Tuesday, April 2, 2013

Research First, Act Second

by Michelle Kowalewski, Penn State Extension Educator, Susquehanna Co.

I recently received a call from a local dairy producer who is currently in business with his father.  His father plans to retire from the business in several years and the son would like to explore options with beef cattle production.  The reason for his call was to find our more information about certified organic.  The producer was very unfamiliar with the process to become a certified organic operation, but this is where his research began - by asking the question!  Whether you are already in an agribusiness or just looking to develop a business, it's important to research your industry.  Ask yourself the following questions:
  • What products and/or services should I consider?
  • What will it take to start this business enterprise?
  • What is the current economic landscape for this business?
  • Who will be my customers?
  • What are my options for reaching my customers?
  • What potential revenues can I expect?

Once you have considered these questions it's time to start your research.  Take a broad look at the industry (agriculture) in your area and then narrow in on the specific product you'd like to produce or service you'd like to provide.  Try looking at past, current, and future trends and try to understand how your product can fit in the marketplace.  Sources for your research can include:
  • Trade publications related to your area of interest
  • Visit federal, state, and local agricultural websites
  • Educational classes or webinars
  • Case studies
Attend educational workshops to learn about your area of interest

Perhaps one of the best methods of research is to conduct a farmer interview.  There is no better way to learn then from firsthand experience.  Talk to producers who are willing to share their experiences, both good and bad, is invaluable.  To find a farmer to interview, think of people you know or get names of potential producers from service providers in your area.  Once you've identified the person(s) you'd like to interview, come up with a list of questions and call to see when they would be available.  Try to pick a time during their "slow" season.  It's best to talk with multiple farmers - all will have different opinions and this will help you weigh out your decisions on what enterprise might be best for you.

Proper market research will help assure your that your preliminary market plan is addressing everything you need to do to prepare, promote, and sell your products.

1 comment:

Miguel Saviroff said...

Also, if borrowed capital is going to be used, need to look at a price/or production risk protection plan as required by lenders.