How To Start A Smallholding Business With No Capital Investment

Posted On: November 3, 2018 Published by | View Comments

No capital? No problem! Discover some tactical manoeuvres to successfully starting a smallholding business without savings


Starting a smallholding business with little or no available capital can be daunting.

Self-sufficiency therefore might be more a matter of necessity than style.

Before you identify your ideal smallholding for sale and take the plunge – you’ll need to count the cost of delivering the returns your would expect.

For an agricultural operation, capital expenses for machinery acquisition, land upgrades, livestock or other asset building activities is unavoidable.

But what do you do if you don’t have the necessary capital to start your smallholding business? 

Use what you’ve got.

And build one step at a time.

This organic approach to starting-up is a different approach to the current economic trend which advocates buying credit to suffice the need for speed.

However, on the contrary, we advise a debt-free (organic) model of start-up/expansion.

Growing organically sure is slower, but it is surer, long term.

But…

How exactly do you set up a smallholding business idea without any capital to invest?

The answer lies in the following ‘key words’:

Serviceleverage.

To be explicit, finding out…how

what you do have may be offered in exchange for something you need to grow.

What could you possibly have from the start (not having any capital investment) which someone else might consider valuable?

This takes knowledge of your market vertical.

For further info on this read: “Transform Farm Gate Sales – With Collaborative Direct Farm Marketing!

But in short, learn what business participants within your local area are in need of and seek to position yourself credibly in the place of serving them.

The following are some strategic tips for starting a sustainable smallholding business – without capital:

How can you make yourself useful within your local agri-economy?

#1 Learn

Acquiring new skills is a popular point of leverage for generating commercial gain.

Adding to your output arsenal by way of learning something new, broadens your scope.

Aim to compliment your knowledge-base with a new sphere that affords you a reach you didn’t have otherwise.

Seek advantage.

It’s a matter of strategy.

Ask yourself, “…where is it that I could be of most benefit within my local agriconomy?

“…what new skill or competency could I embrace that would improve my local business peers?”

This is a profitable value-adding approach…

And a very quick method of becoming appreciated and supported by your neighbouring farm businesses.

#2 Training and qualifications

Sometimes accreditation is necessary to be operate in some contexts where…

licenses, permits and certificates are required by law.

Are there any gaps in your local agri-marketplace where a qualified professional will add significant value?

Count the cost of both time and resources in order to get badged.

Plan feasibility of both succeeding in skill acquisition as well as generating enough interest post-qualification to produce a healthy return on investment.

Looking good on paper?

Contact a local course provider for more details.

#3 Build resources

Problem solving & solutions building is the crux here.

Investigate your local agricultural economy.

Where are the dots which need joining up?

How would you build a solution to suffice the issue?

Once built, how would you make its availability convenient to users within your community?

  1. Interview potential users.
  2. Elicit/uncover the most valued features and benefits.
  3. If your proposed solution would require skills outside of your current ability, consider…
    • upskill vs. hire? Calculate the ROI and make you decision.
  4. Design a prototype and test thoroughly.
  5. Write a roadmap of development for improvement and enhancement.
  6. Plan a launch and promotion.
  7. Set targets & monitor performance.

#4 Offer promotion

The rural economy depends on local customers supporting local enterprise.

According to the AIDA marketing model which declares the gradual steps by which promotional activity leads to sales…the process of fruitful marketing in the rural economy begins with…

awareness‘.

The principal ingredient.

How are customers of a business made aware of their products/services?

Promotion.

Customers have to be told.

Professional promotion costs time and money.

Done successfully, promotion takes real expertise.

Promotional expertise often presents a technical barrier, which rural businesses find prevents them from developing.

Disparate customer bases + no natural footfall + no promotion = failure.

Whilst you can’t choose where customers live, or where they go – you can give them a reason to do business with you.

Promotion.

Why not learn effective means and methods of marketing promotion & offer this benefit to local rural business?

#5 Connect people relevantly

Business grows by people being connected in a meaningful ways.

Get to know the suppliers and buyers in your local marketplace.

Who already knows who?

Who could benefit from knowing who?

Begin facilitating the growth of participating businesses in your local agricultural marketplace – by introduction.

#6 Hyperlocal championing

Find business providers in your local rural economy and take a look at their brand story.

Examine their journey.

Sample their products or services.

Get some value form them, then share that value.

Brand advocates go a long way to enabling a business to grow organically.

Become one.

Speak positively on behalf of local businesses in a way they will never be able to.

Produce material and collateral which articulates the distinct benefits of a given producer or two (…or few).

Start conversations with prospective users and help your local businesses do what they do best – serve up quality, whilst you champion them.

You’ll be valued for it by both users and producers alike.

#7 User club

When users get together big things happen in business.

Cross pollination on ‘value enhancing’ improved use cases, tips, techniques – produces equity among individuals in the market.

Those more competent or experienced users – add on to those who are lesser experienced – raising the bar across the board.

Not to mention the advantage of closing the feedback loop!

Businesses who garner constructive feedback and commentary from their user base only improve their ability to grow sustainably.

Such businesses tend to be right on trend and can more adeptly suffice the changing needs of their customers.

Recruiting and running a user group on behalf of a local agribusiness would help them massively and generate a positive buzz for all involved.

A valuable asset if done well.

#8 Hub it

What do we mean by hub?

Cooperative, collective, collaboration

In other words, the pooling together of agricultural produce in order to draw in a larger crowd for more fruitful for sales.

Farmers markets operate on this premise.

By aggregating the commercial output of producers, market owners seek to generate a concentrated or focused demand.

Crossover, cross-selling and mixing it up affords an optimal environment for trade.

The benefits are shared throughout.

And where complimentary qualities are aligned, the best outcomes occur for the strongest vendors as well as for the least strong.

Do you have a idea for a hub?

How will you assemble your contributors to participate in the hub?

Will it be virtual/online or physical?

Will it assemble on schedule or be openly run?

How will you govern it fairly?

Make your plan and execute.

The round-up…

Does a smallholding business have to be agricultural by nature?

Not necessarily.

It just needs to add value to local businesses and consumers/end-users.

It’s no secret that rural businesses are failing to sustain themselves.

The current economic system is desolating to authentic producers.

Growing produce, whilst universally needed for man’s survival, has somehow become a most treacherous of trades – no matter how high you get.

Debt ridden, unsutainable, eroded profit margins, middleman marketplace…

Such factors are not favourable.

But, where does that leave you?

As a budding smallholding business owner, taking on the risk of debt in such uncertain times could be calamitous.

Why invest capital unless you have tangible assurance of ROI?

Try firstly establishing enterprise value without heavy investment.

Get good at performing mission critical marketing activities, first.

Offer them to other businesses to get yourself some…:

  • income,
  • experience,
  • expertise,
  • contacts and;
  • good will.

All of which will be necessary to succeed once you get producing.

It may so happen that you choose to remain as a facilitator, rather than producer after all.

At least you leave yourself the choice.

Do you have experience starting up a smallholding without capital investment?

Share your story below.

Do you want further advice on how you might achieve the approach contained in this article?

Feel free to get in touch.

« « %

Categorised in:





Post written by smallholdings

Add value by sharing comments or answers to questions
...& we will share them all round.

Join The Conversation!

Leave a Reply

Your email address will not be published. Required fields are marked *