The Five Areas to Consider

Start-up expenses for a farm are different depending on where you live. This is because many of the costs, such as land or utilities are specific to the farmsite. Start-up costs can be broken down into five different areas.

 

1. Location

This includes finding and buying the land, making sure the land is zoned properly and that you have the right permits. When you’re looking for land to buy, think about utility and road access, and how far it is to town. 

2. Production

This means what you will produce on your farm or ranch. Will you raise animals?  Will you plant crops? After you’ve decided what you want to produce, you’ll have even more considerations including:  

  • Whether you’ll raise animals for their byproducts like milk or eggs, or raise them to eat  
  • What type of crops you’ll grow  
  • What the soil supports (Is your location best for grazing or growing?) 
  • Where the markets are so you can sell what you produce

3. Site Preparation

Once you have the land you need, it’s time to prepare for the growing season. For a new farmer who growing crops, the largest cost will be equipment to prepare, plant and harvest.  For a new farmer planning a livestock operation, other costs might include fencing and water taps for animals.

4. Structures (Buildings)

What types of structures you need will depend on location, what you produce, and the growing season. Are the existing buildings at this location? You will need a place to live and a place to store equipment and supplies. If you have livestock you may need a barn. If you plan to grow fruits and vegetables for local consumption, you may need a high tunnel to make your growing season longer. You may also need a work area to prepare products for market and storage. If you plan to raise animals for byproducts or consumption, you may need a refrigeration unit. 

5. Growing and Selling

Growing and selling expenses happen all year.  They include traditional farm operations costs such as tools, seeds, fuel, supplies, veterinarian services, utilities and possibly farm laborers. The farm is a business, and so you’ll also have expenses for phone, accounting, advertising and marketing.