Lavender Farm Business Plan, With a Projection

A lavender farm business plan has to deal with two things most plans don't. The plants take a few seasons to reach full size, so a new farm spends on its field before it sells much, and once it does, the whole year's crop is cut in a few summer weeks, then dried and sold from the shed for the rest of the year. So the plan has two parts: what it costs to plant the field and carry it until the plants mature, and a selling year in which June and July bring nearly half the money and the dried stock carries the winter. In the example below, a farm of 3,000 plants in northern Michigan sells dried bundles, sachets, culinary lavender and gift sets from its farm store and website, and ends a mature year about $32,700 ahead on $60,000 of sales, before paying the owner. Below is a description example, each part of the plan, the seasons before, the selling year, the startup budget, and a free template.

The short version

• Describe the farm in a paragraph: the varieties, the plants, the store and the website, the goals.
• Cost each product: the buds or stems, the minutes of harvesting and making, packaging, card fees.
• A gift set leaves the most per sale; bundles and sachets make up the volume.
• The bloom brings visitors in June and July; dried stock sells the rest of the year.
• The plants take seasons to mature; budget the field care before the first full harvest.
• Count what's dried and on the shelf, by harvest, so winter orders don't run out in October.
• TaroStack keeps dried lavender by harvest lot, each product as a recipe, and one count of what's on the shelf. More below.

Part 1: the business description

Boardman Valley Lavender, a made-up lavender farm near Traverse City, Michigan, I use in these examples, writes:

Boardman Valley Lavender grows 3,000 hardy English lavender plants on an acre and a half, open to visitors through the bloom in late June and July, with dried bundles, sachets, culinary lavender and gift sets sold in the farm store and online all year.

Part 2: what each product costs

The gift set holds a small bundle, a pair of sachets and a tin, in a box. The cost of growing the plants, the weeding, pruning and watering, is in the fixed costs, not here; the variable cost is what making and selling one more costs. How to cost a box, a tin and a label is in packaging cost per unit.

Part 3: customers and prices

A gift set leaves more than two bundles do, and it's what visitors buy to take home and what the website sells in December. Bundles and sachets are the volume. Many farms also sell u-cut bundles during the bloom, where visitors cut their own; they're left out of this projection, which keeps to the products on the shelf. Turning a crop into products that sell all year is in value added products for farms, and pricing a gift set for shops that want to stock it is in how to price handmade items for wholesale.

Culinary lavender is a food, so check your state's rules for selling it before the first tin goes on the shelf.

Part 4: the seasons before the plants mature

A young lavender plant gives a small first harvest and takes a few seasons to reach its full size, weeded and watered the whole time. How long that is depends on the variety, the soil and the winters, so a new grower checks with the state's extension service and a nearby grower before planting, and chooses varieties hardy enough for the site. The startup budget carries the plants, the weed barrier and drip line, the drying shed and store, and the field care until the plants mature; the projection below is a year after that.

Part 5: a mature year, month by month

Fixed costs are $1,075 a month: field upkeep, weeding and pruning, averaged over the year ($600), the farm store and website ($150), insurance ($80), irrigation ($60), marketing and bloom events ($150), and software and card fees ($35). Month 1 is January; the bloom is in late June and July:

The year's sales are $60,016 and the profit $32,698, before paying the owner. June and July bring 43% of the sales, and the first three months lose a little, so the plan keeps $3,000 of working cash. The bundles sold from August to May were cut in the summer, about 1,000 of them, so the harvest has to be planned for the year's orders, not July's. How to plan stock around a short season is in seasonal inventory.

Part 6: the startup budget

The land isn't included. At $32,700 a year, the $36,100 spent on the field, the shed and the store takes a little over a year of mature seasons to earn back.

Get the template

Download the lavender farm business plan workbook. Four sheets: your products with price, variable cost and July's volume; the 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

Racks of drying bundles from three harvest days, buds stripped into bins, tins and sachets made in batches, a store and a website selling from the same shelf, and a December rush of gift sets. A notebook can't say how many bundles are left from July's harvest, whether there are enough buds for the gift sets, or which harvest a tin of culinary lavender came from.

How TaroStack does it

TaroStack keeps dried lavender by harvest lot, each product as a recipe, and one count of what's on the shelf.

Harvests as lots. Each harvest day is a batch that makes a lot of dried bundles or buds with its date, so the stock in the shed is a number by harvest, and a tin can be traced back to the day it was cut.

Products as recipes. A tin, a pair of sachets or a gift set is a recipe of its buds and packaging, so a day of filling takes them off stock at what they cost, and margins are reported by product.

The store and the website. Stock is counted on a phone in the shed. If the website is a Shopify store, we set it up with you, and a daily check catches any difference between its count and yours before it sells gift sets the shelf no longer has.

Counting, lots and recipes are on every plan, from $49 a month. 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

Is lavender farming profitable?

Once the plants mature, it can be. In the example, a farm of 3,000 plants ends a year about $32,700 ahead on $60,000 of sales of dried bundles, sachets, culinary lavender and gift sets, before paying the owner, but only after the seasons it takes the plants to reach full size.

How much does it cost to start a lavender farm?

In the example, $39,100 without the land: 3,000 plants, weed barrier and drip line, drying racks, a farm store, tools, packaging, the field care until the plants mature, and $3,000 of working cash.

What sells best at a lavender farm?

In the example, a gift set leaves $23.11 after its costs, more than two dried bundles, while bundles and sachets sell in the greatest numbers.

When is lavender harvested?

When it blooms, which in the example is late June and July in northern Michigan; the dried stock from those weeks sells for the rest of the year.