Farm Side Hustles: Boost Your Ranch or Farm Income

December 5, 2023

Farm Side Hustles: Boost Your Ranch or Farm Income

Eighty-eight percent of the farms in the U.S. are family farms, and it’s no secret that in recent years smaller agricultural businesses are seeing decreases in their bottom lines due to factors such as higher input costs, farm product price fluctuation and the advent of large-scale, corporate, industrial farming. It’s not for a lack of hard work. Most income reported by small farmers and ranchers also includes part-time, off-farm work.

At FarmRaise, our mission is to help the average grower increase their profitability, offering resources to organize and audit their expenses. Ultimately, we find that adopting sustainability practices and protecting on-farm natural resources can lead to higher profitability. But adopting those practices can take time, money and effort. That’s why we also connect producers to funding opportunities through our Farm Funding Library and help them keep track of their finances and inventory through FarmRaise Tracks.

Take a free, quick demo of FarmRaise Tracks and the Farm Funding Library

But what can small farmers do in the meantime to increase their sources of income, diversifying the operation and earning additional income? Check out our list of ways to make money and diversify your income stream. Consider adding them to your farm business plan!

In this post, we’ll cover the following ways for farm operations to earn extra income:

  • Take full advantage of your real estate with agritourism
  • Try direct-to-consumer marketing and sales tactics like PYOs, CSAs, co-ops, local restaurant sales or farmers markets
  • Sell your byproducts, “ugly food” or flowers
  • Tap into the demand for farm education
  • Use new farming methods to increase your products’ value proposition

Keep Track of Your Side Job Finances

To maximize your farm’s income-generating capabilities, you’ll need to be prepared to keep track of your side jobs. Navigating the complexities of managing multiple income streams for your farm can be challenging, but it's a crucial aspect of ensuring financial success. As you venture into new avenues of income generation, you're not just opening up opportunities; you're also introducing a fresh set of financial responsibilities.

Tracking your side job finances is more than just a matter of balancing the books; it's about strategic financial management for tax purposes, expense analysis, and overall cost reduction. Every new revenue stream brings along its own set of expenditures, and organizing these costs is key to optimizing your profitability.

To simplify this process and empower you with effective financial management tools, it’s important to find a dedicated farm bookkeeping app designed for your diverse income sources. You’ll want to be able to seamlessly itemize each expense according to specific farm tax categories, ensuring accuracy and compliance with tax regulations.

When you find a tool your trust, it isn't just a bookkeeping tool; it's your financial companion, supporting you in making informed decisions, identifying areas for cost reduction and ultimately maximizing the potential of each income-generating venture. If you’re not sure where to look, check out FarmRaise Tracks. It’s an all-in-one tool that tracks everything from milage to revenue and organizes it in Schedule F categories can save you time and money during tax season.

Agritourism

Farm Stays

Whether you’re in a rural area or an urban farmer, there’s a lot of love out there for farm culture. Small and family farms make for fun, interesting stays for travelers. Consider adding farm stays to your farm management plan.

Do you have a barn or guest house that’s suited for guests? Rent it out! If you have space on your land to build, consider investing in a tiny house or cabins for overnight church or school camps. If the startup cost for both of those options is out of reach, there are lower cost options as well. Platforms like Hip Camp allow farmers to rent our their land to guests who’d like to camp on your property. This is what we call passive income - it requires minimal effort on your part and allows you to focus on farming full-time.

Farm Weddings and Events

Survey your land, get to know the needs of people in your community and see where you can fill in gaps in demand. Maybe your operation is perfect as a wedding venue - especially if your operation is a hobby farm. Your farm has the opportunity to create a unique aesthetic for people planning weddings or businesses hosting team-bonding or field day events.

With the average U.S. wedding costing a whopping $30,000, it’s no surprise that weddings are a $60 billion industry. There are two million couples who get hitched each year, and there is high demand for outdoor and barn weddings in rural areas. Weddings might just offer an opportunity for a lucrative secondary source of income for your farm.

Stay Legal

Converting a portion of your farm, ranch, barn, winery/vineyard or orchard into a wedding or camping space doesn't happen overnight. It requires time, investment, communication and significant attention to the safety of both your farm and the those involved in the event. Here are some tips to make it more feasible.

  1. Ensure compliance with local zoning laws: Zoning codes aren’t a state issue, they’re a local law. So it's important that you check applicable zoning laws in your municipality, township or city. Farms are generally zoned for exclusively agricultural purposes, so if your property hasn't been cleared for a commercial business, you will likely need to apply for a variance to allow for a rezoning of your property.
  2. Ensure compliance with local ordinance: We just talked about local zoning laws, but there's another thing. Local ordinances. Think: prohibited noises timeline, traffic control and alcohol sales. Ordinances, like zoning laws, are a local issues and you should consult your local governing body. A quick online search of “local ordinances [your county]” should do the trick. Here’s an example for Waco, TX.
  3. Check state farmland preservation laws: Farmland is "preserved" if its development rights have been sold to the government in exchange for cash so that the property is designated for agricultural use forever. (This also goes for conservation easements.) While this can offer monetary value and help save family farms, it can restrict you from using your farm or ranch as an event venue or stop you from building new infrastructure on the property (unless it is intended for an agricultural purpose). In this instance, it's best to consult your state level Department of Agriculture about the possibility of using your farmland for something other than agriculture.

Get Funding Alerts

Investment in agritourism is trending! Good news for farmers who want to diversify their income. But startup costs can be high and there are grants out there to help you get started. Where can you find them?

FarmRaise Premium Members receive weekly funding alerts that offer announcements and deadline reminders for agritourism grants like the Multi-Business Agritourism Grant Program.

SEND ME FUNDING ALERTS

Boost Your Marketing & Distribution

You can also boost your income diversification by not putting all of your eggs in the same basket. That means putting on your entrepreneur hat and finding new markets to sell your products.

Pick Your Own

Pick Your Own operations (also known as U-Pick, Cut-Your-Own, or "Choose-Your-Own") are farms where customers pick, cut or hand-select their own produce out of the field. If you're looking for a direct marketing choice for your farm, this is a good one - especially for all you berry, tree fruit, pumpkin and Christmas trees producers out there.

Weigh the pros and cons. If you decide a PYO is right for you, we have a few tips to help you get started.

Advantages of PYO farms:

  • Reduced labor for harvest and handling
  • Lower equipment costs
  • Opportunity for larger transactions per customer
  • Potential to sell "ugly food"
  • Getting to meet new people


Disadvantages of PYO farms may include:

  • Location accessibility if your farm is far from a city or highway
  • Increased marketing and advertising budgeting
  • Liability and other risks of having customers on the farm
  • Increased staff for customer supervision and service
  • Increased potential for crop damage from improper product handling due to inexperienced patrons
  • Having to talk to people, if that's not your thing

If you think a PYO plan is right for your farm, check out this list of key tips to get you started.

  1. Pick the right marketing and advertising plan: Promote your farm year-round and especially during harvest season. You can try word of mouth, road signs, paying your 15 year-old nephew or other family member to set up a website or Tik Tok for you, getting listed in a directory of PYOs (sometimes published by state Cooperative Extension offices and Tourism Boards) and offering field trip opportunities to local schools. Just make sure they sign waivers!
  2. Pick the best PYO crop for you: After all, these plants are your money maker. Your customers are more likely to think of PYOs in the spring and fall, so with the exception of Christmas tree farmers, early and late season crops might be best for you. Think berries and peaches for spring and early summer. Think concord grapes, apples, pumpkins and squash for fall.
  3. ‍ Set up PYO Facilities: At the bare minimum, your PYO must have a parking lot and an area for payment collection. A general rule for structuring your parking lot space is 20 cars can fit at a 60-degree angle or 30 cars at a 90-degree angle in a 1000 square foot area. You might need to hire someone to direct traffic. The checkout stand is also key to a PYO. It’s the center of all transactions (including parking fees if you want to charge that) and should be situated so that it can easily be seen and accessed from the parking lot.
  4. Pick your entry charges and pricing: How do you know what to charge customers? How much money do you need to cover your costs, such as outside help? Consider these pricing models:
  • By volume ($X/basket) - The simplest method for calculating prices.
  • By weight ($X/lb.) - Can eliminate the problem of containers being over-filled by overzealous consumers.
  • By count ($X/item) - Better for larger items like pumpkins or Christmas trees. The price per item should be rounded to the nearest nickel or dime to make pricing easier for everyone. Don’t worry about nickel and diming your patrons.

PYOs often sell fruits and vegetables that are designated as "specialty crops.” FarmRaise Premium Members receive weekly funding alerts for federal, state and private grants. We give you deadline reminders for grants like the Specialty Crop Block Grant Program.

SEND ME FUNDING ALERTS

Set Up a Co-op or CSA

Getting the community involved not only helps you strengthen your income, but it helps you strengthen community ties. There are two important ways you might consider selling your products within your community.

Agricultural Cooperatives

Better known as “co-ops,” agricultural cooperatives are mutually-owned businesses. Members pool their resources and work together to achieve a common goal. In this case, it would likely be selling farm fresh food.

Co-ops can help you access markets, pool resources and sharing knowledge among farmers and enthusiasts in your community. Here are some steps that farmers can take to start a co-op:

  1. Identify the demand or community needs: Identify needs and goals  that can be addressed through your co-op. An example could be to supply organic food in a nearby community or city.
  2. Earn partners: Identify a core group of farmers or community members who can serve as suppliers and will help you set up the business.
  3. Develop a business plan: Outline the goals, objectives, pricing model and structure of the co-op. The business plan should also include a financial plan that outlines how the co-op will be financed.
  4. Incorporate the co-op: It’s time to become a legal entity. File articles of incorporation with the state and register the co-op with the relevant regulatory agencies.
  5. Recruit members and launch: Recruit members. They could be volunteers or fellow farmers.
  6. Launch the co-op: Consider hosting a launch party and developing a marketing plan.

Co-ops offer a lot of freedom, but they’re also a heavy lift to get started and sometimes to maintain as well. Consider a CSA which may be better suited for your operation.

Community Supported Agriculture

Community Supported Agriculture (CSA) is a production and marketing model where customers purchase shares of a farm’s harvest to make sure they receive farm-raised products throughout the growing season.

Think of it as a pie. CSA members help you purchase the ingredients. You do the baking and when the pie's done, they get a slice proportional to the amount they contributed. Purchasing a share is generally done with a one-time annual payment or through incremental installments.

CSA shares can offer you upfront funds during the start of the growing season and also helps free you from time-demanding tasks like marketing your products. CSAs can offer a variety of vegetables, fruits, herbs, meats, eggs, dairy, cut flowers and value-added products.

CSAs can also be beneficial for customers looking to better understand and invest in where their food comes from and who works hard to produce it. Like all new farm ventures, getting your CSA off the ground takes planning and careful consideration.

But before you get started, take a look at our abbreviated CSA roadmap:

  1. Recruit potential CSA members: Start networking and prospecting among your friends, family, neighbors, co-workers and fellow farmers. Then gauge interest from your local businesses and organizations: Churches, community action organizations, health food stores, fitness centers, schools, civic organizations, etc.
  2. Craft a business plan and budget: Construct a realistic and detailed cost breakdown of all likely expenses. It'll help you determine your membership share prices. Your expenses should include input expenses, equipment, labor and delivery or hospitality expenses.
  3. Establish a delivery system: Talk with your potential customers to come up with the best delivery channel, pick-up method and delivery timeframe. You've got options here like on-farm pick-up, central distribution site, farmers’ market (see below), home delivery or bulk distribution to businesses or institutes.
  4. Determine share price: Most CSAs offer full shares and half shares. The national average for an annual, full share is $400-700. You might even consider offering discounted membership shares in exchange for hours or farm-work.
  5. Get federal funding: Conducting research projects which examine the viability of a CSA in a given community could be considered a "local and regional food systems" project which could make it eligible for funding by the U.S. Department of Agriculture. The Sustainable Agriculture Research and Education (SARE) is a competitive grant program that supports research and education projects which bring new ideas to farms and ranches around the country. See if you’re eligible for SARE funding to help start your CSA.

For more information, the NC State Extension offers a detailed CSA resource guide for farmers. The USDA-National Agricultural Library also offers a comprehensive list of resources related to structuring a CSA business.

Partner with Local Restaurants

As a farmer, you know how much goes into producing just one unit of produce. Few people can value good food like farmers and ranchers - except for great chefs.

Chefs and restauranteurs tend to understand the value of well-produced and highly quality produce. They tend to be more willing to pay a fair price and they tend to be more understanding of the seasonality and other variables that can lead to changes in production schedules.

By working with local restaurants you can establish a strong relationship with your chef customer and may even find yourself growing produce you didn’t know existed.

See how this farm collaborative is partnering with renown chefs and what lessons you can apply to your operation.

Join the Farmers’ Markets

Farmers’ markets are well-known ways for small-scale farmers to sell their products directly to consumers. But they’re also quite difficult to pull off. Consider the costs of transporting your products, refrigerating them if necessary, setting up a booth and deciding what to do with unsold products.

Despite these considerations, there are some invaluable positives farmers’ markets can offer. At a farmers’ market, you can interact directly with customers helping them understand more about agriculture today, earning word of mouth referrals, boosting followers to your social media accounts and learning feedback that can inform your advertising strategy. Not to mention, you’ll also be able to interact with producers and entrepreneurs in your area, making connections that will strengthen your network - personally and professionally.

What’s more? There’s funding to help you join a farmers’ market.

Get Funding to Expand Your Market

All of the above options can help add value to your farm’s products. Did you know there’s a USDA grant for that? It’s called the Value-Added Producer Grant and it offers up to $750,000 to help farmers expand their market share. Learn the details in our guide to VAPG.

Farm Education

One thing that never goes out of style: learning. There’s a wealth of people out there who have a strong desire to learn from your operation. Here are a few ideas you can tap into:

Field Trips Galore!

Partner with schools within a few hour radius, inviting them to bring students to your operation for a day or weekend filled with farm education. There’s something for every grade level to learn. Here are some examples:

Elementary School

  • Bugs! How bees and worms can be great farm helpers
  • Where do kids come from: See a real-life mama goat and her kids
  • It smells like poo! How we use waste to fertilize crops

Middle and High School

  • Get your hands dirty: Starting a community garden
  • Punnett square and plant genetics
  • What is agroforestry?

College and Beyond

Get Creative With a SARE Grant

Whether you’re educating fellow farmers or people who have never step foot on a farm, you can get creative with what you teach. Offer courses in what you specialize in. You may get some extra help around the farm, put some money in your pocket and spread your agricultural knowledge.

We mentioned SARE grants previously in the Community Supported Agriculture section. You can also use SARE grants to teach others in your community about your farming methods. Search the SARE Grant Management System to get inspiration for farm education projects you might take on to diversify your income.

Sell Your Byproducts

When the layperson thinks of a farm, they may think of large-scale, industrial operations that focus only on soybean and wheat production. But what they may not realize is that smaller farms and ranches can have a strong diversity of products. So be sure to take advantage!

Sell Your Manure

You might have the opportunity to earn some extra cash for your excess manure. Here's how:

  1. Start with a grant‍: USDA programs like the Environmental Quality Incentives Program (EQIP) and the Conservation Stewardship Program (CSP) offer funds to offset the cost of a Nutrient Management Plan. Check the EQIP and CSP deadlines for your area. You can also find these grants in the FarmRaise Farm Funding Library.
  2. Find a market‍: Manure-sharing and sales are often a farmer to farmer transaction. But if you haven't made those connections, check out Facebook Marketplace, Craigslist, etc.
  3. Learn your local rules‍: Selling “transferred manure” (manure applied to land owned by someone else), may come with its own rules, especially if you're crossing county or state lines. Make sure you follow your state's nutrient source sales rules by becoming familiar with your local permitting agency.
  4. Set a price:‍ Outline (in writing) the price, field location, tons/gallons per acre and total tons/gallons delivered to the field before the transaction date. Know whether your buyer can apply the manure themself or if a commercial manure hauler needs to be hired.
  5. Optionally decide on transportation: If a buyer is new to utilizing manure, they might not own the machinery necessary to apply it. In that case, factor in application and transportation costs to your price. Check out this manure value calculator as a starting point!  

These manure-selling tactics can also work for other farm byproducts like selling hay. Take stock of what byproducts you’re throwing away that may be repurposed and sold.

Sell Ugly Foods

The Ugly Food Movement alive and well. More and more, consumers are looking to support their local producers and decrease their negative environmental impact. That may offer you the opportunity to sell your “ugly foods” or the produce that doesn't look as beautiful as the kind you’d see displayed at Whole Foods, but tastes just the same and offers the same nutritional benefits.

Don’t throw that produce away! You may be able to partner with companies like Misfit Market and supply them with your ugly food.

Lean into the “ugly food” label. If you’re selling your produce direct to consumers, encourage them to support your farm and reduce food waste by marketing your imperfect or misshapen produce as “ugly food.”

Sell Flowers

Almost every farm or ranch operation has some real estate that isn’t used for production purposes. Consider using that land to spruce up the farm and create habitats for natural pollinators by planting regional flowers.

You can sell those flowers as a way to diversify your product offerings. Think of them as the candy sold at checkout counters in grocery stores - you can offer it to your farmers’ market customers, chef partners and agritourists along with the product or service they originally solicited from you.

You may also be eligible for funding to plant flowers on your operation. Since the USDA prioritizes regenerative agriculture, you may be able to receive a grant for planting flowers according to your region. Bring some color to your farm, diversity to your operation and boost native bee populations by planting native flowers! You may even notice that the wild pollinators you bring to your operation will pollinate crops that your average honey bee. This could lead to higher yields. Sounds like a win-win doesn’t it?

Boost Your Value Proposition

Try New Farming Methods

One way to increase your income is to show off the quality of your products. Consider adopting organic produce. The organic foods industry is worth $60 billion, and it may be worth investing in transitioning part of your farm to organic. You may receive a premium for your produce. Read our guide to the pros and cons of organic farming and how to get funding to make the transition to organic farming.

You can also boost your value proposition, increase your yield and mitigate the effects climate change by adopting new technologies through practices like precision agriculture. Experimental and regenerative practices can also make you a competitive applicant for USDA funding. You can highlight your production methods in your marketing and set yourself apart from other farm wedding venues, co-ops, farm stays and other businesses that market directly to consumers.

Embarking on the challenging journey of farming requires resilience and strategic thinking. In today's dynamic agricultural landscape, relying on a single product is no longer sufficient to ensure the sustainability of your farm. Diversification is the key to resilience, helping you navigate the uncertainties that farmers often face.

As you strive to avoid the constraints of traditional lenders and seek financial independence, consider the power of diversifying your income streams. Don't limit yourself to a single revenue source; instead, explore new opportunities that align with your farm's strengths and goals.

In the quest for financial diversification, remember that any time you make signifanct changes to your operation, you’ll likely need to update your FSA records. It’s also important to have recordkeeping tools in your arsenal. Managing multiple income streams comes with its challenges, and that's why we've developed FarmRaise Tracks, a comprehensive farm bookkeeping app designed to simplify your financial management.

With FarmRaise Tracks, you can effortlessly track the finances associated with each income stream, ensuring accurate records for tax purposes and gaining insights into your farm's financial health. This isn't just a tool; it's a partner dedicated to supporting your journey toward financial prosperity.

As you embark on the path of diversification, let FarmRaise Tracks be your guide, providing the financial clarity and control you need to make informed decisions. Join us in transforming your farm, ranch, or forestland into a thriving, resilient operation.

Sign up for FarmRaise Tracks today and elevate your farm's financial future.

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