultants, include them with their names and brief information consisting of roles and years of experience.

This section should describe the key personnel for your small farming services, highlighting how you have the perfect team to succeed.

8. Financial Plan

Your financial plan section should provide a summary of your business’s financial projections for the first few years. Here are some key elements to include in your financial plan:

Profit & loss statement:

Cash flow statement:, balance sheet:, break-even point:.

• This exercise will help you understand how much revenue you need to generate to sustain or be profitable.

Financing Needs:

Be realistic with your financial projections, and make sure you offer relevant information and evidence to support your estimates.

9. Appendix

The appendix section of your plan should include any additional information supporting your business plan’s main content, such as market research, legal documentation, financial statements, and other relevant information.

• Add a table of contents for the appendix section to help readers easily find specific information or sections.
• In addition to your financial statements, provide additional financial documents like tax returns, a list of assets within the business, credit history, and more. These statements must be the latest and offer financial projections for at least the first three or five years of business operations.
• Provide data derived from market research, including stats about the small farming industry, user demographics, and industry trends.
• Include any legal documents such as permits, licenses, and contracts.
• Include any additional documentation related to your business plan, such as product brochures, marketing materials, operational procedures, etc.

Use clear headings and labels for each section of the appendix so that readers can easily find the necessary information.

Remember, the appendix section of your small farming business plan should only include relevant and important information supporting your plan’s main content.

The Quickest Way to turn a Business Idea into a Business Plan

Fill-in-the-blanks and automatic financials make it easy.

This sample small farming business plan will provide an idea for writing a successful small farming plan, including all the essential components of your business.

After this, if you still need clarification about writing an investment-ready business plan to impress your audience, download our small farming business plan pdf .

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Frequently asked questions, why do you need a small farming business plan.

A business plan is an essential tool for anyone looking to start or run a successful small farming business. It helps to get clarity in your business, secures funding, and identifies potential challenges while starting and growing your business.

Overall, a well-written plan can help you make informed decisions, which can contribute to the long-term success of your small farm.

How to get funding for your small farming business?

There are several ways to get funding for your small farming business, but self-funding is one of the most efficient and speedy funding options. Other options for funding are:

• Bank loan – You may apply for a loan in government or private banks.
• Small Business Administration (SBA) loan – SBA loans and schemes are available at affordable interest rates, so check the eligibility criteria before applying for it.
• Crowdfunding – The process of supporting a project or business by getting a lot of people to invest in your business, usually online.
• Angel investors – Getting funds from angel investors is one of the most sought startup options.

Apart from all these options, there are small business grants available, check for the same in your location and you can apply for it.

How do I write a good market analysis in a small farming business plan?

Market analysis is one of the key components of your business plan that requires deep research and a thorough understanding of your industry. We can categorize the process of writing a good market analysis section into the following steps:

• Stating the objective of your market analysis—e.g., investor funding.
• Industry study—market size, growth potential, market trends, etc.
• Identifying target market—based on user behavior and demographics.
• Analyzing direct and indirect competitors.
• Calculating market share—understanding TAM, SAM, and SOM.
• Knowing regulations and restrictions
• Organizing data and writing the first draft.

Writing a marketing analysis section can be overwhelming, but using ChatGPT for market research can make things easier.

How detailed should the financial projections be in my small farming business plan?

The level of detail of the financial projections of your small farming business may vary considering various business aspects like direct and indirect competition, pricing, and operational efficiency. However, your financial projections must be comprehensive enough to demonstrate a complete view of your financial performance.

Generally, the statements included in a business plan offer financial projections for at least the first three or five years of business operations.

What key components should a small farming business plan include?

The following are the key components your small farming business plan must include:

• Executive summary
• Business Overview
• Market Analysis
• Products and services
• Sales and marketing strategies
• Operations plan
• Management team
• Financial plan

Can a good small farming business plan help me secure funding?

Indeed. A well-crafted small farming business plan will help your investors better understand your business domain, market trends, strategies, business financials, and growth potential—helping them make better financial decisions.

So, if you have a profitable and investable business, a comprehensive business plan can certainly help you secure your business funding.

About the Author

Upmetrics Team

Upmetrics is the #1 business planning software that helps entrepreneurs and business owners create investment-ready business plans using AI. We regularly share business planning insights on our blog. Check out the Upmetrics blog for such interesting reads. Read more

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Details of a Small Farm Business Plan

• Swarthmore College

• Ohio Wesleyan University
• Brandeis University
• Northeastern University
• Urban Farms
• Planting Guides
• Indoor Gardening

Writing a farm business plan can be a tool for you to plan your farming business. It can also be a requirement of securing grants and loans for your farm business. The process of writing a farm business plan may seem overwhelming and intimidating at first, but if you break it down into its component steps, it becomes much more manageable.

What Is a Business Plan?

A business plan is a roadmap for your small farm . It is both process and product. During the writing of a farm business plan, you'll develop an overall vision and mission for your business. You will think about your short- and long-term goals. You'll define the steps needed to achieve those goals. You'll set the direction for your business to develop over the next five years.

If you're already an established business, your new business plan will show where you're going next. A good business plan should be:

Mission Statement

Your farm’s mission statement is your overarching purpose for your business:

• Why does your farm exist?
• What purpose does your farm serve?
• Where is your farm headed?

This is beyond “make money.” This mission statement is based on your values and your core identity as a small farm.

The goals in your business plan are the specific, measurable “things” you will achieve with your small farm. Short-term goals are defined as those that you will complete within one year. Long-term goals are those that take longer than one year to complete.

SMART Goals are:

• Rewarding, and have a

Background Information

In this section of your business plan, take inventory of what you have right now:

• Where are you located?
• How many acres of land are you farming?
• When did you begin farming?
• How are you currently operating?
• What general practices do you use for such things as conservation, tillage, environmental impact, and marketing?

Farm Strategy

This is where your business plan gets to looking forward. You are going to formulate your farm strategy from now into the next five years or so.

• Gather information and research markets. Make sure that your farm plan fits into the general market in terms of supply and demand. Investigate and analyze industry trends, identify competitors, and define buyers.
• SWOT Analysis. This is an analytical tool that can be used in making decisions. SWOT stands for: strengths, weaknesses, opportunities, and threats. As a business, analyze your internal strengths and weaknesses. Then look externally at what opportunities and threats exist - competitors, new markets, government regulations, economic conditions, and so forth.
• Create alternative strategies. Looking at the information you've gleaned and the analysis you just did, think through options for your farm strategy. Don't rely on price alone; economies of scale are challenging on the small farm level.
• Don't jump to one conclusion immediately. Really spend some time fleshing out the specifics of some of the strategies and looking at their advantages and disadvantages. Try to find options that combine your internal strengths with opportunities in the external environment.
• Look at all your strategies, then reread your mission statement. The ideal farm plan will fit your mission best.
• Write an implementation plan. This is where you write a plan that will make your new strategy happen.

Marketing Strategy and Plan

In the next part of your farm business plan, you develop and outline a marketing strategy for your products and services. This can build on the research you did in the previous step. For each product, include ​the price, placement, and promotion ideas. Consider how you will convey real and perceived value to your customers.

Management Summary

This part of your business plan details your farm business’ structure. Everyone who is involved in the management of the business should be listed here. External resources are listed here as well.

Financial Analysis

In this section, you will need to detail the financial aspect of your farming operation. List your current finances in detail, including all income and operating expenses. Referring to your new strategy, you will forecast what is needed for future growth and to meet the goals you have outlined in terms of capital. Include what your future operating expenses will be.

Pulling It All Together

Writing a farm business plan is a big project. Don’t let that put you off. Your plan can be as simple as it needs to be for right now. Begin with your mission statement and goals. Do your homework by analyzing markets and researching competitors and trends. Have fun brainstorming alternative strategies and let them marinate a while. Take it one step at a time.

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New and Beginning Farmer Series: Writing a Farm Business Plan

Marcus Coleman

A farm business plan can fulfill several purposes for a farm owner, including:

• Serve as an internal organizing tool used to communicate farm plans to individuals outside of the farm business.
• Serve as an internal planning tool to assist in ongoing problem-solving related to farm challenges and opportunities.
• Assist in making annual or seasonal marketing, operations, production and financial decisions.

There is no right or wrong format to use in writing a farm business plan. The primary objective is to effectively communicate what the farm business is about and the goals and strategy for business success. The plan must also convey the long-term feasibility of the farm business, supported with the vision of the farm owner as well as research related to the farm business and market environment that the farm owner seeks to participate in.

In writing a farm business plan, these steps can assist in constructing the plan:

Step 1: Write out the farm mission statement. The mission statement defines the farm business in the context of its primary business function, its products and how it seeks to produce them, its customers, and what unmet customer need it seeks to fill.

Step 2: Write out the farm vision statement. The vision statement states what the farm owner aspires the farm business to be in the future.

Step 3: Write out the farm values. Values explain how the farm business is going to conduct itself in the context of what and who it values.

Step 4: Provide an overview of the farm business. The overview will assist in assessing the farm business and provide a synopsis of what the farm business seeks to do and how it plans to achieve its goals. This overview should consist of the following:

• The purpose of the farm business.
• How the farm business can be managed into a successful operation.
• The key farm business activities.
• The important business and marketing opportunities as well as potential challenges to farm business success.
• The funding that is required to start or expand the farm business. The farm owner should also prepare a budget that provides further detail.

Step 5: Write out the farm goals and include an action plan for each. Including goals and action plans in the farm business plan is necessary as they allow the farm owner to (a) clarify ideas, (b) focus efforts, (c) have a plan to use those time and resources productively, and (d) increase the chances of achieving those goals. Including goals also allows others to understand how the farm business plans to achieve success. There is no right or wrong number of goals to include, but the goals that are included must be attainable within the scope of the farm business.

Every goal must have an action plan that explains (a) who is responsible for the goal, (b) the tasks necessary to complete the goal and (c) when the goal should be completed. The farm owner should also develop a more detailed, step-by-step action plan for their farm goals for personal use. A simple format to highlight farm goals and associated action plans in the farm business plan is show in Tables 1-3.

Table 1. Short-Term Goals (1-3 years)

Table 2. Intermediate Goals (4-6 years)

Table 3. Long-Term Goals (7 or more years)

Step 6: Provide an overview of the target customers and planned marketing strategy. The marketing planning process identifies the farm business’s target customers and the unmet customer need the farm business seeks to serve. The market planning process is summed into three questions:

• Who is the target customer and why should the customer buy from the farm?
• What are the farm business’s primary products?
• What is the plan to promote the farm business to customers?

When defining who the target customer is, the farm owner must consider the following questions:

• What types of customers are expected to buy the farm’s products?
• When and how often might customers buy the products?
• What benefits will the farm products offer customers?
• Where will customers buy the products?

When developing a market strategy, the farm owner must also consider the following questions:

• Why do people want/need the farm’s products?
• What is the plan to attract customers and keep them coming back?
• What are some marketing challenges that could be faced?

Table 4 highlights a format that can be used to present the marketing plan in the farm business plan.

Table 4. Marketing Plan

For more information:

DiGiacomo, Gigi, Robert King and Dale Nordquist. 2003. Building a Sustainable Business: A Guide to Developing a Business Plan for Farms and Rural Businesses. College Park, MD: Sustainable Agriculture Research and Education (SARE).

Hunger, J. David and Wheelen, Thomas L. 2007. Essentials of Strategic Management. 4th Edition. Prentice Hall. Upper Saddle River, New Jersey.

Author Information:

Marcus A. Coleman is the program director of the Grow Louisiana Beginning Farmer Training Program, Louisiana State University, LSU AgCenter.

Contact person for more details on this publication: [email protected].

Acknowledgement:

This publication was developed as a part of the Grow Louisiana Beginning Farmer Training Program and supported by a U.S. Department of Agriculture National Institute of Food and Agriculture grant (Award # 2018-70017-28597).

Visit our website: www.LSUAgCenter.com

Luke Laborde, Interim LSU Vice President for Agriculture

Louisiana State University Agricultural Center

Louisiana Agricultural Experiment Station

Louisiana Cooperative Extension Service

LSU College of Agriculture

Pub. 3800 (online) 04/22 rev.

The LSU AgCenter and LSU provide equal opportunities in programs and employment.

Have a question or comment about the information on this page?

Email marcus coleman, innovate . educate . improve lives.

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An official website of the United States government Here’s how you know

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Find your state/county's agriculture data and USDA resources on your farmers.gov Local Dashboard !

How to Start a Farm: Build Your Business

Lean on USDA and others to equip yourself with the business knowledge to build your operation. After your USDA Service Center visit, establish your operation by registering your business and obtaining licenses, permits, and a tax ID number. You should also consider educational opportunities, business management components, and insurance. 

Keep reading about establishing your business below, get an overview of the beginning farmer's journey , or jump to a different section of the farmer's journey.

On This Page

Grow your business knowledge.

Attend field days, workshops, courses, or formal education programs to build necessary skills to ensure you can successfully produce your selected farm products and/or services. Many local and regional agricultural organizations, including USDA and Cooperative Extension, offer training to beginning farmers.

• Cooperative Extension  offices address common issues faced by agricultural producers, and conduct workshops and educational events for the agricultural community.
• extension.org is an online community for the Cooperative Extension program where you can find publications and ask experts for advice.
• SCORE offers free mentoring, workshops, and online resources for entrepreneurs, small business owners, farmers, ranchers, and agribusiness.

Determine the Legal Structure of Your Business

A business structure refers to how a business is legally organized and can affect how a business is regulated, taxed , and more. Deciding the best structure for your business is one of the most important decisions you will make.

Decide which form of business ownership is best for you:

• sole proprietorship,
• partnership,
• Limited Liability Company (LLC),
• corporation,
• S corporation,
• cooperative.

The structure of farm business you choose may affect eligibility for certain USDA programs and will determine how and where you will need to register your business and which taxes you must pay.

The Sustainable Agriculture Research and Education (SARE) program provides guidance to help farmers decide which legal structure is best for your farm operation as well as detailed information about the characteristics and requirements of each legal structure. Review SARE's Farmers' Guide to Business Structures to learn more about business structures for farm operations.

Register Your Farm Business

Once you determine your business structure, you will need to obtain the necessary federal and state tax identification numbers to register your business . Registering your business and becoming familiar with your federal and state tax responsibilities will help you file your taxes accurately, make payments on time, and avoid potential penalties.

USDA has financial information and resources related to USDA program payments, asset protection, and the important relationships between federal and state income taxes and USDA farm programs.

Federal Tax ID Number (EIN)

As a beginning farmer you will need a federal tax ID number , also known as an Employer Identification Number (EIN). An EIN is used to identify a business entity, hire employees, apply for business licenses, permits, and more. The EIN is necessary for reporting to the IRS. You may apply for an EIN online .

The IRS provides an Agricultural Tax Center with numerous useful documents, including the Farmer’s Tax Guide that explains how the federal tax laws apply to farming.

State Tax ID Number

Tax requirements vary by state. Visit the SBA website to learn about your state’s laws regarding taxes and for specific steps on how to get a state tax ID number.

Obtain Business Licenses and Permits

Obtain the federal, state, and local licenses and permits required for your business. Licenses, permits, and other types of registrations vary by state and locality. Licenses and permits needed may also vary depending on the farm business activity and how those activities are regulated at a federal or state level. Review SBA’s Apply for licenses and permits page for more information. It’s also a good idea to contact your State Department of Agriculture to ask which licenses and permits may apply to them.

Purchase the Insurance You Need

Agriculture is an inherently risky business. Some risks are everyday business risks; some risks are brought on by natural disasters. Producers need to regularly manage for financial, marketing, production, human resource, and legal risks.

There are many types of insurance to consider for the business, employees, and the crops and livestock you may be producing. The following examples are some types of insurance to consider, but not all operations might need these. For example, if there are no employees in their business, they won’t need workers’ compensation insurance. Additionally, the laws requiring insurance vary by state so you will need to check your state website for any additional insurance you might need.

Liability insurance protects against claims resulting from injuries and damage to other people or property. Liability insurance policies cover any legal costs and payouts from the insured producer if they are found legally responsible.

Property insurance provides financial reimbursement to the landowner or renter of a structure and its contents in case of damage, theft or if someone else is injured on the property.

Crop insurance provides financial protection against losses due to adverse events including drought, excess moisture, damaging freezes, hail, wind, disease, and price fluctuations.

Workers' Compensation and Unemployment and Disability Insurance is required by the federal government for every business that has employees.

Health insurance can be purchased for yourself, family members, or as part of a benefits package for your employees. HealthCare.gov and USA.gov make available tools to help you understand what you need to know about new insurance options and other health care changes to help you find health-care related resources.

Life insurance can help protect your farm and help keep it in the family by providing money to pay for various farm expenses, from livestock to crops to new facilities.

USDA Crop Insurance

USDA’s Risk Management Agency (RMA) offers crop insurance to help you manage risk across your operation. Crop insurance helps mitigate production and revenue risks and supports a healthy rural economy. There are many types of insurance products available for a wide variety of production practices, including organic and sustainable agriculture. Beginning farmers and ranchers are also eligible for certain benefits designed to help as you start your operation.

Use RMA’s Agent Locator to find a crop insurance agent near you. Crop insurance may be required to receive loans.

Insurance is required when applying for a loan with FSA. Additional insurance and coverage period may differ depending on the type of loan.

Understand Employer Responsibilities

If you plan to hire employees for your farm operation, you will need to understand employer responsibilities and learn the legal steps you will need to take to hire employees. Then, you should establish a farm work plan to hire and schedule farm labor.

The US Department of Labor administers laws that protect several types of farm workers, including:

• Fair Labor Standards Act
• Migrant and Seasonal Agricultural Worker Protection Act

There may also be relevant state-based laws. For more information, visit your State Department of Agriculture .

H-2A Visa Program

The H-2A provisions of the Immigration and Nationality Act (INA) authorize the lawful entry into the United States of temporary, non-immigrant workers (H-2A workers) to perform agricultural labor or agricultural services of a temporary or seasonal nature. Learn about hiring agricultural workers through the H-2A Visa Program .

Occupational Health and Safety

The Occupational Safety and Health (OSH) Act is administered by the Occupational Safety and Health Administration (OSHA). Employers covered by the OSH Act must comply with the regulations and the safety and health standards promulgated by OSHA. Employers also have a general duty under the OSH Act to provide their employees with work and a workplace free from recognized, serious hazards. OSHA enforces the Act through workplace inspections and investigations. Compliance assistance and other cooperative programs are also available.

Find health and safety requirements and resources for employees on the Occupational Safety and Health Administration’s website . Be sure to also check your state-based laws.

An Agricultural Guide to Federal Labor Law

This video guides agricultural employers and advocates through compliance requirements under the applicable laws, and provides real world examples of compliant and non-compliant employment conditions and practices.

Video: Cultivating Compliance - An Agricultural Guide to Federal Labor Law

Once you have set up your business, it’s time to start producing your products and growing your business. USDA has tools to help producers grow their businesses and build new markets for their products both at home and abroad.

5. Sell your farm products

How to Start a Farm with USDA

Get an  overview of the beginning farmer's journey  or jump to a specific page below.

Find Your Local Service Center

USDA Service Centers are locations where you can connect with Farm Service Agency, Natural Resources Conservation Service, or Rural Development employees for your business needs. Enter your state and county below to find your local service center and agency offices. If this locator does not work in your browser, please visit offices.usda.gov.

Learn more about our Urban Service Centers . Visit the Risk Management Agency website to find a regional or compliance office  or to find an insurance agent near you.

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Farmers Market Business Plan Template

Published Jun.11, 2021

Updated Apr.22, 2024

By: Cynthia Turner

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Table of Content

Farmers market business plan for starting your own business

One of the most lucrative businesses that you can start right now and that too with the least investment is that of farmer’s market. If you want to know how to start a farmers market business, just stick around till the endo of this document as this is a complete business plan for farmers market and has all the information, stats, and guidance that you need to start this business.

We will start this business plan with strategic plan of organization which is the most important part of any business plan and will then navigate through everything from the capital and workforce required for the business to the market trends and a solid marketing analysis and plan that will make it possible for you to start and run the business with efficiency.

Executive Summary

2.1 the business.

Packard Farmer’s Market will be a registered and licensed farmer’s market outside of Dallas, Texas. The owner, Stephen Packard, wanted to go for a retail store business plan , but he has shifted to starting a farmers market business because there is a lot of potential for this business in the area. You can also use this business plan for a banker to get financing for the business.

2.2 Management of Farmer’s Market Business

If you want to know how to start a business at a farmers market, the most important thing to note is that this is a services business and needs a strong management to be successful in the true sense.

To cater for that, Stephen will need to hire the appropriate staff to look after the day-to-day operations of the business. This will need five brokers to buy the products from the farmers and a 3 more to sell it to the buyers. In addition to that, a manager will be needed to look after the operations of the business.

An accountant will also be necessary to keep track of all the money flowing in and out of the business at a daily basis.

2.3 Customers of Farmer’s Market Business

The next thing we need to determine for launching business at farmers market plan is the customers we will be serving. The customers of the market will be:

• Farmers coming in to sell their products.
• Wholesale buyers coming to purchase the product in bulk.
• Domestic buyers coming to buy retail quantities of the product.
• Food processing companies looking for agricultural products.

2.4 Business Target

The subjective target of Packard Farmer’s Market is to provide the best services to farmers as well as buyers in the area of Dallas. By doing that, Stephen targets to become one of the leading farmer’s market broker in the state of Texas.

Company Summary

3.1 company owner.

The owner of the business, Stephen Packard, will easily get farmers market business license because he has a lot of experience in this field. He worked as a broker at several farmer’s market and knows all the ins and outs of the industry. This business plan has a number of things in common with a retail discount store business plan , as you will see down the line.

3.2 Why the Farmer’s Market Business is being started?

Another important thing that we need to talk about in this farmers market business plan sample is the reason why this business is being started. There are two reasons for that. Firstly, there is no market farmer business type in the area to cater the needs of the farmers.

Secondly, Stephen was fired by his former boss in a farmer’s market nearby and he has decided to send him out of the business by making an extremely attractive farmers market business card that will just bankrupt his former boss for good.

3.3 How the Farmer’s Market Business will be started?

Step1: Plan Everything

Much like a pig farming business plan , the main, and the first thing involved in starting this business is planning. Stephen needs to plan everything from the expenses to the place of the market to make it successful. The important thing to note here is that even though not a lot of capital is needed to start a business and no inventory is involved, Stephen needs to have a solid plan to make sure that his business can compel the customers (both buyers and purchasers) to come to his business and leave the ones they have been working with for years.

Step2: Get the Necessary Permits

The next thing that Stephen and his team need to do is to get licensed, bonded, and insured to start the business. Unlike a aquaponics business plan , it is important to get permits from the local trade union and governmental bodies to start the business.

Step3: Establish the Place of Business  

The next thing Stephen has to do to start the business is to establish the point from where he will be operating the business and where he will interact the customers from. It is important to have  a place large enough to keep the products safe if they have to be purchased in large quantities in the harvesting season.

Step4: Promotion and Marketing

This is the most important part of starting this business. It is important because all the farmers as well as buyers in the area are doing business with someone else for years and have permanent accounts with them. We’ll have to put in some real marketing effort to make them come and do business with us.

This is the most important part of this business plan. As the business is all about services more than it is about products, we need to carefully select which services we will be providing. The trouble with deciding the services for a farmers market business plan template is that there are too many services that such businesses provide. We need to go only for the business service of farmers market that are financially viable for us.

• Buying Agricultural Product

This is the main service around which this whole business will be based. We will buy agricultural produce including fruits, vegetables, grain, and cotton from farmers. The produce will be bough on market competitive prices.

• Buyer-Seller Arbitrage

Some time, in a farmer’s market, it is not the right thing to purchase the produce and then sell it. Arbitrage services will be provided by the brokers that we will hire and we will charge a contingency fee from both parties for our services.

• Loan Provision for Farmers

Another of the important services is providing loans to the farmers that they reimburse when they sell their produce. This is a lucrative aspect of this business as the interest rates on these loans are pretty high.

• Grain and Agricultural Produce Storage

We will have a large storage facility where we can store other people’s agricultural produce and charge them a fee based on duration and volume of the storage.

Marketing Analysis of Farmers Market Business

Great service.

Great service. Good turnaround time and quality work. Thanks!

If you want to know how to start farmers market business, the first thing you need to do is the marketing analysis of the business. This is the step where you will discover in detail what are the market variables that you are up against. You need to do this thoroughly before you start a farmers market business

5.1 Market Trends

If you are planning on opening a farmers market business, you need to know that no matter how good farmers market business ideas you might have, you can just not be successful without seeing the market trends of the field you are going to enter.

The farmer’s market business in the US is one of the biggest ones in the world and as the US is expanding its agricultural exports, it is the best time to enter this business. The profit margin here is even more than that of a hydroponics farm business plan .

5.2 Marketing Segmentation

The market segments that Packard Farmer’s Market will be serving will be the following:

5.2.1 Local Farmers

Our primary clients will be the local farmers who wan to sell their agricultural produce. We will offer them good rates and will be willing to give them loans in advance. The success of this business depends on working with as many farmers as we can and we will spare no expense to do that.

5.2.2 Local Retailers

We will sell the produce to the local retailers. These people will mostly buy fruits and vegetables.

5.2.3 Food Processing Companies

This market segment will buy fruits, vegetables, and grain. These will be our permanent customers and will bring a large part of our income.

5.2.4 Manufacturing Units

This market segment can buy any thing from seasonal fruits to cotton and tobacco. We will try to have as many of these clients as possible as they are the most high-paying ones.

5.3 Business Target

• To become the biggest farmer’s market broker in the area.
• To expand the business to other cities and start a chain of outlets.
• To give the farmers the best rates for their produce.
• To be the biggest suppliers of agricultural produce in the area for domestic, business, and industrial clients.

5.4 Product Pricing

We will buy the products at a higher price than the market and sell them at a lower price to attract business. Once we have sufficient customers, we can change the rates to more profitable ones.

Marketing Strategy

It will not be easy to attract customers who are already working with other farmer’s market brokers. To achieve that, we need to have a solid farm business marketing strategy. This is the only thing that can make this business successful and profitable for us in a market where loyalty is the name of the game and people are working with our competitors for years, even generations.

Here’s the competitive analysis for this business plan for a farmers market that will make our business a success.

6.1 Competitive Analysis

• The biggest competitive edge that we have is the location we have chosen for the business. The farmers of the area have to take the produce 100 miles to the other businesses. If we can offer them a price difference that is more than the freight charges, we can make it big in the business.
• Second thing that we have noticed is that the other businesses in the area have a very high interest rate for the loans they offer to the farmers. We can also capitalize on this aspect.
• Thirdly, we will offer delivery services to the buyers which will also give us a competitive edge.

6.2 Sales Strategy

• We will buy the produce from the farmers at a higher rate to attract them to do business with us.
• For the products we sell, we will keep the price lower than what the competitors offer. This will decrease the profit margin but will be great for giving our business customers in the start.
• We will also use multiple ways to advertise out business in order to attract more customers.

6.3 Sales Monthly

6.4 Sales Yearly

6.5 Sales Forecast

Personnel plan

One of the biggest troubles with the farmers market business model is that it requires a lot of skilled and unskilled workers. We need to have all kinds of people for this from daily wagers to college graduates. Just like the mushroom growing business plan , the workforce is what can make our venture a successful one.

7.1  Company Staff

Stephen will be the owner and CEO of the company and will hire the following staff to help him run the company.

• 3 Managers for liaison, operations, and marketing.
• 5 Brokers for purchasing and selling the product.
• 1 Accountant to keep track of the money.
• 2 Surveyors to vet the farmers before giving out a loan.
• 2 Drivers for delivering the produce to the buyers.

7.2 Average Salary of Employees

Financial Plan

Lastly, we need to have a financial plan to start and operate a profitable farmers market business. This will cover all the expenses that we need to have in order to start the business and keep it running until it starts making a profit.

We’ll need to have money for:

• Establishing the business.
• Buying the produce from the farmers.
• Giving loans to the farmers.
• Buying delivery vehicles.
• Salaries of the employees for the first six months.
• Marketing and advertisement.

8.1 Important Assumptions

8.2 Break-even Analysis

8.3 Projected Profit and Loss

8.3.1 Profit Monthly

8.3.2 Profit Yearly

8.3.3 Gross Margin Monthly

8.3.4 Gross Margin Yearly

8.4 Projected Cash Flow

8.5 Projected Balance Sheet

8.6 Business Ratios

Download Farmers Market Business Plan Template in pdf

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Clear Blue provides business insurance through partner agencies, not directly to small businesses. Available coverage types include all the essentials such as general liability, inland marine, commercial property and employment practices insurance.

• Operates in all states and Washington, D.C.
• Specializes in providing insurance programs by partnering with managing general agencies, reinsurers and others.
• Does not sell directly to small businesses. You’ll need to go through one of Clear Blue’s partner agencies.
• Does not offer business insurance quotes online.

You probably know Allstate for its auto and homeowners insurance but the company also sells business insurance with a stellar complaint track record. An Allstate agent can help you select the coverage that’s right for your particular business.

• Covers many  industries including retailers, food and beverage, medical, photographers and more.
• Can provide insurance for small businesses that operate out of homes.
• Website has lists of coverage types you may need based on your  industry.
• Offers online quotes for business owners policies.
• Does not offer online claims filing. You’ll need to call Allstate to file a business insurance claim.
• Does not sell workers compensation insurance.

Farmers Insurance

A (Excellent)

You’ll find a wide variety of commercial coverage types and the assistance of a Farmers agent.

• Provides useful information on its website explaining business insurance coverage types.
• Offers workplace safety videos and material, called MySafetyPoint, without extra charge to its business insurance customers.
• Has online business insurance quotes.
• You can submit a business insurance claim online.
• Does not sell business insurance in all states.

Acuity works through local agents to provide insurance for a wide variety of businesses, from hotels to auto repair shops to retailers and restaurants.

• The Acuity Nurse Helpline can facilitate access to the appropriate health care for your injured employees.
• Provides on-site loss control consultation and training.
• Offers a free online newsletter that addresses the specific concerns of truckers.
• Has a variety of videos with insurance information for various professions, such as construction and retail.
• Offers online business insurance quotes.

CNA has an excellent complaint track record. With over 300 coverage types available from CNA, you’ll have plenty of options to find the right business insurance fit.

• Industries that can be covered by CNA business insurance include construction, health care, financial institutions, law firms, manufacturing and more.
• CNA’s PrepWise provides a number of risk management services, such as cybersecurity awareness and ways to improve ergonomics in the workplace.
• Offers a pay-as-you-go workers compensation insurance option, so that small businesses can budget better.
• Offers online claims filing.
• Has a lower financial strength rating compared to other top competitors but still solid.

A++ (Superior)

As one of the largest insurers for commercial insurance on our list, Travelers also boasts very few complaints about its business insurance. Its wide range of commercial insurance solutions are available through independent agents.

• Offers TravPay, a pay-as-you-go workers compensation system that links your payroll directly to your workers compensation premiums, so you don’t have to guess the amount of annual payroll.
• Travelers’ TravComp is a workers compensation claims system that includes a dedicated return-to-work team of nurses and claims professionals with the goal of getting employees back to work quickly.
• Risk control resources include self-service material such as checklists.
• A variety of online services includes bills and payment histories, certificates of insurance and checking the status of claims.
• Does not offer online business insurance quotes. You will need to contact an agent.

Frankenmuth Insurance

Frankenmuth has customized, business-specific insurance packages for operations such as retail stores, manufacturing and small offices. Frankenmuth is a regional carrier operating in 15 states in parts of the Midwest and Southeast.

• Frankenmuth insurance is sold by local independent agents.
• Types of businesses that can be insured by Frankenmuth include retail stores, contractors, personal services and wholesalers.
• Only available in 15 states.
• Does not offer online business insurance quotes.

Cincinnati Insurance

Cincinnati Insurance sells its coverage through local independent agents who will tailor coverage to fit the needs of a business. Cincinnati’s business insurance is available in most states.

• Industries that can be covered include craft beverages, dentists, manufacturers, medical facilities, retail and more.
• The CinciPlus package combines expanded coverage types at a cost-savings from buying them separately. Cincinnati Insurance also offers CiniPak, which bundles coverage geared toward business types such as retail stores.
• Cincinnati’s three-year commercial package policy lets you lock in rates that won’t increase for the duration of your policy term. (Rates may change if your business’s needs change.)
• Complimentary loss control services can help you identify and manage workplace accidents, injuries and other problems.
• Not available nationwide.

Westfield Insurance

Selling business insurance in 21 states, Westfield Insurance has a notable track record for low complaints.

• With its Westfield Signature Series you can bundle together optional coverage types to address your specific business size and type.
• Among the top sellers of farm business policies.
• Only available in 21 states.

Chubb’s small business insurance targets small businesses with up to $30 million in revenue.

• Chubb offers insurance for operations such as cultural institutions, food services, health care, manufacturers, retail stores and technology.
• Small business owners may want to check out Chubb’s Business Owners Policy (BOP), which provides a blanket limit for property coverage so you have flexibility in where to spend a claim payment after a loss.
• Chubb’s BOP can be customized with coverage types such as flood insurance, electronic data liability, equipment breakdown, professional liability and other valuable protection.
• Only offers online business insurance quotes for businesses with a current or projected annual gross revenue of $2 million or less.

When buying small business insurance, your coverage decisions depend on your business’s type, size and specific risks. Common types of small business insurance include general liability, commercial property, and workers’ compensation insurance.

The Hartford

AM Best financial strength rating

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Insurance Lead Editor

Insurance Managing Editor

Michelle Megna

Start With a BOP

I recommend starting with a business owners policy (BOP). It combines three essential small business insurance types: liability insurance, commercial property insurance and business interruption insurance. It’s usually cheaper to buy a BOP than purchasing each coverage type separately.

Add Other Coverage as Needed

A BOP won’t cover everything, so I recommend adding more coverage types as necessary. For example, a BOP won’t cover car accidents. If you get into an accident with your work vehicle, you’ll need to add commercial auto insurance . Similarly, if you have employees, you’ll need to add workers’ comp insurance in most states.

Reassess Every Year

I think it’s a smart move to reassess your business risks every year. As your business grows, you’re bound to take on more risks, such as buying new equipment or adding more responsibilities for your employees. For example, you can add equipment breakdown insurance to cover equipment like refrigerators, computer systems and manufacturing equipment.

We recommend looking at several factors to determine how much small business insurance you need, such as:

• Your business type. Your industry has certain risks that are associated with it and you’ll need to buy the appropriate coverage types for those risks. For example, if you are an accountant who gives tax advice, you’ll want to buy professional liability insurance.
• The size of your business. As your business grows, you may need to increase coverage such as your liability limits. If you want to add an extra layer of protection, we recommend buying a commercial umbrella insurance policy.
• Your business location. You may need certain types of small business insurance required by law , depending on your city or state.
• Contractual requirements. Your client may require coverage such as general liability insurance, professional liability insurance or a surety bond .

The average cost of small business insurance is $57 per month, according to Insureon. That’s for a business owner’s policy (BOP) , which bundles general liability insurance, commercial property insurance and business interruption insurance. It’s generally cheaper to buy a BOP rather than buying each policy separately.

Your small business insurance costs depend on several factors:

• Industry. Industries with a higher risk will typically pay more than industries with a lower risk. For example, a construction company with multiple employees would cost more to insure than a graphics designer who works on their own.
• Size of payroll and annual revenue. The higher your operating costs and expenses, the more you can expect to pay for liability insurance.
• Number of employees. The greater the number of employees, the higher the risk of accidents.
• Location. If your business operates in a high-risk area with higher crime rates, you may pay more for business insurance.
• Building age and size. Older and larger buildings cost more to insure than newer and smaller buildings.
• Coverage amount and types. The higher your coverage limits and the types of business insurance policies you buy impact your costs. For example, if you have a business vehicle, you need to buy commercial auto insurance, which increase your overall business insurance costs.
• Claims history. If you have a history of filing claims for your small business, it could increase your premiums.

The best way to find cheap business insurance is to compare business insurance quotes from several different insurers. You can find business insurance quotes online or by speaking with an independent insurance agent.

Average Monthly Costs of Small Business Insurance

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Ratings methodology

We ranked business insurance companies based on complaint data for commercial liability and commercial property insurance in 2020. Complaint data is based on complaints upheld by state insurance departments in every state and collected by the National Association of Insurance Commissioners.

How do I know if I need small business insurance?

The vast majority of small businesses would suffer financially if they were sued or experienced a devastating loss, such as losing inventory in a fire. For those businesses, commercial insurance is a must.

Without small business insurance, you’d have to pay for the legal costs of lawsuits and find a way to pay for damage to your business property. General liability insurance and commercial property insurance are good places to start. Commercial auto is important if you have cars, trucks or vans that you use for business.

And workers’ compensation insurance is required in most states.

What does small business insurance not cover?

Certain types of accidents are generally excluded from small business insurance policies, including floods and earthquakes. You can typically buy separate policies to cover these types of problems, such as a commercial flood insurance policy.

Small business insurance also excludes coverage for fraudulent and intentional acts that you commit. For example, if you assault a customer, general liability insurance won’t cover your legal costs.

Do I need business insurance if I have an LLC?

It’s a good idea to get business insurance for your LLC. That’s because business insurance covers your business assets. For example, if someone slips in your store and gets injured, general liability insurance can pay for medical bills as well as legal costs if you get sued because of the accident.

While business insurance is essential for high-risk industries, such as manufacturing and construction, it’s also a good idea if you’re in a lower-risk industry, such as freelancing or bookkeeping. For example, if you get hit with a copyright infringement claim for one of your digital ads, your general liability insurance can cover your legal costs.

What type of insurance is best for a small business?

A good place to start is with a business owners policy (BOP) . It bundles three essential coverage types: general liability insurance, commercial property insurance and business interruption insurance . Combined, these three policies cover problems like accidental injuries and property damage, reputational harm, damaged or stolen business property, and income replacement if you can’t open your business due to a problem covered by your policy.

But a BOP alone may not cover all your needs. You may need to buy other types of small business insurance to cover the risks that affect your company. For example, if you have a work vehicle, a BOP won’t pay for repairs if you get into a car accident. You’ll need to add commercial auto insurance. It’s a good idea to speak with your insurance agent to make sure your business insurance policy meets the specific demands of your industry.

Do remote businesses need insurance?

Yes, remote businesses need business insurance to cover risks such as lawsuits, accidents and stolen business property. For example, if you own business property like computers and office furniture, you’ll need commercial property insurance to cover problems like theft and fire.

Your remote business may need other types of small business insurance. For example, if you visit clients, you’ll need commercial auto insurance. Or if you store sensitive data, such as client’s contact information and credit card numbers, you’ll want to consider cyber liability insurance .

Do you need a business owners policy (BOP)?

You need a business owners policy (BOP) if you want coverage for problems like lawsuits, lost business income and damage and theft of your business property. Without a BOP, you’ll have to cover these problems out-of-pocket, which could be financially devastating to your small business.

You can add other coverage types to your BOP. For example, if you drive a vehicle for work purposes, add commercial auto insurance .

Next Up In Business Insurance

• Best Commercial Auto Insurance Companies
• Types Of Small Business Insurance
• Best General Liability Insurance
• How Workers Compensation Insurance Works
• How To Get Cheap Business Insurance

Get Forbes Advisor’s ratings of the best insurance companies and helpful information on how to find the best travel, auto, home, health, life, pet, and small business coverage for your needs.

As a former claims handler and fraud investigator, Jason Metz has worked on a multitude of complex and multifaceted claims. The insurance industry can be seemingly opaque, and Jason enjoys breaking down confusing terms and products to help others make well-informed decisions.

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Agriculture Farm Business Plan

Start your own agriculture farm business plan

Botanical Bounty

Executive summary executive summary is a brief introduction to your business plan. it describes your business, the problem that it solves, your target market, and financial highlights.">, opportunity.

The health and vitamin industry is growing at a very quick pace. Customers want to have natural and plant alternatives to medication. They are starting to believe the body is a temple. They don’t want to pollute with chemicals. The industry needs botanical plants that are ready to process as well as give to nurseries for the “do it yourselfers”.

Botanical Bounty is working hard to become a leading producer of botanical plants for the natural supplement industry as well as plant nurseries.

Botanical Bounty has three distinct customers: supplement companies, processors of botanicals for supplement companies, and nurseries that resell the plants.

The first two customers purchase the plants for use in their products which they ultimately sell to the end consumer.

The market for natural supplements is quite exciting. Surveys show that over 158 million consumers (over 55% of U.S. population) use dietary supplements. An estimated 115.3 million consumers buy vitamins and minerals for themselves, and 55.8 million purchase them for other members of their family, including children. Consumer surveys consistently find that nearly half of all Americans now use herbs – a statistic that is particularly remarkable when we realize that today’s herbal products industry is just over a quarter century old.`

Competition

Competition takes two forms, farms similar in size and production capacity to Botanical Bounty and megafarms. The similarly sized farms range in size from 5-30 acres. The number of different herbs grown varies from a handful to upwards of 50. The choice of plants grown is based on owner preference as well as location and the ability of the local growing conditions to support the different plants.

It is Botanical Bounty’s mission to become the leading provider of botanical perennials to the health/vitamin industry. This will be accomplished by providing quality plants at fair prices while exceeding customer’s expectations.

Expectations

To finance our growth and full-time production, we need to purchase $35,000 worth of new equipment as long-term assets taking that total up to $53,800. To that end, we are seeking a $100,000 10-year loan. Sales forecasts conservatively indicate that $190,000 revenue will be generated in year two, rising to over 400,000 by year 4.

Financial Highlights by Year

Financing needed.

We need to have a $100,000 10 year loan. We will use our $35,000 of cash from our current operations.

Problem & Solution

Problem worth solving.

There is a growing trend towards plant cures to common diseases or health issues.Consumers care about getting a natural supplement to make them feel better and take care of their body. Because of this the natural market has grown exponentially in the last few years. The market needs high quality botanicals to keep up  with demand. 

Our Solution

Botanical Bounty has identified three keys that will be instrumental in their success. The first is the implementation of strict financial controls. By having the proper controls, production efficiency will be maximized. The second key will be the never ending pursuit for the industry’s highest concentration levels of botanical ingredients in each plant. The third key is the recognition and implementation of the philosophy that 100% customer satisfaction is required to ensure a profitable business. Profits are a by product of satisfying customers, not the other way around.

Target Market

Market size & segments.

Botanical Bounty has identified three different target market segments: 

Supplement Companies This customer group manufactures botanical supplements for their own label products. The companies purchase the plants and extract the active ingredients and transform them into sellable products for their own brand. There are a handful of large companies that operate in this market space. Ten years ago there were many different ones but through consolidation the industry has grown in size but decreased in the number of different players.

Processors These customers purchase the the plants, extract the botanicals and either sell the concentrated botanicals to the end producers or they themselves produce the supplement and sell the final product to other companies for their private label products. In essence they are the subcontractor for the supplement companies. These companies therefore are one layer within the manufacturing system and do not sell to the end consumer. They act as a supplier/processor for the retail brands.

Other Nurseries/Garden Centers This customer group purchases the plants which they in turn sell at retail to the individual end consumer. The typical consumer is a health conscious individual who is interested in either extracting the botanical from the plant immediately or growing the plant in their own garden for future use.

Current Alternatives

As mentioned previously, competition takes two forms, farms similar in size and production capacity to Botanical Bounty and megafarms. The similarly sized farms range in size from 5-30 acres. The number of different herbs grown varies from a handful to upwards of 50. The choice of plants grown is based on owner preference as well as location and the ability of the local growing conditions to support the different plants.

On the other end of spectrum is the megafarm. These farms have a similar range of species cultivated, however they differ greatly in production capacity. These farms are huge, typically not less than 100 acres, peaking at 300 acres. These growers however are few number.

The buying patterns of the different customers are typically based on these variables:

• Availability
• Ability to deliver consistently on long-term contracts
• Significant % of active ingredients
• Consistency

Our Advantages

Botanical Bounty has a dual competitive edge:

Healthy Plants The healthier the plant, the faster it will grow, the more botanicals that can be extracted from it. This means an increase in production efficiency due to a larger percentage of plants that are sellable. Other characteristics of healthy plants which are important on the production side is: lower pest counts, more established root structures, and high biomass.

High Concentration of Active Botanicals This is beneficial to the purchaser because they are buying the plants precisely for the active botanicals. High concentration levels are valuable to Botanical Bounty because they increase the amount of botanicals produced per plant or per acre, increasing the production capacity of a given amount of land, thereby increasing their return on investment and increasing the attractiveness of Botanical Bounty’s plants relative to the competition.

Keys to Success

Our keys to success are: 

• Strict financial controls.
• The never ending pursuit of the highest concentration of botanicals in every plant.
• Ensuring that all customer’s needs are met and they are satisfied with the purchased products.

Marketing & Sales

Marketing plan.

Botanical Bounty’s sales strategy efforts will focus on identifying qualified leads and turning them into paying customers. The main sales effort that Botanical Bounty will undertake is the reinforcement of the fact that Botanical Bounty’s plants have the industry’s highest percentage of botanicals. This will be quite appealing to the buyers as this is exactly what they want, more botanicals per plant. In addition to selling the buyers on Botanical Bounty’s competitive edge of potent plants, there will be an emphasis on Botanical Bounty’s ability to perform on long-term contracts.

Botanical Bounty recognizes that the transactions should not be thought of as individual sales, but as long-term relationships. This is a reasonable assumption based on the fact that the customers are in the business of utilizing botanicals, that they will continually have the need for the botanicals, and that it is far less expensive to establish a relationship with one vendor than to continually have to find new vendors that can meet their needs.

Locations & Facilities

Botanical Bounty is a 10 acre farm that concentrates on the growing of botanical medicinals. Botanical Bounty has chosen five plant species that have significant market demand as well being well suited for growth in the Willamette River Valley. Botanical Bounty will feature: Echinacea – an immune system booster; Ginseng – a source of energy; St John’s Wort – for mild depression; Skullcap- for inflammation; and Ginger – a stomach soother.

Milestones & Metrics

Milestones table.

Key Metrics

Our key metrics are: 

• Sales, cost of sales, expenses, profits, and cash.
• Production cost of goods. We need to keep them low.
• Keep current on our competitors botanical concentration and prices.
• Measure the number of emails and phone calls.
• Measure the Facebook Page views and Twitter re-tweets. 
• Measure website searches and inquiries. 

Ownership & Structure

Botanical Bounty is an Oregon L.L.C. owned by David and Susan Nealon. The L.L.C. business formation has been chosen as a strategic way to shield the Nealons from personal liability.

Company History

Botanical Bounty has been in operation for two years. Initially it was started as a hobby where Susan could use her plant biology skills while covering some of the costs. The Nealon’s were able to achieve this lifestyle due to a windfall that David received as a result of exercised stock options. After the second year, the Nealon’s decided that although they had the money to live on for many years, it would be irresponsible to needlessly spend it so they got serious about the business and made a concerted effort to become profitable.

Botanical Bounty has chosen the Willamette River Valley as an ideal place to grow perennials. Botanical Bounty has 10 acres of land which they use for production. During several of the winter months, production is moved into their green house for propagation. Botanical Bounty employs a drip irrigation system for all of the plants.

Management Team

Botanical Bounty will be lead by the husband and wife team of David and Sue Nealon. David brings a wealth of business and project management skills to the company. While working at Yahoo!, David was responsible for the successful launch and market lead capture of Yahoo!s driving directions section. Utilizing these skills, David will be responsible for the business operations of the farm. Sue, with a background of plant biology will be the driving force of the operation, growing the highest active ingredient content plants in the country. Additionally, because of her wealth of knowledge, she will be the leader of the sales department.

Personnel Table

Financial Plan investor-ready personnel plan .">

Key assumptions.

Our key assumptions 

• Our market and customer base are growing and with them the opportunities for sales.   
• The area has wealthy households that can afford to spend money on non essential vitamins.   
• Our customers appreciate our dedication to high quality products and price controls.   
• We will be able to get the 100,000 dollar loan at 8 percent based on our past success and being able to put our property up as collateral. We are a safe investment. If unplanned expenses pop up we have people interested in investing.

Revenue by Month

Expenses by month, net profit (or loss) by year, use of funds.

We will be using the loan to purchase machines and to expand our farm and our personnel to grow the highest quality botanicals and process them so they can be turned into vitamins or other products that give the  customer a natural cure. 

Sources of Funds

We are leveraging our business to get an $100,000 10-year loan. We will also be using the cash on hand from our current business. 

Projected Profit & Loss

Projected Balance Sheet

Projected Cash Flow Statement

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Newsom unveils plan that would hasten insurance-rate reviews — and increases

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A proposal to fix California’s insurance crisis would require the insurance department to process requests from insurers more quickly. But that could end with a lot of rate increases for consumers.

Gov. Gavin Newsom has proposed legislation to speed up insurance premium rate reviews as he and the Insurance Department try to fix the state’s battered insurance market. 

Last fall, Newsom issued an executive order tasking Insurance Commissioner Ricardo Lara with fixing home and fire insurance availability and affordability as insurers — citing rising wildfire risk and pandemic-induced inflation, and complaining about having to wait too long to get their requests for rate increases approved by the state — were canceling homeowner policies and halting the writing of new ones in California.

Homeowners continue to have trouble obtaining or hanging onto affordable insurance. From September through March, more than 45,000 of them have had to turn to the FAIR Plan , which is supposed to be an insurer of last resort for fire insurance. The plan provides limited coverage at high prices, so some homeowners have chosen to forgo fire insurance because they can’t afford their premiums, which in some cases have tripled or more.

Lara has been rolling out a plan to address the insurance market problems, which is expected to take effect by the end of the year. But Newsom said at a press conference earlier this month that “We’ve got to move it. We’ve just got to do more.”

Hence the bill he released Tuesday night, which is tied to the state budget and may not get as much scrutiny as other bills this late in the legislative session, needs only a simple majority vote in the state Legislature and would take effect immediately after the governor signs it. 

It builds on the part of Lara’s plan that makes changes to the process of approving insurance rate increases. The bill would add language to the insurance code that tightens the timeline of the review process, giving the Insurance Department up to 120 days — an initial 60 days, with options for two 30-day extensions — to respond to insurer rate-review requests with a newly required estimated rate. At that point, unless there is an objection by a consumer or consumer representative, the insurance companies can accept the estimated rate and apply it. 

Currently the law says the Insurance Department must act on rate filings within 60 days without a hearing or 180 days with a hearing. But Michael Soller, spokesperson for the department, said that as of February, the average time for homeowner filings was 196 days. 

“By enacting this important part of our strategy in statute, the Legislature can help us meet the urgency of the moment,” Lara said in a statement after the governor released the text of the bill. 

“This proposal requires the Department of Insurance to modernize and streamline its rate application process to get back to the expedited timelines outlined in Prop. 103,” said Alex Stack, a spokesperson for the governor.

Carmen Balber, executive director of the advocacy group Consumer Watchdog, said the tightened timeline for the state to respond with a rate estimate “seriously hamstrings oversight by the (insurance) department overall” as well as the role of intervenors such as her group. She said because the bill requires the Insurance Department to provide an estimated rate within 120 days, insurance companies could essentially be guaranteed rate increases three times a year — of less than 7% each time without triggering the risk of a hearing under Proposition 103, California’s insurance law that requires the state to approve rates — regardless of whether they can justify them.

The strict timeline “severely limits the information the department and intervenors can obtain” from insurers, Balber said, adding that she hopes lawmakers will “fix it.”

The chair of the Senate’s insurance committee, Sen. Susan Rubio, on Wednesday said she supports the bill. “I could not be more pleased with (the governor’s) proposal to help reduce unnecessary red tape,” the Los Angeles Democrat wrote in an emailed statement.

State lawmakers have been under pressure from their constituents to do something about the insurance market, with some of them proposing legislation to try to ensure individual and community efforts to help prevent wildfires count toward insurance affordability. The office of Assemblymember Lisa Calderon, chair of the Assembly’s insurance committee and another Los Angeles Democrat, did not respond to a request for comment on the governor’s proposal in time for publication.

California insurance market ‘in chaos,’ says former insurance chief. Can this chief fix it?

The insurance industry is optimistic that the bill will speed things up. 

Rex Frazier, president of the Personal Insurance Federation of California, said insurance companies that submit rate increase requests typically don’t hear back from the Insurance Department for four or five months. “At least now, they have to show their work by 60 days,” Frazier said. “The proposal provides more clarity and accountability to all parties involved in the process.”

Denni Ritter, vice president for state government relations for another industry group, the American Property Casualty Insurance Association, said the group was still evaluating the text of the bill. “Streamlining the rate review process will help increase consumer access to coverage by ensuring rates adequately reflect risk and consumer claims,” she said.

Lara’s overall plan, which he has dubbed the Sustainable Insurance Strategy, also includes allowing insurance companies to use catastrophe modeling; letting insurers incorporate reinsurance costs in their rates; and improving the FAIR Plan, including by requiring increased insurance coverage.

more on insurance crisis

Californians are protecting themselves from wildfire. Why is there still an insurance crisis?

California insurance chief, Farmers CEO  ‘look outside’ for answers to insurance crisis

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Farmers Market Business Plan Template

Written by Dave Lavinsky

Farmers Market Business Plan

Over the past 20+ years, we have helped over 500 entrepreneurs and business owners create business plans to start and grow their farmers markets. We have the experience, resources, and knowledge to help you create a great business plan.

In this article, you will learn some background information on why business planning is important. Then, you will learn how to write a farmers market business plan step-by-step so you can create your plan today.

Download our Ultimate Business Plan Template here >

What is a Farmers Market Business Plan?

A business plan provides a snapshot of your farmers market business as it stands today, and lays out your growth plan for the next five years. It explains your business goals and your strategies for reaching them. It also includes market research to support your plans.

Why You Need a Business Plan for a Farmers Market

If you’re looking to start a farmers market business or grow your existing farmers market company, you need a business plan. A business plan will help you raise funding, if needed, and plan out the growth of your farmers market business to improve your chances of success. Your farmers market business plan is a living document that should be updated annually as your company grows and changes.

Sources of Funding for Farmers Market Businesses

With regards to funding, the main sources of funding for a farmers market business are personal savings, credit cards, bank loans, and angel investors. When it comes to bank loans, banks will want to review your business plan and gain confidence that you will be able to repay your loan and interest. To acquire this confidence, the loan officer will not only want to ensure that your financials are reasonable, but they will also want to see a professional plan. Such a plan will give them the confidence that you can successfully and professionally operate a business. Personal savings and bank loans are the most common funding paths for farmers market companies.

Finish Your Business Plan Today!

How to write a business plan for a farmers market business.

If you want to start a farmers market business or expand your current one, you need a business plan. The guide below details the necessary information for how to write each essential component of your farmers market business plan.

Executive Summary

Your executive summary provides an introduction to your business plan, but it is normally the last section you write because it provides a summary of each key section of your plan.

The goal of your executive summary is to quickly engage the reader. Explain to them the kind of farmers market business you are running and the status. For example, are you a startup, do you have a farmers market business that you would like to grow, or are you operating multiple farmers markets?

Next, provide an overview of each of the subsequent sections of your plan.

• Give a brief overview of the farmers market industry.
• Discuss the type of farmers market business you are operating.
• Detail your direct competitors. Give an overview of your target customers.
• Provide a snapshot of your marketing strategy. Identify the key members of your team.
• Offer an overview of your financial plan.

Company Overview

In your company overview, you will detail the type of farmers market business you are operating.

For example, you might specialize in one of the following types of farmers market businesses:

• Produce market: This type of farmers market specializes in selling produce and fruits grown locally by farmers.
• Specialty foods market: This type of farmers market specializes in procuring and selling vegetables, fruits, and other foods that may not be locally or seasonally available.
• Dairy, poultry, and meat market: This type of farmers market specializes in selling dairy products such as milk, butter, cheese, and ice cream, and meat, eggs, and poultry.
• Public market: This type of market sells a wide variety of fruits, vegetables, meats, breads, other foods, and non-food products as well.

In addition to explaining the type of farmers market business you will operate, the company overview needs to provide background on the business.

Include answers to questions such as:

• When and why did you start the business?
• What milestones have you achieved to date? Milestones could include the number of customers served, the number of farmers participating, reaching $X amount in revenue, etc.
• Your legal business Are you incorporated as an S-Corp? An LLC? A sole proprietorship? Explain your legal structure here.

Industry Analysis

In your industry or market analysis, you need to provide an overview of the farmers market industry.

While this may seem unnecessary, it serves multiple purposes.

First, researching the farmers market industry educates you. It helps you understand the market in which you are operating.

Secondly, market research can improve your marketing strategy, particularly if your analysis identifies market trends.

The third reason is to prove to readers that you are an expert in your industry. By conducting the research and presenting it in your plan, you achieve just that.

The following questions should be answered in the industry analysis section of your farmers market business plan:

• How big is the farmers market industry (in dollars)?
• Is the market declining or increasing?
• Who are the key competitors in the market?
• Who are the key suppliers in the market?
• What trends are affecting the industry?
• What is the industry’s growth forecast over the next 5 – 10 years?
• What is the relevant market size? That is, how big is the potential target market for your farmers market business? You can extrapolate such a figure by assessing the size of the market in the entire country and then applying that figure to your local population.

Customer Analysis

The customer analysis section of your farmers market business plan must detail the customers you serve and/or expect to serve.

The following are examples of customer segments: individuals, schools, families, and corporations.

As you can imagine, the customer segment(s) you choose will have a great impact on the type of farmers market business you operate. Clearly, individuals would respond to different marketing promotions than schools, for example.

Try to break out your target customers in terms of their demographic and psychographic profiles. With regards to demographics, including a discussion of the ages, genders, locations, and income levels of the potential customers you seek to serve.

Psychographic profiles explain the wants and needs of your target customers. The more you can recognize and define these needs, the better you will do in attracting and retaining your customers.

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Competitive Analysis

Your competitive analysis should identify the indirect and direct competitors your business faces and then focus on the latter.

Direct competitors are other farmers market businesses.

Indirect competitors are other options that customers have to purchase from that aren’t directly competing with your product or service. This includes grocery stores, specialty food retailers, and online food delivery services. You need to mention such competition as well.

For each such competitor, provide an overview of their business and document their strengths and weaknesses. Unless you once worked at your competitors’ businesses, it will be impossible to know everything about them. But you should be able to find out key things about them such as

• What types of customers do they serve?
• What type of farmers market business are they?
• What is their pricing (premium, low, etc.)?
• What are they good at?
• What are their weaknesses?

With regards to the last two questions, think about your answers from the customers’ perspective. And don’t be afraid to ask your competitors’ customers what they like most and least about them.

The final part of your competitive analysis section is to document your areas of competitive advantage. For example:

• Will you set up your farmers market in a more accessible and convenient location for your customers?
• Will you offer products or services that your competition doesn’t?
• Will you provide better customer service?
• Will you offer better pricing?

Think about ways you will outperform your competition and document them in this section of your plan.  

Marketing Plan

Traditionally, a marketing plan includes the four P’s: Product, Price, Place, and Promotion. For a farmers market business plan, your marketing strategy should include the following:

Product : In the product section, you should reiterate the type of farmers market company that you documented in your company overview. Then, detail the specific products or services you will be offering. For example, will you provide locally grown products, dairy and meat products, or specialty fruits and vegetables?

Price : Document the prices you will offer and how they compare to your competitors. Essentially in the product and price sub-sections of your plan, you are presenting the products and/or services you offer and their prices.

Place : Place refers to the site of your farmers market. Document where your farmers market is situated and mention how the site will impact your success. For example, is your farmers market business located in a busy retail district, near a school, next to a busy park, or in its own indoor facility? Discuss how your site might be the ideal location for your customers.

Promotions : The final part of your farmers market marketing plan is where you will document how you will drive potential customers to your location(s). The following are some promotional methods you might consider:

• Advertise in local papers, radio stations and/or magazines
• Reach out to websites
• Distribute flyers
• Engage in email marketing
• Advertise on social media platforms
• Improve the SEO (search engine optimization) on your website for targeted keywords

Operations Plan

While the earlier sections of your business plan explained your goals, your operations plan describes how you will meet them. Your operations plan should have two distinct sections as follows.

Everyday short-term processes include all of the tasks involved in running your farmers market business, including answering calls and emails, meeting with farmers, pricing products, and allocating space for each vendor.

Long-term goals are the milestones you hope to achieve. These could include the dates when you expect to recruit your Xth farming vendor, or when you hope to reach $X in revenue. It could also be when you expect to expand your farmers market business to a new location.  

Management Team

To demonstrate your farmers market business’ potential to succeed, a strong management team is essential. Highlight your key players’ backgrounds, emphasizing those skills and experiences that prove their ability to grow a company.

Ideally, you and/or your team members have direct experience in managing farmers market businesses. If so, highlight this experience and expertise. But also highlight any experience that you think will help your business succeed.

If your team is lacking, consider assembling an advisory board. An advisory board would include 2 to 8 individuals who would act as mentors to your business. They would help answer questions and provide strategic guidance. If needed, look for advisory board members with experience in working with farmers or managing a farmers market.  

Financial Plan

Your financial plan should include your 5-year financial statement broken out both monthly or quarterly for the first year and then annually. Your financial statements include your income statement, balance sheet, and cash flow statements.

Income Statement

An income statement is more commonly called a Profit and Loss statement or P&L. It shows your revenue and then subtracts your costs to show whether you turned a profit or not.

In developing your income statement, you need to devise assumptions. For example, will your farmers market have space for 20 vendors and be open on weekends? And will sales grow by 2% or 10% per year? As you can imagine, your choice of assumptions will greatly impact the financial forecasts for your business. As much as possible, conduct research to try to root your assumptions in reality.

Balance Sheets

Balance sheets show your assets and liabilities. While balance sheets can include much information, try to simplify them to the key items you need to know about. For instance, if you spend $50,000 on building out your farmers market business, this will not give you immediate profits. Rather it is an asset that will hopefully help you generate profits for years to come. Likewise, if a lender writes you a check for $50,000, you don’t need to pay it back immediately. Rather, that is a liability you will pay back over time.

Cash Flow Statement

Your cash flow statement will help determine how much money you need to start or grow your business, and ensure you never run out of money. What most entrepreneurs and business owners don’t realize is that you can turn a profit but run out of money and go bankrupt.

When creating your Income Statement and Balance Sheets be sure to include several of the key costs needed in starting or growing a farmers market business:

• Cost of equipment and supplies
• Payroll or salaries paid to staff
• Business insurance
• Other start-up expenses (if you’re a new business) like legal expenses, permits, computer software, and equipment

Attach your full financial projections in the appendix of your plan along with any supporting documents that make your plan more compelling. For example, you might include your location permit or a list of farmers you’ve recruited and what they sell.  

Writing a business plan for your farmers market business is a worthwhile endeavor. If you follow the template above, by the time you are done, you will truly be an expert. You will understand the farmers market industry, your competition, and your customers. You will develop a marketing strategy and will understand what it takes to launch and grow a successful farmers market business.  

Farmers Market Business Plan Template FAQs

What is the easiest way to complete my farmers market business plan.

Growthink's Ultimate Business Plan Template allows you to quickly and easily write your farmers market business plan.

How Do You Start a Farmers Market Business?

Starting a farmers market business is easy with these 14 steps:

• Choose the Name for Your Farmers Market Business
• Create Your Farmers Market Business Plan
• Choose the Legal Structure for Your Farmers Market Business
• Secure Startup Funding for Your Farmers Market Business (If Needed)
• Secure a Location for Your Business
• Register Your Farmers Market Business with the IRS
• Open a Business Bank Account
• Get a Business Credit Card
• Get the Required Business Licenses and Permits
• Get Business Insurance for Your Farmers Market Business
• Buy or Lease the Right Farmers Market Business Equipment
• Develop Your Farmers Market Business Marketing Materials
• Purchase and Setup the Software Needed to Run Your Farmers Market Business
• Open for Business

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Insurance Commissioner Lara Encourages Insurers to Step in With Wraparound Policies for FAIR Plan Policy Holders Similar to State Farm’s

CONTRA COSTA – Insurance companies could mimic State Farm’s new offer of providing wraparound choices for policy holders who sign up for California’s FAIR Plan fire insurance policy, state Insurance Commissioner Ricardo Lara said in an interview on the podcast, “Table Talk with Senator Steve Glazer.”

Lara also said a major contributor to the insurance crisis has been the reluctance of insurance companies to be honest with their rate requests because of their concerns about delays in the intervenor process. Under Proposition 103, the intervenor process allows outsiders to challenge proposed insurance rates and get reimbursed for their costs.

Lara told Senator Glazer he has encouraged other insurers to offer supplemental policies to protect homeowners under threat of losing their coverage. It would allow policy holders to keep broader homeowner protection beyond the limited fire protection the FAIR plan provides. The FAIR plan does not cover water damage, leaks or other typical property damage. State Farm in California recently announced it will continue to provide insurance coverage to policy holders as long as it doesn’t include fire protection.

“Yes, we’re talking to other carriers,” Lara said. “But, the non-renewals, as we’ve seen, have been the big carriers in the state, so I’m crossing my fingers and hope we don’t see any more real big bulk of non-renewals.”

In March, State Farm announced it would not renew approximately 30,000 homeowner policies across the state because of the risk of wildfires and fires after earthquakes. The California FAIR Plan is a state-created but privately run insurer of last resort which covers damage from fire, lightning, internal explosions and smoke. Other types of coverage, such as water damage, liability and theft, require a secondary policy. 

The FAIR Plan is now covering more and more homeowners, even those in lower risk areas, because of widespread policy cancellations. Daily applications for the FAIR Plan have fluctuated around 1,000 but rose to 1,200 last week, according to FAIR Plan President Victoria Roach.

From September 2019 to March 2024, the total number of FAIR Plan policies increased by 137%  from 154,494 to 365,694 as many insurers canceled policies in areas with high fire risk. In that same time, the FAIR Plan’s total exposure has risen to $340 billion from $112.8 billion, according to the FAIR Plan’s website.

In a 40-minute interview with Senator Glazer, Lara answered a wide range of questions on the insurance crisis from five mayors, other civic leaders and residents from Contra Costa and Alameda counties. Mayors Darlene Gee (Orinda), Karen Stepper (Danville), Dave Hudson (San Ramon), Anissa Williams (Oakley) and Karla Brown (Pleasanton) all called in with questions.

• On streamlining the intervenor process: “Because of the intervenor process, companies are actually coming in and underpricing the amount that they need, which also contributes to the problem; insurance companies are not being truthful to what is the actual rate that they need because they’re afraid of getting stuck in this intervenor process that then gets elongated and takes forever to approve that rate. … We’ve been vocal about being honest with us and tell us the rate you need, let us review that and if it’s justified it’ll be approved. We’ve been working with them to build some trust.”
• On Governor Gavin Newsom’s recent announcement to take action in the state budget to deal with how long it takes to review rates: “We worked very closely with the governor, we coordinated with him, helped draft the language, which is essentially one piece of a bigger pie of these reforms we’re working on that we felt we can get done in the Legislature and not have it get bogged down through the regulatory process and still be able to defend it when we get sued. We have to make sure these regulations are tight… the last thing I want is to lose these regulations in court over process. I’m willing to debate in court over the meat and substance of these regulations and why they’re needed but I don’t want to lose over the process. That’s why it’s taking us a little longer.”
• On working with State Farm on the wraparound choices for Fair Plan policy holders: “Creating options for homeowners has been really a top priority for us during this crisis. A comprehensive policy is always the best choice for homeowners. … This will help their policy holders stay covered and (be able to) keep access to multi policy discounts that State Farm may offer… I know this acutely affects a lot of your constituents so we’ve been on the phone with State Farm trying to be creative.”
• On insurance companies getting rate increase approvals to help stabilize the market: “Over the last couple months, top 10 insurance companies in the state have gotten rate increases, so if the rate is merited, it’s fair and it’s non-discriminatory, we’re trying to move these as quickly as possible given the crisis we’re in.”
• On why some people are being renewed and others aren’t. “It all depends on the amount of risk of an insurance company’s portfolio. We have to remind consumers that insurance companies are businesses. When you’re signing a contract with an insurance company, you’re entering into a business contract. We cannot force them. We’ve lost in court already trying to force them to underwrite in certain communities.”
•  On how to find a carrier who will underwrite a new policy: “One thing that is critical is we also look at small to medium size insurance companies who continue to write and who are expanding their profile in California. We don’t necessarily have to go to the big 10 companies. That’s something the department can help consumers … we can help coordinate some of the relationships with some of the smaller to midsize companies.”
•  On how the rocky insurance market is affecting home sales: “We know this insurance crisis is having a devastating effect on our real estate market because it is creating a domino effect. If you can’t find insurance for your home you can’t sell your home. Which means local governments are not going to have the resources to hire the fire fighters to protect the home.”
• To the common complaint that neighbors aren’t helping mitigate fire risks: “I’ve heard this time and time again: ‘I’ve done all the mitigation, invested thousands of dollars making my home fire safe but my neighbor has done absolutely nothing.’ This is where enforcement at the local level is critical … where (community leaders) understand that we’re putting the availability of insurance in peril if we’re not looking at this through a communal lens.”
• On reforms to the rate setting models and processing time: “We are on our way to enacting the state’s largest insurance reforms in 30 years, since the passage of Prop. 103 in 1988. …We are facing the accumulated stress of decades of long need reforms and neglected decisions … we are compressing decades of deferral and delay into a one-year timeline of action. We’ve been operating essentially with 20 th Century regulations for what we know is a 21 st Century problem. That cannot continue.”

You can listen to this and other episodes of Table Talk with Senator Steve Glazer by clicking here or wherever you listen to podcasts.

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• Best for customer satisfaction
• Best for older adults
• Best for long-term care
• Best for high returns
• Best for agent support
• Best for term life
• Why you should trust us

Best Life Insurance of June 2024

Affiliate links for the products on this page are from partners that compensate us (see our advertiser disclosure with our list of partners for more details). However, our opinions are our own. See how we rate insurance products to write unbiased product reviews.

Life insurance is as complicated as the policyholders and beneficiaries who use it. That means there's no single "best" life insurance company. Instead, you can find the best option based on what you want or what you prioritize.

Summary of the Best Life Insurance Companies

• Best for customer satisfaction:   State Farm Life Insurance
• Best for older adults:   Prudential Life Insurance
• Best for agent support:   New York Life Insurance
• Best for long-term care:   Columbus Life
• Best for high returns:   Allianz Life
• Best for term life:   North American Company

Best Life Insurance Companies of 2024

While there is no such thing as the objective best life insurance policy, you will be able to find the best insurance policy for your specific needs. Here are our picks for the best life insurance companies, whether you want to use your life insurance policy to build wealth through cash value or you're just looking for a term life insurance policy .

Best Life Insurance for Customer Satisfaction: State Farm Life Insurance

Bundling is standard, and agents often quote with multiple discounts.

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Best in JD Power customer service ratings
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Company offers a range of different insurance products to meet buyer needs
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Agents are knowledgeable about its products
• con icon Two crossed lines that form an 'X'. Life insurance products are conservative and limited
• con icon Two crossed lines that form an 'X'. Buyers may be subject to multi-year waiting periods before they qualify for full payouts on life insurance policies
• con icon Two crossed lines that form an 'X'. State Farm agents cannot offer alternative options if State Farm is unable to bind a life insurance policy

State Farm is one of the insurance industry's most prominent insurers offering auto, home, and other insurance. Bundling is standard, and agents often quote with multiple discounts. Its term, universal, and whole life insurance products are no exception.

• Life insurance products include term and permanent life
• Ranks highly for customer satisfaction

State Farm Life Insurance gets the best life insurance ranking in J.D Power's Individual Life Insurance Study, with a score of 843/1,000. The company is also ranked A++ with AM Best for its financial stability with term, universal, and whole life insurance options. 

All State Farm policies have to be purchased through a State Farm agent. Your agent can help you bundle and save or buy one policy. State Farm is also among the companies offering "survivorship universal life insurance ," which means the policy covers two people, and it kicks in after the second person dies. Couples looking to maximize their death benefit for beneficiaries with one premium payment each month may enjoy lower overall costs.

State Farm agents can run quotes and compare options to find the right plans for each applicant. The range of options, discounts, and familiar name all contribute to the popularity of State Farm's life insurance.

Read our State Farm Life Insurance review here.

Best Life Insurance for Older Adults: Prudential VUL Protector Life Insurance

Offers aggressive financial plans.

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Available in all 50 states (New York residents may have different plans)
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Buyers can withdraw money to pay for nursing home bills due to severe illness or disability
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Knowledgeable agents who can walk you through your options
• con icon Two crossed lines that form an 'X'. Financial returns are limited
• con icon Two crossed lines that form an 'X'. Limited policy options for seniors and other groups who might struggle to find life insurance

The aggressive financial plans offered by Prudential may appeal to many younger buyers and those with a stable income. However, those with lower income or buyers who aren't sure about the financial system may be more hesitant to engage with Prudential. Like many other industry giants, Prudential is working to change this perception.

Prudential Life Insurance is available in all states except New York. New York residents can buy the Pruco Life of New Jersey VUL Protector plan. This plan allows buyers to pull money out of their plan to pay for nursing home expenses. Cash value policy premiums are fixed, so you won't have to worry about extra costs later on. Internal costs are low, which minimizes risk. Due to age, many older adults want a safe investment option for their money. Prudential VUL Protector invests to avoid loss. That also means you're not as likely to see big increases in your available funds outside of what you deposit.

Read our Prudential Life Insurance review here.

Best Life Insurance for Long-Term Care: Columbus Life Insurance

Offers lien method to makes it easier to calculate the financial impact of pulling money out early.

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Buyers can pull money out for medical and other bills in the event of disease or disability
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Columbus uses lien method to simplify accelerated death payments
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Company offers a wide range of riders to customize policies
• con icon Two crossed lines that form an 'X'. Premiums may be higher than competitors
• con icon Two crossed lines that form an 'X'. Term policies are not guaranteed to be converted to whole

Best for long-term care and accelerated death benefits.

Columbus Life offers a wide range of riders to customize your policy with affordable premiums. The company also allows you to convert term policies to whole life insurance policies until the end of your term (generally around age 70). For this and many other reasons, customer satisfaction is high.

When using living health benefits (otherwise known as accelerated death benefits), buyers are allowed to pull money from policies early to pay for medical bills, living costs, etc. under certain circumstances. Most companies use a discounted death benefit, which reduces your final payout using two models. Columbus uses the lien method, which makes it easier to calculate the financial impact of pulling money out early.

Best Life Insurance for High Returns on Income: Allianz Life Insurance

Offers life insurance policies for foreign nationals with H-1B visas.

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Plans offer high returns on investment
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Great for investment and long-term retirement planning
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. May increase your income by as much as 20%
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Allianz offers plans for foreign nationals including H-1B visas
• con icon Two crossed lines that form an 'X'. Plans are meant specifically for high-income adults, alternatives may not be offered

Best for investing and high returns on income.

Allianz Life plans are geared towards high-income adults looking for more tax-free income. Allianz offers a 40% multiplier bonus with a 1% annual assets charge. In short, the professionals managing your investments take 10%. Overall, your investments would pull in an extra 14%-1% asset charge. This means you end up with 3% more than what you deposit every year your life policy is active. This plan offers strong returns when using a life policy to supplement your retirement savings. Allianz also offers specialized plans to grow your income by as much as 20% according to some estimates.

Of note: Allianz also offers plans for foreign nationals, including those with H-1B visas.

Best Life Insurance for Agent Support: New York Life Insurance

Offers aggressive financial products and extensively trained agents.

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Strong life insurance options for financial planning and wealth building
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Policies available nationwide
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Knowledgeable life insurance agents
• con icon Two crossed lines that form an 'X'. May require a medical exam
• con icon Two crossed lines that form an 'X'. Buyers looking for more modest policies may not find the most competitive pricing

If you're preparing for a comfortable retirement or looking to build generational wealth, New York Life is one of the strongest options. If you have questions or genuinely want to understand your life insurance options, New York Life agents are among the most qualified professionals in the business.

• Life insurance provider with policies available across the US

New York Life Insurance agents go through extensive training before they ever hit the sales floor. What does this get you? Policies vary widely, and New York Life offers both large and small payouts. Some policies have significant penalties for early withdrawal, but taking a loan offers more options. Whatever your questions, New York Life agents are trained to offer comprehensive support giving you accurate information about its policies every time. The company comes in at position eight in J.D. Power's latest life insurance customer satisfaction study.

Read our New York Life Insurance review here.

Best Life Insurance for Term Life: North American Life Insurance

Offers term policies alongside accelerated death benefits for critical, chronic, and terminal illnesses and more.

• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Offers accelerated death benefits for critical, chronic, and terminal illnesses
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Offers conversion for life policies up to 70 years old
• Check mark icon A check mark. It indicates a confirmation of your intended interaction. Term policies can be renewed up to age 95 for qualifying applicants
• con icon Two crossed lines that form an 'X'. Not all term policies qualify for renewal or conversion

Best Term Policy.

North American Company offers term policies alongside accelerated death benefits for critical, chronic, and terminal illnesses and more. The company allows one conversion on a 20-year policy at 15 years or 70 years old (whichever is earlier). The conversion cannot happen later than the five-year marker regardless of which policy you choose or the length. North American Company also offers a term policy with a lower premium renewable up to the age of 95 for qualifying insureds.

Types of Life Insurance

While there's many different types of life insurance policies , broadly speaking, there are two types of life insurance: temporary and permanent. Let's go over each in detail.

Temporary life insurance

Temporary life insurance is often called term life insurance. This type of policy covers you for a set amount of time before expiring, usually between 10-30 years. If you pass away after your policy expires, your family won't receive any benefits. Additionally, your policy won't accrue cash value like a permanent policy. That said, some term life insurance policies offer a conversion from term to whole life insurance, so you can extend your coverage. 

Because its benefits aren't guaranteed, term life policies are generally cheaper than permanent life insurance. That said, the vast majority of term life insurance policies never pay out. on

Permanent life insurance

Permanent life insurance is an umbrella term for a variety of life insurance policies that will insure you indefinitely and guarantee a payout as long as you maintain your policy. Policy types that fall under permanent life insurance includes:

• Whole life insurance
• Universal life insurance
• Variable life insurance
• Variable universal life insurance
• Simplified life insurance
• Guaranteed issue life insurance

These policies vary widely in purpose and intended buyers, but all guarantee death benefits to your loved ones. Some permanent life insurance policies, like whole, universal, and variable have a cash value component , which you can use as a savings tool or to leave your heirs a larger death benefit.

How to Pick the Best Life Insurance Policy for You

Finding the right fit in life insurance starts with finding a trusted insurance agent. Because there are so many state regulations, shopping for homeowners or auto insurance can be easily done online. Life insurance is not required. So it's a voluntary purchase. Many buyers don't know what they need or when they need it. Before making your selection, consider a few things:

Some companies will sell you a policy for your child as soon as they're born. While this may seem morbid, early sign-up means lower rates for a policy your child could enjoy in the future. Regardless, early sign-up equates to more policy for lower premiums and a higher likelihood of acceptance. At 20, you may be healthier and be able to pay into the policy for a longer period compared to when you're 50 with more age-related conditions.

As a general rule, never agree to more than you can afford. For the average life insurance agent, their job is to sell you a large policy with a large commission. Consider not only how much you make now, but how likely your current income is to continue. If you work on a project basis and your project is scheduled to end in 12 months, you may want to reconsider a policy premium outside your monthly savings.

How much are you prepared to buy? Some people only want a small policy to cover funerals and other end-of-life expenses. Others build a life policy into their retirement plan. Whatever direction you're going, involving a financial planner could help you make the right decisions. Depending on the carrier, customers can also compare set limits with index universal life policies, which set no limit. These policies never expire, and the value builds over the entirety of your life.

Living Benefits

Life happens unexpectedly. You could be healthy one day and in the hospital the next. Many life policies offer living benefits. These allow you to draw a limited amount out of your policy to cover medical and other bills you cannot pay while sick.

Much like a 401(k), many life insurance policies have penalties for early withdrawal. No matter what policy you want, this question is critical to an informed decision. It's a question of how early you can withdraw and how much you'll lose from the total to have the money in 10 years instead of 30 or after death.

Some policies require insured parties to pay premiums for at least one year before any significant payout would be available. Suicide exclusions are common. Even with no medical exam policies, the company may still do a check for known conditions. An insurance company has to mitigate its risk.

Flexibility

Once you've been denied a life insurance policy, a mark goes on your record. No matter the reasons, other insurance companies may deny you coverage based on the first denial. So consider your whole situation and choose your policy carefully before you submit any applications. Some policies have greater flexibility if you lose your job or otherwise can't make payments. Others will lapse if you miss even one payment.

Payment Type

Even within whole life or term life insurance policies, customers have the option to choose guaranteed fixed or variable rates. Some have guaranteed payouts, but you'll need to ask your agent for details.

What is your intended use? Why are you shopping for a life insurance policy in the first place, and what are your goals? Many successful financial planners also have a background in life insurance. So while they may not be able to find you a specific life insurance policy, financial planners can help you set out a blueprint for your purchase.

Why You Should Trust Us: How We Reviewed the Best Life Insurance Companies

In life insurance, it's easy to get "sold a bill of goods." Many life insurance agents pass a state test to be thrown into the deep end. Agents sell the company product, but not all know the products. In this vein, we look at the products each company offers. We also look at agent training.

A good life insurance agent may not volunteer all facts upfront. But a company's agents should answer questions about its products accurately and in a way the average consumer can digest. Agents should be able to inform you about the long-term benefits and limitations. This will help customers find the right policy for their long-term plan.

We consider affordability, policy sizes available, and performance for a comprehensive assessment in our insurance rating methodology . If you can, we recommend also working with a financial advisor to make a plan for your future with life insurance.

Our Expert Panel for The Best Life Insurance Companies

To inform our choices for the best life insurance companies, we spoke with the following experts:

• Paul LaPiana , head of product at MassMutual
• Barbara Pietrangelo , CFP, CLU, and chair of the nonprofit Life Happens
• Wykeeta Peel , Corporate Vice President and Market Manager, African American Market Unit at New York Life

The Experts' Advice on Choosing The Best Life Insurance for You

How much life insurance coverage do you believe the average buyer should have.

Paul LaPiana, Head of Product at MassMutual

"There are different approaches to determining how much life insurance you need. One is the 'human life' approach, which estimates the current value of your future earning potential. Another is securing specific coverage to pay off debts such as a mortgage or provide for the education of children. A comprehensive protection plan should provide the right amount of coverage over the course of your working life and into retirement."

Barbara A. Pietrangelo, Chair of Life Happens

"There is no one-size-fits-all life insurance policy because everyone is different. One way to get a rough estimate is to multiply your income by 10 to 15; another is adding $100,00 to that amount, should you have a child and anticipate college education expenses.

Your best bet is to talk to a financial professional or use the Life Insurance Needs Calculator on LifeHappens.org to analyze what's right for you."

Wykeeta Peel, Corporate Vice President & Market Manager African American Market Unit at New York Life

"As you consider what policy best meets your needs, it can help to answer four key questions: First, how much death benefit do you need? Second, how long will you need that coverage? Third, what is your budget (or how much monthly premium can you afford to pay?), and finally, what is your investment risk tolerance?

To determine how much death benefit makes sense, it's helpful to think beyond using life insurance to cover funeral expenses and consider whether anyone is relying on the policy owner's income to maintain a lifestyle, pay rent or a mortgage, or fund a child's education and for how long.

There are various rules of thumb regarding the right amount of Life insurance coverage. Some tips can be found online, but they only provide an estimate and don't necessarily factor in an individual's specific needs. In my opinion, human guidance, powered by technology, is required. Basically, it comes down to how much money your loved ones would need to remain on firm financial ground if your earnings were no longer in the picture and that is different for everyone."

What is the biggest opportunity you see for improvement in the life insurance industry?

"Increased accessibility through digital and other channels as well as through underwriting enhancements. Increased tailoring of products and features. And an increased emphasis on health and wellness programs."

"Having enough qualified insurance professionals to walk potential buyers through the multiple benefits of life insurance will be pivotal to the growth of the industry. Education is a key factor here, as professional agents also need to be able to explain life insurance and its benefits in an easy, digestible way, especially when there are so many misconceptions about life insurance."

"The need for life insurance is greater than ever. In fact, a recent New York Life Wealth Watch survey found that 37% of adults have been thinking about life insurance more often these days – and half of adults report that financial products that provide protection (50%) and reliability (50%) are more important now compared to last year. This may be especially true for middle-market and Cultural Market families.

Our organizational structure of having Cultural Market agents embedded in the communities where we live and work allows us to understand the needs of diverse communities and develop solutions that resonate with them."

What advice would you give to buyers who are debating whether or not to buy life insurance?

"It is difficult to say with any certainty how healthy you will be years from now. That's why securing life insurance, and insuring your insurability, today, when you are the youngest you'll ever be again, and perhaps your healthiest is a wise decision."

"Do you love someone? If the answer is yes, then life insurance is certainly something you should consider. Many buy gifts and experiences to express their love, but haven't considered that life insurance is just another way to say I love you. Nothing says support like ensuring your family's financial security and peace of mind."

"If you have someone depending on your income, you should consider purchasing life insurance. A death benefit from a life insurance policy can replace income from the loss of a breadwinner, ensure a family can stay in their home, fund educational or retirement expenses, address debt and so much more.

A life insurance policy can also help you grow your family's wealth over time. Once the risk of an unexpected loss has been managed, you can begin to think more broadly about your family's financial future. Life insurance can enable your mindset to shift from death to growth."

What's the most important thing buyers should look for when choosing a life insurance agent/company to buy from?

"With life insurance, you are securing a future commitment that may be decades away. Research the company behind the policy to ensure it has high financial strength ratings, longevity, and an excellent track record of paying claims."

"When looking for an insurance agent or company, be sure to do your research. When comparing companies, be sure to remember that the policy features that fit you and your loved ones best is the most important factor. Don't automatically assume you should buy from the higher-rated company.

If the policy from the other company has more of what you're looking for, it might be the better choice. If you're unsure where to start, try the Life Happens Agent Locator to find an insurance professional in your area."

• "The insurers' track record: At its core, life insurance is protection - a hedge against the unexpected - and you are paying premiums in exchange for the promise that the insurer will be there when you need them, so the financial strength and track record of the company backing your policy is critical.
• Customer service: Are service professionals available by phone and digital channels? Is there is an online dashboard where you can manage your policy? Beyond ensuring assistance is available after you purchase a policy, it's also critical to ensure you have access to trusted advice and guidance before you buy.
• Flexibility in conversion: How easy is it to change? Life can be unpredictable and while term insurance can cover your loved ones through a critical period of time, you may decide that access to cash value is an important piece of your strategy.
• Accelerated online applications : Online applications are convenient but don't replace human guidance. Keep in mind that accelerated online applications may have a maximum coverage amount, meaning that you may not be able to get all the coverage you may need exclusively through an online process.
• A range of payment options: It's important to understand how often you're required to make premium payments and whether and how often you can change the frequency of payments."

Best Life Insurance FAQs

According to JD Power's 2023 life insurance study, State Farm is the highest-rated life insurance company when it comes to overall customer satisfaction. However, you still may want to shop around for quotes from various insurers if you're looking to purchase a new policy.

There isn't one best life insurance company, because the best option for you will depend on the type of policy you're looking for. It's best to work with a qualified insurance agent to help you find the best coverage. If you're deciding between multiple similar options, it's also worth consulting J.D. Power's life insurance customer satisfaction study . The latest study ranks State Farm as the top pick for individual life insurance, outpacing Nationwide by three points.

The best type of life insurance policy for you will differ from someone else's, as your policy should be tailored to your needs. The best policy for you will be affordable and will offer the benefits best suited to your situation. For example, some policies are only meant to cover end-of-life expenses such as burial and funeral arrangements, whereas others include living benefits like a cash value insurance plan , which you can borrow against during your lifetime.

Some life insurance policies are advertised as "no medical exam." This doesn't mean the insurer won't ask you about known conditions or look at medical records. Policies with no medical exam also tend to offer lower benefits with higher premiums. Most companies have a network of medical examiners, some of whom can come to your home. You can find our guide on the best no exam life insurance here.

Each situation is different and requires a knowledgeable life insurance agent to assess your best options. Bring all your questions and the coverage you're looking for to an insurance agent near you to explore your options.

Editorial Note: Any opinions, analyses, reviews, or recommendations expressed in this article are the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any card issuer. Read our editorial standards .

Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.

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