By: Katelyn Thompson, Michigan State University Extension
Starting a business takes planning and preparation. Starting the business of a cow-calf operation is no different. Creating abusiness plan is a crucial step to developing a successful business. While business plans are used as a means for acquiring capital and potential partners, the primary value in authoring a business plan is to you, the operator or owner. It is a means of bringing together your operation’s management strategy, goals and mission in a cohesive manner that can be reflected and built upon. It is important to remember that a business plan is not set in stone; it should be revisited as goals are reached, your market changes and as the operation changes and grows.
The six key sections to a business plan
When these pieces are brought together, you have a blueprint for how your operation will function and for what reason.
- An executive summary highlights your operation without delving into the details. This section lays out your operation’s goals and mission statement and summarizes what will follow.
- The business description gives insight into the type of business you are operating, the location and facilities, and the history of the business.
- The operations section is the nuts and bolts of what you do and how you get it done.
- Next, is your marketing plan, one of the longer sections of your business plan. This section takes into consideration current demand and supply, your opportunities and challenges, and an analysis of who your customers are and how you plan on reaching them.
- The management organization section is where you indicate positions and people who play a role in the success of your operation.
- Finally, the financial plan will lay out your financial position and projections and benchmarks comparing your operation to others using similar production methods. This section will also include any capital requests if you will also be using the business plan for that purpose.
Putting together a business plan can be a challenge, but a useful resource can be found in the Center for Farm Financial Management’s AgPlan. This is a business planning website specific to agricultural endeavors. It is a great tool to help you get started with your business plan and walk you through the different sections. A well thought out and constructed business plan will be an asset to starting your business. Information for your farm business can also be found on the Michigan State University Extension FIRM team website or by contacting your area FIRM team educator.
Starting a new beef cow-calf operation can be both profitable and rewarding; however, there are many challenges that could cause failure.