Can We Make a Living from a Small Farm?
by Paul E. Hauser of Lincoln University, PA
When I saw that Ten Acres Enough was back in print, it reminded me of a request I had last year. A friend had recently purchased 11 acres of ground and wanted to know if I thought that was enough ground to set up a viable farm to support his family. We have a fairly large farm of 24 acres in our area, probably considered nothing more than a garden to large-scale farmers. Yet from this farm we have been able to support our family entirely from our vegetable and fruit production. It was from this background that my friend asked for my input to assess his chances of becoming a farmer. To answer his question I sat down and wrote a letter outlining some points that I considered important for him to succeed in his quest. Following is that letter that I mailed off to him:
I have given much thought to your interest in making a living from your new home as a farmer. Yes, I absolutely believe you can make a living from that size farm – if you plan to succeed. I look forward to a visit with you this summer to discuss it but I will try to put some of my thoughts in this letter.
First – I haven’t always made my living from a farm. I worked out for many years; farming part time and then around 1989 I decided I wanted to become a full-time farmer. My children were very young then and as an “English” family our monthly living bills are probably higher than most plain families. So my wife and I made a 4-year plan that we would work to implement to make this transition to a self-supporting farmer work. Just to quit my paying job and depend entirely on our farm income without planning would have assured failure because of many facts that I will try to touch on.
Anyone can go out back and plow up a bit of ground and plant corn. But that alone won’t provide a living for you nor make you a farmer. You have to plan on how you can maximize the most output and the highest economic return on these few acres so the first suggestion I would make is to visit as many farmers as possible who are making a living on a few acres. Learn and see what and how they are doing it. Not everything they do will interest you, but you will get ideas from each one. One farmer who I visited frequently, when I was assessing my options, and learned much from was Amos Deff who lives east of you. What impressed me much about Amos’ farm was the thought he had put into developing it. It is a 17-acre farm and he had developed a farm plan that pretty much gave him a 12-month cash flow. He had integrated small fruit, vegetables and orchards along with a small amount of livestock to have a very successful farming operation. In fact, I believe he said after about 6 years of farming his gross sales had exceeded $50,000. I can live on that, was my response when Amos told me that.
In our greater area we are fortunate that there are many examples of successful small farming operations. I also had the opportunity to visit many of the Mennonite farming families just north of New Holland. They have had small vegetable operations for ages. In my immediate neighborhood small farming operations are on the increase with the increasing price of ground, low milk, commodity and livestock prices more young farmers are considering this option. We now have 3 families making a living on an average of 15 acres and 2 more families with far less than 10 acres. In fact one farmer only has 5 acres to farm. I encourage you to come down, visit and talk with these families.
Once you visit these farms you will see what crops these folks are growing, how much labor it takes and how they are marketing their produce. From this you will put together a Farm Business Plan. This plan will provide some direction. As to what you’re going to grow – how much you will grow – what labor will be needed – how you will market your produce – income expectations and expense allocations – the time frame needed to reach these goals – in other words it will spell out exactly how you are going to make it financially from the farm. If you don’t sit down and plan you will never know whether or not small-scale farming will be a viable financial option for your family. Remember people don’t just fail at farming; more often they fail to plan on how to succeed.
This farm plan will change over time. Expect that – but it will give you some initial direction. The crops that you decide to grow are crucial to your success. Most vegetables are short one-season crops – but others will need time to phase into a productive mode, such as asparagus. Fruit corps such as raspberries, peaches or apples need years to bring into production. That’s another reason why it may take you several years before you can count on the farm to support your family. When I drew up my plan, I knew labor would be very limited, so I wanted to spread the workload throughout the entire year. I also wanted a crop that would not be subject to the highs and lows of a lot of farmers getting into a crop. So I went with a lot of fruit trees. This orchard has been extremely profitable even though I knew little going in. Now we are changing directions slightly. We are planning on reducing the size of our orchard, because of slow apple sales and dramatically increasing our bramble production to meet demand.
One of the most important aspects of your farm plan will be the marketing aspect of it. For unless you can profitably sell your products you will not be in the farming business very long. Do plenty of research on whether you will sell wholesale or become retail driven and know what to expect for average returns. Initially we felt we would wholesale some volume crops like tomatoes but we found we could not compete with other farmers because of our limited labor. Subsequently we became much more retail driven than I ever initially imagined. But as I said, your overall farm plan will adjust to meet changing circumstances. Don’t be afraid of spending 1 or 2 days away from the farm selling. For as I have told my neighbors, if you can make more money directly selling than wholesaling, after subtracting expenses and time spent away from home, then that’s what you should be doing to make farming profitable for you.
One important aspect of marketing is matching your crops to your potential buyer. At first you might think this is much ado over nothing, but I have found this to be an extremely important issue. You will find the crops that you grow for wholesale can be vastly different from retail crops and the produce purchased by rural folks is different from those bought by our urban population. The big difference between retail and wholesale crops is that when growing for the retail market you concentrate on crops that genuinely taste good, like heirloom vegetables. Conversely the wholesale market needs produce that can be shipped, has a long shelf life and has a recognized appeal, like Red Delicious apples for example. On our farm I made a key mistake, I planted a significant amount of red and yellow Delicious apples and just a sprinkling of heirloom varieties like Golden Russets and Oppalscents. On the wholesale market these Delicious apples did well for us because of their reputation. But as we concentrated on selling at Farmers Markets we found we couldn’t give these Delicious apples away. Our customer base was shopping at the market to get away from the standard institualized product, like Delicious apples. These folks were looking for local favorites like Russet apples. Heirloom vegetables have been an enormous asset to us. People just love our display of different colored tomatoes and old varieties of peas and beans. Varieties that cannot be shipped or sold on the wholesale market. So think carefully whether you will be selling wholesale or retail before you invest in your crops, especially if they are long term crops like fruit trees.
I also alluded to the difference between what rural customers buy versus those in an urban market. I have sold in both and although the differences may seem vague, they do exist. Let me give you an example we experienced with our peaches. In our local rural market yellow peaches are absolute King yet when we travel to our city markets we get an absolute premium for our white flesh peaches and demand continues to soar for them. Yellow potatoes are huge in the city while white dominates our rural town market. I can’t give away lima beans in the city while I pick bushels for our rural markets. Maybe its just fine-tuning your marketing potential but difference does exist and you will profit when you recognize and capitalize on these.
Another factor in your plan is scheduling your time. I knew that I did not want to farm just in the summer and then get a lunch bucket job in the winter. I also wanted and needed to create a cash flow for as much of the year as possible. This led me into fruit tree production, there was work pruning in the winter and summer demands where not as heavy as vegetables thereby more evenly allocating my work throughout the year. Another work stretcher we went into was greenhouses, as in 2 or 3 of them. For us we start in February with them and start selling by mid March. Once again providing home farm work and giving us an early cash flow. You don’t have to grow just flower plants in them. We specialize in vegetable plants that are sold to gardeners in one of ours. You don’t have to grow just bedding plants in them; you can use them for early season vegetable production. We have one house for early tomatoes, then empty it out and plant lettuce in it during September. Our sales go through early winter, again spreading the work out and keeping the money coming in. Greenhouses will usually pay for themselves in one year and give you a net return on top of it. So as you plan to succeed, don’t try to make all your money in just the summer. Look for ways to grow and market through as much of the year as possible. It will keep you working on the farm all year long.
I believe every farm should include livestock, regardless of how small it may be. The reasons are numerous. First the manure from the livestock will become the heart of your soil fertility program. Secondly, they promote greater financial independence. So thought should be given on how to include them in your farm plan. There is a growing awareness of the benefits of pastured poultry with constantly increasing demand. By raising them on your horse pasture or following vegetables you will be utilizing crop residues while adding fertility to the soil. The time it takes to clean and market the birds will determine the commitment you will be able to make to this becoming part of your farm.
Even if you opt not to raise poultry you will still need something to recycle the unsold produce to. At the very least a hog or perhaps a dairy goat could be a real asset to the farm. I think so many people have gotten away from growing their own food needs. They have seemingly justified the expense of buying food that they should be able to grow cheaper while also having a higher quality of food. On a small farm, every dollar is going to count and even though your farm may be limited, by being innovative you can still produce some of the meat, milk and produce your family will need.
No farm plan would be complete without paying attention to debt control. In order to make it on a small farm – or any size farm for that matter, it is absolutely essential to control the amount of money you spend and borrow. Before we became fulltime farmers, we gave ourselves several years to retire all debts and buy the essential equipment we felt was necessary to start up farming. By working out and farming part time you probably will have more money to pay debt and invest in the future of the farm rather then by going full bore into farming at the start. It will also give you the opportunity to develop farming skills and marketing options as you financially grow into the farm. I recently visited a farm in which the young owners were selling out. The financial strain had simply been too much. Yet I couldn’t help but notice the new heating system in the house. A new Fossil Fuel burning system, while a good woodlot on the farm went untouched. This couple contributed to their own downfall by not minimizing debt and cash outlay through means available on the farm. I believe you must absolutely plan on reducing debt and your cash outlays on the farm and that includes your mortgage.
In discussing debt we also must turn our attention to just what equipment is necessary for the small farm. You can spend a lot of money on new equipment and before you spend you need to justify that cash outlay. Before deciding on specific equipment, you’ll need to decide what the horsepower requirements will be necessary on your farm. So many of my neighbors seem to think they need at least 4 work horses even on the smallest of farms and I just don’t believe that’s so. These neighbors feel it’s almost embarrassing to be in the field without a 4-horse hitch. We simply use 2 horses and have bought equipment that will get the job done and that a team can handle comfortably. My neighbors often have their laughs at my old fashioned equipment, but its all in good useable condition and is paid for. The biggest horsepower requirement on a small farm is for plowing. But you need to be smart about this. Two horses simply can’t go out and accomplish the same amount as a large hitch. But if you buy a 12-inch plow and do a portion of fall plowing and stay ahead of your work, those two horses will easily plow your farm. Additionally – older style – smaller equipment is more affordable, although harder to find. Let me give you an example. We use an old John Deere 12-inch two-way plow that cost $250. My two horses handle it comfortably. But everyone wants a new White Horse hydraulic plow, a great tool. Unfortunately it costs over $3000 and needs 4 horses. Many of today’s farmers don’t realize our grandfathers farmed with much smaller hitches then they use today and got all the work comfortably done.
No discussion on farming would be complete without paying attention to our earning potential. It’s inconceivable that one could go into farming without having some factual information on what you may potentially earn. Unfortunately, the income that farmers earn is the piece of information that they are least willing to share. Based on our farming experience it is absolutely possible to gross realistically $45,000 to $50,000 from your small farm. Our primary crops of importance are our greenhouse, peaches, tomatoes, small berries and apples. My wife and I provide the only labor, although a good portion of my wife’s time is spent being a mother also. My two sons have no real interest in vegetable farming and pursue other jobs they have more interest in. Yet they may still contribute a total of 10 hours combined during the summer. I have crops that keep me busy the entire year so my work schedule is very constant. Can you make that much right off the start? I don’t think so – it takes time to develop crop knowledge and good marketing skills. But the bottom line is, potentially you can make enough to support your family from a small farm.
Now I also don’t mean to mislead you into thinking that it’s easy to make a living from a few acres. For us there have been a lot of sacrifices to achieve that goal. Additionally there are real life problems associated with farming. Farming is not only this idealistic notion of tilling the soil and seeing life regenerated. It’s also about endless hours of work that you never get a break from. At times, especially in the spring and fall when the workload is heaviest, I find myself getting depressed. Depression is a real factor in farm life. A simple hailstorm can ruin a years crops in a few minutes and bring a financial ruin. Think long and hard before you do this because farming is not always pretty once you’re into it. But if you do want to learn more and see the lay out of our small farm, please come and visit. It is not this picturesque, spotless farm; we have weeds in our fields and often there isn’t time to mow the lawn. But as I said – that often is real life farming. Good luck to you and your family in pursuing your farming dreams.