Dairy farming business from scratch

Dairy farming business from scratch

Are you looking to start a dairy business?  here is a complete guide to starting a dairy farming business with no money or experience  .

Ok, so we have provided you with a detailed example of a dairy farming business plan template. We also took it a step further by analyzing and writing a sample dairy marketing plan backed by actionable guerrilla marketing ideas for dairy companies. By giving you:

  1. Industry overview
  2. Market study and feasibility
  3. Dairy farm business plan
  4. Dairy Farm Name Ideas
  5. Licenses and permits
  6. Dairy farm marketing plan
  7. The cost of starting a dairy farm
  8. Marketing idea strategies

In this article, we will cover all the requirements for starting a dairy farming business. So put on your entrepreneur hat and let’s move on.

Why start a dairy farming business?

In the United States and most countries around the world, you can successfully start your own dairy farm and expand your business internationally by exporting milk and cheese to the United States of America and other regions. of the world.

Basically, dairy farming is a type of agriculture that responds to the long-term production of milk and cheese that are processed (either on a farm, or in a dairy, or which may be called dairy products) for sale. possible products.

A close examination of the dairy industry reveals that most dairy farms that have production facilities focus on more than commercial production of raw milk. for households and businesses. They are involved in the production of liquid dairy products, cheese, powdered, condensed and condensed milk, butter and yogurt… They went so far as to found a standard dairy and beef processing company in phase with their core business. It is a way to maximize profits and increase your source of income.

Starting a dairy farm business comes with its own challenges, but that doesn’t exclude it as a truly profitable business. A budding entrepreneur can start a small or large scale dairy farm, depending on their financial situation. If you are interested in starting a dairy farm business, check out this article.

Start a dairy farm from scratch. The Complete Guide

  • Industry overview

There are several business opportunities in agriculture and dairy farms are one of them. A good thing about the agricultural industry is that there is a market for all the products of the industry. A dairy farm is, of course, a thriving and profitable business because of the health benefits of beef and milk. People eat beef, drink milk, use fur and leather. From cattle milk, cheese can be prepared together with other dairy products.

Companies in the dairy industry mainly raise cattle for milk. Although this industry is primarily involved in the sale of raw milk and excludes the production of fluid fluid milk and processed dairy products such as butter, cheese and powdered milk, some dairy farms may accommodate other businesses. related industry if they are able to do so.

Recently, raw milk prices have been very volatile, resulting in fluctuations in the income of the dairy industry. For example, in 2011 the price of milk rebounded from the recession and jumped due to growing global demand, resulting in significant income growth. The 2016 dairy surplus was expected to further deepen industry profits.

However, despite all the volatility, the sector is expected to experience significant growth going forward. Currently, cattle feed prices, which typically account for about half of total dairy farm costs, have declined significantly in 2014, significantly increasing the profitability of the industry.

Dairy Farms This industry is indeed a large industry and is very active in countries like United States of America, Israel, Argentina, Netherlands, Egypt, China, Germany, Turkey , Nigeria and others. There is not a single dairy farm company that held a dominant position in the industry market, so small dairy farms can benefit from it.

According to statistics, in the United States of America alone, approximately 42,536 people are registered and licensed. dairy farms employ around 345,672 people, and the industry receives a whopping $ 47 billion a year. The industry is expected to grow by 1.3% per year.

As a budding entrepreneur looking to strengthen agriculture. industry to generate huge income, then one of the best options is to start a dairy farming business. Dairy farms are engaged in the mass rearing of cattle (cows, bulls, bulls, calves, bulls, heifers, calves, etc.) for the sole purpose of obtaining raw milk in commercial quantities and, of course, from make a profit.

Some of the factors that motivate entrepreneurs to start their own dairy farms may be that the business is easy to set up and they can easily gain government support; in fact, you can set up your own dairy farm in your resort if you live in a rural or farming community. All you have to do is buy your first herd of cattle, buy milking equipment, and then build a secure fence.

Despite the fact that dairy farms have been around since time immemorial, this in no way leads to oversaturation of the industry; Dairy farmers are exploring new technologies to further improve their raw milk production processes as well as the preservation and packaging processes for meat and milk. The fact that there is always a ready market for raw milk and other dairy products makes the business even greener.

Like any other business, if you are able to do cost analysis, market research, and feasibility studies before you start your dairy farm, you probably won’t have a hard time selling your raw milk and other products. dairy because there are tons of people there. who eat beef, drink milk and industries that use livestock by-products in their products.

In addition, there are few barriers to entry into the dairy industry. Usually all input data is readily available. In the near future, the industry may face the highest costs associated with access to technology, especially with regard to the development of genetic modification in animal production.

Additionally, intellectual property rights protecting new inventions and technologies could mean that new entrepreneurs entering the industry will have to pay licensing fees, which will of course lead to increased start-up costs to start a breeding business. bovine semen. cattle on a dairy farm.

Starting a dairy farm from scratch, market research and feasibility studies

  • Demography and psychography

The demographic and psychographic makeup of those who consume milk, cheese and other dairy products is not limited to a group of people. Babies, adults and even pets drink milk, so the dairy market covers the entire market.

So if you want to define the demographics of your dairy business, you have to cover it all. This should include households, dairy businesses, pet owners, and businesses that depend on the supply of fresh milk or cheese from dairy farms.

List of niche ideas within the dairy farming business that you can specialize in

There is no niche in the dairy industry, although a dairy farm may choose to specialize in the production of cow’s milk only, goat’s milk or camel’s milk, or to generalize or expand. concentrate in commercial production. production of raw milk for households and companies producing liquid dairy products, cheese, dry, condensed and condensed milk, butter and yogurt, etc.

So if you want to get started if you own a dairy farm, you need to clearly define your market so you know how to deliver dairy to them.

  • The level of competition in the dairy industry

No matter what industry you decide to pitch your tent in, you will always be competing against others in the same industry, and the dairy industry is no exception.

The level of competition in the dairy industry depends to some extent primarily on the location of the business and of course the capacity of your dairy farm. If you can manage to create a unique niche for your dairy farm, you will likely encounter little to no competition. For example, if you are the only dairy farm in your area that produces camel milk, you may be able to monopolize the market for a long time before competing.

It is also important to point out that competition in the dairy industry depends on the size of your dairy farms. There are dairy farms in the United States that compete with the dairy farms of the world, and there are dairy farms in the United States that can only compete locally.

List of famous brands in the dairy industry

Here are some of the major dairy farms in the United States of America;

  • Aurora Organic Dairy
  • Chaseholm Farm Creamery
  • Cooperative Dairylea Inc.
  • Desert Farms is the first American company to market camel milk
  • Foster Farms Dairy
  • Joseph Gallo Farms is a large family owned dairy business which is a preeminent dairy business in California; based in Livingston, California,
  • Maytag Dairy Farms – Founded in 2041 by Frederick Louis Maytag II and based in Newton, Iowa, it produces blue cheese and other cheeses
  • Dairy products from Prairie farms
  • Smiling hill farm
  • Dairy goat for surfing
  • G. Lee Dairy
  • Tuscan dairy farms
  • Waldrep dairy farm
  • Organic valley
  • Prairie dairy plants
  • Louis Trout dairy
  • Gustafsons Farm is a brand of milk and dairy products sold in Florida
  • Brewster Dairy
  • Byrne Dairy
  • Ardith Mae farm goat cheese

Economic analysis

When you start a dairy farm business, you just need to properly assess your economic analysis, if you want to start a business is to make a profit, grow a business and eventually expand your business and start exporting meat and processed milk to your country and other countries around the world. …

When performing cost analysis and economic analysis of your dairy farm business, all you need to do is take a critical look at these key factors; location, product, price and promotion – In fact, you will need to regularly review these key factors when running a dairy business. As a dairy farm owner, you just need to create your competitive environment if you are serious about maximizing your profits and being at the forefront of the industry.

It is important to note that the cost of treating / treating cattle is one of the most important factors affecting the overall value of a dairy farm business and should be considered a major factor in your cost and cost analysis. ‘economy. This is why a standard dairy farm would prefer to hire a veterinarian rather than contracting livestock treatment with a veterinary clinic.

Start a dairy farm from scratch, not buy a franchise

When it comes to starting a business of this nature, you have to pay from scratch rather than buying a franchise. In addition, according to the available research, no fully operational dairy farms in the United States of America are franchised. Most of the players in this business adopt strategies that will help them sell milk and meat outside of the city, state or country where their dairy farm is located in other parts of the world, rather than to sell a franchise.

Plus, it’s easier to start and run a zero-to-profit dairy farm without using a well-known brand. People will patronize your milk or cheese based on availability and price rather than relying on the brand.

Note that most of the large dairy farms and successful dairy companies started from scratch and were able to build a strong business brand. Business success requires dedication, hard work and determination, and of course, you can build your own dairy farm to become a successful dairy farm in your area of ​​specialization, and even start exporting milk and other products. dairy products to other countries of the world.

Threats and potential challenges you will face when starting a dairy farm business

If you do decide to start your own dairy farm business today, one of the main things you might face is the problem of having a well established dairy farm in your target market. The only way to avoid this problem is to create your own market; focus on households, individuals and start-ups who need fresh milk from a dairy farm.

Some other threats and challenges that you are likely to face when starting your own dairy farm are the global economic downturn which can negatively impact household spending, inclement weather and natural disasters (drafts, epidemics), unfavorable government policies and the arrival of a competitor (a dairy farm or even a beef farm that also produces raw milk) in the same location. There is virtually nothing you can do about these threats and challenges other than optimistically expecting everything to work for you.

Starting a dairy business from scratch Legal issues

  • Best legal entity to use on a dairy farm

Starting a dairy farm business is a very serious business, which is why, as a legal entity, you decide how important it is to determine the size of your business. Without a doubt, choosing a legal entity for a business can be a bit tricky.

When it comes to choosing a legal entity for your dairy farm, you have the option of choosing from a general partnership, limited liability company, LLC, C corporation or C corporation. It is important to ‘make it clear that these different forms of legal structures have their own advantages and disadvantages; This is why you must carefully weigh your options before making your choice.

Here are some of the factors to consider before choosing a legal entity for your dairy business; limitation of personal liability, ease of transfer, acceptance of new owners and investor expectations, and of course taxes.

If you take the time to do critical research on the different legal entities that will be used for your dairy farm business, you will agree that a limited liability company; LLC is the most appropriate. You can start this type of business as a limited liability company (LLC) and in the future turn it into a “C” corporation or an “S” corporation, especially if you plan to become a public and international corporation.

Switching to a C or S company will give you the opportunity to grow your dairy farm business to compete with the major industry players not only in the United States of America, but also globally; you will be able to receive capital from venture capital firms, benefit from a separate tax structure and easily transfer ownership of the business; you will have flexibility in ownership and in your management structures.

Catchy trade name ideas suitable for a dairy farm

As a general rule, when it comes to choosing a name for your business, you have to be creative, because whatever name you choose for your business will go a long way in creating a perception of what is. the company. business people generally follow the trends of the industry they intend to work with.

If you are thinking of starting your own dairy farm business, here are some catchy names you can choose from;

  • Golden Era Dairy Farms Ltd
  • Columbus Drake Sons Dairy Farms, LLC
  • Bay Town Community Dairy Farms, Inc.
  • John Bosco Organic Dairy Farms Ltd.
  • Captain LP Dairy Farms, LLC.
  • Camel and Cows Dairy Farms Ltd.
  • Jose and Justin Daire
  • Dairy Star Farms, Inc.
  • County Lake Dairy, Inc.
  • Sally Milk Cheese Farms, LLC.

Insurance conditions

In the United States and most countries around the world, you cannot run a business without the basic insurance required for the industry in which you want to work. of. Thus, it is imperative to create an insurance budget and possibly consult an insurance broker to help you choose the best and most suitable insurance policies for your dairy business.

Here are some of the basic insurance policies that you should consider when buying if you want to start your own dairy farm business in the United States of America;

  • General insurance
  • Health insurance
  • Liability insurance
  • Animal mortality insurance
  • Insurance of agricultural equipment and vehicles
  • Commercial agri-food insurance
  • Workers compensation
  • General disability insurance
  • Group insurance for business owners
  • Payment protection insurance

Protection of intellectual property / trademark

If you are planning to start your own dairy farm business, you generally will not need to apply for intellectual property / trademark protection. This is because the nature of the business allows you to successfully run your business without any reason to challenge anyone in court for illegal use of your business intellectual property.

But if you just want to protect your company logo and other documents or software that are unique to you, or even manufacturing concepts, you can file for intellectual property protection. If you want to register your trademark, you must begin the process by filing an application with the USPTO. Final approval of your trademark is subject to legal review as required by the USPTO.

Do i need professional certification to run a dairy farm?

Besides the milk that you produce on your dairy farm, professional certification is one of the main reasons most dairy farms commit to supplying raw milk to large companies that depend on fresh milk from dairy farms, you must therefore strive to obtain all the certifications you need. in their field of specialization. It is strongly recommended to obtain professional certification; this will go a long way in demonstrating your commitment to the company.

Here are some of the certifications you can aspire to if you want to run your own dairy farm business;

  • Organic dairy certification
  • National certificate in the field of dairy farming (artificial insemination)
  • Dairy Management Certificate Program
  • Dairy Manufacturing Medicine (DPM) Certificate Program
  • Production of certified organic milk
  • Dairy Production Systems Consultant Certification

Please note that average local dairy farmers in the suburbs of the United States are not certified, which does not prevent them from developing dairy farms in any way.

List of legal documents required to start a dairy farm

The essence of having the necessary documentation that existed prior to starting a business in the United States of America cannot be overstated. It is the fact that you cannot run a successful business in the United States without proper documentation.

Here are some of the basic legal documents you need to have if you want to legally operate your own dairy farming business in the United States of America;

  • Business and liability insurance
  • Commercial vehicle operator registration for distribution truck
  • Food and Beverage Handler Certificate
  • Appropriate driving license for drivers
  • Assistant licenses for assistants
  • Medical examination certificate
  • Proof of ownership, correct identification and license of the vehicle
  • The deposit service, commissioner or technical support meets the operating needs of the vending machine
  • Copy of the technical support center license and / or recent inspection report
  • taxpayer ID
  • Fire certificate
  • Registration certificate
  • Business license
  • Business plan
  • Non-disclosure agreement
  • Employment contract (letters with proposals)
  • Employee Handbook
  • Operating Agreement for LLC
  • Agricultural partnership agreement
  • Operating Agreement for LLC
  • Insurance policy
  • Apostille (for those intending to work outside the United States of America)

Financing of dairy companies

Setting up a standard, well-equipped dairy farm can be capital intensive, especially if you decide to start a large dairy farm capable of supplying raw milk outside your immediate community Secure a large farmland, build a ranch well protected with the right fence, purchasing your first equipment for livestock and milking milk is part of what will require a significant chunk of your start-up capital, but if you decide to go into a small business, you won’t have maybe no need to raise funds to finance the business.

There is no doubt that when it comes to business financing, this is one of the first things and perhaps the main factors that you should consider in writing a good business plan. If you have a good, viable business plan document, you may not have to work on your own before convincing your bank, investors, and friends to invest in your business.

Here are some of the options you can explore when looking for start-up capital for your dairy business;

  • raise funds from personal savings and sell personal stocks and property
  • raise funds from investors and business partners
  • Sell ​​shares to interested investors
  • Apply for a loan from your bank / banks
  • Transfer your business idea and apply for business grants and seed funding from government, donor organizations, and angel investors
  • Source of loans on favorable terms from your family and friends.

Choosing the right location for your dairy farm

Starting a business like a dairy farm comes with its own challenges; it is a business that cannot be located anywhere that you choose. In fact, you will not be allowed to open a dairy farm in a residential complex in the United States of America, Canada, the United Kingdom and Australia. The only place where you might be allowed to run a dairy farm is a dedicated dairy farm.

Dairy farming starts with the technical details of the workforce

When it comes to starting a standard dairy farm business, you will need the following equipment / machines; milking machine and milk collector, milk storage tanks and containers, waterfall / channel, guardrail, shovel and rake, and wheelbarrow / cart. This equipment can be bought as just if you are on a tight budget.

When it comes to choosing between leasing and leasing land for your dairy farms, the size of the dairy you want to own and your budget for your entire business. If you have enough capital to run a fairly large and well-equipped dairy farm, you should consider a long-term lease or an appropriate purchase of farmland; When you lease or buy farmland, you will be able to work with long term planning, structuring and expansion.

When it comes to how many employees you are supposed to start your business with, you will need to consider your finances before making a decision. On average, for the large-scale start of a standard dairy farm, you will need the services of the following specialists; COO (you can fill this position), general farm manager, veterinarian (optional as he can be hired), human resources manager and administrator, accountant / cashier, sales and marketing manager, field workers, cleaners and guards of security.

In addition, you will need a minimum of 15-20 key employees to effectively manage a medium to standard dairy farm. Please note that there will be times when you will need to be able to hire experts to help you with a job. If you are just starting out, you may not have the financial capacity or the business structure to retain all of the professionals expected to work with you, so you should plan to partner with the veterinary clinics around you.

Production process in a dairy farm

When it comes to a dairy product from a dairy farm, the process is simple and straightforward, but in fact, a dairy farm can operate successfully on autopilot with little to no owner oversight.

Basically, when the cattle (female) are mature enough to produce milk, a certain time of day (usually in the morning) is chosen when the cattle will be milked. Once the milk has been collected, it is stored in a clean container or delivered directly to the customer on request.

Some dairy farms that can run a standard business make sure that after collecting the amount of milk needed for the day, they also process and produce liquid dairy products, cheese, powdered, condensed and condensed milk, butter , yogurt, etc. Then they are marketed or sold in retail stores for the purpose for which they are intended in the community.

Creation of a dairy farming business. Marketing plan

  • Marketing ideas and strategies

As a dairy farmer you will need to prove that you have the ability not only to run a dairy farm, but also to consistently deliver fresh milk on a commercial level. So, if you are planning to start your own dairy farm, you will need to build your capacity first before using fresh milk for large companies that need fresh milk from dairy farms.

The fact that entry is a low barrier to starting a small dairy business means that there are bound to be more players in the industry no matter where you choose your location. Essentially, you have to find creativity and innovation if you want to market available in your community, city, state or country.

So, when developing your marketing plans and strategies for your dairy farm, make sure you create an attractive personal and business profile. In addition to your qualifications and experience, it is important to be clear in practice what you have been able to achieve in the meantime with a dairy farm. This will help you increase your chances in the market when selling fresh milk and other dairy products.

Please note that in most cases when submitting an offer for fresh milk from organizations that need fresh milk, you will be asked to defend your offer and therefore you should be quite good with introductions.

Here are some of the platforms you can use to promote your dairy farm and its products;

  • Introduce your business by sending cover letters with your brochure to households, food manufacturing and processing companies that use fresh milk, corporate organizations, and businesses in the United States (if you are just starting out, you can focus on startups and small businesses) …
  • Effectiveness of tendering for contracts for the supply of fresh milk, etc.
  • Open your dairy farm with a group to get the attention of the villagers who are your first targets.
  • From time to time participate in roadshows in targeted communities to market your products.
  • Promote your products in local newspapers, local TV and radio stations.
  • List your businesses and products in yellow pages (local directories).
  • Internet to promote your dairy farm.
  • Do direct marketing and sales.
  • Encourage the use of word of mouth (referrals) marketing.
  • Use the power of the internet to promote your business (when you blog regularly on key business issues, people see you as an expert in this field).
  • Join local chambers of commerce around you with one main goal. networking and marketing of your products; Most likely, you will receive referrals from these networks.
  • Hire direct marketing marketing managers and business developers.

Strategies Increase brand awareness and corporate identity of dairy farms

No matter what industry you belong to, the truth is that the market is dynamic and requires constant brand awareness and stimulation. continue to attract your target market. Your corporate identity has a lot in common when it comes to building a profitable and sustainable business.

Here are the platforms you can use to build your brand awareness and brand identity for your dairy farm;

  • Place advertisements both in print (in newspapers and magazines) and on electronic media. Platform
  • Sponsor relevant community events / programs
  • Use on the Internet and social networks such as; Instagram, Facebook, Twitter, YouTube, Google +, etc. To promote your business
  • Set up bulletin boards at strategic locations in the city or state
  • From time to time take part in roadshows in targeted areas
  • Distribute leaflets and flyers in targeted areas
  • Reach out to businesses and residents in your target areas by calling them and letting them know about your dairy farm and dairy products. You sell
  • List your dairy farms in local directories / yellow pages
  • Promote your dairy farms on your official website and implement strategies that will help drive traffic to your site.
  • Make sure that all of your employees are wearing your branded shirts and that all of your cars and trucks are properly branded with your company logo etc.