A business plan is the most essential element of the early stage planning of your farming business.
Healthy, sustainable and inclusive food systems are critical to achieve the world’s development goals. Agricultural development is one of the most powerful tools to end extreme poverty, boost shared prosperity, and feed a projected 9.7 billion people by 2050. Growth in the agriculture sector is two to four times more effective in raising incomes among the poorest compared to other sectors.
Agriculture is also crucial to economic growth: accounting for 4% of global gross domestic product (GDP) and in some least developing countries, it can account for more than 25% of GDP.
South Africa’s agriculture remains an important sector of the economy and holds great potential to reduce poverty. It’s also central to the political economy of the country.
In 2023, there are six key themes that are likely to underpin the sector. Unless these challenges are addressed, the country’s agricultural sector will not achieve the growth and job creation prospects it’s capable of. These include; the impact of energy shortages and associated costs to businesses and consumers after the severest power outages the country has ever seen, the expansion of exports, land reform, the fallout from collapsing local administrations, lack of progress on key regulations, and the financing of the sector.
Elements of an orderly Farming Business Plan include:
•Executive summary: Is positioned first the business plan. It includes key information on the ownership structure, funding or grant requests, the amount and reason thereof, the mission, and objectives of the business.
•Company and management summary: This section describes your company history (if applicable) ownership structure, and management and staffing structure.
•Products and/or Services: Describe and list every crop grown and the rationale for cultivating them.
•Market analysis summary: The market should be segmented by processors, nurseries, and eating establishments. A target market segment strategy and industry analysis are key, as well as information on competition and buying patterns.
•Strategy and implementation summary: This section includes the competitive edge of the business, marketing strategy, sales strategy, sales forecast, and milestones. Include a SWOT Analysis.
•Financial projections: Eight documents comprising of the management account, income statement, balance sheet, cash flow, cash forecast, break even analysis, loan amortisation schedule, and fixed asset schedule. Charts, ratios, graphs, and calculations are included.
•Annexures: Statutory information required by funders in an application (contact DTC for the list).
At DTC we understand the complexities of the criteria and requirements for a custom and detailed business plan. If using the document for the purpose of raising funding and/or non-repayable business grants, we guide you through the process and provide access to our funding network. These include, to name a few, venture capital companies, private equity companies, angel investors, banks, Government BBBEE initiatives, Silicon Cape investment organisations, rent to own asset funding companies, and crowd funds.
Contact us for more information and support with your Farming Business Plan.