Sample Business Plan Kory Clark, Bank of America Merrill Lynch senior
The message from cat le and other ag lenders is “keep it simple.” • Financial Management Analysis - The plan should
vice president in Amarillo, encourages producers to have a plan, but don’t go overboard. In other words, a PowerPoint presentation probably isn’t necessary. “Here’s what I’m doing, here’s how it works and
here’s why – that type of plan speaks volumes,” he says. The Small Business Administration recommends
that each basic plan include these: • Description of Business - The plan should include
the mission statement, vision for the future, goals and objectives. This section should tell the story of what the business is, what it stands for and where you see the business in the future. • Marketing Plan - This section is an analysis of
consumer or buyer needs. Operators should identify their customers, specifi c needs to be met and how those needs are expected to change over time. This section includes a description of the products and services available, advertising strategies if any and ways to remain competitive in a changing marketplace.
include details of the business’ current fi nancial portfolio and foreseeable future income and expense. Ag producers should record expenses and income by enterprise (cow-calf, wheat, etc.) to determine the agricultural enterprise most suited for the available resources. Detailed production records and labor should also be recorded. More formal documents may be included, such as loan applications, equipment and inventory lists, breakeven projections, a balance sheet and a cash fl ow statement. Startup businesses commonly do not have such records, but are expected to provide estimates. • Organization and Management - This fi nal
component should describe the type of business ownership along with key personnel, their duties and the fl ow of operations. This section will include items not typically associated with daily agricultural production activities such as insurance, taxes, permits/licensing, employee management, estate planning and other legal concerns.
business plan that highlights your goals, marketing and production, land and fi nancial management. Ranching is a business. With continued threat of
drought, high feed costs, animal health issues and volatile cattle markets, managing the huge investment that goes into running successful cow-calf or stocker operations puts a lot of pressure on the bottom line. If you’re buying $1,800 to $2,000 bred heifers, need
a new pickup to haul calves to the sale or a baler to handle the extra forage you seeded, these items should be written into a business plan along with other ex- penses. Jeri Donnell, agricultural economist for The Samuel R. Noble Foundation, Ardmore, Okla., provides guid-
86 The Cattleman March 2014
ance for producers on developing and writing a business plan. “According to the Small Business Administration (SBA), a business plan is an individualized document defi ning strategies needed to reach the goal of profi t- ability,” she says. “Small ranches or farms should manage their op-
erations similarly to larger agricultural enterprises to ensure long-term sustainability. To achieve this goal, substantial planning and development of a compre- hensive business plan is key.” She says a business plan is a written document that
should be updated periodically to defi ne goals, outline why these goals are attainable and detail a plan for reaching these goals.
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