Building An Entrepreneur Friendly

Community
Opportunities for Entrepreneurs in Agriculture
 The Need for Integrated
Entrepreneurs in Agriculture

• Farmers historically have been production

entrepreneurs producing a commodity

• Other entrepreneurs have added value to

these commodities
 The Need for Integrated
Entrepreneurs in Agriculture

• The result has been a decrease in the amount of

food expenditures which go to the farmer:
1900 – 65 cents
1960 – 40 cents
1980 – 37 cents
1992 – 23 cents
2003 – 16 cents
 How Can Farmers Become
Integrated Entrepreneurs?

1. Add value to commodity produced

2. Market directly to consumer
3. Alternative enterprises
4. Niche markets
5. Sell experience (the sizzle)
6. Brand your product
7. Sell service, management, or
convenience
 Why Should Farmers Become
Integrated Entrepreneurs?

1.Add value to product you produce

(Name of County) County hog producer:

-Sell fat hogs at sale barn:
260 lbs. X .50/lb = $130 gross
 Why Should Farmers Become
Integrated Entrepreneurs?

(Name of County) County hog producer:

-Direct market freezer pork to
consumers at farmers markets

195 lbs. pork X $1.49/lb = $290.55 gross

 Why Should Farmers Become
Integrated Entrepreneurs?

(Name of County) County hog producer:

-Add value & sell service

Bill’s BBQ Service sells roasted pork

260 lb. hog = 75 lbs. roasted pork
75 lbs X $6 per pound = $450 gross
 Which Would you Choose?

• (Name of County) County hog producer:

- $132.50
- $290.55
- $450.00
 How Can Farmers Become
Integrated Entrepreneurs?

2. Market directly to consumers

-farmers markets
-roadside and farm stands
-CSA
-festivals & community events
-online sales
-subscriptions and orders
-many more!
 How Can Farmers Become
Integrated Entrepreneurs?

Why direct market?

Wholesale markets pay farmers 16 cents of every

dollar consumer spends on food

Direct markets pay farmers more than 95 cents of

every dollar consumer spends on food
 How Can Farmers Become
Integrated Entrepreneurs?

3. Alternative enterprises

Unlimited opportunities in a state of 11

million residents
 How Can Farmers Become
Integrated Entrepreneurs?

4. Niche markets

Niche doesn’t mean small

Millions of niches in a state of 11 million!

 How Can Farmers Become
Integrated Entrepreneurs?

5. Sell experiences
-farm tours
-pick-your-own
-corn mazes
-hay rides
-vineyard/winery
-farm vacation, dude ranch, etc.
-lots more
 How Can Farmers Become
Integrated Entrepreneurs?

6. Brand your product

 How Can Farmers Become
Integrated Entrepreneurs?

Progression of economic value w/ branding:

Coffee grower commodity $1.25/lb

Kroger product $6.00/lb
McDonalds service $25/lb
Starbucks experience $50/lb
 How Can Farmers Become
Integrated Entrepreneurs?

7. Sell service, management, or

convenience
-Horse boarding
-Contract raising of heifers
-Custom farming
 Supporting Integrated
Entrepreneurs in Agriculture

• Infrastructure
• Networks
• Capital
• Education
 Supporting Integrated
Entrepreneurs in Agriculture

• Infrastructure:
-Production infrastructure
-Processing infrastructure
-Marketing infrastructure
-Infrastructure infrastructure!
 Supporting Integrated
Entrepreneurs in Agriculture

• Networks for production, processing, marketing:

-Co-ops
-Kitchen or business incubator
-Farmers markets
-Commodity groups
-Chambers of Commerce/trade groups
-Others
 Supporting Integrated
Entrepreneurs in Agriculture

• Capital:
-Revolving loan funds
-Low interest loans
-Micro loans
-Venture capital funds
-Grant funds
-Special programs
i.e., Tobacco funds
 Supporting Integrated Agricultural
Entrepreneurs

• Education:
-Production topics
-Business management
 Contact Information

Put your name and affiliation on this slide. Please also

give credit to author and Ohio State University Extension

Adapted from an original presentation created by:

Mike Hogan, Associate Professor
Ohio State University Extension
October 2008