GoFarm Hawaii

GoFarm Hawaii

What are your goals and your business model?

Define Your Goals

Becoming a farmer is a wonderful goal to have, but farming means different things to different people. You will need to make a lot of smaller, results-driven goals in order to successfully start your agribusiness and become the kind of farmer you want to be. Most of your goals will fit into various categories: personal, environmental, community, social, cultural, or economic.  As you make goals in each of these six areas, the type of agribusiness you want to have and ways to make your business a success will become clearer.

The following are just some of many questions you may want to ask yourself as you begin to make goals. Good goals will motivate you and help you channel your enthusiasm in the right direction. The goals you make now will shape your agribusiness and give you a good starting point for developing a strategic plan and a business plan later on.

Personal

Personal goals include thinking about why you want to farm and what you want to accomplish through farming. Consider the following questions and come up with others that will help you define what kind of farmer you want to be and what kind of farm or agribusiness you want to have.

  • What do you like about farming?
  • Do you want to farm as a hobby or as a large producer?
  • Is this an opportunity to allow your family to work together?
  • Do you want to provide all your family’s produce and sell some on the side as well?
  • Do you want to provide healthy food to the disadvantaged?
  • Do you want your agribusiness to expand and be your main source of income?
  • How much time do you want to spend on the business?

As you make personal goals, inventory the skills you possess (technical or practical knowledge, drive, physical health, family support, etc.). Make a list of necessary skills you lack and set goals to fill in those gaps through education, technical advice, trained farm hands, or other means.

Environmental

Farming, depending on how it is done, can have a potentially negative or positive effect on the environment. You may not even have land yet for your farm. In that case, think about the natural resources on a property before you buy or lease. The following are examples of environmental questions you may want to consider:

  • What will you do to minimize or negate negative effects on the land?  Are you consider
  • What natural or cultural resources are in the area and how will you maintain them? Will you practice traditional, organic, regenerative, or natural farming?
  • Will you develop a conservation plan for your farm? Conservation plans are developed and implemented to protect, conserve, and/or enhance natural resources on your farm.  Some conservation practices include changing your crop rotation, stripcropping, contour farming and use of grassed waterways and terraces.
  • Is there a stream nearby that could be contaminated by fertilizers or pesticides?
  • Are there endangered or nesting birds in the area? Any native plants, insects or animals to consider?

Community/Social

Farming is not an isolated enterprise. Your neighbors and community will probably be observing your operation. They may even be part of your market or labor pool, so it is always important to develop and maintain good relations with them.

The desire to make a positive impact in your local community or farther afield may drive your desire to farm and therefore drive your activities and business decisions. Do you want to educate a specific group about healthy eating, food sustainability, job skills, or Native Hawaiian culture? Do you want to provide access to healthy food to a specific population?  Are your farm activities and revenues being used to support a broader cause?

Is a connection to the community a driving factor for starting your business and if so, how will you do so?  Think about how your business will help the community. What local businesses and organizations will you support as you build your business and expand your own resources?

Cultural

Historically, Native Hawaiians relied heavily on farming and fishing to ensure a sustainable food supply.   Culturally, there is a sacred and emotional connection to the land and with specific crops. If you plan to incorporate a cultural aspect into your business, determine how you will do so.  Will this impact the types of crops you grow or a growing method?  Will you incorporate a cultural education component?

Economic

As you make economic goals for yourself and your agribusiness, inventory your existing resources, income and expenses. Estimate what you will need to start and base your economic goals off those numbers. Think about how much you are willing to spend, how much debt you’re willing to accrue, when you’ll need to start receiving net income, and whether or not you’re financially able to weather a disaster or bad production year.

Document Your Goals

Once you determine the type of farm business you would like to have, write down your goals.  When setting goals, make sure they’re specific and have an end-date.  Goals should be based on reality. If you have no idea what’s attainable, do some research. Look online or ask other farmers at what point they turned a profit, how much time they put in, etc. You can give yourself either more or less time, but it’s helpful to have a starting point.

Additional Resources for Defining Your Goals

This section is adapted from a helpful factsheet for new farmers developed by the Midwest Organic and Sustainable Education Service (MOSES):

https://mosesorganic.org/wp-content/uploads/Publications/Fact_Sheets/20ResourcesBeginningFarmer.pdf

Developing Your Business Model

Based on the goals for your business, start to develop your business model:

  • What product or service will your company provide?
  • To whom will you sell to?
  • Why will people pay you for your product?
  • How will your business make money?

What Products or Services Will You Provide?

Think about the products and services you plan to offer:

  • Are you planning to grow specific crops or type of crops?
  • Do you have plans to sell value-added products?
  • Will you offer services like farm tours or classes?

When considering crop selection, think about:

  • What can you grow and how much time and money will it cost to grow the selected crop(s)?  This may be affected by location, elevation, climate, soil conditions, chosen growing method and personal preferences.
  • Will you be able to sell it?  What kind of competition exists in your intended markets?  What is the existing supply and demand?
  • How much money can you make?  How much is the crop generally sold for at various markets, and how does this price compare with the cost of growing it?

Who is Your Target Market?

Think about who you will sell to and how you will reach them:

  • Do you plan to target customers who want local, organic produce? If so, you may consider reaching:
    • Families committed to eating healthy food through farmers’ markets, grocery stores, or CSAs.
    • Farm-to-table restaurants
    • Local, organic markets
  • Do you want to focus on retail customers? If this is your target, you may consider reaching them through:
    • Farmers’ markets
    • CSA
    • Pick your own
  • Would you rather concentrate on wholesale customers? If this is your target, you may consider reaching:
    • Restaurants
    • Grocers
    • Distributors
    • Produce subscription services (aggregate CSAs)

When considering target markets, think about how prices and volumes are impacted by your selection.

  • Consider business/personal goals and traits and how it is impacted by selection.
  • Consider how focus in specific categories can make your business more efficient and competitive.
  • Refer to the NCAT Marketing Tip Sheet Series (https://attra.ncat.org/publication/ncat-marketing-tip-sheet-series/).  It describes various marketing channels and considerations for each.

Why Will Consumers Pay for Your Product?

Think about how you will be different from your competition.  How will you stand out and what it will cost to position your company:

  • Do you plan to offer a better/lower price?
    • Many consumers are attracted by lower prices.
    • This may help get more local products to underserved markets.
    • If prices are comparable or cheaper, this may encourage consumers to replace imports with local products.
    • Lower pricing will mean lower profits per item but may lead to increased overall sales
  • Do you have a superior product?
    • Many consumers are attracted to a “better” or unique product (i.e. taste; organic; healthier; safer; local)
  • Do you have exceptional service levels?
    • Are you friendly and welcoming, easy to deal with, and responsive?
    • Will you offer refunds or return policies that are valuable to your particular market?
    • Do you handle complaints in a positive way?
  • Do you offer a connection to the farm or farmer?
    • Many consumers want to have a personal connection with their farmer. Are you able to provide this?
  • Do you offer familiarity, consistency, or a strong reputation?
    • Depending on your market channel, consistency and communication is key. Can you provide this critical service?
  • Are you filling a need or demand that others in the marketplace are not meeting?

How Will You Make Money?

Think about how your business will make money. Think through the following and use Step 3 to ensure you have a financially feasible business idea:

  • What are your revenues?
  • What are your costs?
  • What is your profit?
  • How do target customers impact your revenues (price/volume) and costs?
  • How do growing methods, certifications, or business goals impact revenues and costs?
  • How will you ensure that you are profitable? Know your cost of production to ensure your cost is lower than your sales price.

Additional Resources for Developing Your Business Model

Use this Hawaiʻi Agribusiness Guidebook to think through various aspects of your business.  Get personalized help from: