Are you interested in starting a Christmas tree farming business? If YES, here is a complete guide to starting a Christmas tree farm from scratch with little money and no experience plus a sample Christmas tree farming business plan template.
Christmas tree cultivation is an AGRICULTURAL, FORESTRY and horticultural and occupation which involves growing pine, spruce and fir trees specifically for use as Christmas tree. The first Christmas tree farm was established in 1901, but most consumers continued to obtain their trees from forests until the 1930s and 1940s.
Christmas tree farming was once seen only as a viable alternative for low-quality farmland, but that perception has changed within the agriculture industry. For optimum yield and quality, land should be flat or gently rolling and relatively free of debris and undergrowth.
A wide variety of pine and fir species are grown as Christmas trees, although a handful of varieties stand out in popularity. In the united states, Douglas-fir Scots pine and Fraser fir all sell well. Nordmann fir and Norway spruce sell well in the United Kingdom, the latter being popular throughout Europe.
The practice of cultivating evergreens specifically to sell as Christmas trees dates back to 1901, when a 25,000 tree Norway spruce farm was sown near Trenton, New Jersey. The commercial market for Christmas trees had started fifty years earlier when a farmer from the Catskill Mountains brought trees into New York City to sell.
Despite these pioneering efforts, most people still obtained wild-grown Christmas trees from forests into the 1930s and 1940s. More trees were grown in plantations after World War II, and by the 1950s farmers were shearing and pruning trees to meet customer demands.
In the united states, visits to Christmas tree farms have become a Christmas holiday tradition for people. Christmas tree farms have embraced this trend; at one Minnesota tree farm it has become tradition for customers to pose for snapshots with their trees, when they return in subsequent years they can check the “wall of memories” for their photo.
Today, tree farms offer more than just a chance to cut down a live Christmas tree. Outdoor and holiday themed activities are not uncommon and include wagon rides, offering hot cocoa or cider, Santa Claus visits and holiday crafts. Many tree farms actively encourage schools to sponsor field trips to the farms.
Steps to Starting a Christmas Tree Farm Business
Table of Content
- 2. Conduct Market Research and Feasibility Studies
- 3. Decide Which Niche to Concentrate On
- 4. Know Your Major Competitors in the Industry
- 5. Decide Whether to Buy a Franchise or Start from Scratch
- 9. Discuss with an Agent to Know the Best Insurance Policies for You
- 10. Protect your Intellectual Property With Trademark, Copyrights, Patents
- 11. Get the Necessary Professional Certification
- 12. Get the Necessary Legal Documents You Need to Operate
- 13. Write a Business Plan
- 14. Prepare a Detailed Cost Analysis
- 15. Raise the Needed Startup Capital
- 16. Choose a Suitable Location for your Business
- 17. Hire Employees for your Technical and Manpower Needs
- 18. Write a Marketing Plan Packed with ideas & Strategies
- 19. Develop Iron-clad Competitive Strategies to Help You Win
- 20. Brainstorm Possible Ways to Retain Clients & Customers
- 21. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
1. Understand the Industry
Christmas Trees were added to the federal agriculture census in 1997, when the responsibility for census shifted from the U.S. Department of Commerce, Bureau of the Census, to the United States Department of Agriculture (USDA), National Agricultural Statistics Service (NASS). The agriculture census is conducted every five years.
Interesting Statistics About the Industry
While the first Christmas tree farm may have appeared as early as 1901, Christmas tree production in the United States was largely limited to what could be harvested from natural forests until the 1950s. Among the important Christmas tree producing areas in the U.S. are Wisconsin, North Carolina, Pennsylvania and the Pacific Northwest.
In 2002 Christmas tree production in the United States totalled 20.8 million trees and the U.S. was one of the world’s leading producers of natural Christmas trees. That same year, Pennsylvania was the top producer in the United States.
The first [Christmas tree farm] in the United States is believed to have begun in 1901 when 25,000 Norway Spruce trees were planted by W. V. McGalliard in Mercer County, near Trenton, New Jersey. The trees were sold seven years later for US$1.00 each.
Despite the early pioneers of the industry, by the late 1940s 90 percent of all natural Christmas trees sold in the United States were still harvested from forests. The most popular species during that era, Balsam Fir, Douglas-fir, Black Spruce etc. were all readily available from forests.
The total U.S. crop in 2004 was valued at $506 million with $143 million attributed to the nation’s leading producer in 2004, Oregon. Oregon was followed in production numbers by North Carolina, Washington, and Michigan.
The Christmas tree farm business is indeed growing from the facts and figures presented above, and it will continue to grow especially with the recreational attraction attached to those trees in this century. Many people are encouraged to delve into this farm business not only because of their love for farming, but also due to the fact that they enjoy the Christmas celebrations, and are willing to do everything within their reach to preserve its history.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
The demographic and psychographic composition of those who need the services of Christmas tree farms cuts across the public sector, the organized private sector, households, communities and people of different class and from all walks of life.
Below is a list of the people and organizations that need the services of Christmas tree farms;
- The public sector (public facilities et al)
- Organized private sector (Corporate organizations)
- Businessmen and Businesswomen
- University Campuses and Schools
- Event Planners
- Estates and Communities
- Religious Centres
- Sport Organizations
3. Decide Which Niche to Concentrate On
When it comes to starting a Christmas tree farm, there are a couple of niche ideas within the industry that an entrepreneur can choose from. Aside from the niches in the industry, an entrepreneur who is creative can carve a niche for himself / herself.
Here are some niches / areas that a Christmas tree farm can be specialized in;
- Recreational centres for people during the Christmas season
- Leveraging on cooperation with religious groups
- Tree Bags
- Tree Shaking
- Tree Baling
The Level of Competition in the Industry
Surviving in the business world as a Christmas tree farm requires more than, your expertise, knowing how to deliver good trees that will be appreciated by all is indeed a source of concern for all would-be tree farmers.
Without a shadow of doubt, many individuals and organizations are delving into this business, and are willing to put in their all to succeed in it. Therefore, the competition is becoming stiffer especially in this century when people really appreciate the trees for its historical and celebrated attachments.
In fact, some people are going as far as producing artificial tree farms which makes it even more difficult for those who toil, day and night to plant these trees get appreciated and compensated.
4. Know Your Major Competitors in the Industry
There is hardly any industry where there are no well-known brands that have made it big in it. The Christmas tree farm is though not an exception as there are many brands (farms) that have carved out a name for themselves doing what they know how to do best.
Some of the popular farms/brands in the Christmas tree farm include:
- Timberpeg Tree Farm
- Clark’s Christmas tree farm
- Croix Valley Christmas Tree farm
- Bald Peak Christmas Tree Farm
- Santa’s Shaped Christmas Tree Farm etc.
Starting a Farm generally is not a day’s job, hence specializing in starting a Christmas tree farm is indeed a herculean task.
This is because farming itself is a hard work that requires a lot of time, dedication and commitment. Due to this, critical economic analysis must be conducted to ensure that the risks and other threats associated with starting a business from the scratch or investing in a business idea are mitigated.
If you are considering starting a Christmas farm tree in the United States, your concern should not be restricted to just acquiring a farmland and getting the right species of trees in place. Your major concern should rather be on how to ensure that the farmland gotten is up to the required level that is needed for the planting, and the mechanization that is associated with it, to ensure that the trees come out well.
On the average, setting up and running a Christmas tree farm business in the United States can be cost effective simply because it’s not a business that requires having a large workforce, rather the best hands who are good in farming and know what it takes to indulge in such a business is the major consideration that must be taken into cognisance.
5. Decide Whether to Buy a Franchise or Start from Scratch
Although there is the possibility of buying a farm from a successful farmer or even partnering with a big Christmas tree farm if you are considering owning an investment in the Christmas tree farm industry.
One thing is certain, people are motivated to start a business based on various factors and incentives. If you are looking towards building a business that you intend controlling, a business brand that you hope to one day transfer ownership to your children and perhaps also sell franchise in future, then starting from the scratch should be your best bet.
But if you only interested in making money and multiplying your wealth, then you may as well buy the franchise of a successful farm that is willing to sell its franchise.
But one thing certainly is paramount, and must be considered, starting a Christmas tree farm from scratch is indeed the best option. Because with these, all the economic analysis, advantages, disadvantages etc. will be critically considered so as to maximize profit and ensure that, the farm produces the best species of trees.
6. Know the Possible Threats and Challenges You Will Face
Generally in the Christmas tree farm, both the already established ones, and start – up farms are subject to threat and challenges from government policies, global economic downturn which usually affects spending and unforeseen natural disasters (disasters that may cause setback).
Another threat that you are likely going to face when you start your own Christmas tree farm is the proliferation of the market with artificial Christmas trees as an alternative to the natural ones. This threat posed to the genuine Christmas tree farmers is indeed a challenge that all farmers must watch out for.
7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
No doubt starting a Christmas tree farm is indeed a serious business which is why the legal entity you choose will go a long way to determine how big the business to can grow. choosing a legal entity for a business such as a Christmas tree farm is some worth straightforward especially if you are indeed positioning your farm for huge success in the market.
When it comes to choosing a legal entity for your Christmas tree farm you have the option of choosing from a general partnership, a limited partnership, an LLC, a “C” corporation, or a “S” corporation.
It is important to clearly state that these different forms of legal structure for business has its own advantages and disadvantages; which is why you must weigh your options properly before making your choice on the legal structure to build your farm on.
These are some of the factors you should consider before choosing a legal entity for your Christmas tree farm; limitation of personal liability, ease of transferability, admission of new owners and investors’ expectation and tax issues.
If you take your time to critically study the various legal entities to use for your Christmas tree farm, then you will agree that Limited Liability Company; an LLC is the most suitable. You can start your farm as a limited liability company (LLC) and in future convert it to a ‘C’ corporation or even a ‘S’ corporations especially when you have the plans of going public.
Upgrading to a ‘C’ corporation or ‘S’ corporation will afford you the opportunity to grow Christmas tree farm and make you go public, this is indeed the turning point for most businesses and farms.
8. Choose a Catchy Business Name
When it comes to choosing a name for your Christmas tree farm, there are no hard and fast rules to follow. This is so because Christmas tree farms are not like other business who hopes that their names can help them attract passers-by who may just walk in to want to do business with them; there is no rule of thumb.
Here are some catchy business name ideas you can choose for your private security company;
- Williams and co. farms
- ABC Christmas tree Farms
- Junior & sons farms ltd.
- Jessica Tree Farms
- Queens farms Limited
9. Discuss with an Agent to Know the Best Insurance Policies for You
In the United States and of course in most countries of the world, you can’t operate a business without having some of the basic insurance policies that is required by the industry you want to operate from. Besides, the nature of the farm industry requires that you have the proper insurance cover in place or else you will be forced out of business if anything goes wrong with the farm.
So, it is important to create a budget for insurance and perhaps consult an insurance broker to guide you in choosing the best insurance policies for your Christmas tree farm; it is their duty to help you assess the risks involved in the type of farm you intend running and then advise you accordingly.
Here are some of the basic insurance covers that you should consider purchasing if you want to start your own Christmas tree farm in the United States of America;
- General insurance
- Health insurance
- Risk Insurance
- Payment protection insurance
- Liability insurance
- Workers Compensation
- Overhead expense disability insurance
- Business owner’s policy group insurance
10. Protect your Intellectual Property With Trademark, Copyrights, Patents
There is really no intellectual property that is been protected in the Christmas tree farm and other aspects of farming generally. What is required mostly in this business is to ensure that all products from a particular farm are well noted to make sure that, no one else claims to be the producer of a product from your farm.
11. Get the Necessary Professional Certification
The farm industry is one of the industries that is highly regulated so as to prevent costly malpractices and sharp practices by some persons who might want to cut corners and climb up the ladder without putting in much effort.
It is for this reason that if you are looking towards beginning a farm, you should ensure that all necessary certifications that will portray you as a professional are well sought out for. Though, there are really no professional certifications that is required for farming except that you must acquire the requisite knowledge of farming from a recognized institution.
12. Get the Necessary Legal Documents You Need to Operate
In The United States of America and of course all over the world, the farm industry is amongst the industries that is highly regulated so as to avoid malpractices in the farm industry in the country. If you are considering starting a Christmas tree farm, then you are expected to meet the legal documents requirements as stipulated in the constitution of your country.
These are some of the basic legal document that you are expected to have in place if you want to start a Christmas tree farm in the United States of America;
- Certificate of Incorporation
- Security Clearance Certificate
- Business License
- Business Plan
- Non – disclosure Agreement
- Memorandum of Understanding (MoU)
- Employment Agreement (offer letters)
- Operating Agreement
- Company Bylaws
- Operating Agreement for LLCs
- Insurance Policy
13. Write a Business Plan
If you are looking towards starting a Christmas tree farm, then one of the first steps that you are expected to take is to consult experts to help you write a good and workable business plan. The truth is that, in order to successfully run a farm, you would need to have a good business plan in place.
A Business plan is the blue print that is needed to successfully run a business; with a workable business plan in place, you will reduce the trial and error approach of doing business. You will be able to manage your business with purpose and perhaps precisions; you will know what to do per time and how to handle challenges, growth and expansion.
So if you want to start your own Christmas tree farm, you are required to write a detailed business plan that can pass reality test when subjected to it; you should work with the facts, figures and other indices in the farm industry as it applies to the country you intend starting the business.
The whole idea of writing a business plan is not just for the sake of having a business document in place; but a detail guide on how to effectively run your business from the scratch. Your business plan should outline and cover strategies on how you intend to manage and grow your own Christmas tree farm.
14. Prepare a Detailed Cost Analysis
There are several expenses that you would have to make before successfully launching your own Christmas tree farm. It is important to state that the location you choose to launch your business will definitely impact on the overall cost of starting the business which is why it is very important to have concluded and analyzed your feasibility studies and market survey before drawing up a budget and sourcing for funding for your business.
Here are some of the basic cost you must look towards fulfilling when starting a Christmas tree farm in the United States of America
- The Total Fee for incorporating the Business in United States of America – $750.
- The budget for Insurance, permits and license – $5,000
- The Amount needed to buy a land – $1000,000.
- The Cost for mechanizing the farms- $10,000
- The Cost of Launching an official Website – $700
- Additional Expenditure (Business cards, Signage, Adverts and Promotions et al) – $2,500
- Other miscellaneous – $1,000
Going by the report from our research and feasibility studies, we will need about $120,000 to set up a small scale Christmas tree farm in the United States of America.
On the average, you would need a over 200,000 US dollars to start a medium scale Christmas tree farm in the United States of America. If you choose to start a large scale Christmas tree farm, then you should look towards budgeting about 2 million US dollars and above. This money include paying labourers hourly wages for working on the farm.
15. Raise the Needed Startup Capital
If you choose to start your Christmas tree farm on a small scale, you might not need loads of resources to launch the business, but if you decide to start on a large scale, you will sure need to raise the required start – up capital to launch the business.
If you are starting your Christmas tree farm on a large scale, you will need a decent farm land, and money budgeted for the payment of salaries and utility bills for at least a period of 3 months and you will also need money to purchase the seedlings and pay wages to labourers.
When it comes to financing a business, one of the first thing and perhaps the major factors that you should consider is to write a good business plan. If you have a good and workable business plan in place, you may not have to labour yourself before convincing your bank, investors and your friends to invest in your business.
Here are some of the options you can explore when sourcing for start – up capital for your Christmas tree farm;
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Applying for Loan from your Bank / banks
- Pitching your business idea and applying for business grants and seed funding from donor organizations and angel investors
- Source for soft loans from your family members and your friends.
16. Choose a Suitable Location for your Business
Choosing a location for your business is not what you should do without due consultation. The truth is that if you get it wrong with the location where you have decided to pitch your business tent, you are more likely going to struggle to make headway with the business. One of the major reasons why businesses struggle, fail and eventual close shop is the fact that the owners decided to choose a wrong location for the business.
Therefore, if you are just starting out; especially if you are a newbie in the farm industry, it is important that you locate your business in an area with healthy business activities.
These are some of the factors that you should consider before choosing a location for your farm;
- The demography of the location
- Accessibility of the location
- The numbers of private security companies in the location
- The local laws and regulations in the community / state
- Traffic, parking and security et al
17. Hire Employees for your Technical and Manpower Needs
If you are about starting a Christmas tree farm, then you should be ready to purchase effective equipment and mechanised machines, this is what you are expected to spend part of your start-up capital on.
When it comes to choosing between renting and leasing an office space, the size of Christmas farm tree you want to build, and your entire budget for the business should influence your choice. If you have enough capital to run a farm, then you should consider the option of leasing a facility for your farm; when you lease, you will be able to work with long – term planning.
Also, the major manpower details needed in this industry is labourers who will have to work day and night on the farm to ensure that it produces well.
The Service Delivery Process of the Business
The services process involved in the Christmas tree farm depends on the niches of farm industry a company is into. On the average, the process starts with ensuring that someone gets a good farmland to run the business,
Secondly, once the trees have matured, it is now the onus of the farmer to ensure that he sells the trees or use it for recreational activities.
18. Write a Marketing Plan Packed with ideas & Strategies
Christmas tree farm is a business that you have to retail products which is why you must do all you can to maximize any opportunity that comes your way.
So when you are drafting your marketing ideas and strategies for your Christmas tree farm, make sure that you have different and good species of trees that can be patronised by clients. Here are some of the platforms you can utilize to market your Christmas tree farm;
- Advertise your business in relevant business magazines, TV and radio station.
- List your business on local directories / yellow pages (both online and offline)
- Attend farm related expos, seminars, and business fairs et al
- Leverage on the internet to promote your business
- Join local chambers of commerce around you with the main aim of networking and marketing your Christmas tree farm.
- Introduce your business by sending introductory letters alongside your brochure to all the corporate organizations, community leaders, schools, hospitals, hotels and government offices in your target area.
- Create different packages for different category of clients in order to work with their budgets.
19. Develop Iron-clad Competitive Strategies to Help You Win
It might be challenging competing as a newbie in the Christmas tree farm especially in a highly organized market like that of the United States of America, which is why you must be deliberate in choosing the species of trees you plant.
As a Christmas tree farm, if you have the required expertise and equipment to carry out a Christmas tree farm, then you are likely not going to struggle to compete in the industry. Hence, ensure that you put in your best to ensure that you make farming more professional. You should be known for delivering excellent species of trees at all times. Creativity, excellence and attention must be your watchword.
Lastly, ensure that your organization is well positioned and if possible form strategic partnership with other key stakeholders in the farm industry; it will sure give you competitive advantage over your competitions.
20. Brainstorm Possible Ways to Retain Clients & Customers
When it comes to business no matter the industry you choose to pitch your tent in, one of the easiest ways to increase customers’ retention and perhaps to attract new customers is to satisfy your customers always. If your customers are satisfied with your services delivery, they can hardly source for alternative service provider or products.
Statistics has it that one of the major reasons why customer’s source for alternative service provider or product is when there is a drop in quality. Another reason is poor customer service. If you can continue to improve on the quality or your services and your customer service delivery, then you won’t struggle to maintain your loyal customers.
With a customized system you can easily stay in touch with your clients (you can carry out quick survey, you can introduce new products and prices to them without any hitch, you can felicitate with them on their birthdays and other anniversaries especially during the festive season, you can keep track of their progress, you can send bulk text messages and customized e – mails and above all you can easily receive compliant and feedback from them).
21. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
When it comes to creating brand identity for a Christmas tree farm, the calibre of species of products that your farm produces is indeed a selling point on its own.
It is pretty important to work with your consultants to help you map out publicity and advertising strategies that will help you walk your way into the heart of your target market. First and foremost, you should ensure that your brand is visible and well communicated which is why you should make provisions to work with different class of people in the society. All your publicity materials and jingles should be done by some of the best hands in the industry.
Below are the platforms you should leverage on to boost your brand awareness and create a corporate identity for your private security company;
- Introduce your business by sending introductory letters alongside your brochure to all the corporate organizations, community leaders, schools, hospitals, hotels and government offices in your target area.
- Advertise your business in relevant magazines and websites
- List your business on local directories / yellow pages (both online and offline)
- Promote your business on satellite TV stations and radio stations.
- Engage in direct email marketing
- Leverage on the internet (social media platforms and your official websites) to promote your business
- Ensures that your workers wear your branded shirts at all times during working hours and also make sure you brand all your company’s official vans, trucks and cars et al.
22. Create a Suppliers / Distribution Network
The nature of the farm industry gives room for farmers to network amongst themselves and also network with government own farming agencies.
It is important to state that there will always be room for farmers to form strategic alliance with one another which is why it is important to maintain a good network within the industry. For example, you may have need for the supply of a particular species of crops; it is not mandatory for your organization to specialize in these areas trees, but with a good marketing network in place, that will be feasible.
23. Tips for Running a Christmas Tree Farming Business Successfully
The truth is that, irrespective of the kind of business you run, your ability to get all the members of your team on same page at all times is one of the keys you need to successfully run the organization.
As the chief executive officer or president of a Christmas tree farm, it is your responsibility to give direction to the business. Part of what you need to do is to ensure that you create time for office meetings; a time where challenges, feedbacks, projections and relevant issues are discussed. The meetings could be daily, once in a week, twice a week or once in a month. The bottom line is that there should be consistent meetings in your organization.
Carrying out appraisals on a regular basis and training your employees will help you run your organization effectively. Encourage your employees to pursue certifications in their various area of specializations; it will help your organization’s profile and of course it will help the individuals. You can choose to fully or partially sponsor some of the certifications.
Lastly, you should keep your doors open for suggestions from members of your team and your clients. It is very important to reward excellent performance in your organization; it will go a long way to encourage healthy competition in your organization.