Christmas Tree Farm Business Plan, With a Projection

A Christmas tree farm business plan is unusual in two ways. The trees take years to grow, so a new farm spends for most of a decade before it sells anything, and once it does, nearly the whole year's money arrives in about six weeks. So the plan has two parts: what it costs to establish the field and carry it to the first harvest, and a selling year in which ten months of costs are paid before November's first customer. In the example below, a choose-and-cut farm in the North Carolina mountains sells about 1,350 trees to families, 675 to retail lots, wreaths and hot cider, and ends a selling year about $83,300 ahead on $149,200 of sales, after paying a field crew and the December staff, but it needs $26,700 of cash to reach November. Below is a description example, each part of the plan, the years before, the selling year, the startup budget, and a free template.

The short version

• Describe the farm in a paragraph: the species, the acres, the choose-and-cut and wholesale trade, the goals.
• Cost a tree at sale: shaking, netting, the crew, the seedling that replaces it, card fees.
• Choose-and-cut families pay the most; retail lots take volume at a wholesale price.
• Wreaths and hot cider make a visit worth more than the tree.
• A field takes years to reach harvest; budget the planting and the upkeep before it.
• Cash for ten months of costs comes before November; plan for it every year.
• TaroStack keeps trees by field and size, wreaths and supplies counted, and the December rush on orders. More below.

Part 1: the business description

Grandview Fraser Fir Farm, a made-up Christmas tree farm near Boone, North Carolina, I use in these examples, writes:

Grandview Fraser Fir Farm grows Fraser fir on 12 acres in rotation, open for choose-and-cut on weekends from the Saturday before Thanksgiving to mid-December, with fresh wreaths and hot cider, and sells pre-cut trees to retail lots and churches in the region.

Part 2: what a tree costs at sale

The cost to grow each tree, the years of shearing, mowing and spraying, is carried in the fixed costs and the startup budget, not here; the variable cost is what selling one more tree costs, including the seedling that replaces it. Netting, bows and wreath boxes are costed like any packaging; how is in packaging cost per unit.

Part 3: customers and prices

A choose-and-cut tree leaves two and a half times what the same tree sold to a lot does, but the farm can only host so many families on a December weekend, and lots take the trees that don't sell on the farm. A wreath or a cup of cider is the second sale of the visit. How a farm adds value to what it grows is in value added products for farms.

Part 4: the years before the first harvest

A Fraser fir planted as a seedling takes years to reach a saleable 6 to 8 feet, sheared every summer to its shape, mowed around and protected from pests the whole time. This plan's farm plants about 13,000 trees across 12 acres and replants each tree it sells, so once it's established it harvests a block a year. The startup budget carries the planting, the equipment, and the field upkeep for the years before the first harvest; how long that is depends on the species, the climate and the site, so a new grower checks with the state's extension service and a nearby grower before planting.

Part 5: a selling year, month by month

Fixed costs are $2,665 a month, averaged over the year: the field crew for shearing, mowing and planting ($1,500), land taxes and payments ($500), fertilizer and pest control ($200), insurance ($150), equipment and fuel ($200), marketing ($80), and software and card fees ($35). Month 1 is January; the farm sells in late November and December:

The year's sales are $149,175 and the profit $83,309, after the field crew and December's staff. Cash falls to −$26,650 by the end of October, which is why the startup budget carries $27,000 of working cash, and why every year after the first needs that much put aside from the December before. How to plan around a short season is in seasonal inventory.

Part 6: the startup budget

The land isn't included. At $83,300 a year, the $130,000 spent establishing the field takes about a year and a half of good seasons to earn back, after the years of waiting.

Get the template

Download the Christmas tree farm business plan workbook. Four sheets: your trees, wreaths and extras with price, variable cost and December's volume; the selling year, month by month, with sales, profit and cash, and month 1 set to January; your fixed costs; and your startup budget with working cash. It's an ordinary Excel file with no macros, and it works in Google Sheets, LibreOffice and Numbers.

Where this stops working

Blocks of trees at different ages, a tally of what's ready in each size, 675 pre-cut trees promised to lots for the first week of December, wreath supplies, and four weekends of families. A notebook can't say how many 7-foot trees are left in the lower field, which lots are still owed trees, or what a wreath costs this year.

How TaroStack does it

TaroStack keeps trees by field and size, wreaths and supplies counted, and the December rush on orders.

Trees as stock. Each size of tree is an item at each field, counted on a phone in the rows with no signal, so the trees ready to sell are a number, not a guess.

Lot orders. Pre-cut orders for retail lots are sales orders for their delivery day that show whether enough trees are tagged and cut while you're still typing.

And the wreaths. Each wreath is a recipe of its ring, greens, bow and decorations, so a day's wreath-making takes them off stock at what you paid, and margins are reported by product and by customer.

Counting, recipes and sales orders are on every plan, from $49 a month; up to three sites, the fields and the barn, are on Standard at $99. The first 30 days are free, with no credit card. If you'd like a hand setting up, ask, and we'll do it with you.

Questions people also ask

How profitable is a Christmas tree farm?

Once it's established, it can be. In the example, a 12-acre choose-and-cut farm ends a selling year about $83,300 ahead on $149,200 of sales, after the field crew and December staff, but only after years of growing before the first harvest.

How much does it cost to start a Christmas tree farm?

In the example, $157,000 without the land: seedlings and planting, a tractor and mower, a shaker and baler, tools, the field upkeep before the first harvest, and $27,000 of working cash to reach November.

How long does it take to grow a Christmas tree to sell?

Years, depending on the species, the climate and the site; ask your state's extension service and nearby growers before planting.

How much should I charge for a choose-and-cut Christmas tree?

Cover the year's costs and price against nearby farms and lots. In the example, a 6- to 8-foot tree sells for $75, leaving $61.75 after the crew, netting, a replacement seedling and card fees.