Are you interested in starting a chicken farm? If YES, here is a complete guide to starting a poultry farming business for beginners with NO money and no experience.
Okay, so we have provided you an in-depth sample poultry farming business plan template. We also took it further by analyzing and drafting a sample chicken and egg marketing plan backed up by actionable guerrilla marketing ideas for poultry farms.
The chicken industry has two main parts:
- Layers, where the chickens bred also lay or produce eggs
- Broilers, where chicken are bred mainly for meat
Whatever sector you finally decide on, should be one where you have technical knowledge required and also one that should be profitable for you.
There are usually two ways by which chickens are raised in a poultry farm. The conventional system, where the birds are confined and where you can easily control the lightning as well as temperature; and the free-range system where the chickens are allowed to roam freely and behave as naturally as possible.
Starting a Poultry Farming Business for Beginners – A Complete Guide
- Industry Overview
In the United States, the chicken industry is one of the most successful sectors. In a little over 50 years, the chicken industry, especially the broiler sector, has evolved from being fragmented and locally oriented, into something that is highly efficient, and increasingly supplying customers nationwide and around the globe.
Table of Content
- Interesting Statistics About the Poultry Industry
- Market Feasibility and Research
- List of Well – Known Brands in the Poultry Industry
- Buying a Franchise vs Starting a Poultry Farm from Scratch
- Possible Threats and Challenges You Will Face
- Writing a Business Plan for Your Poultry Farm Business
- Choosing a Suitable Location for your Poultry Farm Business
- Technical & Manpower Details
- The Production Process in Poultry Farm Business
- Marketing ideas and Strategies for a Poultry Farm
- Factors That Will Help You Get the Right Product Pricing
- Creating a Suppliers/Distribution Network for your Poultry
- Tips for Running a Poultry Farm Business Successfully
Interesting Statistics About the Poultry Industry
The chicken industry is now producing products that are nutritious, wholesome, and of high quality, and is increasingly becoming affordable year after year. The success can be attributed to the fact that organizations are now becoming more efficient structurally, with improved processing and production techniques that meets with customer’s demands and standards.
In the United States, there are one million plus hens that represent 85% of the total production with 16 companies jointly owning more than 5 million hens. As of September 2015, the total cage-free flock totaled 8.6% or 23.6 million hens. 4.2% of this figure was USDA Organic, while 4.5% were other cage free.
The poultry industry in the United States is one of the largest producers in the world. Externally, the industry is the second largest exporter of poultry meat, with a total of 18% being exported, and a major egg producer. Internally, poultry meats and its products are consumed higher than beef or pork but a little less than red meat.
The poultry industry is highly influenced by fluctuations of the currency, trade negotiations, as well as the economic growth of importing markets. Usually broilers that are under 13 weeks old usually constitute most of the commercial chicken production.
25,000 broiler family farmers have production contracts with companies. Most of the broilers, approximately 95% are produced in these farms with the remaining 5% raised on farms that are owned by the company. As at 2015, almost 9 billion broiler chickens were produced.
The United States has the largest broiler industry in the world, with about 19% being exported to other countries as at 2015, with the top 5 broiler producing states being Georgia, Arkansas, Alabama, North Carolina, and Mississippi.
Market Feasibility and Research
- Demographics and Psychographics
The demographic and psychographic composition of those who require the products of a poultry farm are all sectors of the demography, because almost everyone takes poultry products. Eggs can be taken raw, cooked, fried, or put in other products such as bread, pancakes, cakes, ice cream, and so on.
It can also be used as a beauty product. This would include homes, hospitals, restaurants, fast food outlets, beauty salons, spas, gyms, schools, and so on. People having events like weddings, anniversaries, occasions, children’s party, and other such activities.
List of Niche ideas within the Poultry Farm Industry
As regards the niches within the poultry farm business, there are a number of niches one can go into that would differentiate your services from that of your competitors. Some of the areas of specialization in the poultry farm business includes;
- Chicken meat production
- Egg production
- Poultry feed production
- Processing of chicken meat and eggs
- Packaging and marketing of poultry products
- Manufacturing of poultry equipment
- Poultry marketing and consultancy services
- Administration of poultry vaccines and medicines
- Sales of poultry equipment
While most large poultry farms might offer tall or most of these niches, smaller poultry farms usually have to concentrate on one or few of the above areas of specialization.
The Level of Competition in the Poultry Far Industry
Starting a poultry farm is not an easy venture as it is usually capital intensive, with an unpredictable nature; which is why before you start this business as an entrepreneur you’ve got to be sure that you are serious about the business.
The equipment needed for this business is usually expensive but it is a one-time expenditure, with feeds taking a huge cut too. It is usually easier for smaller poultry farms to concentrate on a niche and compete from that niche rather than try to take up their competition by offering all the niches.
List of Well – Known Brands in the Poultry Industry
Well known brands are those that within the industry have been consistent and whose public awareness is quite high. They are usually looked up to by start-up businesses because they have survived the volatile business environment with strategies that have served them well. Below are some well-known brands in the poultry farm business in the United States of America;
- Cargill Meat Solutions
- Hormel Foods Corp
- Tyson Foods
- JBS USA
- Smithfield Foods, Inc
- Sysco Corp
- ConAgra Foods, Inc
- Keystone Foods, LLC
- OSI Group LLC
Before starting the poultry farm business, you should ensure that you carry out a thorough investigation and garner information from experienced hands before starting off your own, this is so as to save you a lot of heartache and reckless spending when you eventually start the business.
The poultry farm business is a growing business that continues to grow as the population grows. Also, people are conscious of what they now eat, and chickens and the eggs they lay are highly nutritious. This means that there is always a ready market for poultry and poultry products.
While this might seem like an easy business to start, it is a highly regulated industry, as there are strict requirements for starting and running a poultry farm. Poultry farms are often affected by diseases when there is a poor handling of the birds, these diseases – chief of which is salmonella – can wipe out all the birds if not handled and reported properly and quickly. Also, the avian virus can be passed to humans, which might lead to their death.
Buying a Franchise vs Starting a Poultry Farm from Scratch
Starting a business from scratch affords one the opportunity of learning and growing with the business. Starting from scratch also enables the entrepreneur become better at the business and mentors others as well. Other benefit of starting from the scratch includes devising strategies and determining which best suits your business, and also devising means to retain your customers.
Buying a franchise is usually for those that want to go into the business but do not want to be bothered about paperwork and getting the customers, a task that the franchisor is fully concerned with. There are no poultry farm franchises, and franchises usually exist in other niches like processing and packaging.
Possible Threats and Challenges You Will Face
Every poultry business owner knows that even though the business is a lucrative one, it is filled with risks that sometimes only the strong of heart can bear. Some of the threats and challenges you are likely to face when starting your poultry farm business is the outbreak of diseases that might wipe out all your birds.
Another challenge could be in trying to provide innovative services to stay ahead of your competition. Also, the economic downturn can affect your business, as you would need to pay higher for feeds and other items needed for daily running of the poultry farm business. Every business faces challenges and threats at one point or another, and so you would also need to face yours, hoping for the best in every encounter.
Writing a Business Plan for Your Poultry Farm Business
Your business plan should contain key components such as an executive summary, where your poultry business is summarized so that any investor at a glance could know if your business is worth going into. Also components like your history, structure, vision, objectives and mission statements, products and services you intend to offer, as well as the overall strategy for entering into the market should be put down.
Your plan also needs to include your intended target market, how you intend to address the market segments, the infrastructure you will need to meets the needs of running your business, SWOT analysis, and who your major competitors are in the industry you intend going into, and how your strategies are better than theirs, and how you intend to become one of the industry’s leaders.
No business plan is complete without a three or five year financial projections. This usually includes a cash flow, profit and loss statement, and a balance sheet, as well as a sensitivity analysis.
Choosing a Suitable Location for your Poultry Farm Business
The location for a poultry farm business is very essential especially if you intend for your business to be a success. If you live in the city and want to go into this business, it is best you lease or buy a land that is on the outskirts of town, or meet with regulatory agencies and relevant authorities so you would not run afoul of the law.
This is due to the fact that hens make a lot of noise and also smell a bit, and can transmit diseases easily, so it is not only the safety of people around you that should be considered, but the safety of your birds as well.
Another thing that would determine your location is dependent on the type of poultry farm business you intend to go into. Different types include rearing of just layers only, rearing of broilers, breeding chicken, producing chicken feed, processing and packaging of chicken meat and or eggs, and poultry marketing or consultancy services.
This means that if your business is in marketing of poultry products, or consultancy services, you can have your business building right in the heart of town without fear from regulatory agencies. Another issue with location for your poultry farm business is ensuring that you get it close to where your target market is.
This will help in reducing overhead for logistics such as transport, when you want to deliver your poultry products to your customers, or distributors. So, any land or facility you get should ensure that it is not too far from your target market, so you do not spend too much; and also convenient for your customers to access whenever they want to.
Another thing your location has to consider is how you intend to house your birds. If you want your birds not to be housed but to engage in a free range, you would have to consider going for a place where they wouldn’t be disturbed too much by noise. Other considerations would be needed if you intend to house them using deep litter system, semi litter, or battery caging.
Technical & Manpower Details
Even though most of the equipment and tools to be used in starting a poultry farm business can be bought for fairly used, it is best to get some of the equipment new so as to be on the safe side.
Purchasing fairly used equipment such as feeders and drinkers might make economic sense but might be hazardous to your business in the long run, especially if you do not take care in thoroughly ensuring that the equipment are cleaned in a chemicals that would ensure that it doesn’t affect you or your birds.
Cheap equipment can be gotten from poultry farms which are no longer in business. Some of the equipment you would need to fully launch your poultry farm business include;
- Lighting System
- Cages and coops
- Waste disposal
If you are running a small scale poultry farm business with just a few birds, and you live on the outskirts of town, you can basically run the business from home. If you must rent a facility for your birds due to the fact that you intend to run a medium or large scale poultry business that will employ people, then ensure that you lease for a short term, as regulations might change ensuring that you move your birds.
Regarding the number of employees that would be needed to run your poultry farm business, it isn’t constant, as your employees would depend on the size of your farm. While one person can effectively run a small poultry business farm, a medium or large scale poultry business farm, would need more than one person.
This means that in running your medium or large scale poultry farm, you would need a manager, supervisor, marketing executive and sales rep, driver, bird handlers/staff. This is about 5 to 10 employees.
The Production Process in Poultry Farm Business
The production process involved in the poultry farm business usually depends on the poultry niche you are venturing into, as the production processes differ depending on the niche.
This could range from rearing chicks, to production of feeds for chicks as well as growing birds; it could also involve egg production, handling and packaging, as well as bird or egg delivery. Other processes involve vaccination, packaging and sales of poultry meat and birds, as well as consultancy poultry farm services.
Marketing ideas and Strategies for a Poultry Farm
Marketing for your poultry business is very essential especially if you are into raising and selling of birds or hatchery. You would need to not only rear birds, but would have to put a thought to how they can be sold off, especially as they need to be sold off at the right time so that you don’t incur a loss.
If you are running a medium to large scale poultry farm business, then you owe it to yourself and your business to ensure that you get contracts from food and hospitality industries that would need your product when the time arises.
Also, you would need to partner with poultry packaging businesses so that you could ensure that you get steady sales for your birds. Below are some marketing ideas and strategies that you could adopt to ensure that your poultry business generates income;
- Ensure that you introduce your poultry business to food industries, relevant government agencies, as well as the hospitality industries, by sending introductory letters to them.
- Advertise your poultry farm business in relevant magazines and websites.
- Ensure that you employ the word of mouth method in advertising your business
- Ensure that your business is listed in yellow pages
- Attend relevant seminars and business fairs, in the food and hospitality industries, and ensure that you drop your business cards.
- Use your official website to promote your business
- Ensure you make your social media platforms interactive by offering incentives
- Attend and be active in local associations’ meetings
- Create different packages depending on the type of clients you have and ensure that your customers are aware of these packages.
Factors That Will Help You Get the Right Product Pricing
Factors that will ensure that you give your customers the right pricing for your products are those that will ensure that your overhead is covered and that there is room for you to make profit. This means that you can get your equipment for fairly used, and buy your land out rightly instead of leasing so that you can help your customers, while also helping your business.
Possible Competitive Strategies for Winning Your Competitors
Before going into this business, you would need to realize that the business isn’t one where you will be operating alone. This means you are going to meet already established poultry farm businesses, and are also going to have new entrants coming into the industry from time to time.
Your already established competitors would have combined different strategies to ensure that they remain long in the business. To compete with them, you would need to study their strategies and ensure that you tweak it to suit your business, so that you can favorably compete with them.
If you intend to ensure that you stay ahead of the new competition, you would need to adopt strategies to ensure that you stay ahead by delivering excellent services. These strategies even though contained in your business plan can be changed from time to time depending on how the business environment is as at the time the strategy is needed.
Another way to stay ahead of your competitors is by ensuring that your business is packaged in such a way as to cater to all types and classes of clients – corporate and individuals – this means you can do business with anyone. You could also offer related services so that you stay ahead of your competitors.
Possible Ways to Increase Customer Retention
Getting your customers to stay is one of the hardest things for a business to do, which is why businesses should be innovative so as to ensure that they are able to retain at least 75% of their customers. One of the ways by which customers can be retained for your poultry farm business is ensuring that you deliver excellent services at all times.
Customers are always pleased when a business goes all out to ensure that they remain satisfied, and will leave for your competition if they are assured of getting better services than they would get from your business. Also, another way to retain customers is by ensuring that you do not stop keeping in touch with them.
This does not mean you flood their mails with materials that do not make sense. If you send tips and advice to your customers especially on health and nutrition issues via their mails, your website and social media platform, you are likely to have very satisfied customers who will stick to your company for the long haul.
Strategies to Boost your Brand Awareness and Create a Corporate identity
Every company needs important strategies that will help to boost brand awareness whilst also creating a corporate identity for your business. If your poultry farm business is on a medium to large scale, you would have to take the idea of boosting your brand seriously, and might even need to hire brand consultants that will help you in this regard.
Listed below are the basic ways that you can boost your poultry’s brand whilst giving your business the necessary publicity it needs;
- Ensuring that your distributors and customers help with referrals
- Posting your fliers in relevant areas such as close to restaurants, and hotels
- Getting an official website and promoting your poultry business via this route.
- Leveraging on social media platforms such as Facebook, Twitter, Linkedin, and Instagram to promote your poultry farm business
- Advertising your business via your local newspapers, radio and if possible television stations.
- Attending related poultry association meetings so that your poultry farm business can be known.
- Listing your poultry farm business in yellow pages
Creating a Suppliers/Distribution Network for your Poultry
Every poultry business that is run on a set standard will always be dependent on suppliers of feeds, medicines, and other accessories needed to keep the poultry farm business running without any hitches. Being in the poultry farm business, you would need for the sake of your birds, to be in a good business relationship with your suppliers or distributors.
Your feed suppliers would always give you the best feed for your birds, and your vaccine suppliers will allow you be the first to know what you can do for your birds when something drastic happens to them. Also, your distributors could help in ensuring that you get your birds to your customers without any hassles. The growth of your company is one reason you should be in a good relationship with your suppliers and distributors.
Tips for Running a Poultry Farm Business Successfully
For any entrepreneur who knows what they are doing, running a poultry farm can be a very lucrative business especially if you have the right information at your finger tips and also the technical know-how needed to be able to run the poultry farm business. Also, the success of this business depends entirely on dedication, as one who is not dedicated is likely to lose his or her investment.
Apart from dedication and having an in-depth knowledge of the poultry business, you should seek to network with other poultry farmers as well as poultry farm association bodies. This will help especially in situations when there is an outbreak of diseases that could affect your livestock. Tips and advises from your peers will help in saving your investment and also ensure that the business is run successfully.
Another way to successfully run your poultry business is to envisage your competition, and be innovative in product and service delivery, and also in marketing your business brand as well. This means that your poultry might not be known if you don’t make the effort to ensure that you publicize it and also offer incentives from time to time.