Presentation Title This course developed by The Environmental Finance Center at UNC Chapel Hill for The North Carolina School of Science and Math and NCDPI is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported LicenseCreative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License “Cattle at Sunset” by Andrew S. Gray Photography, Creative Commons CC BY-NC-SA Agricultural Microeconomics Lesson 9: Developing a Business Plan This course developed by The Environmental Finance Center at UNC Chapel Hill for The North Carolina School of Science and Math and NCDPI is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported LicenseCreative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License

Photos by: Nancy Ranney, Ranney Ranch. Used with permission “The business that fails to plan, plans to fail.”

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Why Does Your Farm Need a Business Plan? Serve as a guide for your farm’s future needs. Helps to develop a marketing and promotion strategy for products. Facilitates the cost/benefit analysis of future innovation. Required for financing a new project or expansion of business.

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Key Components 1.SWOT analysis 2.Management team 3.Description of product(s) 4.Marketing plan – Customer assessment – Competitor analysis 5.Financial summary (actual and projected)

Photos by: Nancy Ranney, Ranney Ranch. Used with permission What is a SWOT Analysis? S trengths W eaknesses O pportunities T hreats

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Completing a SWOT Analysis Take a look at your personal and business strengths: Your advantages over your competition Your current production and management capabilities Your location Your personal philosophy Your access to or ability to secure capital Your knowledge and skills Your product’s value to consumers Your customer’s perception of your products’ quality

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Completing a SWOT Analysis Be honest about your weaknesses: Lack of experience Lack of knowledge Unknown or poor reputation Lack of financing Current production schedule Access to processing facilities Production timelines Marketing challenges Limited, or no, farm help Distribution Pricing

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Completing a SWOT Analysis Find the opportunities you can take advantage of: Market trends Consumer preferences Unfilled niches New or emerging markets International potential Competitors’ susceptibilities Innovations and developments Partnerships

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Completing a SWOT Analysis Recognize the threats to your business: Market instability Competitors with lower production costs Negative health claims about product Legal considerations that may affect your operation Weather Lack of market awareness High market-entry costs

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Your Own SWOT Analysis

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Marketing Plan Who are your customers? Who are your competitors? What are you selling? At what price will you sell each product? Where are your customers located? When are your customers most likely to purchase your products? How will you reach your customers? (farmers market, stores, online, farm)

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Marketing Strategies Define your market niche Know your customers and assess your competitors Price your products appropriately Create your marketing message Adjust strategy as needed

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Your Own Marketing Plan

Photos by: Nancy Ranney, Ranney Ranch. Used with permission Financial Summary Net Earnings (Income) Statement Balance Sheet Cash Flow Statement Three-Year Income Projections

Presentation Title This course developed by The Environmental Finance Center at UNC Chapel Hill for The North Carolina School of Science and Math and NCDPI is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported LicenseCreative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License “Cattle at Sunset” by Andrew S. Gray Photography, Creative Commons CC BY-NC-SA Next Class: Successful Business Planning This course developed by The Environmental Finance Center at UNC Chapel Hill for The North Carolina School of Science and Math and NCDPI is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported LicenseCreative Commons Attribution-NonCommercial-ShareAlike 3.0 Unported License