Too often, entrepreneurial-minded growers love the idea of their farm business more than actually running the business, says Bev Connell, principal of Nova Scotia-based ProAgri Consulting Ltd.
"Passion doesn’t necessarily mean profit," he said.
Connell offers several practical tips for growers looking to diversify their businesses:
-Add value: Processing their crops into new products or making their farms destinations for consumers can help boost farm revenues. A grower may see just 13.8 per cent of an apple’s retail price, but a strategy for bringing people to their orchard can boost revenues from crop production significantly. He suggests growers ask themselves: "What value can you create by having people come to you?"
-Track production costs and cash flows: Number crunching may not be everyone’s idea of a good time, but it can result in more competitive pricing, better margins, more disposable income, and smoother overall development of the business. "It’s the only way you can make decisions about how to move forward," Connell says.
-Self-promotion: Connell advises entrepreneurs who are developing products to give the market a taste of what’s in store before they launch as well as afterwards. Showing people what you’re doing will help create excitement around the product and may yield valuable feedback about what will and won’t work.
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