As
I wrote in one of my books about the expenses you should be careful of when
doing your book, I have seen farmers complaining about why they are not getting
profit from their farm.
The reasons why you are not profiting from your farm are lack
of patience, irregular pricing, much information, no records, not diversifying into other Value chains, poor
management, you do not treat farming as a business, not seeking knowledge of
your production area continuously and waiting to have a product to sell before building
the marketing strategy.
There
are several reasons for this that I will talk about in this article. Whether
you're a new farmer or an experienced farmer, there are some things you should
know before you get into selling your seeds.
If
you want to know why you are not making a profit on your farm, read on
Why You Are Not
Making Profit on Your Farm
• Lack of Patience
The
number one reason you won't make a profit on your farm is impatience. Many
people are too quick to believe everything they see online without delving into
the real information. The Internet is a place of free information, but what you
see is only a quarter of the truth. People only talk about the soft side of
business; they don't bother to look at the bitter side of the business.
Let
me tell you a story about a client I worked with, he started a fish farm for
the first time and we are not even half way through the production process,
they are talking about the profit they will get. Hmm, I laughed and explained
that farming is not a get-rich-quick scheme, you don't start a business today
and believe that you will start profiting immediately.
It
takes time to reach the level of people you meet online. What most new people
don't know is that the people they are looking for started the business a long
time ago (5, 8, or even 10 years), so they have done little and learned the
basics of the business. You are just your first production cycle.
If
you do not have patience, you will not qualify to start an agribusiness because
you will waste your money and time.
•
Irregular Pricing
We
are in an industry where prices are not controlled because there are many
people who start this business to survive and not for anything else.
In
this case, it is difficult to get a single price that really affects the
consumers. Let me clear things up if I sell my fish for $3 after eating for 6
months, and someone else who wants to sell quickly decides to reduce the price
by $0.5 and sell at $2.5, people will rush to buy back from such a person.
These
people do not care whether they are profitable or not. When such things happen,
I will be forced to lower my price so that I can sell my fish quickly. I may
not lower the price to $2.5 but I won't sell to $3 if I want to sell and not
continue to eat junk food. If all this happens, you already know that you will
not do half of what you have to do, sometimes you will break even in this
production process.
Before
you decide the price at which you will sell your agricultural products, be sure
to do the necessary calculations to ensure that it will return to you at the
end of the day. If you don't know how much to take out of the books, read this article
about the hidden expenses you should know about on your farm.
•
Much Information
Imagine that you go to the market to buy something, before you leave your home, you have an idea of what you want the expert to give you, and you arrive at the market and start listening to a lot of noise in the market, you will be confused and misled.
The same thing happens when you consume too much information in one
decision. When a client contacts me about a job they want to do or are
currently working on, I ask about who they were with and what happened to that
person. Bringing experts or different people into your farm to do the right
thing will do you more harm than good.
I'm
not saying that you shouldn't look at what other people are saying about the
business, but I would advise you to analyze all the information you collect and
put into your farming. Don't be an online student who doesn't go to class,
study only online but you want to get out of class first.
If
you do that, you will fail a lot. I cannot stress enough the importance of
keeping accurate records in a food business if you are thinking about the
business and not just for fun.
Many
farmers do not record the daily income of their farm, which does not allow them
to know whether they have made a profit or not, a loss or a misfortune.
• Not Diversifying into other Value
Chains
Another reason why you are not making profit from your
farm is to get stuck in the marketing chain.
There
are different agricultural business value chains, you can connect two or more
at the same time and get money from them. There is no rule that says you have
to make any of these streams useful in your company.
Let
me take catfish farming as an example, there are different ways to make money
from fishing and organizing for fishing and so on. You can combine two similar
or closely related areas of business to make money for yourself.
I
wrote an article about ways to make money from fishing and raising poultry. You
can choose from two methods and combine them to expand your financial system.
•
You Do Not Treat Farming as a Business
The
former Minister of Agriculture and now the Chairman of the Development Bank,
Dr. Akinwumi Adesina, advises farmers to treat agriculture as a business and not
as a development issue, because this is the only way to make money and sustain
it. He argued that many small farmers fail because they do not consider farming
as a business. As a small farmer, if you want to make money from your farm, you
"have to be careful with the soil if you want the business to last
long," said Canadian farmer Curtis Stone.
•
You Do Not Have a Sustainable Agribusiness Plan
Before
starting an agricultural business, you must have a business plan that takes
into account all aspects of production and marketing. The current trend is that
"farmers start farming and try to shape the business around it, instead of
creating a business, creating a plan, and then executing it." If you have
a sustainable business model and build a farm around that model, the chances of
success are high.
•
You Don't Have Time to Explore the Farm or Spend Quality Time on the Farm
This
is one of the killers of many farms. Many farmers who live in cities have
little time to spend on their farms to monitor any new developments. There are
people who usually visit their farm in a week and even when they do, they don't
have time to explore everything in the farm. They hire others to take care of
the farm for them without even taking care of it. Such a farm will not last
long.
•
Not Seeking Knowledge of your Production Area Continuously
As
a farmer, you must constantly update your knowledge in order to become an
expert in what you do. This will help you improve your production capacity and
expand your sales network. You will not be successful if you are not constantly
interacting with people (creating the same thing) and learning from the best.
•
Waiting to Have a product to Sell Before Building the Marketing Strategy
If
you wait until you have the product in hand before selling, you will be in
trouble. "You can start marketing your farm and build an audience from day
one. Don't expect people to line up at the door just because you have a product
to sell," Stone said. advised.
•
Poor Management
The
last, but not the least, reason why you are not making profit from your farm is
poor management.
Management
includes both staff and livestock management, which if you don't take care of
them properly, you will only work for your employees. I have seen many farmers
who treat their workers like crap (like they are not human) they are
responsible for your business and if you do not treat them well, they may
decide to put your business.
Similarly,
if you don't feed your livestock well and use protein-rich feed that will
promote better growth, you won't make money because customers will mistake your
product. I've seen people online eating catfish, eba (it's local food), and
processing it all in the name of cutting down on food costs.
I
tell people, it is what you take that you have to give.
Way
to Follow
If
you want to overcome a lot of negativity in business you have to follow someone
who knows the way, what I'm saying is let your supervisor be a business person,
fail and learn from his failure.
Don't
trade with emotions, trade with a good heart and a clear mind. Contact
counselors who will guide you in the right direction and who are willing to be
clear.
Look
for more information, but don't apply everything you see online to your farm,
because every farm has its own challenges that people won't tell you about.
Final
Thought
We have mentioned in these articles some of the many reasons why you will not get profit from your farm no matter how hard you try. There is no chance in these things, you have to follow the process when you do business.
Farming is like
any business (oil and gas, finance, etc.), you can't cheat the system and keep
going. Don't let anyone fool you into thinking otherwise. If this article is
useful, it would be great if you share it with your fellow farmer or anyone who
is interested in starting a farming business.
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