Do you want to start a poultry farm and you want to know the cost? If YES, here is an estimated cost breakdown to open a poultry farming business.
When starting a poultry farm business, you just have to get your costing cum economic analysis right if your intention of building the business is to generate profit, grow the business and perhaps expand the business and start exporting chicken and eggs within your country and other countries of the world.
When conducting costing and economic analysis for your poultry farm business, you just have to critically examine these key factors; place, product, pricing, promotion. As a matter of fact, you would have to continually review these key factors at regular intervals while running your poultry farm business. As a poultry farm owner, you just have to have a proper grasp of your competitive landscape.
Estimated Cost Breakdown for Opening a Poultry Farm
It is important to note that poultry feed cost is one of the most important factors contributing to the overall cost of a poultry farm business and should be considered as a major factor when carrying out your costing and economic analysis.
Over and above, the cost analysis as it relates to starting a standard poultry farm in the United States of America, Canada, United Kingdom, Australia can be said to be almost the same except for few variations. For example, the cost of constructing a poultry farm with the right fencing are same especially when benchmarked against the US Dollars.
Other factors that may be slightly different in terms of costing when it comes to starting a standard poultry farm business in any of the countries listed above are cost of labor, cost of poultry feed, cost of poultry medication, cost of transportation and logistics, local tax, insurance policies, business incorporation fee, promotion and branding cost, rent/leasing amongst other factors.
Over and above, when it comes to starting a medium scale poultry farm business, you should be prepared to either rent or lease a large farm land in a good and easy to access location; this is going to be one of the areas where you are expected to spend the bulk of your start–up capital.
These are the key expenses you are expected to make when starting a medium scale but standard poultry farm business in the united states of America;
- The cost for the purchase of poultry feed and poultry medication – $35,000.
- The operational cost for the first 3 months (salaries of employees, payments of bills et al) – $60,000.
- Other start-up expenses including stationery ($500) and phone and utility (gas, sewer, water and electric) deposits ($6,500).
- The cost for the construction of a standard poultry facility with the right fencing – $200,000.
- The cost for leasing a large farm land – $200,000
- The cost for insurance (general liability, theft, workers’ compensation and property casualty) coverage at a total premium – $30,400.
- The cost for hiring a business consultant (including writing business plan) – $2,500.
- Marketing promotion expenses for the grand opening of the poultry farm in the amount of $3,500 and as well as flyer printing (2,000 flyers at $0.04 per copy) for the total amount of $3,580.
- Legal expenses for obtaining licenses and permits (Health department license and business license) and permits (Fire department permit, Air and water pollution control permit, Sign permit et al) as well as accounting services (CRM software, Payroll software, P.O.S machines and other software) – $15,300.
- The total fee for registering the business in the United States of America – $750.
- The amount required for the purchase of the first set of various birds, chicken, turkey, quails, guinea fowls, ducks et al – $100,000.
- The cost for acquiring the required working tools and equipment, machines, hatchery et al– $100,000.
- The cost for store equipment (cash register, security, ventilation, signage) – $13,750
- The cost of purchase and installation of CCTVs – $5,000
- The cost for building and hosting a website – $600
- The cost for opening party – $8,000
- Miscellaneous – $5,000
You will need an estimate of seven hundred and fifty thousand Dollars ($750,000) to successfully set up a medium scale but standard poultry farm business with the capacity to raise various birds, a standard hatchery and mass egg production in the United States of America. Please note that this amount includes the salaries of all the staff for the first 3 months of operation.
Starting a small scale but standard poultry farm business with the capacity to raise minimal birds in the United States of America will cost from five thousand dollars to twenty five thousand Dollars ($5,000 to $25,000). Please note that this amount includes the salaries of all the staff for the first 3 months of operation.
When it comes to starting a standard and large scale poultry farm business with the capacity to raise various birds, operate a standard commercial hatchery, with mass egg production and the capacity to export chicken and eggs in the United States of America, then you should look towards budgeting well over two million Dollars ($2 million). Please note that this amount includes the salaries of all the staff for the first 3 months of operation.
Factors That Determine the Cost of Opening a Poultry Farm
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First, you would need to purchase a good plot of land that would be suitable for farming. Farm lands are usually cheaper than lands in residential areas, so you may be lucky to get a very sizable plot at a very good price.
For instance, you can get a very good plot of farm land with about $3,500. I am certain that regardless of which country you decide to set up your poultry farm, you should be able to get a good farmland within the price range of $3,500 and $5,000 or even cheaper.
2. Construction Costs
The next stage after purchase of land is construction. You would have to build a cage to keep the birds in. There are different types of cages and you can check one of my previous articles on how to start a poultry farm for the different types of poultry housing.
When you have decided on the most suitable one for you, then you can call in experts to give you a quote. You may also need to construct some building like stores for keeping equipment and supplies and maybe a security/farm house for farm laborers.
The next thing you would have to spend on is getting chicks to start your farm with. As a beginner, you wouldn’t have chicks of your own yet so you would have to buy from other poultry farmers. The number of chicks you would need depends on the size of your farm and the capacity of the poultry housing you have constructed.
The price would also depend on the size of the chicks. Day old chicks are usually very cheap and you could get a carton of about 24 chicks for $1.5 to $2. You may even get it for cheaper but you have to be careful when handling day old chicks because they are usually at a high risk of dying.
4. Poultry Equipment
This is yet another thing that is dependent on the size of your poultry farm and the nature of your business. If you want to hatch and sell chicks for instance, you would have to buy hatchery equipment. If you want to process meat for sale, you would also need meat processing equipment. The same thing goes for if you want to produce your own poultry feed yourself.
So as for cost of equipment, you would really have to sit down and decide on the nature of poultry farming you want to do and find out the type of equipment you would need but you should have a budget of at least ,000 for purchasing equipment for a commercial poultry farm.
Your birds must be given the necessary medical attention so that they can grow properly and produce efficiently. You have to include the costs of vaccination in your business plan. This cost would also include costs of drugs and payment to the medical consultant that would be called upon to give the birds the required medical attention. Again, you should have a budget of at least $500 for about 200 birds.
This is like the most important expense you would undertake in this business. Feeding is very important because the growth and productivity of your birds would depend on how well you feed them. There are different types of poultry feeds for different stages in the bird’s lives.
There is the starter for when they are little chicks, there is the grower for optimal growth and strength and there is the finisher for when they are getting close to the selling stage. You can budget about $700 for 200 chicks but if you want to cut costs of feeding, you can consider producing your own poultry feed. Although this may cost you a lot of money for a start, it would save you a lot of money in the long run.
7. Cost of Labor
If you are setting up a commercial poultry farm, it is unlikely that you would be capable of handling all the tasks yourself.
You may have to employ people to assist you and you would need to pay them. You can make a budget of at least $1,000 for that but the actual cost would depend on labor rates in the country where you want to set up your poultry farm.
8. Other Expenses
You should also make out a budget for electricity, transportation, advertising, security, insurance as well as selling and distribution expenses. To get a detailed and accurate cost of setting up your poultry farm, it is advisable for you to carry out your own feasibility study
Can a Poultry Farm Business be Bootstrapped on a Lean Budget from Home?
If you a looking for a small scale business that you can successfully bootstrap on a lean budget right from your home, then you should consider starting a poultry farm business. This is possible if you have enough space in your compound. The truth is that people that live in rural communities find it pretty easy to either start a poultry farm at their backyard or start a small garden or both.
All you have to do is to construct a portable poultry with the right poultry wire and fencing, purchase some poultry birds or chicken, poultry feed and poultry medication. As a matter of fact, you can start a poultry farm with as low as two thousand dollars or even less depending on how small you want the business to be.
The challenge here is that you must be ready to take on more than half of the available roles in the business. You should be able to serve as the general farm manager, accountant, security guard and sales and marketing officer et al.
How Much Does It Cost to Buy a Poultry Farm Franchise?
From available research conducted, there are no known fully operational poultry farm in the United States of America, United Kingdom, Canada and Australia that is into franchising. Most players in this line of business are adopting strategies that will help them sell their birds and eggs beyond the city, state or country where their poultry farm in domicile to other parts of the world as against selling franchise.
Besides, it is easier to start and run a poultry farm from scratch to profitability without leveraging on a known brand name. People will patronize your birds/chicken and eggs based on accessibility and pricing as against relying on a brand name.
Financing Your Poultry Farm Business
Even though the poultry farm business is regarded as a lucrative business, it does not therefore mean that everyone gets the financing they require for this business, as it is regarded as a lucrative but highly risky business. Financing a business is not only important, but it determines if a business idea would kick off and become a reality or just remain as a business idea.
Most entrepreneurs do not relish the fact of having to source for start-up capital as the requirements can be cumbersome and very strenuous; however, every serious entrepreneur knows the importance of finance. This is the reason why one needs a business plan on ground.
Some of the options that will be available to you when it comes to raising money to finance your poultry farm business in the United States of America are;
- Applying for credit facility from the relevant government agency
- Sourcing for grants from public and private institutions
- Raising money from personal savings
- Sourcing for loan from family and friends
- Applying for loan from the bank