how to create an agricultural business plan

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How to Start a Farm: Plan Your Operation

Think about your operation from the ground up and start planning for your business.  A good farm business plan is your roadmap to start-up, profitability, and growth, and provides the foundation for your conversation with USDA about how our programs can complement your operation. 

Keep reading about planning 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

Why you need a farm business plan.

A comprehensive business plan is an important first step for any size business, no matter how simple or complex. You should create a strong business plan because it:

• Will help you get organized . It will help you to remember all of the details and make sure you are taking all of the necessary steps.
• Will act as your guide . It will help you to think carefully about why you want to farm or ranch and what you want to achieve in the future. Over time, you can look back at your business plan and determine whether you are achieving your goals.
• Is required to get a loan . In order to get an FSA loan, a guarantee on a loan made by a commercial lender, or a land contract, you need to create a detailed business plan . Lenders look closely at business plans to determine if you can afford to repay the loan.

How USDA Can Help

Whether you need a good get-started guide, have a plan that you would like to verify, or have a plan you’re looking to update for your next growth phase, USDA can help connect you to resources to help your decisions.

Your state's beginning farmer and rancher coordinator  can connect you to local resources in your community to help you establish a successful business plan. Reach out to your state's coordinator for one-on-one technical assistance and guidance. They can also connect you with organizations that specifically serve beginning farmers and ranchers.

It is important to know that no single solution fits everyone, and you should research, seek guidance, and make the best decision for your operation according to your own individual priorities.

Build a Farm Business Plan

There are many different styles of business plans. Some are written documents; others may be a set of worksheets that you complete. No matter what format you choose, several key aspects of your operation are important to consider.

Use the guidelines below to draft your business plan. Answering these kinds of questions in detail will help you create and develop your final business plan. Once you have a business plan for your operation, prepare for your visit to a USDA service center. During your visit, we can help you with the necessary steps to register your business and get access to key USDA programs.

Business History

Are you starting a new farm or ranch, or are you already in business? If you are already in business:

• What products do you produce?
• What is the size of your operation?
• What agricultural production and financial management training or experience do you, your family members, or your business partners have?
• How long have you been in business?

Mission, Vision, and Goals

This is your business. Defining your mission, vision and goals is crucial to the success of your business. These questions will help provide a basis for developing other aspects of your business plan.

• What values are important to you and the operation as a whole?
• What short- and long-term goals do you have for your operation?
• How do you plan to start, expand, or change your operation?
• What plans do you have to make your operation efficient or more profitable ?
• What type of farm or ranch model (conventional, sustainable, organic, or alternative agricultural practices) do you plan to use?

Organization and Management

Starting your own business is no small feat. You will need to determine how your business will be structured and organized, and who will manage (or help manage) your business. You will need to be able to convey this to others who are involved as well.

• What is the legal structure of your business? Will it be a sole proprietorship, partnership, corporation, trust, limited liability company, or other type of entity?
• What help will you need in operating and managing your farm or ranch?
• What other resources, such as a mentor or community-based organization , do you plan to use?

Marketing is a valuable tool for businesses. It can help your businesses increase brand awareness, engagement and sales. It is important to narrow down your target audience and think about what you are providing that others cannot.

• What are you going to produce ?
• Who is your target consumer ?
• Is there demand for what you are planning to produce?
• What is the cost of production?
• How much will you sell it for and when do you expect to see profit ?
• How will you get your product to consumers ? What are the transportation costs and requirements?
• How will you market your products?
• Do you know the relevant federal, state, and local food safety regulations? What licensing do you need for your operation?

Today there are many types of land, tools, and resources to choose from. You will need to think about what you currently have and what you will need to obtain to achieve your goals.

• What resources do you have or will you need for your business?
• Do you already have access to farmland ? If not, do you plan to lease, rent, or purchase land?
• What equipment do you need?
• Is the equipment and real estate that you own or rent adequate to conduct your operation? If not, how do you plan to address those needs?
• Will you be implementing any conservation practices to sustain your operation?
• What types of workers will you need to operate the farm?
• What additional resources do you need?

Now that you have an idea of what you are going to provide and what you will need to run your operation you will need to consider the finances of your operation.

• How will you finance the business?
• What are your current assets (property or investments you own) and liabilities (debts, loans, or payments you owe)?
• Will the income you generate be sufficient to pay your operating expenses, living expenses, and loan payments?
• What other sources of income are available to supplement your business income?
• What business expenses will you incur?
• What family living expenses do you pay?
• What are some potential risks or challenges you foresee for your operation? How will you manage those risks?
• How will you measure the success of your business?

Farm Business Plan Worksheets

The Farm Business Plan Balance Sheet can help gather information for the financial and operational aspects of your plan.

Form FSA-2037 is a template that gathers information on your assets and liabilities like farm equipment, vehicles and existing loans.

• FSA-2037 - Farm Business Plan - Balance Sheet
• FSA-2037 Instructions

Planning for Conservation and Risk Management

Another key tool is a conservation plan, which determines how you want to improve the health of your land. A conservation plan can help you lay out your plan to address resource needs, costs and schedules.

USDA’s Natural Resources Conservation Service (NRCS) staff are available at your local USDA Service Center to help you develop a conservation plan for your land based on your goals. NRCS staff can also help you explore conservation programs and initiatives, such as the Environmental Quality Incentives Program (EQIP) .

Conservation in Agriculture

Crop insurance, whole farm revenue protection and other resources can help you prepare for unforeseen challenges like natural disasters.

Disaster Recovery

Special Considerations

Special considerations for businesses.

There are different types of farm businesses each with their own unique considerations. Determine what applies to your operation.

• Organic Farming  has unique considerations. Learn about organic agriculture , organic certification , and the  Organic Certification Cost Share Program  to see if an organic business is an option for you. NRCS also has resources for organic producers and offers assistance to develop a conservation plan.
• Urban Farming  has special opportunities and restrictions. Learn how USDA can help farmers in urban spaces .
• Value-Added Products . The Agricultural Marketing Resource Center (AgMRC) is a national virtual resource center for value-added agricultural groups.
• Cooperative.  If you are interested in starting a cooperative, USDA’s Rural Development Agency (RD) has helpful resources to help you begin . State-based  Cooperative Development Centers , partially funded by RD, provide technical assistance and education on starting a cooperative.

Special Considerations for Individuals

Historically Underserved Farmers and Ranchers: We offer help for the unique concerns of producers who meet the USDA definition of "historically underserved,"  which includes farmers who are:

• socially disadvantaged
• limited resource
• military veterans

Women: Learn about specific incentives, priorities, and set asides for  women in agriculture within USDA programs.

Heirs' Property Landowners: If you inherited land without a clear title or documented legal ownership, learn how USDA can help Heirs’ Property Landowners gain access to a variety of programs and services

Business Planning

Creating a good business plan takes time and effort. The following are some key resources for planning your business.

• Farm Answers from the University of Minnesota features a library of how-to resources and guidance, a directory of beginning farmer training programs, and other sources of information in agriculture. The library includes business planning guides such as a Guide to Developing a Business Plan for Farms and Rural Businesses and an Example Business Plan .
• The Small Business Administration (SBA) offers information about starting, managing, and transitioning a business.

SCORE is a nonprofit organization with a network of volunteers who have experience in running and managing businesses. The Score Mentorship Program partners with USDA to provide:

• Free, local support and resources, including business planning help, financial guidance, growth strategies.
• Mentorship through one-on-one business coaching -- in-person, online, and by phone.
• Training from subject matter experts with agribusiness experience.
• Online resources and step-by-step outlines for business strategies.
• Learn more about the program through the Score FAQ .

Training Opportunities

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.

Now that you have a basic plan for your farm operation, prepare for your visit to a USDA service center.

2. Visit Your USDA Service Center

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.

How to Create an Agricultural Business Plan

Blog > how to create an agricultural business plan, table of content, introduction, executive summary, company description, market analysis, product/service description, marketing and sales strategies, operational plan, swot analysis, financial projections, funding and investment, risk management, sustainability and environmental impact, legal and regulatory compliance, timeline and milestones, our other categories.

• Company Valuation
• Pitch Deck Essentials
• Raising Capital
• Startup Guide
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Reading Time : 16 Min

Business plan 101.

Starting an agricultural venture is an exciting and rewarding journey, but it requires careful planning and a well-crafted agricultural business plan. This document serves as a roadmap for your agricultural business, outlining your goals, strategies, and financial projections. In this comprehensive guide, we will walk you through each step of creating a robust agricultural business plan to set your venture up for success. Whether you’re planning to start a small family farm or a large-scale agricultural operation, this guide will help you make informed decisions and navigate the challenges of the agricultural industry.

The executive summary is the first section of your agricultural business plan, but it is typically written last. This section provides a concise overview of your entire plan and should capture the reader’s attention. Include the following elements in your executive summary:

• Example: ABC Farms is a sustainable agriculture venture committed to providing organic, locally sourced produce to health-conscious consumers in the region. Our mission is to promote eco-friendly farming practices and support local communities while delivering premium-quality products.

Stellar Business Tips: Keep your executive summary clear, compelling, and focused. Highlight the unique selling points of your agricultural business and how it addresses market demands.

In this section, provide a comprehensive description of your agricultural business. Include the following details:

• Example: ABC Farms was founded in 2010 by John and Jane Smith, who have a combined experience of over 20 years in sustainable agriculture. The business started as a small family farm and has since expanded to a 50-acre organic farm with a diverse range of crops, including vegetables, fruits, and herbs.

Stellar Business Tips: Share your business’s background, founders’ expertise, and growth trajectory. Emphasize your passion for agriculture and commitment to environmental and social responsibility.

Conduct a thorough market analysis to gain insights into the agricultural industry, market trends, and potential opportunities. Consider the following factors:

• Example: The organic produce market has been steadily growing at a rate of 10% per year, driven by increasing consumer awareness of health benefits and environmental concerns. Local restaurants and grocery stores are eager to source fresh, organic produce from nearby farms.

Stellar Business Tips: Use data and statistics to support your market analysis. Identify target customers and potential gaps in the market that your agricultural business can address.

Detail the agricultural products or services your business offers. If you are into crop farming, describe the crops you plan to grow, their varieties, and their uses. If you are into livestock rearing, specify the types of animals and breeds you’ll raise. If you offer agricultural services, describe them in detail.

• Example: ABC Farms specializes in heirloom vegetables, such as tomatoes, peppers, and cucumbers, renowned for their exceptional flavor and nutritional value. We also raise heritage-breed livestock, including free-range chickens and pasture-raised pigs, to provide ethically sourced meat products.

Stellar Business Tips: Highlight the uniqueness and quality of your agricultural products or services. Emphasize your commitment to sustainability and responsible animal husbandry if applicable.

Outline your marketing and sales strategies to reach and attract your target customers. Consider the following aspects:

• Example: ABC Farms utilizes social media platforms to showcase our farm-to-table journey and engage with customers. We actively participate in farmers’ markets and local food events to promote our brand and build personal connections with consumers.

Stellar Business Tips: Utilize digital marketing tools, such as social media and email marketing, to create brand awareness and engage with customers directly. Explore partnerships with local businesses to expand your reach.

The operational plan outlines how your agricultural business will function on a day-to-day basis. It includes the following details:

• Example: ABC Farms employs a team of experienced farmers who follow sustainable farming practices, including crop rotation and integrated pest management, to ensure soil health and minimize environmental impact. We have invested in modern irrigation systems and machinery to optimize productivity and reduce labor costs.

Stellar Business Tips: Detail the specific practices and technologies you’ll use to enhance efficiency and sustainability. Showcase your commitment to ethical and responsible farm management.

Conduct a SWOT analysis to evaluate your agricultural business’s internal strengths and weaknesses, as well as external opportunities and threats. Use this analysis to make informed decisions and develop effective strategies.

• Example: Strengths: ABC Farms has established a strong reputation for premium-quality produce, garnering repeat customers and positive reviews. Weaknesses: We currently face limited storage facilities for harvested crops, which may affect our ability to meet peak demands.

Stellar Business Tips: Be honest about your agricultural business’s strengths and weaknesses. Address how you plan to capitalize on opportunities and mitigate potential risks.

The financial projections section provides a detailed forecast of your agricultural business’s financial performance over the next 3-5 years. Include the following financial statements:

• Example: Sales Forecast: We anticipate steady growth in sales, with a projected increase of 15% annually due to expanding customer base and diversified product offerings.

Stellar Business Tips: Use realistic and data-driven estimates for your financial projections. Include contingency plans for unforeseen financial challenges.

If your agricultural business requires funding or investment, outline your funding requirements and sources of financing. This section should include:

• Example: Funding Requirements: ABC Farms seeks a capital investment of $200,000 to expand farmland, install greenhouses, and upgrade equipment to meet the growing demand for our organic products.

Stellar Business Tips: Clearly explain how the investment will be used to drive the growth and success of your agricultural business.

Identify potential risks and challenges that your agricultural business may face and develop risk management strategies to mitigate their impact. Consider the following risk categories:

• Example: Market Risks: Fluctuations in commodity prices and changes in consumer preferences may impact our sales revenue. To address this, we will diversify our product offerings and explore new markets.

Stellar Business Tips: Demonstrate your proactive approach to risk management. Provide solutions for handling potential challenges to reassure stakeholders.

As the importance of sustainable farming practices grows, customers and investors increasingly value agricultural businesses that prioritize environmental stewardship and social responsibility. In this section, highlight your commitment to sustainability:

• Example: ABC Farms is committed to regenerative agriculture practices, including cover cropping and no-till farming, to enhance soil health and sequester carbon. We actively participate in local conservation programs to protect natural habitats and biodiversity.

Stellar Business Tips: Showcase your efforts to contribute positively to the environment and local community. Share success stories of how your sustainable practices have made a difference.

The agricultural industry is subject to various laws and regulations, such as agricultural zoning laws, environmental regulations, labor laws, and food safety standards. In this section, address the legal and regulatory aspects of your agricultural business:

• Example: ABC Farms complies with all local, state, and federal regulations for organic certification and food safety. We conduct regular inspections and maintain accurate records to ensure full compliance.

Stellar Business Tips: Emphasize your commitment to adhering to legal requirements and ensuring transparency in your agricultural operations.

Develop a timeline for your agricultural business’s key milestones and achievements. This section should include:

• Example: Milestone Timeline: Year 1 – Acquire additional farmland; Year 2 – Expand greenhouse production; Year 3 – Launch an online farm-to-table store.

Stellar Business Tips: Set realistic timelines for achieving your milestones. This will help you track progress and stay on course.

In conclusion, creating a well-structured and comprehensive agricultural business plan is crucial for your venture’s success. It provides a roadmap to guide your agricultural business towards its goals, while also attracting investors and other stakeholders. Remember that the agricultural industry is dynamic and continually evolving, so your business plan should be flexible enough to adapt to changing market conditions and opportunities.

By following the steps outlined in this guide and incorporating sustainable practices, your agricultural business can thrive in an increasingly competitive landscape. At Stellar Business Plans , we are dedicated to supporting the success of agricultural entrepreneurs like you. Our team of experts can assist you in crafting a tailored business plan that aligns with your vision and values. Let’s cultivate growth together and create a sustainable future for agriculture!

Remember, agricultural business success is not only about financial gains but also about nurturing the land, supporting local communities, and providing consumers with nutritious and ethically sourced products. Let your passion for agriculture and dedication to sustainability shine through every aspect of your business. Together, we can sow the seeds of a thriving agricultural future.

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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.

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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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Agricultural Business Plan Template

Written by Dave Lavinsky

Agricultural Business Plan

You’ve come to the right place to create your Agricultural business plan.

We have helped over 1,000 entrepreneurs and business owners create business plans and many have used them to start or grow their Agricultural companies.

Below is a template to help you create each section of your Agricultural business plan.

Executive Summary

Business overview.

Schrute’s Roots is a startup agricultural business that produces crops for Scranton, Pennsylvania and the surrounding area. Schrute’s Roots will specifically grow root vegetables, including potatoes, onions, and beets. The company’s mission statement is to work hard to grow these vegetables organically and without any chemicals. We will sell our produce at local farmer’s markets as well as to local restaurants and other establishments that would like to use or sell our produce.

Schrute’s Roots is owned and led by Dwight Schrute. Dwight has been a farm operations manager for the past twenty years, bringing a plethora of knowledge and skills that will prove to be invaluable to all aspects of the business. After working as a farm operations manager, Dwight desired to run his own agricultural farm business that grows organic produce and benefits the local community. He will utilize his prior knowledge and experience to manage crop production, operations, and other aspects of the business.

Product Offering

Schrute’s Roots grows a variety of root vegetables for Scranton, Pennsylvania and the local community. All produce will be organically grown. We alternate our crops, so the exact crops that are grown will be dependent on the season and current crop cycle. Some crops that we plan to grow include the following:

Customer Focus

Schrute’s Roots will primarily serve the residents and businesses of Scranton, Pennsylvania and the surrounding areas. Any individual or establishment that is interested in purchasing our crops is welcome to partner with us. We will sell our crops to individuals at local farmer’s markets and directly to wholesalers, grocery stores, and restaurants.

Management Team

Schrute’s Roots’ most valuable asset is the expertise and experience of its founder, Dwight Schrute. Dwight has been a farm operations manager for the past twenty years, bringing a plethora of knowledge and skills that will prove to be invaluable to all aspects of the business. After working as a farm operations manager, Dwight desired to run his own agricultural business that grows organic produce and benefits the local community. He will utilize his prior knowledge and experience to manage crop production, operations, and other aspects of the business.

Success Factors

Schrute’s Roots will be able to achieve success by offering the following competitive advantages:

• Management: Schrute’s Roots’ management team has years of experience in agricultural operations, which will prove invaluable to all aspects of the business.
• Relationships: Having lived in the community for twenty years, Dwight Schrute knows all of the local leaders, media, and other influencers. As such, it will be relatively easy for Schrute’s Roots to build brand awareness and an initial customer base.
• Quality products at affordable pricing: Schrute’s Roots will provide quality products at affordable pricing, as it has high-quality equipment and uses the latest techniques.

Financial Highlights

Schrute’s Roots is currently seeking $750,000 to start the company. The funding will be dedicated towards securing the land and purchasing equipment and supplies. Funding will also be dedicated towards three months of overhead costs and marketing costs. Specifically, these funds will be used as follows:

• Land: $200,000
• Equipment: $200,000
• Three Months of Overhead Expenses (payroll, utilities): $150,000
• Marketing Costs: $100,000
• Working Capital: $100,000

The following graph below outlines the pro forma financial projections for Schrute’s Roots.

Company Overview

Who is schrute’s roots.

Schrute’s Roots is a startup agricultural business that produces crops for Scranton, Pennsylvania and the surrounding area. Schrute’s Roots will specifically grow root vegetables, including potatoes, onions, and beets. The company’s mission is to grow vegetables organically and without any chemicals. We will sell our produce at local farmer’s markets as well as to local restaurants and other establishments that would like to use or sell our produce.

  Schrute’s Roots is owned and led by Dwight Schrute. Dwight has been a farm operations manager for the past twenty years, bringing a plethora of knowledge and skills that will prove to be invaluable to all aspects of the business. After working as a farm operations manager, Dwight desired to run his own agricultural business that grows organic produce and benefits the local community. He will utilize his prior knowledge and experience to manage crop production, operations, and other aspects of the business.

Schrute’s Roots’ History

Dwight Schrute incorporated Schrute’s Roots as an S-corporation on May 1st, 2023. The operations aspects of the business will be run from Dwight’s home, while the agricultural aspects will be run from the land purchased for crop production.

Since incorporation, the company has achieved the following milestones:

• Found land to grow the crops and wrote a letter of intent to purchase it
• Developed the company’s name, logo, and website
• Determined agricultural equipment and inventory requirements
• Began recruiting key employees

Schrute’s Roots’ Services

Industry analysis.

The agricultural industry is vital to all communities. The crops and products grown by local farmers and crop production companies are essential to the health of local communities. They provide jobs to the locals and result in locally grown food that the nearby residents can purchase. Larger agriculture businesses do not offer these benefits to smaller communities. Because of this, there has been a greater demand and emphasis on the sustainability of local agricultural companies that can directly benefit the local community.

Furthermore, market research shows that local communities are demanding that crop production and other agricultural companies grow their products organically. Organic foods are much healthier for individuals to eat because they provide more nutrition and aren’t laced with chemicals. Improved technology and research into organic methods are making this form of crop production more profitable and sustainable.

Therefore, with the increasing demand for local organic farms, we are confident that Schrute’s Roots will succeed in the local market and benefit the residents of the Scranton area.

Customer Analysis

Demographic profile of target market.

Schrute’s Roots will serve the industries and community residents of Scranton, Pennsylvania and its surrounding areas. We will sell our produce at farmer’s markets to individuals and directly to establishments that wish to partner with us.

The demographics of Scranton, Pennsylvania are as follows:

Customer Segmentation

Schrute’s target audience segments include:

• Individuals
• Restaurants
• Grocery Stores

Competitive Analysis

Direct and indirect competitors.

Schrute’s Roots will face competition from other agriculture businesses. A description of each competitor company is below.

AgraFarm is one of the largest raw food manufacturers in the U.S., owning a 15,000-acre farm for agriculture. It has well-established connections with big FMCG companies and has been thriving in the agricultural industry for 12 years. It also has automated equipment and machines, which helps in improving its operations and reducing costs. AgraFarm is also known for delivering large orders at the right time without delay.

BDA Farms was established in 1998. BDA Farms is a very well-known company that provides good quality organic produce to companies. It also has a very good brand value, and its product packaging is second to none. BDA Farms is located in Scranton, Pennsylvania, and it has a very effective distribution and supply chain network.

BeetFarms was initially a beets producer company and then branched out to other vegetables. BeetFarms is now one of the ten largest vegetable producers in the state. The Company’s packaging and processing units are located in Scranton, Pennsylvania. It has recently acquired other local vegetable producers, expanding its operations as well as limiting the variety of farms producing vegetables for the community.

Competitive Advantage

Schrute’s Roots will be able to offer the following advantages over their competition:

Marketing Plan

Brand & value proposition.

Schrute’s Roots will offer the unique value proposition to its clientele:

• Production of high-quality organic produce
• Affordable pricing
• Providing excellent customer service and customer experiences

Promotions Strategy

The promotions strategy for Schrute’s Roots is as follows:

Social Media Marketing

Social media is one of the most cost-effective and practical marketing methods for improving brand visibility. The company will use social media to develop engaging content in terms of various forms and technologies of commercial cultivation and post customer reviews that will increase audience awareness and loyalty.

Website/SEO

Schrute’s Roots will develop a professional website that showcases pictures of the farm and the products we will grow. It will also invest in SEO so that the company’s website will appear at the top of search engine results.

Industry Events

By attending regional farming conferences, association meetings, and symposia, Schrute’s Roots will network with agricultural industry leaders and seek referrals to potential customers.

Direct Mail

The company will use a direct mail campaign to promote its brand and draw customers, as well. The campaign will blanket specific neighborhoods with simple, effective mail advertisements that highlight the credentials and credibility of Schrute’s Roots as a high-quality crop production agriculture business.

Schrute’s Roots’ pricing will be competitive. Pricing will be about 50% lower than retail prices to allow wholesalers and retailers to earn their margins.

Operations Plan

Operation Functions: The following will be the operations plan for Schrute’s Roots.

• Dwight Schrute will be the Owner and President of the company. He will oversee all staff and manage client relations. He will help with the produce cultivation until he has hired a full staff of farmhands. Dwight has spent the past year recruiting the following staff:
• Meredith Grant – will oversee all administrative aspects of running the farm. This will include bookkeeping, tax payments, and payroll of the staff.
• Kevin Baird – Head Farmhand who will oversee the farming staff and day to day operations.
• Oscar Smith– Assistant Farmhand who will assist Kevin.

Milestones:

Schrute’s Roots will have the following milestones completed in the next six months.

• 07/202X Finalize land purchase
• 08/202X Design and build out Schrute’s Roots
• 09/202X Hire and train initial staff
• 10/202X Kickoff of promotional campaign
• 11/202X Launch Schrute’s Roots
• 12/202X Reach break-even

Financial Plan

Key revenue & costs.

Schrute’s Roots’ revenues will come from the sales of root vegetables to its customers and local food establishments.

The major cost drivers for Schrute’s Roots will be labor expenses, land purchase, equipment purchases and maintenance, and marketing plan expenses.

Funding Requirements and Use of Funds

• Three months of overhead expenses (payroll, utilities): $150,000
• Marketing costs: $100,000
• Working capital: $100,000

Key Assumptions

The following outlines the key assumptions required in order to achieve the revenue and cost numbers in the financials and pay off the startup business loan.

• Number of customers per month:
• Annual equipment maintenance costs: $20,000

Financial Projections

Income statement.

Balance Sheet

Cash Flow Statement

Agricultural Business Plan FAQs

What is an agricultural business plan.

An agricultural business plan is a plan to start and/or grow your agricultural business. Among other things, it outlines your business concept, identifies your target customers, presents your marketing plan and details your financial projections.

You can easily complete your Agricultural business plan using our Agricultural Business Plan Template here .

What are the Main Types of Agricultural Businesses?

There are a number of different kinds of agricultural businesses , some examples include: Animal feed manufacturing, Agrichemical and seed manufacturing, Agricultural engineering, Biofuel manufacturing, and Crop production.

How Do You Get Funding for Your Agricultural Business Plan?

Agricultural businesses are often funded through small business loans. Personal savings, credit card financing and angel investors are also popular forms of funding.

What are the Steps To Start an Agricultural Business?

Starting an agricultural business can be an exciting endeavor. Having a clear roadmap of the steps to start a business will help you stay focused on your goals and get started faster.

1. Develop An Agricultural Business Plan - The first step in starting a business is to create a detailed agricultural business plan that outlines all aspects of the venture. This should include potential market size and target customers, the services or products you will offer, pricing strategies and a detailed financial forecast. 

2. Choose Your Legal Structure - It's important to select an appropriate legal entity for your agricultural business. This could be a limited liability company (LLC), corporation, partnership, or sole proprietorship. Each type has its own benefits and drawbacks so it’s important to do research and choose wisely so that your agricultural business is in compliance with local laws.

3. Register Your Agricultural Business - Once you have chosen a legal structure, the next step is to register your agricultural business with the government or state where you’re operating from. This includes obtaining licenses and permits as required by federal, state, and local laws.

4. Identify Financing Options - It’s likely that you’ll need some capital to start your agricultural business, so take some time to identify what financing options are available such as bank loans, investor funding, grants, or crowdfunding platforms.

5. Choose a Location - Whether you plan on operating out of a physical location or not, you should always have an idea of where you’ll be based should it become necessary in the future as well as what kind of space would be suitable for your operations.

6. Hire Employees - There are several ways to find qualified employees including job boards like LinkedIn or Indeed as well as hiring agencies if needed – depending on what type of employees you need it might also be more effective to reach out directly through networking events.

7. Acquire Necessary Agricultural Equipment & Supplies - In order to start your agricultural business, you'll need to purchase all of the necessary equipment and supplies to run a successful operation.

8. Market & Promote Your Business - Once you have all the necessary pieces in place, it’s time to start promoting and marketing your agricultural business. This includes creating a website, utilizing social media platforms like Facebook or Twitter, and having an effective Search Engine Optimization (SEO) strategy. You should also consider traditional marketing techniques such as radio or print advertising. 

Details of a Small Farm Business Plan

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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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Horizon Farm Credit

How to write a farm business plan.

Getting a loan for your agricultural business — no matter the size or scope — means asking the lender to have faith in your ability to manage a full-fledged operation and your finances in a healthy way. The best way to prove that is by coming prepared with a farm business plan proposal.

No pressure, right? While it may seem daunting and scary, we’ve broken down the steps to writing the perfect business plan below. Read on to learn more and check out the end of this guide for additional resources to help you craft a top-notch business plan.

Creating a Farm Business Plan

You can set yourself up for success — both in business and with your lender — by having a detailed business plan for your farming operation. It doesn't need to be pretty, but you do have to prove that you're willing to put the time and effort into creating a well thought out course of action for your operation.

Are you already operating but don't have a plan? That's okay! It's never too late to put extra thought into how your operation will continue to fulfill your livelihood.

What to Include in your Agricultural Business Plan

Whether you're a new farmer looking for a loan , or a seasoned grower that needs funding for a new agribusiness , there are a few things that you want to make sure you include in your agricultural business plan.

Title/ Cover Page

Keep it simple on the cover page. The most important information here is accurate contact information so your lender can get in touch with you easily. Include your mailing address, phone, email, and fax if you have it.

Business Overview

Although it will be the first page of your farm plan, this will be the last section that you write, since it acts as a summary of all your key points in your plan. Remember that this is the first section that your lender will read , so they’ll expect to see all of the highlights that make approving this loan a good financial decision for both you and the lending organization. Include points about expansion plans, market opportunities, financial trends and projections in a short and easy to read summary. Treat this section as if you're telling a stranger about your operation and you want to give them an overview of what you do and what sets you apart from other businesses in your industry.

What are your key business objectives? In this part of your farming business plan, you'll want to describe your products and services your business will offer. 

Start by describing how your business will operate and include what makes your business unique. Provide details regarding the size of the operation, location, and note any expansion plans.     

Who is your target audience? Who will benefit from your products or services produced from your farm business?   

Think about the desire and drive behind why you want to pursue this business venture. It is common to connect your business why with your mission statement.  

If applying for a loan:

If you’re starting a new operation, clearly state how much money you are applying for, how you plan to use it and how it will make your business more profitable, thereby ensuring repayment. 

Creating your own farm business plan will take time and effort. As you complete sections, send them to partners or colleagues to review as you go along. If you have any questions on farm business plan examples or more specifically what lenders are looking for, give us a call. 

Business Management and Organization

Business history:.

How long have you been in operation? Are you starting from scratch or did the business have previous owners?

Strengths and Weaknesses:

Describe the strengths and weaknesses of your business.

Implementation Timeline:

What is your plan of action? What specific tasks need to be completed in order to reach your business goals?   

Goals are often broken into two categories — short term and long term. Short term goals are focused on actions likely to be achieved in 1-3 years, and long term goals are likely accomplished in 3-10 years, or beyond.  

Risk Management:

What risk management practices do you have in place? Think about your business contingency plan, insurance coverage , regulatory requirements, and your market and production diversification.   

For some people, this can be the most fun or the most challenging part of creating your small farm business plan. Before thinking about your marketing tactics, think about the data you need to make informed business decisions .  

Market Share:

Researching your target market is key to understanding what opportunities are available in the marketplace. Is there current market share to gain? How will you remain competitive as a farm business? Who are your biggest competitors in the marketplace? Do you anticipate any obstacles?    

How will your farm business generate farm income? Think about how your product will be sold and priced? What is your projected or estimated income? How are you going to gain commitments and contracts to sell your products? 

What marketing strategy will your business use to reach your business goals? As a small business, will you utilize tools like social media, email marketing, and/or ecommerce to maximize your marketing efforts to connect with your target audience? Check out our blog on how to create a marketing plan for your farm and download a free template!

Arguably, the most important part of your agricultural business plan is how you will finance your operation. In this section, make sure to take time to complete your balance sheet. The balance sheet will identify your cash-basis income trend, breakeven analysis, and sensitivity analysis. This statement is a summary of what you own vs. what you owe. 

The income and expenses statement shows your business’ profit and loss over a period of time, determined by taking all the revenue and subtracting all expenses. This will show the profitability of your operation. 

Business Advisors

Business advisors are a group of professionals who serve as subject matter experts to enhance productivity, business, and on-farm profitability, while offering technical insight for your farm operations. Surrounding yourself with people who know how to support your farming venture will help to support and find your long-term business success. You will want to organize your team that might consist of an attorney, accountant, lender, insurance provider, and consultants in the last section of the business plan.  Did you know Farm Credit offers services for Accounting, Records, Payroll and Taxes, Appraisal, Business Consulting, Farm Succession Planning, and more? Give us a call at 888.339.3334 or view our full list of services here .

Congratulations! You’ve made it through each section of how to write your business plan! If you’re interested in more coaching on your business plan, check out the resources below or give us a call to connect with a local lender — we're happy to help. 

Additional Resources to Help You Write Your Farm Business Plan

Request your Business Plan Template and replay of our How to Write a Business Plan webinar here.

Click here to request a mentor with SCORE Small Business Resources.

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How to Create a Farming Business Plan: Step-by-Step Guide for Agriculture Business Plan

Table of contents, what is a farming business plan, understanding the importance of a farming business plan, key elements of an agriculture business plan, steps in crafting your agriculture business blueprint, conducting market research for your farming business plan, defining your farming business goals and objectives, choosing the right farming enterprise for your business plan, analyzing the financial aspects of your farming business plan, developing a production plan for your farming business, marketing and sales strategy for your farming business, managing risks and challenges in your farming business plan, organizational structure and management team in your farming business plan, environmental considerations in your farming business plan, legal and regulatory requirements for starting a farming business, financial projections and analysis in your farming business plan, monitoring and evaluation of your farming business plan.

Agriculture, a cornerstone of global economies, sustains communities by providing food, resources, and employment. It’s a sector employing over 80% of the world’s workforce, playing a pivotal role in national economic prosperity. For entrepreneurs, agriculture offers myriad opportunities, from starting a farm to accessing government loans and subsidies.

This article explores these avenues. This guide offers a step-by-step approach to a comprehensive agriculture business plan. This guide will provide you with the essential components of planning, from market analysis to financial strategies, ensuring your farming business is well-rooted for growth and sustainability.

How to Create a Farming Business Plan

A farming business plan is a document that outlines the vision, goals, and strategies of a farming enterprise. It serves as a roadmap/ blueprint for starting, managing, and growing a successful farming business. A farming business plan also helps to attract investors, lenders, partners, and customers to support the farming venture. In India, the significance of agriculture is profound.

Over 60-70% of the population depends on it, with nearly 52% of the workforce engaged in this sector. Contributing about 18.3% to India’s GDP in 2022-23, the sector saw a GDP rise to 6934.75 INR billion in Q4 of 2022 from 4297.55 INR billion in Q3. Expected to grow by 3.5% in 2022-2023, the Indian agriculture industry is a robust field for investment and growth.

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• Clarify the vision and mission of the farming business.
• Identify the target market and customer segments.
• Assess the strengths, weaknesses, opportunities, threats of the farming business.
• Define the short-term and long-term goals and objectives of the farming business.
• Choose the most suitable farming enterprise based on market demand, resources, and skills.
• Analyze the financial feasibility and profitability of the farming business.
• Develop a production plan that outlines the inputs, outputs, and processes of the farming operation.
• Create a marketing and sales strategy that describes how to promote, price, distribute, and sell the farm products or services.
• Manage the risks and challenges that may affect the farming business.
• Organize the structure and management team of the farming business.
• Determine the equipment, infrastructure, and resources required for the farming business.
• Consider the environmental impacts and benefits of the farming business.
• Comply with the legal, regulatory requirements for starting a farming business.
• Project the financial performance and outcomes of the farming business.
• Monitor, evaluate the progress and results of the farming business plan.
• Purpose and Objectives : Define the mission statement, outlining the business’s goals, brand, and core values, and identify potential collaborations.
• Business Details : Describe your business comprehensively, including location, size, operational history, current status, and sector involvement. Address marketing and sustainability aspects.
• Market Analysis : Conduct thorough industry research to understand supply and demand, market trends, competitors, and customer needs.
• SWOT Analysis : Assess internal strengths and weaknesses and external opportunities and threats, including market conditions, competitors, and regulations.
• Business Strategy : Develop a marketing plan aligned with your mission and objectives, considering product/service offerings, pricing, location, promotion, and customer benefits.
• Finances : Evaluate current financial status and future projections, determining the necessity of business loans and investment requirements.
• Management Summary : Conclude with a highlight of achievements and financial projections to attract potential investors, showcasing the business’s investment potential.
• Decide Your Niche : Begin by choosing the specific type of agriculture business that resonates with your vision.
• Land Acquisition : Secure your farming land and finalize any lease agreements.
• Market Research : Dive deep into market analysis to understand the needs your business will fulfill.
• Economic Assessment : Calculate the financial feasibility, commodity trading prospects, and roles for future opportunities.
• Resource Identification : Determine the resources required for production post-planning.
• Business Registration : Officially register your agriculture business.
• Credit Strategy : Develop a plan to establish and secure credit, a cornerstone for launching your agribusiness.

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To create a comprehensive and effective farming business plan, it is essential to conduct market research. Market research process involves gathering and analyzing information about current and potential customers, competitors, suppliers, trends, and opportunities in the farming industry. Market research helps to:

• Understand the needs, preferences, behaviors, and expectations of the customers.
• Identify the size, growth, segmentation, and profitability of the market
• Evaluate the strengths, weaknesses, opportunities, threats of the competitors
• Establish the unique selling proposition (USP) and competitive advantage of the farming business
• Determine the best pricing, promotion, distribution, and sales channels for the farm products or services
• Assess the demand and supply gaps in the market
• Identify the niche markets and customer segments that the farming business can serve.

One of the key steps in creating a farming business plan is to define the goals and objectives of the farming business. Goals are the broad and long-term outcomes that the farming business aims to achieve. Objectives are the specific and measurable sthat will help to accomplish the goals. Goals and objectives of business should be SMART: Specific, Measurable, Achievable, Relevant, Time-bound. Some examples of goals and objectives for a farming business are:

• Goal : To become a leading organic vegetable producer in the region
• Objective : To increase the production of organic vegetables by 20% annually for the next five years
• Goal : To diversify the income sources of the farming business
• Objective : To add value-added products, such as jams, sauces, pickles, etc., to the product portfolio by next year
• Goal : To improve customer satisfaction and loyalty
• Objective : To implement a customer feedback system and offer discounts and incentives for repeat customers by next month

Before you start your farming business, you need to decide what type of farming enterprise you want to pursue. There are many factors to consider, such as your land, climate, market, skills, interests, and goals. It would be best if you also did some research on the profitability and sustainability of different farming enterprises in your area. 

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Some examples of farming enterprises are crop, livestock, dairy, poultry, aquaculture, apiculture, horticulture, floriculture, agroforestry, and agri-tourism. Each of these enterprises has its advantages and disadvantages, opportunities and challenges, and requirements and regulations. You should choose a farming enterprise that matches your resources, capabilities, and aspirations.

One of the most important aspects of your farming business plan is the financial analysis. This is where you estimate your income and expenses, your cash flow and balance sheet, and your break-even point and profitability. You should also include a sensitivity analysis to assess how your financial performance would change under different scenarios, such as changes in prices, costs, yields, or demand.

To conduct a financial analysis, you need to gather accurate and reliable data on your current situation and your projected operations. You can use various tools and methods to help you with this task, such as budgeting, accounting, record-keeping, benchmarking, and financial ratios. You can seek professional advice from an accountant or a financial consultant if needed.

Another key aspect of your farming business plan is the production plan. This is where you describe how you will produce your products or services, what inputs and resources you will need, what activities and processes you will follow, and what standards and quality measures you will adhere to. You should also include a risk management plan to identify and mitigate the potential risks that could affect your production, such as pests, diseases, weather, market fluctuations, or equipment failures. 

To develop a production plan, you need to have a clear understanding of your farming enterprise, your target market, your competitors, and your industry best practices. You should also consult with experts and stakeholders in your field, such as extension agents, researchers, suppliers, customers, or peers.

A farming business plan should include a marketing and sales strategy detailing how to promote and sell products/ services to the target market. This strategy should include a market analysis to assess customer needs, trends, and behavior. It should also identify competitors’ strengths and weaknesses and identify a competitive advantage. 

A clear value proposition should be included, and various marketing tools and channels, such as branding, packaging, labeling, advertising, social media, websites, brochures, trade shows, farmers’ markets, or direct sales, should be used to communicate effectively with customers.

Farming faces numerous risks from both external and internal sources, including climate change, natural disasters, market volatility, policy changes, and consumer preferences. Internal challenges include labor shortages, skill gaps, health issues, and succession planning. To manage these risks effectively, a contingency plan should be developed, outlining possible scenarios and actions to prevent or cope with them.

Fund should be established to cover expenses in case of unforeseen events. Regular performance monitoring and adjustments are essential for maintaining a successful farming business.

The organizational structure and management team of a farming business plan should outline the structure and management of the business, including the roles, responsibilities, qualifications, experience, and compensation. It should also detail the legal structure and ownership of the business, such as sole proprietorship, partnership, corporation, or cooperative.

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The plan should also detail the governance and decision-making processes, such as board meetings, annual reports, or audits. The equipment, infrastructure, and resources required for the farming business should be detailed, including the type, quantity, quality, and cost of each item, as well as their sources, availability, and maintenance. Examples of equipment include tractors, plows, harvesters, milking machines, barns, silos, fences, irrigation systems, land, water, seeds, fertilizers, and feed.

The farming business plan should consider the environmental impacts and opportunities it has on the natural environment. It should outline compliance with environmental laws and regulations, such as waste management and water quality, and how to reduce environmental footprint through sustainable practices and renewable energy. It should also highlight the benefits of environmental services and incentives, such as carbon credits, ecosystem payments, and organic certification, to the business.

The legal, regulatory requirements for starting a farming business are the rules and obligations that you need to follow and fulfill to operate your business legally and ethically. You should include information on the licenses, permits, registrations, certifications, or memberships that you need to obtain or maintain for your business, such as land titles, tax registrations, business registrations, or trade associations. 

You should also include information on the laws and regulations that you need to comply with for your business, such as labor laws, health, and safety laws, animal welfare laws, or food safety laws. You should also include information on the contracts and agreements that you need to sign or negotiate for your business, such as land leases, supply contracts, or insurance policies.

The financial projections and analysis in your farming business plan are the estimates and evaluations of your business’s financial performance and viability. You should include information on the income statement, balance sheet, cash flow statement, break-even analysis, profitability analysis, and sensitivity analysis of your business for at least three to five years. 

You should also include information on the assumptions and sources that you used to prepare these projections and analyses. You should also include information on the funding needs and sources of your business, such as equity, debt, grants, or subsidies. You should also include information on your business’s financial goals and indicators, such as return on investment, debt-to-equity ratio, or net profit margin.

The monitoring and evaluation of your farming business plan are the processes and tools that you use to track and assess the progress and results of your business. You should include information on the objectives and indicators that you use to measure the performance and impact of your business, such as sales volume, customer satisfaction, or environmental benefits.

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You should also include information on the methods and frequency that you use to collect and analyze data on these indicators, such as surveys, records, or reports. You should also include information on the feedback and learning mechanisms that you use to improve your business based on these data, such as reviews, audits, or adjustments.

Creating a farming business plan is a strategic step toward agricultural success. It involves thorough market analysis, clear goal setting, and meticulous financial planning. This guide serves as a roadmap, helping aspiring and established farmers navigate the complexities of the agricultural sector, ensuring sustainable growth and profitability.

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• Farm Management

11 Steps to a Whole-Farm Plan

A broad-based operating plan helps your family stay on course.

It's no insurance against setbacks, but having a whole-farm plan in place can help your family stay on course when difficulties unfold.

"It's often tough to communicate as a family because you tend to focus so much on the day-to-day business operations of producing a commodity," says David Marrison, Ohio State University agriculture-natural resources Extension educator.

"Having a whole-farm business plan in place helps you stay true to your vision and the mission of the operation," he says. "It helps you stay on course and not get lost in the weeds of not having a plan, especially when you're facing big stressors like crop failures or tractor engines going down."

A whole-farm plan encompasses the breadth and width of your farm family's business. "You might say it gives a perspective of the operation from a distance of 30,000 feet, as opposed to a view from 10 feet away," says Marrison.

A whole-farm plan addresses a broad spectrum of components, such as family values and goals, a business analysis and business goals, a business plan, retirement plan, transition plan, estate plan, and investment plan.

"The parts of the whole-farm plan are like spokes in a wheel. All need to work together in harmony for the long-term success of the operation, and all play a role in keeping it operating into the future," he says.

The writing of a broad-based plan begins, of course, with the holding of family business meetings. Before the actual writing of the plan begins, the topics of the meetings might facilitate a process of taking stock of the family, individual assets and goals, and resources and goals of the business.

Marrison suggests taking the following 11 steps to write a whole-farm plan.

1. Take stock of the family.

Look at the history of your family and its farm, and identify family values and family goals.

"It is valuable for the business to begin the planning process by reflecting on family and farm history," he says. "Valuable lessons can be learned by all the generations involved by examining past successes and disappointments. The underlying values and goals of the family unit should also be determined. While these values and goals often remain unspoken, they have a large impact on how family members treat each other and employees, and how they make business decisions."

2. Assess individuals' goals, strengths, and also weaknesses.

"Each member of the farm business should conduct a self-assessment of his or her communication, financial, production, marketing, and management skills," says Marrison. "This is particularly important when bringing generations back to the farm."

This process helps your family determine the areas of responsibility to be allocated to each person. A lack of skill or experience in certain areas could suggest outsourcing some jobs. Or, it could suggest a need for additional education or training.

"You should always be looking at ways to help family members and employees improve their skills and strengths," says Marrison.

3. Analyze the business and set business goals.

A business analysis takes stock of available land, labor, capital, management resources, profitability, business structure, operating procedures, and employee management.

"After taking a snapshot of where the farm business is currently, the family business team should develop key goals for the future," says Marrison. "It is important that each individual share his or her individual goals and skill-set assessments with the other members of the business during this process. Members can then work together to determine the responsibilities of each team member and to develop goals."

4. Write a mission statement.

"A mission statement is a short statement describing the fundamental reason for the business to exist," he says. "It identifies the underlying values that are going to push your family and the business forward."

5. Write a business plan.

The previous steps comprise an internal analysis that can be used to develop plans encompassing the diverse areas of your farm's operation.

"A business plan helps your family develop a plan of action for production and operation practices," says Marrison. "It also helps develop plans for the financial, marketing, personnel, and risk-management sectors of the business."

This analysis could also examine the strengths, weaknesses, opportunities, and threats in each of these areas.

6. Plan for retirement.

This plan identifies retirees' needs and the role the farm plays in meeting these. "Retirement plans should be established early for all members of the business," says Marrison. "The profitability of your farm should be such that a family member can retire and not adversely affect the financial position of the business."

7. Plan a transition strategy.

This describes how your farm will be transferred to the next generation. It encompasses both the transfer of assets and the transfer of managerial control. It describes how the retiring generation will transfer their knowledge to the younger generation, and how and when managerial responsibilities will be transferred.

8. Make an estate plan.

"Farm estate planning determines how your farm's assets will be distributed upon the death of the principal operators," he says.

9. Outline an investment plan.

Investments vary widely by family and farm, typically comprising land, machinery, and livestock. Others have off-farm investments also. Determine how these investments affect future needs.

10. Set goals in all areas.

"Setting goals establishes a plan of action for each area of business activity," says Marrison. "Set measurable goals that are short, mid, and long term. At monthly family meetings, you can look back at the goals you set in each major area of planning. Reviewing goals keeps them in focus, even though you might not be able to act on them until a future date."

11. Plan for the unexpected.

In each planning area, work into the plan a what-if scenario. "Look at what unexpected things could happen," he says. "Having conversations about those what-if circumstances no one wants to think about could help you stay on target and not get stressed when bad things happen."

In sum, says Marrison, "By implementing a whole-farm approach to business planning, your farm family can be ready to face the future with confidence."

David Marrison | 440/576-9008 [email protected]

• Agriculture

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Agricultural business plan

An agricultural business is an enterprise that engages in producing, processing, and marketing agricultural products. Agricultural businesses can be small, family-owned operations or large, multi-national corporations. Farmers may sell their products directly to consumers or through intermediaries such as wholesalers or retailers. There are many different types of agricultural businesses, including livestock farms, dairy farms, crop farms, and horticultural businesses.

Each type of agricultural business has its unique challenges and opportunities. Livestock farms raise and care for animals used for meat, milk, eggs, or other products. Dairy farms produce milk and other dairy products. Crop farms grow fruits, vegetables, grains, and other crops. Horticultural businesses grow plants for sale as ornamentals or use in landscaping.

Agricultural businesses must carefully plan their operations to be successful. They must consider factors such as the type of product they will produce, the market for their product, the cost of inputs (land, labor, capital), and the price they will receive. A well-executed business plan can help an agricultural business to thrive and become profitable.

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There are many reasons to start an agricultural business. Agricultural businesses can be very profitable, provide a valuable service to the community, and offer an excellent lifestyle for the owners and employees. An agricultural business can be profitable because of a strong demand for food and other agricultural products. In addition, the world population is growing, and more people are moving into cities with less access to fresh food.

This creates a large market for agricultural businesses that can provide safe, healthy, and affordable food. Starting an agricultural business can also provide a valuable service to the community. Agricultural businesses can help meet the needs of local communities by providing fresh produce, meat, dairy, and other products. They can also create jobs and support the local economy.

Finally, owning an agricultural business can offer an excellent lifestyle for the owners and employees. Agricultural businesses are often located in beautiful rural areas, where the pace of life is slower and more relaxed. The work can be challenging and rewarding, and a sense of pride comes from producing food for others to enjoy.

An agricultural business can be a very profitable venture. There are many benefits to starting and owning a farming business. Some of the benefits include:

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• Agricultural businesses provide a much-needed service to society. They produce food and other necessary items that we need to survive. Without agriculture, the world would be a very different place.
• Agricultural businesses are typically very stable. They are not as prone to the economy’s ups and downs as other businesses. This stability can provide security for families and employees alike.
• Agricultural businesses offer an excellent opportunity to be your boss. You can be in control of your destiny and make all of the decisions regarding your business. This can be a very empowering feeling.
• Agricultural businesses often have a positive impact on their local communities. They provide jobs and economic stability to rural areas that might otherwise struggle financially. Additionally, they usually give back to the community through charitable donations and other forms of giving.
• Agricultural businesses offer a unique lifestyle that can be very rewarding. An agricultural business may be the perfect fit if you love working outdoors and being around animals and crops. However, this type of business is only for some people, so make sure it is something you are genuinely interested in before committing.

If you’re thinking of starting an agricultural business, there are a few things you need to know. First, you need to understand the business you want to create. What kind of products or services will you offer? What is your target market? Who are your competitors? Once you understand the business you want to start, you must develop a business plan.

This plan will help you map out the steps, process you need for getting your business up and running, and it will also help you secure funding from investors or lenders. Next, you need to choose a location for your agricultural business. For example, if you’re starting a small farm, you’ll need to find land suitable for farming. Once you’ve found a location, you’ll need to get the necessary permits and licenses from the government.

Once you have your location and all the required licenses and permits, you can start buying equipment and hiring staff. For example, starting a small farm requires tractors, planting equipment, irrigation systems, etc. You’ll also need employees to help with the farm’s day-to-day operations.

As your agricultural business grows, you’ll need to focus on marketing and sales. You’ll need to find ways to reach your target market and convince them to buy your products or services. You may also want to consider expanding your operations by opening additional locations or offering new products.

Several agricultural businesses can be pretty profitable. One option is to start a small farm and sell products directly to consumers at farmer’s markets or through a Community Supported Agriculture (CSA) program. Another option is to raise livestock for meat, eggs, or dairy products.

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Other possibilities include starting an organic gardening business, operating a nursery selling plants and trees, or running a landscape design business specializing in creating gardens and outdoor spaces for homes and businesses. There are also opportunities for value-added agriculture businesses such as making and selling jams, jellies, or other food products made from fruits and vegetables grown on the farm.

There are a few key things to start an agricultural business. First, you need to choose the correct location. You want to pick a spot with good soil and a lot of sunlight. You also want to make sure there is enough water for your crops. Next, you need to choose what crops you want to grow. Then, it would be best to research which crops are in demand and which will fetch a good price.

You also want to consider your chosen location’s climate so you can pick crops that will do well there. Finally, you need to develop a business plan. This includes figuring out your costs, how much you need to sell your crop, and marketing your business. Once you have all this figured out, you can start planting and growing your business!

When choosing the most profitable crops to grow for your agricultural business, there are several factors to consider:

• The market demand for the crop. What crops are in high demand and will fetch a good price?
• The growing conditions required for the crop. Some crops are very sensitive to climate and soil type, so choosing ones that can be successfully grown in your area is important.
• The input costs associated with growing the crop.

Make sure to factor in things like seed, fertilizer, labor, and equipment costs. Some of the most profitable agricultural crops to grow to include:

• Corn/Maize : Corn is a staple crop used in various products, from food to biofuels. It is relatively easy to grow and has high market demand.
• Soybeans : Soybeans are another widely used crop that has a variety of uses, including animal feed, biodiesel, and human food. They are relatively easy to grow and have a high market demand.
• Wheat : It is a versatile grain from bread to pasta to beer brewing. It’s relatively easy to grow and has strong market demand.
• Rice/Paddy : Rice is a dietary staple for billions of people around the world. It’s easy to grow and has high market demand.
• Cotton : Cotton is a high-dollar cash crop to consider.

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There are a few factors to consider when choosing the best state for your agricultural business. The climate, soil type, and availability of water are important considerations. You will also want to consider the market for your products, transportation infrastructure, and the overall business environment.

The best states for agricultural businesses vary depending on the type of business. For example, California is well-suited for businesses that produce fruits and vegetables, while Nebraska is better suited for livestock production. Here is a more detailed look at some of the best states for different types of agricultural businesses:

• Fruits and Vegetables : California, Florida, Hawaii, Texas
• Livestock : Nebraska, Iowa, Kansas, South Dakota
• Grain : North Dakota, South Dakota, Minnesota, Illinois
• Dairy : Wisconsin, New York, Pennsylvania

If you’re considering starting a farming business, you’ll need to create a business plan. This will help you secure funding, find the right location, and hire employees. Here’s a step-by-step guide to writing a business plan for an agricultural business:

• Define your business. What type of agricultural business do you want to start? What products or services will you offer? Who is your target market?
• Write your executive summary. This is a brief overview of your business plan. Include your mission statement, company description, and goals.
• Do your market research. First, conduct a feasibility study to see if there’s a demand for your products or services in your target market. Then, research your competition and pricing options.
• Develop your marketing strategy. How will you reach your target market? What marketing channels will you use? What are your sales goals?
• Create a financial plan. Estimate your start-up costs and projected revenue for the first few years of operation. Create a budget and cash flow statement. Find sources of financing, such as loans or investors.
• Plan for management and operations. Describe how you’ll organize and run your business on a day-to-day basis. Include information on staffing, facilities, and logistics.

When starting an agricultural business, you must keep a few key things in mind to succeed. Firstly you need to have a well-thought-out business plan. This plan should include your goals and objectives for the business, as well as how you intend to achieve them. In addition to a strong business plan, you must have the financial backing necessary to get your business off the ground.

This means having access to capital through savings, loans, or investors. Another important aspect of starting a successful agricultural business is understanding the market well. You need to know your target customers and what they are looking for. Additionally, you should have a solid marketing strategy to reach these customers.

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Finally, it is also crucial that you have a strong team in place to help you run the day-to-day operations of your business. This team should be composed of individuals with expertise in various areas such as marketing, finance, and agriculture. By working together, you can increase your chances of success exponentially.

Many different agricultural businesses can be profitable, but it is vital to have a clear plan before getting started. This article has provided tips on developing a profitable agricultural business plan, including researching, knowing your costs, and having a clear marketing strategy. Following these tips gives you the best chance of success in starting your own agricultural business.

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Farm Business Plan

Most entrepreneurs are terrified of planning. But this can be a different scenario for you.  A farming business can be more successful if you will develop a farm  business plan . Not only will you set the steps that you need to follow to achieve your goals, but you can also become more prepared with the risks. More so, your  strategic plans  will help you develop a mission statement that will guide you through. So, are you ready for this? Below,we provide you a farm business plan examples that you can look into as a guide.

20+ Farm Business Plan Examples

1. farm business plan template.

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What Is a Farm Business Plan?

A farm business plan is an excellent organizational and business material that you can use for a variety of purposes. All you must do is to be familiar with  business plan guidelines  and the basics of farm business management so you can already identify the specific business plan document that you need.

Importance of a Farm Business Plan

Have you ever been to a hotel where you can see each process’s organization from the welcoming of guests up to their check-out procedures? One of the planning documents that provide a contribution to that organization is a  hotel operational business plan . This can be compared to the usage of a farm business plan if you want to ensure that the operations of your farm business are laid out properly. According to a gathered  analysis  published by Noble Research Institute,  the advantages of a farm business plan  includes an easy application to loans. It can also promote solidarity within the farm business’s stakeholders. This is relatively substantial, especially for every small business in the agricultural industry.

How To Create a Farm Business Plan

Creating your farm business plan can be easier if you will refer to helpful agriculture business plan examples. But aside from the items mentioned above, there are still some items that can make it more efficient for you to develop an outstanding, complete, and organized farm business  plan . Some of these tips and guidelines are all listed below.

1. Begin with a Realistic Plan

To begin with, always start by visualizing your ideas. After that, you can now proceed with outlining your goals and objectives. Remember to make it as realistic as possible. Come up with measurable and obtainable plans. This should include  proposals ,  marketing , and budget . Truly, there is no easy business. So, plan long-term, and everything else will follow.

2. Provide an Executive Summary

Next, you have to learn how to write an  executive summary  for your business plan. Especially for farm business startups, an executive summary is one of the parts of the farm business plan that will be first seen by your target audience. Make it as appealing and as presentable as possible so you can already get positive responses and impressions. But remember, don’t make it too long and invite confusion from readers. Make it precise as much as possible.

3. Set an Action Plan

What could be the necessary steps to do in achieving your goals? Here, you have to outline your  action plans . It should be relevant to your objectives. Therefore, they must align. You can also set a  schedule  to follow. This helps you cope with your daily tasks while keeping it on time. Another thing to remember is to make it attainable for everyone in the organization.

4. Present the Values and Benefits

make sure that your farm business plan can present your business values. It should be a reflection of your identity, brand,  mission statement , and image as a business. These characteristics can set you apart from your competition. It can promote memory retention, which is an excellent way for you to remain relevant and memorable in the marketplace where the farm business belongs.

5. Proofread the Plan

Don’t propose it right away. But make sure that you check your content from the cover page down to the last pages. Is your budget for the business plan considerable? Can your members achieve success in no time? It is essential to check it first before using it for actual scenarios. This helps you come up with an excellent  report  later on.

FAQ’s

How much is a typical business plan.

The price of a business plan depends on the agency that creates it. But in most cases, it reaches up to $15,000 for a complete plan.

Is a business plan necessary?

A business plan is a necessity if you take a look at the bigger picture when it comes to finances and projects. This helps you accomplish more than what you imagine for your business.

What are the two primary elements of a business plan?

Among the various elements of a business plan, the executive summary and market analysis are standard.

Again, feeling overwhelmed with everything that you need to consider when developing a farm business plan is normal. However, you should make sure that you will not be carried away so you can focus on the items that can help you give the farm business a boost in productivity, efficiency, sales, visibility, and leads. Be mindful of how you will develop farm planning strategies. Also, see how an effective one can improve your farm business’s overall operations . So, get ready with your  document  and follow the list of steps above.

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300+ Business Plan Examples

With over two decades of experience, Growthink has assisted more than 1 million companies in developing effective business plans to launch and expand their businesses. Trust in our expertise to guide you through developing a business plan that drives your success. In addition to our sample plans, below you’ll learn the answers to key business plan questions and gain insightful tips on writing your business plan.

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1. Why is utilizing an example business plan a good idea?

Sample business plans can help you quickly and easily write a business plan for your own business. Business plans are an important tool for any business, but they can be challenging to create. A sample business plan will help you understand the business plan format , the benefit of market research, and how to write a compelling executive summary. It can also serve as a guide for creating your own business plan, outlining the key sections and providing examples of successful plans. Utilizing the best business plan template can save you time and ensure that your plan is well-structured and comprehensive.

Business plan examples may even help you with the different sections of a plan, including market analysis, business description, cash flow statements/business financial statements, and more. Business plans can also show you how a quality plan in your exact business plan category is organized and shows you the appropriate business communications style to use when writing your business plan.

2. Who would benefit from using an example business plan?

Any entrepreneur or business owner who has never written a business plan before can benefit from an example or sample plan. New business owners often start with business plan templates , which are helpful but are sometimes more useful after reviewing other sample business plans.

A good sample plan can be a step-by-step guide as you work on your business planning and business idea. Once you have a sense for the flow, specs, and details, etc. that business plans have, utilizing a business plan template will help you pull everything together, helping you create a plan investors and other stakeholders will value. A solid business plan will also help you if you need a bank loan, which may require a startup business plan. Download our free business plan template to help you get started on your own business plan.

Free Download : Free Business Plan Template PDF

3. How do you get started with a sample business plan and maximize its benefit?

First you should read the business plan thoroughly. Study both the type of information provided in key sections like the executive summary, target market analysis, summary, etc., as well as the format and style of the plan. As you read, you may find yourself thinking through things such as improving or evaluating your business planning process, your business idea, or reconsidering who you want to write your business plan for. This is OK and part of the process. In fact, when you start writing a business plan for the first time, it will be much easier because you’ve gone through this process.

After this initial read, outline your business plan and copy in from the sample plan sections that apply to your business. For instance, if the sample plan included public relations in their marketing strategy and sales plan, and you will also use this tactic, you can copy it into your plan and edit it as appropriate. Finally, answer the other questions answered in the sample plan in ways that reflect your unique business and target customers.

Writing a business plan can seem daunting. Starting your business plan writing process by reviewing a plan that’s already been created can remove a lot of mental and emotional barriers while helping you craft the best plan you can.

4. When should you not use a sample business plan?

If your business is unlike any other, using a sample business plan will not be as effective. In this situation, writing a business plan from scratch utilizing a business plan template is probably your best path forward.

As an example, Facebook’s early business plan was unlike others since it was paving a new path and way of doing business. But, groundbreaking new businesses like Facebook are not the norm, and the vast majority of companies will benefit from utilizing sample business plans.

5. How do you choose the right type of business plan for your venture?

Selecting the appropriate type of business plan depends on your business’s stage, needs, and goals. Let’s explore the different types of business plans and how to determine which business plan format is right for you.

• Startup Business Plan : This type of plan is for businesses just starting out and seeking funding or investment. It typically includes a detailed analysis of the market, target audience, competition, and financial projections.
• Traditional Business Plan : Traditional business plans are the most common type of business plan, used by established businesses to outline their goals and strategies. It includes all the key sections such as market analysis, company description, and financial statements.
• Internal Business Plan : Internal business plans are used for internal purposes, to guide the day-to-day operations and decision making of the business. It may not be as detailed as a traditional business plan, but still includes important information such as company mission, objectives, and key performance indicators.
• Feasibility Business Plan : A feasibility business plan is used to assess the viability of a new product or service in the market. It includes detailed research and analysis to determine if the business idea is feasible and profitable.
• One-Page Business Plan : As the name suggests, this type of business plan is condensed into one page and includes the most critical information about the business. It can be a useful tool for pitching to potential investors or partners.
• Strategic Business Plan : A strategic plan looks at the big picture and long-term business goals of a company. It may include the company’s mission statement, core values, and overarching strategies for achieving success.

Ultimately, the type of business plan you choose will depend on your business’s specific needs and goals. It may also be beneficial to combine elements from different types of plans to create a customized plan that best fits your business. Carefully consider your objectives and resources before deciding on the right type of plan for your venture.

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The business plan example below is for Shoutmouth, a company that enjoyed much success in the early 2000’s and which was able to raise funding. While the plan’s premise (social networking) is not as unique now as it was then, the format and structure of this business plan still holds.

I. Executive Summary

Business Overview

Launched in late February 2007, Shoutmouth.com is the most comprehensive music news website on the Internet .

Music is one of the most searched and accessed interests on the Internet. Top music artists like Akon receive over 3 million searches each month. In addition, over 500 music artists each receive over 25,000 searches a month.

However, music fans are largely unsatisfied when it comes to the news and information they seek on the artists they love. This is because most music websites (e.g., RollingStone.com, MTV.com, Billboard.com, etc.) cover only the top eight to ten music stories each day – the stories with mass appeal. This type of generic coverage does not satisfy the needs of serious music fans. Music fans generally listen to many different artists and genres of music. By publishing over 100 music stories each day, Shoutmouth enables these fans to read news on all their favorite artists.

In addition to publishing comprehensive music news on over 1200 music artists, Shoutmouth is a social network that allows fans to meet and communicate with other fans about music, and allows them to:

• Create personal profiles
• Interact with other members
• Provide comments on news stories and music videos
• Submit news stories and videos
• Recommend new music artists to add to the community
• Receive customized news and email alerts on their favorite artists

Success Factors

Shoutmouth is uniquely qualified to succeed due to the following reasons:

• Entrepreneurial track record : Shoutmouth’s CEO and team have helped launch numerous successful ventures.
• Affiliate marketing track record : Online affiliate marketing expertise has been cited as one of MySpace’s key success factors. Over the past two years, Shoutmouth’s founders have run one of the most successful online affiliate marketing programs, having sold products to over 500,000 music customers online.
• Key milestones completed : Shoutmouth’s founders have invested $500,000 to-date to staff the company (we currently have an 11-person full-time team), build the core technology, and launch the site. We have succeeded in gaining initial customer traction with 50,000 unique visitors in March, 100,000 unique visitors in April, and 200,000 unique visitors in May 2007.

Unique Investment Metrics

The Shoutmouth investment opportunity is very exciting due to the metrics of the business.

To begin, over the past two years, over twenty social networks have been acquired. The value in these networks is their relationships with large numbers of customers, which allow acquirers to effectively sell to this audience.

The sales price of these social networks has ranged from $25 to $137 per member. Shoutmouth has the ability to enroll members at less than $1 each, thus providing an extraordinary return on marketing expenditures. In fact, during an April 2007 test, we were able to sign-up 2,000 members to artist-specific Shoutmouth newsletters at a cost of only 43 cents per member.

While we are building Shoutmouth to last, potential acquirers include many types of companies that seek relationships with music fans such as music media/publishing (e.g., MTV, Rolling Stone), ticketing (e.g., Ticketmaster, LiveNation) and digital music sales firms (e.g., iTunes, The Orchard).

Financial Strategy, Needs and Exit Strategy

While Shoutmouth’s technological, marketing and operational infrastructure has been developed, we currently require $3 million to execute on our marketing and technology plan over the next 24 months until we hit profitability.

Shoutmouth will primarily generate revenues from selling advertising space. As technologies evolve that allow us to seamlessly integrate music sampling and purchasing on our site, sales of downloadable music are also expected to become a significant revenue source. To a lesser extent, we may sell other music-related items such as ringtones, concert tickets, and apparel.

Topline projections over the next three years are as follows:

II. Shoutmouth Overview

What is Shoutmouth?

Shoutmouth is an operating company of The Kisco Group Inc. (TKG). Since 2003, TKG has capitalized on web-based marketing opportunities via launching targeted websites and generating web-based leads. TKG revenues in 2005 exceeded $1.3 million and grew to $3.5 million in 2006. Shoutmouth is currently the sole focus of TKG; all other TKG business units have been divested.

Development of Shoutmouth began in August 2006 and the site officially launched on February 21, 2007. Shoutmouth (located at www.shoutmouth.com) is the most comprehensive music news community on the Internet. The website covers 1,200 popular bands and music artists and offers more than 100 new music articles each day. In addition to providing news, Shoutmouth is a web community. That is, Shoutmouth members can actively participate on the site, by doing things such as commenting on news stories and submitting their own stories.

The Market Size and Need for Shoutmouth

The music market is clearly vast. According to IFPI, which represents the recording industry worldwide, global music sales were $33.5 billion in 2005, with the U.S. accounting for $12.3 billion of that amount. Importantly, digitally music sales are seeing substantial growth, with IFPI reporting sales of $400 million in 2004, $1.1 billion in 2005 and $2 billion in 2006.

Online, music is the one of the most frequently searched and accessed interests. For example, according to Wordtracker, the music artist Eminem received over 1.7 million web searches in December 2006, while band Green Day received 534,000 searches.

To put these figures in perspective, top celebrities in other entertainment fields receive but a fraction of this search volume. For example, December 2006 search volumes for select sports stars and actors were as follows: Kobe Bryant, 122K; Tiger Woods, 88K; Cameron Diaz, 332K; and Tom Cruise, 82K.

Conversely, 225 music artists received over 100,000 searches in December 2006, and over 500 music artists received over 25,000 searches.

This data is corroborated by Nielsen BuzzMetrics which plots the most popular topics bloggers are posting about. The chart to the right plots September 25, 2006 to March 25, 2007 and shows how music dominates other entertainment sectors online.

When searching for music artists online, fans, which are primarily between the ages of 13 and 35, are looking for news, pictures, lyrics, videos and audio files. In addition, fans enjoy publicly voicing their opinions about music and interacting with other fans.

There is currently no website besides Shoutmouth that provides comprehensive music news. Currently, to get the latest news on their favorite artists, fans must visit the official websites or fan websites of each of the artists they like . Even then, it is unlikely that the fan will get all the news that has occurred. To solve this problem, Shoutmouth scours the web and uncovers news from thousands of web sites.

What Shoutmouth Does and Will Offer

As of May 2007, the site covers the 1,200 most popular music artists (popularity primarily based on the number of web searches over the past 12 months for each artist).

Shoutmouth currently offers members the ability to:

• Read over 500 new music articles each week
• Read special features such as album reviews, interviews, new album release dates, top quotes of the week and other special reports
• Watch and rate music videos
• Listen to select music audio clips
• Comment on news stories and music videos
• Submit news stories that they see/hear of elsewhere
• Suggest new music artists to add to the site
• View articles by music artist or by genre (current genres include Rock, Pop, Rap, R&B, Country, and Electronic)
• Create a user profile that includes their favorite music artists, Shoutmouth friends, news stories submitted to Shoutmouth, and comments made. Members have the ability to find other members based on their favorite artists and via our search functions.
• Receive customized news and email alerts. Members can customize their “My News” page to include only artists they specify. Likewise, they can choose to receive email alerts whenever there is a new story on one of their favorite artists.

While establishing itself as the premier music news community, Shoutmouth will embark on the more aggressive goal of becoming the premier music community online . To accomplish this, Shoutmouth will begin to offer additional content (more videos, audio, pictures, lyrics, etc.) and additional functionality (music compatibility testing (e.g., if you like this, you’ll like this), voting capabilities, member-to-member messaging, etc.). We have already begun mapping out our content and technology growths plans to achieve this goal upon financing.

Importantly, Shoutmouth expects to be able to add massive amounts of relevant content (e.g., lyrics, reviews, pictures, video files, audio files, etc.) via member submissions and moderation. This is the same way that YouTube has been able to quickly add millions of videos and Wikipedia has been able to add millions of articles. Importantly, since established music websites (e.g., MTV, RollingStone.com, Billboard.com, etc.) are not community based, they would have to hire thousands of staff members to rival the content that Shoutmouth will have.

How We Get and Publish Our News

Currently, news stories that appear on Shoutmouth are gathered from numerous online sources. Shoutmouth’s staff writers find these stories by using RSS and News feeds that cover thousands of websites. In addition, Shoutmouth community members have the ability to submit stories they find elsewhere.

Typical stories include factual information plus the insight of the author. Shoutmouth editors ensure that all stories are properly classified by artist and genre, and that duplicate articles are filtered out.

Over the past three months, Shoutmouth has developed a solid infrastructure, which we consider a core competitive advantage, that that allows us to provide comprehensive music news . This infrastructure includes:

• Setting up hundreds of RSS feeds based on comprehensive research regarding sites from which to receive feeds
• Training our editorial team regarding identifying a story and weeding out duplicates
• Assigning music artists among our five-person editorial team to better manage work flow and avoid duplicate articles

We are working on a system to ensure that member-submitted articles are automatically routed to the appropriate member of Shoutmouth’s editorial team to improve our efficiencies further.

Shoutmouth’s Goal to Break News First

The majority (approximately 90%) of Shoutmouth’s articles are currently developed by our in-house editorial team, while the balance is submitted by members. In addition, virtually all of our articles are based on information gleaned from other websites. As such, we are generally not the first to publish news; however we are the first and only site to publish all the news in one easily-accessible place. The one current exception is news which is published on bands’ official MySpace pages; Shoutmouth generally publishes articles on this news 24 to 48 hours before it is reported by other news or music sites (due to our efficiencies in finding news).

Shoutmouth realizes that it will gain a key competitive advantage, and will generate significant market buzz, if it is able to report on music news stories before other media sources . To accomplish this, we have begun contacting publicity departments at record labels to gain direct access to music news. We expect these contacts to enable us to gain immediate and sometimes exclusive access to news which will help further establish Shoutmouth as the canonical source for music news. We also plan to more aggressively solicit member submissions of new, buzzworthy news events and will consider offering rewards for unique substantiated news (much the way paparazzi are compensated).

III. Competition in the Online Music Market

This section of the business plan provides a competitive analysis, which is an overview of the competitive landscape, discusses both indirect and direct competitors and then details Shoutmouth’s competitive advantages.

Because consumer demand for music on the Internet is so great, there are a vast number of music websites. In summary, we consider most sectors of the online music market (which are discussed below) to be indirect competitors and potentially partners, rather than direct competitors, because none of them focus on music news.

The reason we believe that no one focuses on music news is that it is very difficult to do. Because news is very important to music fans, most music websites offer news. However, they primarily get their news from organizations such as CNN, Reuters, the Associated Press and BBC. These large organizations only write about the music stories that have mass appeal, which traditionally amounts to 8-10 music news stories per day. However, since music fans are often zealots when it comes to their favorite artists, they are not merely interested in cover stories. For instance, a U2 fan cares about any U2 news, particularly news that a non-U2 fan might consider insignificant.

In fact, because Shoutmouth is the sole one-stop shop for getting comprehensive music news, there might be an opportunity to license our content to other music websites.

Sectors of the Online Music Market

Shoutmouth specifically comPs in the community-based music news market. While players in this market represent direct competitors, Shoutmouth faces indirect competitors in the following markets:

• Community-Based Sites
• Community-Based News Sites
• Community-Based Music Sites
• Traditional Music Websites
• Official Artist and Fan Sites

Each of these markets is described below.

A. Community-Based Sites

Community-based sites, also known as social networking sites, are websites in which members can create profiles, leave comments throughout the site, and communicate with other members among other features.

A June 2006 report by Piper Jaffray entitled “Silk Road: Social Networking is Here to Stay” effectively sums up the power and longevity of social networking:

“We believe social networking sites have become a permanent part of the fabric of web applications and are rapidly becoming one of the most popular activities online, potentially impacting how other popular services such as email, IM, and maybe even search are accessed.

As a clear indication of the growth rate and scale of social networking, consider this: MySpace monthly page views have now surpassed MSN or AOL in the U.S. and are nearly 75% of the size of Yahoo!. Social networking has filled a gap that was left by all the existing portals and web services and it is fulfilling a very important and basic function for millions of users: allowing them to express themselves and connect with their friends, with the two functions tightly integrated.

The leading sites such as MySpace (News Corp), Facebook, and others are amassing significant power in the new landscape of the Internet and the existing Internet companies are likely to have to work with these newcomers as they may yield material control on the flow of traffic to other applications.”

Social networking sites such as MySpace.com, Facebook.com, Tagged.com, and TagWorld.com have educated consumers regarding the value of these sites and how to use them. Their success has spurred genre-specific social networks such as community-based/social networking news sites and music sites, which are discussed below.

Shoutmouth doesn’t view established social networking sites as competitors since these sites have a general focus. That is, members talk about all aspects of life, from dating to music to movies, etc. Conversely, Shoutmouth is solely focused on music.

B. Community-Based News Sites

Community-based news sites are sites in which members decide what’s newsworthy and what’s not. For instance, on Digg.com, the most prominent community-based news site, members “Digg” stories that they feel are most newsworthy. The stories that the community feels are most important rise to Digg’s homepage, while less important stories get little attention.

Digg’s one million members can submit stories, “digg” stories, and comment on stories. Digg focuses on general news with a slant towards technology, gaming and unique/sensational news. While Digg does have a Music area within its Entertainment section, this receives little focus. In fact, at the time of the writing of this plan, Digg’s music home page only includes one article submitted within the past 48 hours. Furthermore, Digg doesn’t pare down the music category into sub-categories such as Rock and individual music artists. Conversely, these sub-categories are the entire focus of Shoutmouth.

Other sites that are similar to Digg include Newsvine.com, Spotback.com and Gabbr.com. Of most relevance is the Digg-like site for music, Noisetap.com, which was launched by Ticketmaster in January 2007.

Like Digg, Noisetap.com allows members to submit and vote for music stories. Noisetap.com is organized by music genre and not by music artist. This most likely will not satisfy the needs of many music fans since they don’t have the ability to find news on the specific artists they care most about. Likewise, without a full-time staff actively researching and publishing news stories at the artist-level, Noisetap.com will never be able to offer the comprehensive news that Shoutmouth does.

While Shoutmouth is currently similar to community-based news sites in that members can submit stories and comment on the news they find most interesting, no established player in the market provides a comprehensive focus on music. In addition, Shoutmouth sees these sites as marketing partners as we have and will continue to submit our stories on them to increase our readership.

C. Community-Based Music Sites

There are many community-based music websites, although none focuses on music news such as Shoutmouth. Conversely, these sites generally give members the ability to create and listen to song play lists. The community acts to help individual members find new music and new friends based on similarities in their music tastes. Prominent sites in this genre include Last.fm, Finetune, Pandora, RadioBlogClub, MyStrands, iLike[1] and iJigg.

Last.fm is the most prominent community-based music site and is a good model with which to compare Shoutmouth. Likewise, we will benchmark our performance against Last.fm as we reach of goal of becoming the premier music news community and focus on becoming the premier music community.

According to Alexa, Last.fm is the 359th most visited site on the Internet. While Last.fm focuses on allowing members to create customized Internet stations based on their music tastes, the site has much additional content and social networking features. For instance, for each artist, Last.fm includes pictures, a bio, concert dates, discography, fans on Last.fm, and similar artists. Fans are also able to create journals and communicate with other fans. Key features that Last.fm doesn’t currently focus on include news and video.

D. Traditional Music Websites

Traditional music websites such as MTV.com, RollingStone.com, Billboard.com, NME.com, AOL Music, and Yahoo! Music tend to have many features such as news, reviews, pictures, videos and audio. While these sites are generally very well done and extremely popular, they are under-serving visitors in two core areas: music news and community .

These sites’ lack of music news stems from the difficulty in creating this news, specifically that it requires filtering through thousands of articles and websites to find relevant stories. Likewise, as discussed, these firms might wish to license our news content in the future.

Regarding community , none of the top music sites are thriving communities. Rather, either these sites offer no community features or they recently began offering select features (e.g., submitting reviews or commenting on articles). Even when available, the community features on these sites are afterthoughts and are not engrained within the core fabric of the sites.

While they haven’t been able to transform their current sites into communities, top music websites clearly understand the power of online music communities and have an appetite for them. For example, in January 2007, MTV invested in social networking website TagWorld. MTV also acquired RateMyProfessors.com and Quizilla.com (teen social network) in January 2007 and October 2006 respectively.

As mentioned previously, our vision is to build and incorporate additional technologies, and use our “army” of members to publish vast amounts of music content on Shoutmouth, in order to fully satisfy music fans and leapfrog traditional music sites in terms of their music content.

E. Official Artist and Fan Sites

Shoutmouth com’s with official music artist websites and fan websites. These sites often include news about the specific artist as well as pictures, videos and other relevant information.

On one hand, official music artist and fan websites are direct competitors to Shoutmouth. This is because some of these sites offer comprehensive news on the specific artist they cover. In addition, many offer forums, discussion boards or other ways to communicate with other fans.

However, two factors separate Shoutmouth from these types of sites: 1) breadth and 2) sophistication.

• Breadth : Most music fans love more than one artist. As such, in order to get the news they want, they would have to visit/join multiple fan or artist websites rather than getting all of their news from Shoutmouth.
• Sophistication : While some official music artist websites are technologically sophisticated, offering forums, networking and other worthwhile features, the majority of artist and fan websites have limited usability, functionality and networking ability. In fact, this deficiency has lead to the success of MusicToday, which provides front and back-end technology to power artist websites.

Specifically, MusicToday offers web design and hosting, develops sophisticated online stores, builds online fan clubs and offers web ticketing among other services to select top music artists such as Dave Matthews Band, Christina Aguilera, Kenny Chesney, Britney Spears and Usher. While offering sophisticated tools for select music artist websites, MusicToday offers little to no music news nor advanced social networking functions. For instance, the official Dave Matthews Band website offers less than one news story per month.

F. Direct Competitors: Community-Based Music News Sites

Shoutmouth’s direct competitors are other music news websites that have social or community features that allow users to join the site, submit articles, comment on articles, create public profiles and/or communicate with other members. Shoutmouth has identified one significant player who offers this service, AbsolutePunk.net.

AbsolutePunk.net has done a good job of building a user base (the site claims 125,000+ registered members and nearly 500,000 un-registered members). In addition, the user base is very active — the average story on their site receives approximately 20 comments. AbsolutePunk.net offers music news, reviews, pictures and interviews among other features.

On the negative side, AbsolutePunk.net’s articles are generally posted by one staff writer (as opposed to Shoutmouth’s five writers), most articles are simply one sentence posts rather than full articles, and no attempt seems to have been made to cover all news stories. In addition, the site only covers the punk music genre. Although “punk” is broadly defined on the site, the site doesn’t cater to genres such as R&B, rap and country among others, failing to satisfy the broader market.

AbsolutePunk.net is owned by Indieclick, a Los Angeles-based media company. According to the AbsolutePunk.net website, the site:

• Has developed a loyal (72% return rate) reader base
• 5,182,147 Posts
• 163,535 Threads
• 126,448 Members
• 1,711 Artist Profiles
• 20,774 Multimedia Files
• Approx 76,000 visits per day.
• Approx 276,000 pageviews per day.

Shoutmouth’s Competitive Advantage

In addition to being the first to fill the untapped market void for comprehensive music news, Shoutmouth’s competitive advantage in the market primarily includes the following:

Online Marketing Sophistication

Content Development Experience and Expertise

Shoutmouth’s team, primarily team members DL and PF, has operated an affiliate marketing business focusing on music for the past four years. Affiliate marketing is defined as a system of revenue sharing between one site (the affiliate) which features an ad or content designed to drive traffic to another site (the merchant). The affiliate receives a fee based on traffic to the merchant which converts to sales.

Our affiliate business has focused on connecting music fans, primarily aged 13 to 30, with music offers such as iPods and ringtones. Over the past two years, we have successful sold affiliated offers to over 500,000 customers. We have become a significant online advertiser, receiving Google’s “over 1 million leads” award, and are recognized as a major player among the top affiliate networks.

It is important to note that affiliate marketing success has been credited with part of MySpace’s success. This is because effective affiliate marketers understand how to drive and convert on Internet traffic.

Shoutmouth will employ its affiliate marketing techniques to drive traffic to Shoutmouth.com and enroll members. We will utilize technologies and proprietary techniques that allow us to monitor multiple metrics such as the cost per visitor, cost per member sign-up, etc., so that we can set and maintain profitable metrics.

Another venture that Shoutmouth team members, primarily PK and DL, launched was the development of over 3,000 niche websites. To create the content for these websites, we employed a virtual work force of over 90 researchers in India and 30 writers and editors in the US.

This experience taught us how to manage a large workforce, train writers to improve content quality and motivate a large group of people. These skill sets will be critical in allowing Shoutmouth to grow the content of the site, as developed by both staff and members, while maintaining quality standards.

IV. Marketing Plan

Shoutmouth’s marketing plan includes the following:

Online Advertising : Shoutmouth will initiate pay-per-click advertising campaigns on Google and Yahoo! in order to inexpensively drive traffic to the site. Specifically, Shoutmouth believes it can drive qualified traffic to the site for 20 cents per visitor and achieve a 20% member conversion rate, thus generating members at a cost of $1.00 per member.

Keys to Shoutmouth’s success in achieving this metric include:

• Conducting thorough keyword research and advertising on appropriate keywords and keyword groups
• Creating advertising text that maximizes click through rates
• Creating landing pages that maximize conversions while maintaining the highest Google AdWords quality score possible
• Closely monitoring conversions to quickly stop and/or modify unprofitable campaigns
• Getting individuals to enter their email address to join the newsletter is much easier than getting them to join a site where they have to create a username, select a password, etc. As such, step one will be to get visitors to sign up for artist-specific newsletters.
• Once on the newsletter distribution list, members will constantly receive messages (embedded in their daily newsletter) regarding the benefits of participating more on Shoutmouth.
• Active Shoutmouth Membership: the constant reminders regarding Shoutmouth’s value proposition in the daily newsletters will influence members to participate more actively on the site (e.g., customize their profile, visit the site more often, etc.).

Invite-A-Friend : Shoutmouth is in the process of creating an aggressive invite-a-friend/member referral program. In doing so, we are following the lead of social movie community, Flixster, which grew to 5 million members within 10 months. It did this by encouraging members, during their initial registration process, to upload and send an invitation to multiple contacts in their email address books. The technology to develop this process is fairly complex and we expect to be completed with and to rollout this program in June 2007.

Direct Email Marketing : Shoutmouth will directly contact bloggers and prominent music fans we find online to tell them about Shoutmouth, encourage them to join, and encourage them to write about Shoutmouth on their blogs and online journals .

Creating/Distributing Buzzworthy/Viral Content : Shoutmouth plans to have several buzzworthy/viral articles (i.e., content that people would want to email to their friends since it is funny, interesting, etc.) on the site each day. With a single click, visitors will be able to send these articles to social bookmarking sites such as Digg.com or Fark.com, where these articles could receive widespread attention. In addition to our traditional news stories, Shoutmouth will also periodically create special reports/features in order to satisfy our members and visitors and to try to get widespread exposure.

An example of the power of such buzzworthy content, Shoutmouth has already succeeded in having two stories accepted by Fark and Digg, which have brought in over 50,000 unique visitors.

Super Fans/Street Team Development : Shoutmouth also plans to recruit “super fans.” Super fans are individuals who are passionate about a certain music artist/band and actively contribute articles and/or comments on Shoutmouth. We will recruit these fans, reward them with status (e.g., adding a gold Shoutmouth headphones image to their profile page) and encourage them to more aggressively promote the site by:

• Submitting more news to Shoutmouth
• Commenting on more articles on Shoutmouth
• Growing the Shoutmouth community around their favorite artist(s) by actively recruiting new members to join the site (such as actively posting Shoutmouth-related comments on their MySpace pages, on other music forums, etc.)

Public Relations : Upon financing, Shoutmouth will hire a public relations firm to help us get mentions in media sources ranging from magazines, newspapers, radio, television and blogs. To date, we have developed and issued press releases via Billboard Publicity Wire which have been syndicated throughout the web. An effective PR firm will enable Shoutmouth to quickly reach a wide audience.

Widgets : Shoutmouth will create artist-specific and genre-specific music news widgets. For example, our U2 widget (see example on right) would include all of the recent U2 articles published on Shoutmouth. The widget can easily be placed on MySpace pages, blogs, etc. Each story title in the widget links to the full article on Shoutmouth.

Shoutmouth has great expectations for our widget. To begin, no such widget currently exists as there is no one place to get comprehensive news for specific music artists. Secondly, each time someone places a Shoutmouth widget on their blog or social networking page, it will effectively market Shoutmouth to a wide audience at zero cost to us.

V. Technology/Site Development Plan

This section provides a brief roadmap of the initial and future functionality of Shoutmouth.

Initial Site Functionality

The initial Shoutmouth website will include the following features:

• Ability to submit and comment on news stories
• Ability to suggest new music artists to add to the site
• Ability to create user profiles
• Ability to receive customized news and email alerts
• Articles categorized by artist and core genre (e.g., Rock, Rap, Pop, etc.)
• Music artist sections which includes News, Bio and Fans

Future Site Functionality

Shoutmouth will use news and basic functionality as the platform though which we will build a thriving music community. After initial launch, the Shoutmouth technology team will work on incorporating additional features such as:

• Ability to message other members via the site (e.g., members will have an Inbox on the site)
• Event calendars: members will receive online calendars. With the click of a button, the member will be able to add tour dates of their favorite artists/bands to their calendar.
• Articles also categorized by sub-genre (e.g., Alternative Rock, West Coast Rap, etc.)
• Music artist sections to also include videos, audio files, photo galleries, reviews and event calendars to which members can upload files and vote on top content.
• Forums and member blogs
• Music compatibility testing (suggestions on song/artists members might like)
• Trivia quizzes
• Music playlists

VI. Financial Plan

Revenue Model

During the first six months, Shoutmouth will not generate any revenues as it will not sell advertising space nor offer products for sale. This decision has been made to spur the growth of the Shoutmouth community. By initially positioning Shoutmouth more as a non-profit, for-the-people-by-the-people venture, members will be more prone to promote the site and invite their friends than if the site looks too commercial.

Starting in September 2007, Shoutmouth will primarily generate revenues from selling advertising space. As technologies (such as the Snocap music widget) evolve that allow us to seamlessly integrate music sampling and purchasing on our site, sales of downloadable music are also expected to be a significant revenue source. To a lesser extent, we may sell other music-related items such as ringtones, concert tickets, and apparel.

Funding To Date

To date, Shoutmouth’s founders have invested $500,000 in Shoutmouth, with which we have accomplished the following:

• Built the site’s core technology
• Hired and trained our core staff (we currently maintain an 11-person full-time team)
• Populated the website with content (over 10,000 articles and 1,200 artist bios)
• Generated brand awareness among music fans, including driving 50,000 unique visitors in March, 100,000 unique visitors in April, and 200,000 unique visitors in May 2007.

Funding Requirements/Use of Funds

Shoutmouth is currently seeking $3 million to provide funding for the next 24 months. At this point, the site will be profitable and can grow organically, or additional capital may be sought to more aggressively expand our member base.

The capital will be used as follows:

• Execution of Marketing plan : in order for Shoutmouth to grow its visitor and member base, we need to invest dollars in online advertising and public relations. With regards to online advertising, we are confident that we can enroll members at a cost of $1 per member, which is a fraction of the value of the members to an acquirer (minimum $25 per member), thus providing a significant return on our marketing investments.
• Execution of Technology plan : in order to build a thriving community, Shoutmouth needs to offer its visitors a “stickier” website and enhanced features. We currently maintain a vast “wish list” of features, such as members uploading and rating pictures and videos, trivia quizzes, and member-to-member messaging, that will significantly improve the site’s functionality and value proposition.
• Staffing : In order to reach our goals, we will have to hire additional technical and operations personnel.

Financial Projections

Below is an overview of Shoutmouth’s Financial Projections for the next three years. Please see the Appendix for the full financial projections and key assumptions.

Exit Strategy / Valuation Metric

Shoutmouth’s most likely exit strategy is to be acquired by a traditional music website or property (e.g., Viacom/MTV, Ticketmaster, Rolling Stone), an entertainment/media conglomerate (e.g., Yahoo!, IAC/InterActiveCorp, NBC), or a large social networking site (e.g., News Corp/MySpace).

This strategy is supported by the significant M&A activity in the social networking market, which includes the following transactions over the past 24 months:

Regarding valuation, below are the estimated valuations of social networking companies on a per member basis upon exit:

• Del.icio.us: $50 – $100 per member
• MySpace: $25 per member
• Xing (business social network): $137 per member at IPO in 10/06
• Flickr: $56 – $130 per member
• Grouper: $130 per member

Based on this data, not only are social networking sites a promising investment, but sites that can acquire members for less than $25 each (a conservative valuation estimate based on the figures above), should earn a solid return on investment. As discussed above, Shoutmouth’s goal is to acquire members for no more than $1 each.

In addition, per the membership projections above, Shoutmouth’s valuation at the end of 2009, at a $25 valuation per member, is expected to be $239 million. A more conservative, using a 24.4 time EBITDA multiple (the average multiple of tech M&A deals in 2006 according to The M&A Advisor), yields a $121 million valuation in 2009.

Shoutmouth’s founding team includes entrepreneurs and managers with a track record of success and a history of successfully working together.

Management Team

DL, Co-Founder and CEO

D has a history of successfully launching and growing businesses of all sizes. As president and co-founder of an entrepreneurial services firm., D has personally assisted in the launch and development of over 100 ventures.

Over the past three years, D founded and has managed The Kisco Group which includes an affiliate marketing division (2006 revenues exceeded $3 million), a search engine optimization business which includes a network of 3,000 websites (2006 revenues exceeded $500,000) and an e-commerce business (which includes TopPayingKeywords.com and ShowerHeadsEtc.com).

D earned his Bachelors degree from the University of South Carolina.

PK, Co-Founder and Vice President of Operations

For the past two years, P has managed The Kisco Group’s search engine optimization business where he hired, trained and managed nearly 100 employees and a dozen outside firms. During this time, P has honed his management skills with regards to content development, marketing and operations.

P has had a passion for music since childhood and has been a semi-professional drummer for the past 15 years.

P earned his Bachelors of Arts degree, magna cum laude, from Clemson University.

PF, Co-Founder and Vice President of Technology

For the past year, P has managed The Kisco Group’s affiliate marketing business. In addition to setting up and managing widespread marketing campaigns, P has developed sophisticated analytic techniques to precisely analyze web traffic in order to optimize profitability.

Since August 2006, P has shifted his efforts and leveraged his technology skills in developing the Shoutmouth website. P has been instrumental in selecting the Content Management Platform upon which Shoutmouth is built, and finding and managing the technology team.

P earned his Bachelor of Arts degree from Swarthmore College.

AB, Marketing Manager

A’s background in music includes being a singer, songwriter, guitarist and producer. He has also worked on the marketing side of music, having marketed Veritas Records through the development and distribution of promotional materials.

A’s career also includes psychological research and administration, having served as a Research Assistant with the Interpersonal Perception And Communication Laboratory in Cambridge, MA.

A earned his Bachelor of Arts degree in Psychology from Ohio State University.

M, Lead Technology Developer

M is an experienced web programmer with expertise in web design, application development and database development among others.

M’s work experience includes serving as a Senior Developer at Spheres. M has also engaged in multiple, long term freelance projects including serving as a Database Developer Consultant with The Penn Group and a Web Developer Consultant with Volution Media Group and Allied Online Consulting Group.

M earned his Bachelors degree in Computer Science with a minor in Cognitive Science from Rutgers University.

Content Development Team

Shoutmouth’s writing team, managed by PK, includes the following members:

• JS, Editorial Manager: former content manager and copywriter for Scholastic Inc. and Promotions.com.
• TZ: former music intern (Virgin Records and WRRV) and author of the blog, The Tom Z Show .
• ML: former assistant editor for Adventure Publishing; author of the blog Certified Gangsta ; and former editor-in-chief of Fordham University’s newspaper The Paper .
• SB: former staff writer for Paste Magazine , The Clarion Ledger , and Nightclub and Bar Magazine among others.
• CSJ: former editorial intern for Rolling Stone and Editorial Assistant for Psychology Today .

Outsourced Technology Team

Shoutmouth works very closely with 2skies, a technology firm based in Australia with staff in Australia and the United States. 2skies is run by JDN, one of the co-founding developers of XE, the platform upon which Shoutmouth is built.

XE is an extensible, Open Source web application framework written in PHP and licensed under the GNU General Public License. XE delivers the requisite infrastructure and tools to create custom web applications that include fully dynamic multi-platform Content Management Solutions (CMS).

VIII. Appendix: Shoutmouth Financial Projections   3-Year Income Statement

3-Year Balance Sheet

As of December 31

3-Year Cash Flow Statement

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Free Business Plan Template for Small Businesses (2024)

Use this free business plan template to write your business plan quickly and efficiently.

A good business plan is essential to successfully starting your business —  and the easiest way to simplify the work of writing a business plan is to start with a business plan template.

You’re already investing time and energy in refining your business model and planning your launch—there’s no need to reinvent the wheel when it comes to writing a business plan. Instead, to help build a complete and effective plan, lean on time-tested structures created by other  entrepreneurs and startups. 

Ahead, learn what it takes to create a solid business plan and download Shopify's free business plan template to get started on your dream today. 

What this free business plan template includes

• Executive summary
• Company overview
• Products or services offered
• Market analysis
• Marketing plan
• Logistics and operations plan
• Financial plan

This business plan outline is designed to ensure you’re thinking through all of the important facets of starting a new business. It’s intended to help new business owners and entrepreneurs consider the full scope of running a business and identify functional areas they may not have considered or where they may need to level up their skills as they grow.

That said, it may not include the specific details or structure preferred by a potential investor or lender. If your goal with a business plan is to secure funding , check with your target organizations—typically banks or investors—to see if they have business plan templates you can follow to maximize your chances of success.

Our free business plan template includes seven key elements typically found in the traditional business plan format:

1. Executive summary

This is a one-page summary of your whole plan, typically written after the rest of the plan is completed. The description section of your executive summary will also cover your management team, business objectives and strategy, and other background information about the brand. 

2. Company overview

This section of your business plan will answer two fundamental questions: “Who are you?” and “What do you plan to do?” Answering these questions clarifies why your company exists, what sets it apart from others, and why it’s a good investment opportunity. This section will detail the reasons for your business’s existence, its goals, and its guiding principles.

3. Products or services offered

What you sell and the most important features of your products or services. It also includes any plans for intellectual property, like patent filings or copyright. If you do market research for new product lines, it will show up in this section of your business plan.

4. Market analysis

This section includes everything from estimated market size to your target markets and competitive advantage. It’ll include a competitive analysis of your industry to address competitors’ strengths and weaknesses. Market research is an important part of ensuring you have a viable idea.

5. Marketing plan

How you intend to get the word out about your business, and what strategic decisions you’ve made about things like your pricing strategy. It also covers potential customers’ demographics, your sales plan, and your metrics and milestones for success.

6. Logistics and operations plan

Everything that needs to happen to turn your raw materials into products and get them into the hands of your customers.

7. Financial plan

It’s important to include a look at your financial projections, including both revenue and expense projections. This section includes templates for three key financial statements: an income statement, a balance sheet, and a cash-flow statement . You can also include whether or not you need a business loan and how much you’ll need.

Business plan examples

What do financial projections look like on paper? How do you write an executive summary? What should your company description include?  Business plan examples  can help answer some of these questions and transform your business idea into an actionable plan.

Professional business plan example

Inside our template, we’ve filled out a sample business plan featuring a fictional ecommerce business . 

The sample is set up to help you get a sense of each section and understand how they apply to the planning and evaluation stages of a business plan. If you’re looking for funding, this example won’t be a complete or formal look at business plans, but it will give you a great place to start and notes about where to expand.

Lean business plan example

A lean business plan format is a shortened version of your more detailed business plan. It’s helpful when modifying your plan for a specific audience, like investors or new hires. 

Also known as a one-page business plan, it includes only the most important, need-to-know information, such as:

• Company description
• Key members of your team
• Customer segments

💡 Tip: For a step-by-step guide to creating a lean business plan (including a sample business plan), read our guide on how to create a lean business plan .

Benefits of writing a solid business plan

It’s tempting to dive right into execution when you’re excited about a new business or side project, but taking the time to write a thorough business plan and get your thoughts on paper allows you to do a number of beneficial things:

• Test the viability of your business idea. Whether you’ve got one business idea or many, business plans can make an idea more tangible, helping you see if it’s truly viable and ensure you’ve found a target market. 
• Plan for your next phase. Whether your goal is to start a new business or scale an existing business to the next level, a business plan can help you understand what needs to happen and identify gaps to address.
• Clarify marketing strategy, goals, and tactics. Writing a business plan can show you the actionable next steps to take on a big, abstract idea. It can also help you narrow your strategy and identify clear-cut tactics that will support it.
• Scope the necessary work. Without a concrete plan, cost overruns and delays are all but certain. A business plan can help you see the full scope of work to be done and adjust your investment of time and money accordingly.
• Hire and build partnerships. When you need buy-in from potential employees and business partners, especially in the early stages of your business, a clearly written business plan is one of the best tools at your disposal. A business plan provides a refined look at your goals for the business, letting partners judge for themselves whether or not they agree with your vision.
• Secure funds. Seeking financing for your business—whether from venture capital, financial institutions, or Shopify Capital —is one of the most common reasons to create a business plan.

Why you should you use a template for a business plan

A business plan can be as informal or formal as your situation calls for, but even if you’re a fan of the back-of-the-napkin approach to planning, there are some key benefits to starting your plan from an existing outline or simple business plan template.

No blank-page paralysis

A blank page can be intimidating to even the most seasoned writers. Using an established business planning process and template can help you get past the inertia of starting your business plan, and it allows you to skip the work of building an outline from scratch. You can always adjust a template to suit your needs.

Guidance on what to include in each section

If you’ve never sat through a business class, you might never have created a SWOT analysis or financial projections. Templates that offer guidance—in plain language—about how to fill in each section can help you navigate sometimes-daunting business jargon and create a complete and effective plan.

Knowing you’ve considered every section

In some cases, you may not need to complete every section of a startup business plan template, but its initial structure shows you you’re choosing to omit a section as opposed to forgetting to include it in the first place.

Tips for creating a successful business plan

There are some high-level strategic guidelines beyond the advice included in this free business plan template that can help you write an effective, complete plan while minimizing busywork.

Understand the audience for your plan

If you’re writing a business plan for yourself in order to get clarity on your ideas and your industry as a whole, you may not need to include the same level of detail or polish you would with a business plan you want to send to potential investors. Knowing who will read your plan will help you decide how much time to spend on it.

Know your goals

Understanding the goals of your plan can help you set the right scope. If your goal is to use the plan as a roadmap for growth, you may invest more time in it than if your goal is to understand the competitive landscape of a new industry.

Take it step by step

Writing a 10- to 15-page document can feel daunting, so try to tackle one section at a time. Select a couple of sections you feel most confident writing and start there—you can start on the next few sections once those are complete. Jot down bullet-point notes in each section before you start writing to organize your thoughts and streamline the writing process.

Maximize your business planning efforts

Planning is key to the financial success of any type of business , whether you’re a startup, non-profit, or corporation.

To make sure your efforts are focused on the highest-value parts of your own business planning, like clarifying your goals, setting a strategy, and understanding the target market and competitive landscape, lean on a business plan outline to handle the structure and format for you. Even if you eventually omit sections, you’ll save yourself time and energy by starting with a framework already in place.

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Business plan template FAQ

What is the purpose of a business plan.

The purpose of your business plan is to describe a new business opportunity or an existing one. It clarifies the business strategy, marketing plan, financial forecasts, potential providers, and more information about the company.

How do I write a simple business plan?

• Choose a business plan format, such as a traditional or a one-page business plan. 
• Find a business plan template.
• Read through a business plan sample.
• Fill in the sections of your business plan.

What is the best business plan template?

If you need help writing a business plan, Shopify’s template is one of the most beginner-friendly options you’ll find. It’s comprehensive, well-written, and helps you fill out every section.

What are the 5 essential parts of a business plan?

The five essential parts of a traditional business plan include:

• Executive summary: This is a brief overview of the business plan, summarizing the key points and highlighting the main points of the plan.
• Business description: This section outlines the business concept and how it will be executed.
• Market analysis: This section provides an in-depth look at the target market and how the business will compete in the marketplace.
• Financial plan: This section details the financial projections for the business, including sales forecasts, capital requirements, and a break-even analysis.
• Management and organization: This section describes the management team and the organizational structure of the business.

Are there any free business plan templates?

There are several free templates for business plans for small business owners available online, including Shopify’s own version. Download a copy for your business.

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Farm and Agriculture Business Plans

Agri-tourism business plans.

• Vineyard Bed & Breakfast Business Plan
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Agriculture Consulting Business Plans

• Agricultural Consultants Business Plan

Agriculture Products & Retail Business Plans

• Butcher Shop Business Plan
• Feed and Farm Supply Business Plan
• Garden Nursery Business Plan
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• Horse Reseller Business Plan
• Recycling Waste Materials Business Plan

Farm Business Plans

• Agriculture Farm Business Plan
• Agriculture Fruit Farm Business Plan
• Horse Training Business Plan
• Hydroponics Farm Business Plan
• Peach and Apricot Farm Business Plan
• Produce Farm Business Plan

Farm Machinery Business Plans

• Farm Machinery Manufacturer Business Plan

Farming and agriculture are complicated businesses. To be successful, you need more than a green thumb and the willingness to get your hands dirty. You need to know how to operate your agricultural enterprise efficiently and not just forecast your crop rotations, but your cash position and revenue. To do that, you need a business plan.

How can a business plan help your farm or agriculture business?

A good business plan will help your farm or food production business grow. It can improve your chances of receiving government grants or loans, help you manage your business through hard times, and identify additional forms of revenue like tourism or consulting. Most lenders or investors require a business plan before they even consider funding a project. When you add in the numerous elements of running an agricultural business, and the factors like weather and government regulations that are often beyond your control, a business plan becomes an essential tool for effective management, strategic planning and communication across all the key stakeholders in your business.

Find the right agriculture business plan template for your business

If you’re not sure where to begin, check out our farms, food growers, food production facilities, and other agriculture-related sample business plans for inspiration.

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Why you need a marketing plan

Download our marketing plan template.

Having a marketing plan can help you to:

• identify your target market and how your product or service can benefit it
• identify how you might attract new customers
• encourage your existing customers to continue purchasing your product or service
• set goals and time frames for your marketing activities
• map out a strategy to reach your target audience, including the messages, channels and tools you’ll use
• evaluate your marketing activities
• provide a marketing budget and see your return on investment.

Our marketing plan template helps you identify who your customers are, how you'll meet their needs and what marketing tactics you might undertake.

Marketing plan template

Our template steps you through the process of developing a succession plan with links to extra information if you need it.

You may want to check our tips below before you start.

1. Analyse your market

Market research can help you to understand your strengths, weaknesses and the opportunities that you can take advantage of. Analysing your own business and your competition can help you identify where you're positioned in the market.

It’s important to analyse your competition to identify their strengths and weaknesses. This can help you refine your marketing strategy and what's unique about your business.

A strengths, weaknesses, opportunities and threats (SWOT) analysis can help you determine where your business fits within the market and your unique selling point. Use it to help identify what your business is doing well and how you can improve.

Identifying and understanding your customers is an essential part of your marketing plan. Not everyone is your potential buyer, so it’s important to have a clear understanding of your target market early on.

Identify your target market, competitors and potential customers .

2. Set your goals and objectives

Once you're clear about your business and its positioning, you can start thinking about what you want to achieve. Think about your main business goals, whether it's the size of your business, expansion plans or desired sales. Set specific, measurable, achievable, relevant and time bound (SMART) goals to increase your chances of success in achieving them.

3. Outline your marketing strategies

Once you’ve set some goals, consider what marketing activity, process or price will help you achieve them.

Try and choose marketing activities that suit your business and your customers. For example, if you want to target young adults, newspaper advertising may not be as effective as a social media campaign.

Choosing multiple activities that complement each other is a good way to help you get your message across. For example, if you're trying to establish a new product in the market, you may choose to advertise on the local radio, as well as setting up  social media channels  and introducing a low-cost pricing strategy for first-time buyers. When used together, these strategies complement each other and help you reach a broader market.

4. Set your marketing budget

Knowing how much you have to spend on marketing and how to spend it is critical to the success of your business. A marketing budget will ensure you accurately calculate your marketing campaign or advertising.

When developing your marketing budget, make sure you're only spending money on the activities that contribute to your current marketing goals. Advertising and promotion can be expensive. Make sure to pick options that will give you the best value while still reaching your target customers.

5. Keep your marketing plan up-to-date

It's important to evaluate your marketing activities. Analysing your results and being aware of new marketing trends is important to keeping your marketing plan up-to-date and reaching your business goals. You should tweak and change your plan as your business and market grow and change.

Find out the different types of advertising.

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How To Get A Business License In 5 Steps

Updated: Apr 8, 2024, 7:49pm

When you’re starting a business, it can be difficult to sort out which steps to take to get up and running—and stay compliant with confounding government regulations. Depending on the type of business you run, and where, you may need to apply for one or more business licenses. Here’s everything you need to know to figure out which licenses you need and how to get a business license in your area.

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What Is a Business License?

“Business license” is a broad term that refers to any kind of license or permit required to operate your business and provide your services in your location. Various types of business licenses are issued by federal, state, county and municipal agencies.

A business license’s purpose may be to register your business with the government for tax purposes or to ensure you follow industry regulations.

Do You Need a Business License?

Whether you’re required to get any type of license to run your business depends on where you live (and where your business is based) and what kind of goods and services you sell.

Most states don’t require a general business license—also known as business operating license—just to do business in that state. However, you may still need a business license from your city or county. You may also need a license from a relevant state or federal regulatory agency to perform certain business activities, like agriculture or medicine.

If you run an online business, you register the business and obtain required licenses in the state and city where you base the business. If you’re a digital nomad , speak with your lawyer and accountant about the best way to set up your business.

Types of Business Licenses

To sell your goods or services, you may be required to get one or more of these types of business licenses in your state:

• Business operating license: This is what many people mean when they say “business license.” This is a license that lets you do business in your state or locality. In some states, you must obtain a business license from the state but, in others, you’ll need a business license from your city or county.
• Seller’s permit: If you sell goods in person or online, most states require this permit, which lets you collect sales tax from customers.
• Doing business as (DBA) or fictitious name statement: A DBA statement lets you operate the business under a name different from your legally registered business name. Depending on your state, you may need to register a DBA with your state or at the local level.
• Special permits: Many industries require special permits to operate. If you run a brick-and-mortar business, you’ll probably need permits for planning, zoning, building, signs and fire in your city or county.
• Industry licenses: You might need a special license to perform your services in industries like salons, electrical, childcare, medicine and law. You obtain these licenses through the relevant licensing board in your state.
• Federal licenses: Select industries, such as alcohol and firearms sales and aviation are regulated by the U.S. government and require a federal license or permit. The Small Business Administration lists which types of businesses require federal licenses and where to apply.

How To Get a Business License

The process to get a business license varies by state—and it’s not required in every state for every type of business. Follow these steps to determine whether you need a license and to apply with your state if you do.

1. Form Your Business Entity

You’ll need a business license in the name of your business. It’s best to establish a business structure and business name before you apply for a business license. That way you don’t have to reapply or amend your business license later.

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Common legal structures for small businesses include:

• Sole proprietorship: A one-owner business is considered a sole proprietorship if you don’t file paperwork to establish any other kind of business structure. Sole proprietors are fully responsible for business debts and obligations, and they report business income as self-employment income on their tax returns. If you’re a sole proprietor, your own name is the official name of your business, though you may choose to use a DBA, such as Joe Jones, DBA Affordable Lawn Care.
• General partnership: A general partnership is similar to a sole proprietorship for tax purposes. For liability purposes, partners divvy up liability, and personal assets aren’t separated from the business. General partnerships use the partners’ last names as their official business name, and they may also have a DBA.
• Limited liability company (LLC): A simple business structure where profits and losses are passed through to owners for tax purposes, but personal assets are protected from business liabilities (like debts or lawsuits).
• Corporation: Like an LLC, a corporation protects personal assets from business liabilities. Corporations tend to have a more fixed operating structure and may be better than LLCs for attracting outside investors.
• Nonprofit corporation: A legal entity is organized similar to a corporation, except profits can’t be distributed to owners. Some nonprofits receive tax-exempt status.

If you establish an LLC, corporation or nonprofit corporation, you’ll establish a name for your company when you file formation paperwork with your state. Depending on your state, you may be able to get a DBA from the state, or you may need to file your DBA with your local government.

2. Apply for an Employer Tax Identification Number (TIN)

Depending on how your state processes business licenses, you may need to include your federal TIN on your business license application.

Sole proprietors who don’t have employees can use their Social Security Numbers instead of a TIN, but all other businesses need a federal employer ID number or FEIN. 

You can obtain an EIN through the IRS online . The process is simple and you’ll receive your number right away.

3. Determine Which Licenses You Need

Which types of business licenses you need depends on federal, state and local requirements and what kind of business you run.

You can find out which licenses and permits you need through:

• Your state’s Secretary of State office, Department of Revenue or similar agency that issues business licenses.
• Resources available through your local Small Business Administration office .
• Working with a business lawyer to determine and file the necessary licenses and paperwork.

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4. Apply for a Business License

You may have to file for licenses and permits with state, county and municipal agencies—for example, a sales tax permit from the state, health permits through a department of health, and planning permits through the city.

Look for resources from your state or your local SBA office that gather all the information you need in one place, so you don’t have to spend hours researching every relevant agency. Step-by-step guides in your state could walk you through the process and include links to necessary applications on various websites.

In most states and many localities, you can get a general business license online through the proper agency’s website. Industry-specific licenses may have a more complicated application process.

You likely won’t have to wait long for a business operating license or a sales tax permit to be approved. Other types of licenses and permits may have a longer and more involved review process.

5. Renew Your Business License

Talk with your lawyer or pay attention to the fine print on your business license and permits to figure out how often you have to apply or pay to renew them. You may have to renew annually or every five years, for example.

Frequently Asked Questions

How much does a business license cost.

Business license fees vary widely across states and industries. Depending on where your business operates and what kind of licensing you need, you could pay a fee in the area of $50 to $200. Many businesses can operate without an operating license, so you may not have to pay anything.

Is an LLC and a business license the same thing?

No. An LLC (limited liability company) is a business entity that determines how your business is structured for legal and tax purposes. A business license is a permit that allows your business to operate in your state or locality. A business license may also refer to specialized licenses and permits that allow your business to perform certain services or operate in certain locations.

Can you run a business without registering it?

You can run a business as a sole proprietorship (just you) or general partnership (you and one or more partners) instead of forming a business entity like an LLC or corporation. However, sole proprietorships and partnerships may still need to register DBAs and obtain business licenses from government agencies. Learn more about the differences between a sole proprietorship and an LLC . 

What types of business licenses are possible?

The term “business license” can sometimes describe a general operating license but is often used to refer to several different types of permits. The most common types of business licenses include:

• A business operating license, also known as a business license
• A sales tax license, which allows businesses to sell goods and services
• A liquor license, which is necessary if your business sells or distributes alcohol
• Specialty licenses, such as for accounting, massage therapy, plumbing or legal counsel

Do you need an EIN to run a business?

It is not mandatory to have an employee identification number or EIN to run a business. However, if you want to open a business bank account or hire employees, you will need to get one. Learn more about the legal requirements of starting a small business . 

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Get A Business License In Your State

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Dana Miranda is a Certified Educator in Personal Finance® who's been writing about money management and small business operations for more than a decade. She writes the newsletter Healthy Rich about how capitalism impacts the ways we think, teach and talk about money. She's the author of YOU DON'T NEED A BUDGET (Little, Brown Spark, 2024).

With over a decade of editorial experience, Rob Watts breaks down complex topics for small businesses that want to grow and succeed. His work has been featured in outlets such as Keypoint Intelligence, FitSmallBusiness and PCMag.

Jane Haskins practiced law for 20 years, representing small businesses in startup, dissolution, business transactions and litigation. She has written hundreds of articles on legal, intellectual property and tax issues affecting small businesses.