[Market-farming] Making money from farming
mhcsa at bcn.net
Tue Jan 28 21:26:08 EST 2003
> Full Circle Farm wrote>
> This is an interesting question to me. It is not totally
> clear to me that
> the people who are operating at a larger scale with more paid
> help are
> actually taking any more home at the end of the day than
> those of us who
> operate at a smaller scale. More money going in, but more
> money going out
> as well.
This is an interesting question for me too.
My experience is that the first $20K net is the easiest to make. After
that the gross has to go up far faster than the net. In other words, the
ratio between gross and net gets larger the more your target income is.
For each additional $5K net, you need to do proportionally more
business. If this is not the case for any given enterprise then I
believe you would be right that a larger operation would be worse off
than a smaller one at least in terms of income per hour input [ return
on management ] and possibly in absolute terms.
On the other hand I see many operations operating below a minimum scale
threshold, afraid to grow when it would actually make their lives
I have said before in this forum that I believe that profitable
operations operate at 60-80% of the capacity of their invested resources
[equipment package, hired labor and land ]. More than this range does
not allow for flexibility and will also lead to break downs, of
equipment people and land. Less than this range and the operation will
get buried in overhead.
People have mixed motives when it comes to most things but definitely in
growing food.To say farming should be about profit, or stewardship,
healing, lifestyle or whatever is unnecessarily limiting. I don't care
much what anyone's reasons for farming are but I do think they should
be able to say what they are and how their operation is meeting their
objectives. This is why I find H.R.M. [ Holistic Resource Management ]
so useful. If you don't know where you are going, don't be surprised if
you don't get there?
To me the whole thing comes down to this:
What is the right scale for my operation?
Mahaiwe Harvest C.S.A.
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