[Market-farming] Making money from farming

Rick Williams mrfarm at frontiernet.net
Wed Jan 29 19:57:26 EST 2003


Dave Inglis wrote:
> 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.

This seems opposite to what occurs with most businesses. Although it may be
easier to get the gross sales easier for the first money that comes in,
there are many fixed costs that have to be paid no matter what the sales
happen to be. Once those are amortized, your profits increase faster on the
marginal sales.

This is certainly true here at Misty Ridge Farm. As we increase sales, our
costs do not necessarily increase at the same rate. And it has been very
true of the sales and business operations that I have had in the past in
other fields of endeavor.

Sincerely,

Rick Williams




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