A farm store sells what the farm grows, raises and makes, plus enough from neighbors to make the trip worth it. That gives it something a grocery doesn't have: its own produce keeps most of each dollar, because the farm already grew it. Each kind of product comes with its own rules: whole produce sold by the farm has the fewest, eggs have to stay cold, meat has to come from an inspected plant, and the farm kitchen's pies and jams need a licensed kitchen. In the example below, a Kentucky farm store opens in April with $188,500, makes $23,116 in its first year before the owner's pay on $369,000 of sales, and loses money in the winter months. Below is each part of the plan, the rules, the year month by month, the startup budget, and a free template.
The short version
- Describe the store in a paragraph: the farm, the road, who drives out, what they come for, the goals.
- Plan sales by category per $100: your produce, your eggs and meat, the farm kitchen, local products, seasonal.
- Your own produce keeps the most of each dollar; products bought in keep the least.
- Eggs stay at 45 °F or below; meat sold by the cut comes from an inspected plant.
- The farm kitchen needs its own license; whole produce from your own farm needs the least.
- Plan the year by season: fall is the peak, winter is slow.
- TaroStack makes the kitchen's pies and jams as batches with lots and dates, and keeps the meat's lots. More below.
Part 1: the business description
Two Creeks Farm Store, a made-up farm store in Lexington, Kentucky, I use in these examples, writes:
Two Creeks Farm Store is a store in a renovated barn on our vegetable and livestock farm, open year-round, selling our vegetables, eggs, beef and pork, pies, bread and jams from our farm kitchen, honey, cheese and coffee from neighbors, and pumpkins, mums and wreaths in season. In its first year it aims to reach $45,000 of sales in its best months and keep produce shrink under 6%.
Part 2: the rules for each product
Whole, uncut produce the farm grew itself is the simplest thing a farm store sells; cut fruit, salads and anything cooked are food processing and fall under the kitchen's license. Eggs held for retail have to be refrigerated on arrival and stored and displayed at an air temperature no higher than 45 °F (21 CFR 115.50), and many states add their own rules for selling eggs. Meat sold by the cut has to come from an inspected slaughter and processing plant: custom slaughter is exempt from inspection only when the meat goes back for use in the owner's own household (9 CFR 303.1), so beef and pork for the store's freezer go through a USDA-inspected or state-inspected plant. The farm kitchen's pies, bread and jams need a licensed kitchen, and how the state treats a farm's own kitchen varies. This is general information, not legal advice.
Part 3: what each category earns
Each category is planned per $100 of sales, with card fees and shrink in its cost:
| Category | Sales | Variable cost | Contribution | Margin | Hundreds in a peak month |
|---|---|---|---|---|---|
| Our produce | $100.00 | $38.50 | $61.50 | 61.5% | 110 |
| Our eggs and meat | $100.00 | $58.50 | $41.50 | 41.5% | 90 |
| Farm kitchen: pies, bread, jams | $100.00 | $57.50 | $42.50 | 42.5% | 90 |
| Local products bought in | $100.00 | $68.50 | $31.50 | 31.5% | 90 |
| Gifts and seasonal: pumpkins, mums, wreaths | $100.00 | $54.00 | $46.00 | 46.0% | 70 |
The produce's cost is what it costs to grow, about $30 of each $100, plus 6% shrink and card fees. The meat's cost includes the processing plant's kill and cutting fees; the kitchen's includes ingredients, packaging and the baker's hours. In a peak month the store sells $45,000 and keeps $20,380, 45.3%; produce brings $6,765 of it on a quarter of the sales. How to price beef from the processor's figures is in how to price beef by hanging weight, and pricing a farm's produce in farm stand prices.
Part 4: the first year, month by month
Fixed costs are $12,000 every month: store wages ($9,000), utilities and coolers ($1,200), insurance ($500), the register, scales and software ($150), ads and events ($500), and licenses, repairs and other costs ($650). The store opens in April:
| Month | Sales | Profit | Cash, year to date |
|---|---|---|---|
| April | $18,000 | −$3,848 | −$3,848 |
| May | $27,000 | $228 | −$3,620 |
| June | $36,000 | $4,304 | $684 |
| July | $40,500 | $6,342 | $7,026 |
| August | $40,500 | $6,342 | $13,368 |
| September | $45,000 | $8,380 | $21,748 |
| October | $45,000 | $8,380 | $30,128 |
| November | $36,000 | $4,304 | $34,432 |
| December | $36,000 | $4,304 | $38,736 |
| January | $13,500 | −$5,886 | $32,850 |
| February | $13,500 | −$5,886 | $26,964 |
| March | $18,000 | −$3,848 | $23,116 |
The year's sales are $369,000 and the profit $23,116, before the owner's pay. The store breaks even at about $26,500 of sales a month. September and October, with pumpkins, apples and the corn maze crowd, are the peak; November and December sell pies and wreaths; January to March lose $15,620 together, because the wages and the coolers don't stop. Cutting winter hours to weekends is the first change that improves the year.
Part 5: the startup budget
| Item | Example |
|---|---|
| Barn made into a store | $80,000 |
| Kitchen equipment | $30,000 |
| Coolers and freezers | $25,000 |
| Opening inventory | $15,000 |
| Signs and parking | $8,000 |
| Register and scales | $4,000 |
| Licenses and permits | $1,500 |
| Working cash | $25,000 |
| Total to start | $188,500 |
The farm already owns the land and the barn, so there's no rent; the renovation, the kitchen and the coolers are most of the cost. The $163,500 before working cash is a long payback from $23,116 in the first year, which is why many farm stores start smaller, in a shed with a cooler, and grow into the barn.
Get the template
Download the farm store business plan workbook. Four sheets: your categories, each per $100 of sales with its variable cost and hundreds in a peak month; the first year, month by month (month 1 is April), with sales, profit and cash; 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
A plan in categories hides the farm. Vegetables harvested daily and sold or composted within days, eggs collected and dated, a steer that comes back from the plant as 450 pounds of cuts in a dozen kinds, pies baked each morning from the farm's own fruit, and jams with best-before dates on every jar. A spreadsheet can't say what a pie cost, which steer the ribeyes came from, or how much of Tuesday's lettuce went to the compost.
How TaroStack does it
TaroStack makes the kitchen's pies and jams as batches with lots and dates, and keeps the meat's lots.
The farm kitchen. A pie or a jar of jam is a recipe: a batch takes the fruit, flour, sugar and jars off stock, costs what it used, and gets a lot of its own with its best-before date, so every jar on the shelf has a date and a cost.
Meat by lot. Cuts come back from the processing plant as a lot with their packing date, so the store knows which animal each package came from, and one recall report shows what's still in the freezer and which orders, such as a restaurant's, it went to. How lot numbers work is in what is lot tracking.
Losses with a reason. Every adjustment carries its reason, spoiled, expired, damaged or sample, so produce going to the compost is reported by item instead of hidden in the margin.
| The job | Spreadsheet | In TaroStack |
|---|---|---|
| What a pie cost | Estimated | The batch's cost from what it used |
| A date on every jar | Written by hand | Each batch's lot and best-before date |
| Which animal the ribeyes came from | The processor's paperwork | The cuts' lot |
| Produce composted | Not recorded | A loss with its reason |
Recipes, batches, lots, expiry and losses by reason are on every plan, from $49 a month; TaroStack connects to Square. 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.