The livestock industry is a complex and diverse sector that covers a wide range of animals and products. Many types of businesses within the livestock industry, from small family farms to large commercial operations. And, of course, you might have already heard how profitable it can be.
A study shows that livestock farming contributes to approximately 40% of total agriculture in developed nations. U.S. agriculture, food, and related sectors generated $1.055 trillion for the country’s GDP in 2020. This means that the livestock industry is a lucrative field.
While it may be easy for you to get attracted to the profitability of this industry, you should know that running a livestock business is not as simple as it seems. Much like any other business, there are certain things you need to know before diving in. Here are some things you should keep in mind if you’re thinking of starting a livestock business:
1. Know your product
This may seem like a no-brainer, but you must have a good understanding of the animal or product you’re planning to sell. Do your research and find out everything you can about the species. What do they eat, or how do they reproduce? What is the market for this particular product?
With all these in mind, you must have a solid business plan. This will serve as your roadmap and will help you make informed decisions along the way. Livestock farming is not a simple business, so you must be prepared for whatever challenges come your way.
Knowing your product can also help you with your target market. For example, if you’re selling beef, you might want to focus on restaurants or grocery stores that sell meat. On the other hand, if you’re selling eggs, your target market could be bakeries or households. Knowing these things can help you better market your products.
2. Financing is key
Like any business, you need to have enough capital to get your livestock business up and running. This is especially important if you’re planning to start on a large scale. You need enough money to buy the animals, build the infrastructure, and hire the staff.
Aside from that, the equipment can also be a factor in the success of your business. For example, if you have durable stock trailers, you can transport your animals easily and without hassle. If you’re able to score a good deal on these transporters, your business would be sufficient and save you money in the long run.
Financial factors aren’t just about having the right amount of money. It’s also vital that you know how to manage your finances properly. Have a system in place, and ensure you’re monitoring your expenses closely. This way, you can avoid any financial problems in the future.
3. The proper infrastructure is crucial
Your animals need a place to stay, and that’s where your infrastructure comes in. If you’re planning to start small, you might get away with just a few pens or cages. But if you’re aiming for a more extensive operation, you must have a well-built facility.
It’s important that your facility can meet the needs of your animals. For example, if you’re raising chickens, they need a place to roost and nest. Cattle, on the other hand, need a comfortable place to lie down and rest. If you’re unable to provide these things, your animals will become stressed and get sick.
Aside from that, your facility should also be able to protect your animals from the elements. If you’re raising them outdoors, ensure their pens are sturdy enough to withstand strong winds and heavy rains. If you’re keeping them indoors, the environment should be clean and spacious enough for them to move around.
4. Location is important
The location of your business can also have an impact on its success. If you’re selling products that need to be refrigerated, then you must be situated near a power source. This way, you can keep your products fresh and prevent them from spoiling.
You must be situated near a market if you’re selling live animals. This way, you can easily transport your animals where they need to go. If you’re selling products sensitive to temperature, you must be located in an area with a stable climate.
The location has always been a vital factor when running a business. It can play a significant role in your livestock business which can only thrive if you choose the right location.
5. Understand the regulations
Lastly, you need to be familiar with the regulations regarding livestock businesses. This is important so you can avoid any legal problems in the future. There are different rules and regulations for each type of livestock business, so make sure you’re well-informed about them.
Sustainability is one factor that you need to consider when starting a livestock business. You need to have a plan in place on how you will take care of your animals and ensure that they’re well-fed and healthy. Aside from that, you also need to have a waste management system to dispose of the manure properly. Doing these aren’t only the right thing to do, but regulations may require them.
The livestock industry is a complex and diverse sector that offers many opportunities for profitability. However, as with any business venture, you should know a few things before getting started. By keeping the above points in mind, you can set your livestock business up for success.