Do you want to start a sheep farm and need to write a business plan? If YES, here is a sample sheep farming business plan template & FREE feasibility report. Sheep farming is a business that is becoming attractive and interested investors are channeling their monies in this industry. This is so because aside from the meat (mutton or lamb), products such as milk and wool and even the horns and hoofs are in high demand from related industries.
Another good news is that you can’t get it wrong because sheep meat (mutton or lamb) finds general acceptance in the world, especially among tribes that would rather not eat beef.
It is important to state that starting a sheep farming business comes with its own fair share of challenges, but that does not rule out the fact that it is indeed a profitable business venture. An aspiring entrepreneur can either choose to start it on a small or large scale depending on their financial status.
A Sample Sheep Farming Business Plan Template
Table of Content
- 2. Executive Summary
- 5. Job Roles and Responsibilities
- 6. SWOT Analysis
- 7. MARKET ANALYSIS
- 13. Startup Expenditure (Budget)
1. Industry Overview
Sheep farmers primarily raise or fatten sheep and lambs for their wool, meat, milk or sale to other farmers. Meat derived from these animals is separated into two categories, which include lamb and mutton. Lamb is meat from sheep less than one year old, while mutton refers to meat from sheep more than one year old.
There is no single sheep farming company that has dominate market share in the industry hence smaller sheep farming business can successfully make profits. Statistics has it that in the united states of America alone, there are about 50,144 registered and licensed sheep farming business responsible for employing about 48,966 people and the industry rakes in a whooping sum of $621 million annually.
The industry was projected to enjoy 2.5 percent annual growth between 2014 and 2019. It is important to state that the sheep farming in the US industry has no companies with major market shares.
A recent report published by IBISWorld shows that that industry revenue will decline at an average annualized rate of 6.5 percent to $385.6 million over the five years to 2010. Sheep farming operations are shrinking, as the result of low demand and diminished production levels.
Meat production has particularly been hurt by the high level of imports, with lamb imports being significantly affected. Since lamb is considered a high-end meat, the economic downturn has caused disposable income levels to drop, consequently hurting consumer demand. With demand remaining low, prices have been negatively affected.
Wool production, another aspect of sheep farming, is continuing to decline as well. Wool yields per animal have decreased marginally, though prices are expected to remain high because of concerns about the Australian wool supply and strong global demand.
Still, profits are expected to fall at a relatively strong rate over the last five years, with the cost of feed rising and drought conditions threatening production. In light of these negative trends, farm numbers are expected to fall, with enterprise, establishment and employment numbers all declining.
One thing is certain about sheep farming business, if you are able to conduct your market research and feasibility studies, you are more likely not going to struggle to sell your sheep and its by products because loads of people out there eat mutton, drink milk and industries make use of byproducts from sheep in manufacturing their products.
Over and above there are few barriers to entry into the sheep farming industry. Usually, all inputs are readily available. In the nearest future, players in this industry may face the highest costs associated with accessing technology, especially in relation to genetic modification engineering in livestock breeding.
So also, intellectual property rights protecting new inventions and technology may mean that new entrepreneurs coming into the industry will need to pay license fees and this of course will cause increase in the startup fee for a sheep farming business.
2. Executive Summary
AB Pedro® Sheep Farms, LLC is a registered and licensed sheep farming company that will be based in the outskirt of Des Moines, Iowa – United States of America. We have done our detailed market research and feasibility studies and we were able to secure twenty acres of land to build our cattle ranch and start our sheep farming business.
Our sheep farming business is a going to be standard one hence will be involved in commercial breeding of sheep. In the nearest future, hopefully within the first five years of officially running AB Pedro® Sheep Farms, LLC, we will start our milk and wool processing plant and also start exporting our mutton and other by products to other parts of the world.
We are in the sheep farming business because we want to leverage on the vast opportunities available in the industry, to contribute our quota in growing the U.S. economy, in national food (meat and milk) production, raw material production for industries, to export agriculture produce from the United States to other countries and over and above to make profit.
AB Pedro® Sheep Farms, LLC is well positioned to become one of the leading sheep farming businesses in the United States of America, which is why we have been able to source for the best hands and equipment to run the business. We have put process and strategies in place that will help us employ best practices when it comes to sheep farming.
AB Pedro® Sheep Farms, LLC is a private registered sheep farming company that is owned by Andy Bryan Pedro and his immediate family members. Before starting AB Pedro® Sheep Farms, LLC, Andy Bryan Pedro has worked with some of the leading livestock farms in the United States of America. He has worked in the industry for over 20 years before resigning to start his own sheep farming business.
3. Our Products and Services
AB Pedro® Sheep Farms, LLC is a licensed sheep farming business that is committed to producing meat and products such as milk and wool and even the horns and hoofs of sheep. We are in this line of business to make profits and we will ensure that we do all that is permitted by the law to achieve our business aim and objectives.
These are the areas we will concentrate on in our sheep farming business. If need arises, we will definitely add more related services to our list;
- Sheep farming (e.g. for meat, milk and wool production or herd replacements)
- Lamb feedlots (except stockyards for transportation)
- Sale of processed sheep meat and products such as milk and wool and even the horns and hoofs
4. Our Mission and Vision Statement
- Our Vision is to be listed among the top 5 sheep farming business not just in Des Moines – Iowa, but also in the United States of America.
- Our mission is to sell our sheep meat and products such as milk and wool in commercial quantities both locally, nationally and internationally.
- We want to build a sheep farming business that can favorably compete with other leading brands in the United States of America.
Our Business Structure
AB Pedro® Sheep Farms, intends starting small in Des Moines – Iowa, but hopes to grow big in order to compete favorably with leading sheep farms in the industry. We are aware of the importance of building a solid business structure that can support the kind of world class business we want to own.
At AB Pedro® Sheep Farms, LLC, we will ensure that we hire people that are qualified, hardworking, dedicated, customer centric and are ready to work to help us build a prosperous business that will benefit all the stake holders.
As a matter of fact, profit-sharing arrangement will be made available to all our senior management staff and it will be based on their performance for a period of five years or more as agreed by the management of the farm. In view of the above, we have decided to hire qualified and competent hands to occupy the following positions; Below is the business structure of AB Pedro® Sheep Farms, LLC;
- Chief Operating Officer
- General Farm Manager
- Administrator / Accountant
- Sheep Ranch Manager / Supervisor
- Sales and Marketing Executive
- Field Employees
- Front Desk Officer
5. Job Roles and Responsibilities
Chief Operating Officer:
- Increases management’s effectiveness by recruiting, selecting, orienting, training, coaching, counseling, and disciplining managers; communicating values, strategies, and objectives; assigning accountabilities; planning, monitoring, and appraising job results
- Responsible for providing direction for the business
- Creating, communicating, and implementing the organization’s vision, mission, and overall direction – i.e. leading the development and implementation of the overall organization’s strategy.
- Responsible for signing checks and documents on behalf of the company
- Evaluates the success of the organization
General Farm Manager
- Responsible for the planning, management and coordinating all farm activities
- Supervise other section manager
- Ensure compliance during project executions
- Providing advice on the management of farming activities across all section
- Responsible for carrying out risk assessment
- Using IT systems and software to keep track of people and progress of the growth of sheep
- Represent the organization’s interest at various stakeholders’ meetings
- Ensures that farming goals desired result are achieved, the most efficient resources are utilized and different interests involved are satisfied.
- Oversee the smooth running of the sheep farming activities across the various farming sections.
- Responsible for overseeing the smooth running of HR and administrative tasks for the organization
- Defining job positions for recruitment and managing interviewing process
- Carrying out induction for new team members
- Responsible for training, evaluation and assessment of employees
- Responsible for preparing financial reports, budgets, and financial statements for the organization
- Responsible for financial forecasting and risks analysis.
- Responsible for developing and managing financial systems and policies
- Responsible for administering payrolls
- Ensuring compliance with taxation legislation
- Handles all financial transactions for the company
- Serves as internal auditor for the company
Sheep Farming Manager/Supervisor
- Responsible for managing the breeding of sheep
- Responsible for managing boarding services, breeding services, dairy support services, livestock health services, farrier services, and shearing services et al.
- Work closely with the General Manager to achieve the organizations’ goals and objectives
Sales and Marketing Officer
- Identify, prioritize, and reach out to new partners, and business opportunities et al
- Identifies development opportunities; follows up on development leads and contacts
- Writing winning proposal documents, negotiate fees and rates in line with company policy
- Responsible for handling business research, marker surveys and feasibility studies for clients
- Responsible for supervising implementation, advocate for the customer’s needs, and communicate with clients
- Document all customer contact and information
- Represent the company in strategic meetings
- Help increase sales and growth for the company
Field Workers/Contract Staff
- Responsible for feeding sheep as instructed by the supervisor
- Responsible for cleaning the sheep ranch
- Change the water in the water trough / trench as instructed by the supervisor on a regular basis
- Assist in handling the breeding of sheep
- Carries out task in line with the stated job description
- Assist in transport working tools and equipment from the farm and back to the designated store room
- Handles any other duties as assigned by the farm manager
Client Service Executive/Front Desk Officer
- Welcomes guests and clients by greeting them in person or on the telephone; answering or directing inquiries.
- Ensures that all contacts with clients (e-mail, walk-In center, SMS or phone) provides the client with a personalized customer service experience of the highest level
- Through interaction with clients on the phone, uses every opportunity to build client’s interest in the company’s products and services
- Manages administrative duties assigned by the cattle ranch manager in an effective and timely manner
- Consistently stays abreast of any new information on the company’s products, promotional campaigns etc. to ensure accurate and helpful information is supplied to clients
- Receives parcels / documents for the company
- Distribute mails in the organization
- Handles any other duties as assigned by the line manager
6. SWOT Analysis
AB Pedro® Sheep Farms, LLC do not intend to launch out with trial and error hence the need to conduct a proper SWOT analysis. We know that if we get it right from the onset, we would have succeeded in creating the foundation that will help us build a standard sheep farming business that will favorably compete with leading sheep farming businesses in the United States of America.
Here is a summary from the result of the SWOT analysis that was conducted on behalf of AB Pedro® Sheep Farms, LLC;
Our strength as a sheep farming business is the fact that we have healthy relationships with loads of major players in the industry within and outside of the United States. We have some of the latest tools and equipment that will help us breed our sheep and generate milk and wool in commercial quantities with less stress.
Aside from our relationship (network) and equipment, we can confidently boast that we have some the most experienced hands in Sheep Farming industry in our payroll.
Our weakness could be that we are a new sheep farming business in the United States and we may not have the required cash to pump into the publicity of our business. We are aware of this and from our projection will overcome this weakness with time and turn it to a major advantage for the business.
Red meat prices dictate the returns for American cattle ranches and feedlots. Increased prices generate an increase in returns per head for farmers. Sheep and lamb yield red meat, and red meat prices dictate returns to sheep producers. As the price of red meat increases, so too does industry revenue. The price of red meat is expected to rise in the coming year, representing a huge potential opportunity for the industry.
Disease can reduce the national sheep flock and negatively affect industry operators. Additionally, consumer concerns about food safety following disease outbreaks can adversely affect downstream demand for lamb and mutton. While there is no way to anticipate an outbreak, the threat of disease in US livestock negatively affects the industry.
7. MARKET ANALYSIS
- Market Trends
Despite the fact that commercial cattle rearing or better still sheep farming has been in existence since time immemorial, that does not in any way make the industry to be over saturated; commercial sheep farmers are exploring new technology to continue to improve cattle rearing processes and also meat and milk preservation and packaging process.
The fact that there is always a ready market for mutton and its by products makes the business ever green. With the recent advancement in technology, livestock farmers can now improve the various breeds of the animals they are breeding. As a matter of fact, it is now easier for sheep farming businesses to comfortably import the kind of breed they want from any country of their choice.
8. Our Target Market
The end consumers of mutton and its products and also those who benefit from the business value chain are all encompassing; it is far – reaching. Almost every household consumes produce from sheep farms be it meat, milk, wool, hoof, horns and the skin (leather) used for bags, belts and shoe production et al.
So also, a large chunk of manufacturing companies depends on sheep farming businesses for some of their raw materials. In essence a sheep farmer should be able to sell his or her farm produce to as many people as possible. We will ensure that we position our business to attract consumers not just in the United States of America alone but also other parts of the world which is why we will be exporting some of our products to other countries of the world.
AB Pedro® Sheep Farms, LLC is fully aware that there are competitions when it comes to selling mutton or lamb and its by products, which is why we decided to carry out thorough research so as to know how to take advantage of the available market in the United States and in other parts of the world.
We have done our homework and we have been able to highlight some factors that will give us competitive advantage in the marketplace; some of the factors are effective and reliable sheep farming processes that can help us sell our products at competitive prices, good network and excellent relationship management.
Lastly, our employees will be well taken care of, and their welfare package will be amongst the best in the industry meaning that they will be more than willing to build the business with us and help deliver our set goals and objectives.
9. SALES AND MARKETING STRATEGY
- Sources of Income
AB Pedro® Sheep Farms, LLC is in the Sheep Farming industry for the purpose of maximizing profits hence we have decided to explore all the available opportunities within the industry to achieve our corporate goals and objectives. Below are the sources we intend exploring to generate income for AB Pedro® Sheep Farms, LLC;
- Sheep farming (e.g. for meat, milk and wool production or herd replacements)
- Lamb feedlots (except stockyards for transportation)
- Sale of processed sheep meat (mutton or lamb), and products such as milk and wool and even the horns and hoofs
10. Sales Forecast
From the survey conducted, we were are able to discover that the sales generated by a commercial sheep farming businesses depend on the size of the ranch, the network of the business and of course the quantity of meat they can produce per time.
We have perfected or sales and marketing strategies and we are quite optimistic that we will meet or even surpass our set sales target of generating enough income / profits from the year of operation and build the business from survival to sustainability.
We have been able to examine the Sheep Farming industry, we have analyzed our chances in the industry and we have been able to come up with the following sales forecast. Below are the projections that we were able to come up with for the first three years of running AB Pedro® Sheep Farms, LLC;
- First Fiscal Year (FY1): $280,000
- Second Fiscal Year (FY2): $450,000
- Third Fiscal Year (FY3): $700,000
N.B: This projection was done based on what is obtainable in the industry and with the assumption that there won’t be any major economic meltdown that can impact negatively on household spending, bad weather cum natural disasters, and unfavorable government policies.
- Marketing Strategy and Sales Strategy
We are quite aware that the reason why some sheep farming businesses hardly make good profits is their inability to sell off their produce to a larger market. In view of that, we decided to partner with some of the leading sheep merchants to help us maximize profits.
In summary, AB Pedro® Sheep Farms, LLC will adopt the following strategies in marketing our mutton and other products;
- Introduce our business by sending introductory letters alongside our brochure to hotels, restaurants, caterers, merchants that deal in sheep meat (mutton or lamb), and products such as milk and wool and even the horns and hoofs sheep and key stake holders in and around Des Moines – Iowa.
- Advertise our business and livestock farms in agro – allied and food related magazines and websites
- List our sheep farming business on yellow pages ads (local directories)
- Attend related agriculture and food expos, seminars, and business fairs et al
- Leverage on the internet to promote our business
- Engage in direct marketing
- Encourage the use of Word of mouth marketing (referrals)
11. Publicity and Advertising Strategy
Any business that wants to grow beyond the corner of the street or the city they are operating from must be ready and willing to utilize every available means to advertise and promote the business. We intend growing our business which is why we have perfected plans to build our brand via every available means.
Below are the platforms we want to leverage on to boost our sheep farming brand and to promote and advertise our business;
- Place adverts on both print (newspapers and magazines) and electronic media platforms
- Sponsor relevant community – based events / programs
- Leverage on the internet and social media platforms like; Instagram, Facebook, twitter, YouTube, Google + et al to promote our business
- Install our Bill Boards on strategic locations all around Des Moines – Iowa
- Distribute our fliers and handbills in target areas
- List our commercial sheep farms in local directories / yellow pages
- Advertise our commercial sheep farm in our official website and employ strategies that will help us pull traffic to the site.
- Ensure that all our staff members wear our branded shirts and all our vehicles and trucks are well branded with our company logo et al.
12. Our Pricing Strategy
Sale prices for sheep meat and products such as milk and wool and even the horns and hoofs of sheep are subject to fluctuation as part of the sheep cycle of financial markets. The relatively long period it takes sheep farmers to build up a sheep herd and raise new sheep and lamb to the desired weigh tends to extend the length of such a cycle.
Generally speaking, a sheep will cost between $2,000 and $3,000. The actual cost depends on the weight of the sheep, the gender, and the breed. Yearlings usually sell for between $800 and $1,500. Sheep will also differ in price based on whether or not they are dairy sheep or wool sheep or meat sheep.
We are quite aware that one of the easiest means of penetrating the market and acquiring loads of customers is to sell our products at competitive prices.
One thing is certain, the nature of sheep farming business we are involved in makes it possible for farmers to place prices for their sheep based on their discretion without following the benchmark in the industry. The truth is that it is one of the means of avoiding running into loss. The easier you sell off your sheep when they are mature the better for your business.
- Payment Options
The payment policy adopted by AB Pedro® Sheep Farms, LLC is all inclusive because we are quite aware that different customers prefer different payment options as it suits them but at the same time, we will ensure that we abide by the financial rules and regulation of the United States of America.
Here are the payment options that AB Pedro® Sheep Farms, LLC will make available to her clients;
- Payment via bank transfer
- Payment with cash
- Payment via online bank transfer
- Payment via check
- Payment via Point of Sale Machines (POS Machines)
- Payment via mobile money transfer
- Payment via bank draft
In view of the above, we have chosen banking platforms that will enable our clients make payment of sheep purchase without any stress on their part. Our bank account numbers will be made available on our website and promotional materials.
13. Startup Expenditure (Budget)
Below are some of the basic areas we will spend our startup capital in setting up our sheep farming business/cattle ranch;
- The total fee for incorporating the business in United States of America – $750.
- The budget for key insurance policies, permits and business license – $2,500
- The amount needed to acquire / lease a farm land – $150,000
- The amount required for preparing the farm land (for construction of cattle ranch and cages / fencing et al et al) – $100,000
- The cost for acquiring the required working tools and equipment / machines / fencing et al – $50,000
- The amount required for purchase of the first set of sheep, feeds, medication and other supplies – $150,000
- The cost of launching an official website – $600
- The amount required for payment of workers for a period of 3 months – $100,000
- Additional Expenditure (Business cards, Signage, Adverts and Promotions et al) – $2,000
Going by the report from detailed research and feasibility studies conducted, we will need an average of four hundred and fifty thousand dollars ($450,000) to start a standard sheep farming business in the United States of America.
Generating Funds/Startup Capital for AB Pedro® Sheep Farms, LLC
No matter how fantastic your business idea might be, if you don’t have the required money to finance the business, the business might not become a reality. Finance is a very important factor when it comes to starting a business such as sheep farming business. No doubt raising startup capital for a business might not come cheap, but it is a task that an entrepreneur must go through.
AB Pedro® Sheep Farms, LLC is a family owned business and it will be financed by Andy Bryan Pedro and his immediate family members. These are the areas where we intend sourcing for fund for Jonah Livingston and Family Farms Ltd;
- Generate part of the startup capital from personal savings and sale of his stocks
- Generate part of the startup capital from friends and other extended family members
- Generate a larger chunk of the startup capital from the bank (loan facility).
N.B: We have been able to generate about $200,000 (Personal savings $150,000 and soft loan from family members $50,000) and we are at the final stages of obtaining a loan facility of $250,000 from our bank. All the papers and documents have been duly signed and submitted, the loan has been approved and any moment from now our account will be credited.
14. Sustainability and Expansion Strategy
Part of the plans we have in place to sustain AB Pedro® Sheep Farms, LLC is to ensure that we continue to make available in commercial quantities sheep meat (mutton or lamb), and products such as milk and wool and even the horns and hoofs of sheep, deliver quality services, improvise on how to do things faster and cheaper.
We are not going to relent in providing conducive environment for our workers and also the required trainings that will help them deliver excellent services at all times.
From our findings, another factor that kills new businesses is financial leakages. In order to plug financial leakages, the management of AB Pedro® Sheep Farms, LLC adopted the use of payment machine and accounting software to run the business.
We are quite aware that our customers are key component to the growth and survival of our business hence we are going to continuously engage them to give us ideas on how to serve them better. We will not waste time in adopting new technology, and international best practices as it relates to the production of sheep meat and its by products such as milk and wool and even the horns and hoofs of sheep.
AB Pedro® Sheep Farms, LLC will make sure that the right foundation, structures and processes are put in place to ensure that our staff welfare are well taken of. Our company’s corporate culture is designed to drive our business to greater heights and training and re – training of our workforce is at the top burner.
We know that if that is put in place, we will be able to successfully hire and retain the best hands we can get in the industry; they will be more committed to help us build the business of our dreams.
- Business Name Availability Check: Completed
- Business Incorporation: Completed
- Opening of Corporate Bank Accounts : Completed
- Opening Online Payment Platforms: Completed
- Application and Obtaining Tax Payer’s ID: In Progress
- Application for business license and permit: Completed
- Purchase of Insurance for the Business: Completed
- Leasing of farm land in Des Moines – Iowa: Completed
- Conducting Feasibility Studies: Completed
- Startup Capital Generation: Completed
- writing of business plan: Completed
- Drafting of Employee’s Handbook: Completed
- Design of The Company’s Logo: Completed
- Printing of Packaging and Promotional Materials: Completed
- Recruitment of employees: In Progress
- Building /construction of cages and fence et al: In Progress
- Purchase of the first set of sheep, feeds and medications: Completed
- Purchase of the needed working tools, machines and equipment: Completed
- Creating Official Website for the Company: In Progress
- Creating Awareness for the business (Business PR): In Progress
- Farm land Treatment, Health and Safety Arrangement: In Progress
- Establishing business relationship with key players in the industry (agriculture farm produce merchants, beef jerky businesses, abattoir operators and transporter / haulage): Completed