Do you want to start an organic fertilizer production business? If YES, here is a complete guide to starting an organic fertilizer production business with NO money and no experience.
Okay, so we have provided you an in-depth sample organic fertilizer production business plan template. We also took it further by analyzing and drafting a sample organic fertilizer production marketing plan backed up by actionable guerrilla marketing ideas for organic fertilizer production companies. In this article, we will be considering all the requirements for starting an organic fertilizer production business. So put on your entrepreneurial hat and let’s proceed.
Table of Content
- Why Start an Organic Fertilizer Production Business?
- Starting an Organic Fertilizer Production Business – Market Research and Feasibility Studies
- Starting an Organic Fertilizer Production Business – Legal Matters
- Is Professional Certification Needed to Run an Organic Fertilizer Production Business?
- Starting an Organic Fertilizer Production Business – Technical and Manpower Details
- Starting an Organic Fertilizer Production Business – The Marketing Plan
Why Start an Organic Fertilizer Production Business?
One of the agriculture related businesses that an entrepreneur can successfully start in the United States and in any part of the world is the production of organic fertilizer. Organic fertilizer which is also known as compost or manure is produced from human excreta, animal matter or decomposed vegetables/plants. It is what is used in the cultivation of organic food. There are various sources of organic fertilizer; there is the mineral source (peat et al) which is the main source of organic fertilizer, and other sources such as animal, plants, and sewage sludge (bio – solids).
An organic fertilizer production company is not one of those businesses that can be underway without appropriate research. It is imperative that you conduct detailed research in order to find out all it will take to setup an organic fertilizer manufacturing company and how to leverage on the existing market to sell your products. As a matter of fact, if you want to sell your organic fertilizer in the US, then you must ensure that it does not contain traces of toxic metals.
The organic fertilizer Production Company can be capital intensive, but it is indeed a money-spinning business if it is well located. You also stand the chance of receiving grants from the government of the united states and from other donor agencies if you start your own organic fertilizer production company. It is important to state that if you can’t bear offensive odors, then you should think twice before setting up an organic fertilizer production company.
Essentially, what a large number of production companies rely on to increase sales cum revenue generation is robust distribution network within their coverage areas; organic farmers are some of the key people that you should partner with if you want to do pretty well in this line of business.
If you are considering going into the organic fertilizer production business, part of what you need to do is to read this article to get some information on how to launch the business; it is a business that requires that you get permits as it relates to the location and facility you intended using.
The truth is that you can start your organic fertilizer production business in a small town in the United States and if you put the proper structure in place, it won’t be too long before your brand becomes a nationally recognized brand.
Starting an Organic Fertilizer Production Business – A Complete Guide
- Industry Overview
Those who are into organic crop cultivation mainly make use of organic fertilizer and organic fertilizers are fertilizers that are generated from animal matter, human excreta or vegetable matter. Examples of organic fertilizer are compost and manure. The main organic fertilizers are animal wastes (often from slaughter houses), peat, plant wastes from agriculture, and treated sewage sludge.
Operators in the organic fertilizer production industry basically manufacture pure organic fertilizer products. The products are properly packaged and distributed via wholesale arrangements with third parties or, in the case of vertically integrated operations, by the manufacturer.
The Fertilizer manufacturing industry of which organic fertilizer production line of business is subset of is a thriving sector of the economy of the United States of America and they generate well over billion annually from more than 476 registered and licensed fertilizer manufacturing companies scattered all around the United States of America.
The industry is responsible for the employment of over 16,278 people. Experts project the fertilizer manufacturing industry to grow at a -2.0 percent annual rate. Agrium Inc., CF Industries, Mosaic and Potash Corporation of Saskatchewan are the market leaders in the fertilizer manufacturing industry; they have the lion market share in the United States of America.
According to research carried out by IBISWORLD, the initial capital required to enter this industry is quite significant. Operators require more than five million USD to construct a competitive fertilizer plant. For example, nitrogen plants that can produce one million metric tons of nitrogen products cost between seven hundred million USD and one billion USD and take two to three years to build, while phosphate plants can cost over $1.5 billion and take three to four years to build.
The research also states that Potash plants cost even more: $2.5 billion, excluding infrastructure outside of the plant, such as natural gas lines, rail lines and cars and port facilities and have longer development time of five to seven years. Taken together these factors illustrate that this industry has high barriers to entry.
With this kind of business, if you want to start on a small scale, you can choose to start servicing your local farming community. All you would need is contacts, packaging, networking and good marketing and customer service skills. However, if you intend starting it on a large scale, then you should consider spreading beyond your local community to the state and even national level.
Some of the factors that encourage aspiring entrepreneurs to venture into starting an organic fertilizer production company is because the market for organic fertilizer is growing rapidly in the United States and it is not seasonal. This makes it easier for loads of entrepreneurs who are interested in the business to come into the industry at any time they desire.
The Organic Fertilizer Manufacturing industry is a profitable industry and it is open for any aspiring entrepreneur to come in and establish his or her business as long as you are able to obtain the required license and permits; you can choose to start on a small scale producing limited quantities of organic fertilizer or you can choose to start on a large scale with distribution network and several outlets in key cities all around the United States of America.
Starting an Organic Fertilizer Production Business – Market Research and Feasibility Studies
- Demographics and Psychographics
The people who make use of organic fertilizer cut across all players in the organic farming line of business and some non-organic crop farmers.
List of Niche ideas Within the Organic Fertilizer Production Business That You Can Specialize in
There is no niche area in the organic fertilizer manufacturing industry; it is the practice for organic fertilizer production companies to engage in two main area which are;
- Manufacturing natural-organic and animal-waste or sewage-origin fertilizers
- Manufacturing potting soil, plant foods and compost
The Level of Competition in the Organic Fertilizer Manufacturing Industry
There is hardly any industry or line of business anywhere in the world where there is no competition, as a matter of fact; it is competition that brings innovations in the business world.
This goes to show that if you are looking towards starting an organic fertilizer production company, then you should brace up for competition in the industry. The truth is that you are expected to compete with other players in the Organic Fertilizer Manufacturing industry and players in the non-organic fertilizer manufacturing industry. This is why most organic fertilizer production companies are leveraging on creativity, packaging and marketing to continue to stay afloat in the industry.
The fact that there are increasing competitions in the Organic Fertilizer Manufacturing industry is not hampering the performance of new entrants; most of them know how to recreate and re-strategize to reach out or attract more customers even if it is just organic farmers in their immediate community.
List of Well – Known Brands in the Fertilizer Production Industry
It is the norm that in every industry, there are always brands that perform better or are better regarded by customers and the general public than others. Some of these brands are those that have been in the industry for a long time, while others are best known for how they conduct their businesses and the results they have achieved over the years.
These are some of the leading organic fertilizer production companies in the United States of America and in the globe;
- BioStar™ Organics
- California Organic Fertilizers
- Sustane Natural Fertilizer
- True Organics Products
- Plan B Organics
- Fertrell Co Plant
- Humic Growth Solutions, Inc.
- MYCSA AG, Inc.
- Humalfa – America’s Organic Fertilizer Company
- US AG LLC
- Aggrand Organic Fertilizer
- Koch Fertilizer, LLC
- Fertiplus® Organic Fertilizers
An organic fertilizer production company is not a difficult business venture but at the same time, it is a business that requires thorough economic and cost analysis – feasibility studies and market survey if you want to make profits in the industry.
Part of what you need to focus on in this line of business is how to build a standard organic fertilizer production plant, a robust distribution network, branding, how to maintain your machinery and equipment and to take care of your overhead before your business breaks even. Other costs that should be considered during planning and budgeting are supply of animal waste, plants, sewage sludge and mineral source, packaging materials and maintenance costs et al.
Starting Your Organic Fertilizer Production Business from Scratch vs Buying a Franchise
There are loads of factors that should be considered before choosing the option to follow. Some of the factors to consider are the cost of starting from the scratch or buying a franchise, your financial capacity, your vision, your business skills and experience.
If your intention of starting an organic fertilizer production business is to grow beyond one city, if you want to have presence in key cities in the United States and Canada, then starting your organic fertilizer production company from the scratch is your best option.
But if you just want to start a business with the aim of just making profits and you don’t have the required finance and experience to build a business from the scratch, then it will pay you to buy the franchise of a successful brand in the Organic Fertilizer Manufacturing industry if you are lucky to come by one.
Please note that most of the big and successful organic fertilizer production companies around started from the scratch and they were able to build a solid business brand. It takes dedication, hard work and determination to achieve business success and of course you can build your own organic fertilizer production company to become a successful brand with your distribution network spread throughout the length and breadth of the United States of America and other countries of the world if you decide to go into exporting.
Possible Threats and Challenges You Will Face When Starting an Organic Fertilizer Production Company
If you decide to go into organic fertilizer production business today, one of the major challenges you are likely going to face is the presence of well – established brands in the Organic Fertilizer Manufacturing industry both in the United States of America and other parts of the world. The only way to avoid this challenge is to create your own market (distribution network) by concentrating on local organic farmers in your immediate community.
So also, unfavorable government policies can also hamper the growth of your organic fertilizer production company especially as it relates to choosing a location to launch the business. There is nothing you can do as regards these threats and challenges other than to stay positive that things will work well for you.
Starting an Organic Fertilizer Production Business – Legal Matters
- Best legal entity to use for this type of business
If you have plans to launch an organic fertilizer production business, the legal entity you choose will go a long way to determine how big the business can grow; some organic fertilizer production companies design their business for neighborhood market, some for city wide market, while others for national and international market by exporting opening chains of distribution network globally.
You can consider using even a sole proprietorship for your organic fertilizer production business. Ordinarily, sole proprietorship should have been the ideal business structure for a small scale organic fertilizer production business especially if you are just starting out with a moderate startup capital in a small neighborhood and just into producing limited organic fertilizers for local organic farmers in your immediate community. But people prefer Limited Liability Company for various reasons.
As a matter of fact, if your intention is to grow the business and have distribution networks spread across the United States of America and other countries of the world via franchising, and then choosing sole proprietorship is not an option for you.
Catchy Business Name ideas Suitable for an Organic Fertilizer Production Company
In reality, when it comes to Choosing a name for your business, you should be creative because whatever name you choose for your business will go a long way to create a perception of what the business represents. Usually it is the norm for people to follow the trend in the industry they intend operating from when naming their business.
If you are considering starting your own organic fertilizer production business, here are some catchy names that you can choose from;
- Texas Countryside® Organic Fertilizer Production Co
- Step Dung® Organic Fertilizer Production Company, LLC
- Green Life® Organic Fertilizer Production Company, Inc.
- Health Pro® Organic Fertilizer Production Company, Inc.
- Animal Farm® Organic Fertilizer Production Company, Inc.
- Andre Cosmos™ Organic Fertilizer Production Company, Inc.
- Fresh Farms© Organic Fertilizer Production Company, Inc.
- Framer’s Friend™ Organic Fertilizer Production Company, LLC
- Organics© Organic Fertilizer Production Company, Inc.
- Manure Makers© Organic Fertilizer Production Company, Inc.
In the United States and in most countries of the world, you can’t operate a business without having some of the basic insurance policy covers that are required by the industry you want to operate from. So, it is important to create a budget for insurance and perhaps consult an insurance broker to guide you in choosing the best and most appropriate insurance policies for your organic fertilizer production company.
Here are some of the basic insurance covers that you should consider purchasing if you want to start your own organic fertilizer production company in the United States of America;
- General insurance
- Health/Medical insurance
- Liability insurance
- Building Insurance
- Workers Compensation
- Overhead expense disability insurance
- Business owner’s policy group insurance
Intellectual Property Protection/Trademark
If you are considering starting your own organic fertilizer production company, usually you may not have any need to file for intellectual property protection/trademark. This is because the nature of the business makes it possible for you to successfully run it without having any cause to challenge anybody in court for illegally making use of your company’s intellectual properties.
But if you just want to protect your company’s logo and other documents or software that are unique to you or even jingles and media production concepts, then you can go ahead to file for intellectual property protection. If you want to register your trademark, you are expected to begin the process by filing an application with the USPTO.
Is Professional Certification Needed to Run an Organic Fertilizer Production Business?
Irrespective of producing effective organic fertilizer, professional certification is one of the main reasons why some organic fertilizer production companies stand out. If you want to make an impact in the organic fertilizer manufacturing industry, you should work towards acquiring all the needed certifications in your area of specialization. Certification validates your competency and shows that you are highly skilled, committed to your career and up-to-date in this competitive market.
These are some of the certifications you can work towards achieving if you want to run your own organic fertilizer production company;
- CCOF – Organic Certification
- Global Certified Organic Fertilizer Suppliers
- Degree or Diploma in Agriculture related courses
Please note that you can successfully run an organic fertilizer production company in the United States and in most countries of the world without necessarily acquiring professional certifications and as long as you have acquired the required experience.
List of Legal Documents You Need to Run an Organic Fertilizer Production Company
The essence of having the necessary documentation in place before launching any business in the United States of America cannot be overemphasized. It is a fact that you cannot successfully run any business in the United States without the proper documentations. If you do, it won’t be too long before the long hand of the law catches up with you.
These are some of the basic legal documents that you are expected to have in place if you want to legally run your own organic fertilizer production business in the United States of America;
- Business and liability insurance
- Tax Payer’s ID
- Fire certificate
- Certificate of Incorporation
- Business License
- Business Plan
- Non-disclosure Agreement
- Employment Agreement (offer letters)
- Employee’s Handbook
- Operating Agreement for LLCs
- Insurance Policy
- Company Bylaws
- Memorandum of Understanding (MoU)
- Building License
- Franchise or Trademark License (optional)
Financing Your Organic Fertilizer Production Company
It is often said that money is the blood of any business. Raising startup capital is perhaps one of the major concerns of entrepreneurs as it can be challenging raising capital to launch a business idea. Your idea must be workable and promising for you to secure finance from financial institutions or from angel investors.
The first thing to put in place before sourcing for startup capital for your organic fertilizer production business is a detailed business plan. With a good business plan, you can easily convince investors to invest in your business. The truth is that no bank can give you a loan if you don’t have a good and workable business plan. Besides, investors will not take you seriously if you don’t have a business plan on ground.
Here are some of the options you can explore when sourcing for startup capital for your organic fertilizer production company;
- Raising money from personal savings and sale of personal stocks and properties
- Raising money from investors and business partners
- Selling shares to interested investors
- Applying for Loan from your Bank
- 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
When it comes to choosing a location for a business such as organic fertilizer production company, there are key questions you should answer and key factors that must be considered. You are expected to choose a location that is easily accessible for the distribution of products and supply of raw materials (supply of animal waste, plants, sewage sludge and mineral source and packaging materials). Affordability, availability of labor and safety are also some of the factors that you should consider.
Despite the fact that organic fertilizers are used by organic farmers and non-organic farmers, it is important to choose a location that will give you economy of scales; a location that will help you compete in the industry as a new entrant and also to make reasonable profits.
It cannot be overemphasized that the location you chose to launch your organic fertilizer production company is key to the success of the business, hence entrepreneurs are willing to rent or lease a facility in a visible location; a location where the demography consists of people and businesses with the required purchasing power
Most importantly, before choosing a location for your organic fertilizer production company, ensure that you first conduct a thorough feasibility studies and market survey. The possibility of you coming across similar business that just closed shop in the location you want to open yours can’t be ruled out.
Starting an Organic Fertilizer Production Business – Technical and Manpower Details
If you are considering starting an organic fertilizer production company, then you should make plans to build a standard organic fertilizer production plant. A standard organic fertilizer production plant includes manure mixer/compost turner, vessels, tanks, and conveyor belt system et al. So, you are expected to put all this equipment and machine in place and also purchase standard distribution trucks.
Although you can get fairly used of the above listed equipment and machines, but it is advisable to go for new equipment that can serve you for a long time especially if you have the required money to make the purchase. Even if you don’t have the required amount, you can enter into an agreement with the suppliers of such machines and equipment and spread the payment over a period of time.
As regard acquiring a facility, if you have the required finance, it is to your advantage to acquire a property or lease a facility to be used for your organic fertilizer production plant; it usually gives you the freedom to design the facility the way you want to it to be and install safety gadgets as you so desire. But if you are low on cash, then you don’t have any option other than to rent a facility.
When it comes to creating a workforce structure for a standard organic fertilizer production company, then you should look towards getting qualified and competent people to fill the following roles; Chief Executive Officer (Owner), Plant Manager, Quality Control Officer, Human Resources and Admin Manager, Merchandize Manager, Sales and Marketing Manager, Accountants/Cashiers, Production Workers/Machine Operators, Distribution Truck drivers, and Cleaners.
Over and above, you will need a minimum of 15 – 20 staff members to successfully run a small scale but standard organic fertilizer production company.
The Business Services Process Involved in Organic Fertilizer Production
Basically, the organic Fertilizer Manufacturing Process includes: Pretreatment of raw materials, organic materials fermentation: in this process, compost turner is used to stir and mix raw materials evenly and then the next process is compost drying/grinding before the organic fertilizer is packaged in a bag and ready for distribution as demanded by organic farmers.
It is important to state that an organic fertilizer production company may decide to improvise or adopt any business process and structure that will guarantee them efficiency and flexibility; the above stated organic fertilizer production company process is not cast on stone.
Starting an Organic Fertilizer Production Business – The Marketing Plan
- Marketing ideas and Strategies
Running a business requires that you should be proactive when it comes to marketing your goods or services. If you choose to launch an organic fertilizer production company, then you must go all out to employ strategies that will help you attract customers or else you will likely struggle with the business because there are well – known brands that determine the market direction for organic fertilizer manufacturing industry.
People and organizations will purchase and make use of your organic fertilizers if they know that they are going to get the best and of course value for their money.
As a matter of fact, your marketing strategy will center on quality, less foul smell, good packaging and pricing, and above all excellent customer service. The truth is that if you are able to put the above stated in place, you won’t struggle to retain your old customers and at the same time win over new customers.
Businesses these days are aware of the power of the internet and which is why they will do all they can to maximize the internet to market their services or products. In other words, a larger percentage of your marketing effort will be directed to internet users.
These are some of the marketing ideas and strategies that you can adopt for your organic fertilizer production company;
- Introduce your organic fertilizer production company by sending introductory letters alongside your brochure to organic farmers, organic fertilizer distributors and other key stakeholders throughout the city where your organic fertilizer production company is located and distributed
- Advertise on the internet on blogs and forums, and also on social media like Twitter, Facebook, LinkedIn to get your message across, so that those on the social media or those who read blogs will know what organic fertilizer to purchase within your location
- Create a basic website for your business so as to give your business an online presence
- Directly market your products
- Engage in roadshows in targeted farming communities from time to time to promote your organic fertilizer
- Join local organic fertilizer production company associations for industry trends and tips
- Provide discount days for your customers
- Advertise our business in community based newspapers, local TV and radio stations
- List your business on yellow pages ads (local directories)
- Encourage the u se of word of mouth marketing (referrals)
Strategies to Boost Your Organic Fertilizer Production Business Brand Awareness and Create Your Corporate Identity
If you are in business and you are not deliberate about boosting you brand awareness and communicating your corporate identity, then you should be ready to take on whatever the society portrays your business to be. One of the secrets of larger corporations is that they spend fortunes year in and year out to boost their brand awareness and to continue to communicate their corporate identity.
If your intention of starting an organic fertilizer production company is to grow the business beyond the city where you are operating from to become a national and international brand by opening chains of distribution networks and exporting your products, then you must be ready to spend money on promotion and advertisement of your brand.
No matter the industry you belong to, the truth is that the market is dynamic and it requires consistent brand awareness and boosting cum promotion to continue to appeal to your target market. Here are the platforms you can leverage on to boost your brand awareness and create a corporate identity for your organic fertilizer production company;
- Place adverts on both print (newspapers and agriculture 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 your organic fertilizer production company – brand
- Install your billboards in strategic locations all around your city or state
- Engage in roadshows from time to time in targeted neighborhoods to create awareness of your organic fertilizer production company
- Distribute your fliers and handbills in target areas
- Contact organic farmers, organic fertilizer distributors and other key stake holders throughout the city where your organic fertilizer company is located informing them about your organic fertilizer production company and the products you sell
- List your organic fertilizer production company in local directories/yellow pages
- Advertise your organic fertilizer production company in your official website and employ strategies that will help you pull traffic to the site
- Position our Flexi Banners at strategic positions in the location where organic fertilizer production company is located.
- Ensure that all your staff members wear your branded shirts and all your vehicles and trucks/vans are well branded with your company logo.