Being a new farmer, trying to start out, that’s scary, from the investment market volatility, land prices, even trying to live up to what others are doing. The question becomes, who do I talk to first? Program Supervisor at the Wisconsin Farm Center Dan Bauer tells SFN the newly released Wisconsin beginning farmer resource guide helps these new farmers navigate the tough decisions ahead.
The inspiration for this project was this realization that hey, there’s a lot of organizations who work in this space and receive inquiries from farmers. And it would be so valuable if there was you know, one piece they could refer to that summarized all the different programs available. And another benefit is that if you have a piece like that is it could kind of standardize the type of referrals and recommendations these organizations are making the young farmers regardless of which organization they approach.
Okay, so the guide may have been made in Wisconsin, but it can be useful for all new farmers everywhere.
Ultimately, what the project team arrived at is the steps of brainstorming what is your business idea learning let’s learn about the business let’s become an expert in the business you’re looking to start planning is so important, you know, you can have your idea but if you don’t have a plan, that business isn’t going to be successful or the next one is funding you have to have access to capital if you’re going to make any kind of equipment purchases if you’re going to do any kind of marketing promotion. And then the next step we came up with is forming it’s getting your insurance in order getting legal entities legal paperwork, you know, so you can actually be recognized as a business and get the benefits of that organization. And then lastly is operating. You’ve got an idea. You’ve got the education, you’ve got the plan, you’ve got the money, you are officially a business well now you got to operate it successfully.
Bauer says connecting with experience farmers and industry groups is also a good idea.
The guide includes three or more references for each of these stages. And it allows readers to jump in at any step they’re at in the guide and then immediately have access to references and referrals, depending on any and whichever phase they happen to be on.
When it comes to financial support for young farmers, it’s important to consider the available grants, loans and assistance programs. Bauer suggests starting with your local FSA office.
They actually have a beginning farmer direct and guaranteed loan program and the benefit of this program is it typically offers an interest rate that’s going to be much lower than what would be commercially available from private lenders. And really, when you think about where we’re at today in the business cycle, the potential interest rate difference today is expected to be even more significant the other program that FSA can offer as they actually have a microloan program, and this is designed to help farmers have an important source of financial assistance, especially during those startup years.
Now while grants can be a valuable resource, Bower says they should be viewed as a bonus rather than a primary funding source.
A team member and I were recently talking about the topic of grants and he shared some advice. And what he had mentioned to me is that a person should not start a business or make a change to an existing business just because of an available grant. And said he said the way to think about it is to make sure the new business or the business change makes strategic sense on its own merit. And then you can look to the grants as a way to kind of assist in executing that strategy. And that’s kind of where I get that icing on the cake analogy.