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Guide to Starting a Farm Supply Store

By Edited May 18, 2015 0 0

Farm supply stores provide farmers and ranchers with the supplies and products they need to care for their crops and animals. Some supply stores are located in cities nearby major retail areas while others are in rural towns combined with a local farmer's co-op. Regardless of location, you can start your own store by learning what it takes to start a farm supply business.

Become knowledgeable about farming. Learn the needs of farmers in your community. Find out what crops and animals are popular in your region and cater the supplies in your store to them. Become familiar with pet and gardening supplies as well since some non-farmers may also use your store to get the products they need for their home and activities.

Write a business plan. Conduct an analysis of your strengths and weaknesses to determine what opportunities you have opening a farm supply store as well as what competition or threats exist. Determine the amount of money you need to start a farm supply store as well as how long it will take before it starts to make a profit. Include plans for marketing and advertising the farm supply business as well.

Obtain funding. Go to a bank or credit union to speak with a loan officer and apply for a business loan to fund the startup of your farm supply business. Bring along a copy of your business plan to include with your loan application since most financial institutions want to review this before approving the loan application. Find out if you qualify for any low-interest or guaranteed loans through the U.S. Small Business Administration since you're starting your own small business. If you can't qualify for a loan, consider partnering with an investor who will donate money to start the farm supply business in return for a share of the profits.

Find a facility. Seek out a commercial property that has the space to operate your farm supply store. Search for a building capable of housing large pallets of feed and grain as well as farm supplies such as troughs, water tanks, cattle panels and fencing. Ensure that your location is easily accessible to farmers by choosing a location on the outskirts of town. This makes trips to your farm supply store quick and possible in farm machines such as a tractor.

Buy insurance. Purchase general liability insurance to protect your business in the event someone is injured while in your farm supply store. Get property insurance to protect against damage to your building and your supplies by fire or a natural disaster.

Find supplies. Determine what farm supplies to offer in your store, and find out who manufactures them. Learn if they sell the product directly to retail stores or if they use a wholesale supplier. Use the financial information from your business plan along with the wholesale price of the products to determine selling prices for supplies in your store. Review the quantity and frequency of products sold as your business grows to learn and customize ordering of supplies to the demands farmers in your area.

Hire staff. Obtain employees knowledgeable about farm supplies, who can provide solid advice to customers with questions. Consider hiring delivery staff to take supplies to farmers who order products over the phone. This is a great way to beat your competition since farmers often don't have time to drive to the store to get the supplies they need.

Advertise your farm supply business. Look for ways to advertise to the farming community about your new farm supply store. Consider an advertisement or article in a local farming journal. Hang flyers at farmer co-ops, livestock shows, sell barns and other places farmers frequent. Get to know the farmers in your area since they have the potential to become repeat customers and make your farm supply business a success.



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