Agriculture Products or Services
As you go through this layout you will notice that we try to build a number of parallels between agribusiness and a traditional commercial or retail business. This structure is on purpose so that you will associate the two. Throughout the narrative sections of this layout there is a reference to the marketing concept that people purchase goods and services for the benefit they receive from using them. While we try to maintain these parallels in this section you will also notice a lot of differences do exist. Most agriculture producers never consider the consumer benefit when they are growing a commodity. A farmer growing corn or cotton doesn’t really give the same thought as to how the consumer will enjoy the product as a manufacturer of toaster strudel or pillow cases. That’s because the producer is typically so far removed from the end user that they don’t get the connection. Yet that satisfaction that the consumer gets from the consumption of the end product drives sales all the way through the system.
In the business plan you will need to clearly define and describe the products. If the producer or processor only handles one type of product then this description will be condensed into one section. If on the other hand when several different products or services are produced or processed within the same enterprise, then it is suggested you detail each one separately. Keep in mind that the business plan needs to move along briskly and should keep the reader’s attention. It may be necessary to move some of the extensive detail to the appendix. Pictures, drawings and even video clips are a useful addition to the plan. For each product outlined in this section there should be a corresponding marketing plan in the marketing section.
Agribusiness is associated with a number of very specialized services. When your business provides services to other businesses that are either producing and/or processing Ag products you are subject to the seasonality of the business and the economic conditions that they face. Ag services must be flexible enough to adapt to changing production. You also must consider how to market the Ag service business to the prospective clients.