Category: Alpaca

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Alpaca Business – Writing an Alpaca Business Plan

Most alpaca ranchers are not going to go to a bank and attempt to take out a loan to fund their initial alpaca herds.  So the type of alpaca business plan you’ll probably need is not as in depth as what a bank is looking for.  What I use my business plan for is to keep my spending, marketing, breeding, and sales on tract and I use 1 year, 2 year and 5 year goals in my plan. 

The biggest reason you should have an active business plan is in the off chance you are audited by the IRS.  Many alpaca ranchers run the fine line between running a farm for profit (business) and running a farm at a loss (hobby).  Don’t get me wrong, there is technically nothing wrong with running your farm at a loss and most of you will probably be in the red for 3-5 years after your starting your farm until your herd builds up and you are able to make your first sales. The trick is if the IRS audits you to make sure you are seriously running your farm and attempting to make a profit.  Having a business plan is step one in proving you are running a farm as a business.

Writing a business plan is going to take some time and some homework on your end.  However don’t let it scare you.  In the end you’re technically just interviewing yourself. 

Business Plan Outline – for self use not for banks

  • Purpose
    • Brief description of objectives
  • Description
    • Business Form: DBA, Partnership, LLC, Corporation etc
    • Type of Business: Retail, wholesale, manufacturing, service, etc
    • What is your product/service
    • When does your business open/start?
    • What have you learned from other businesses of similar type?
    • Why will your business be profitable?
    • What are your personal and business goals?
  • Product/Service
    • What are you selling? Seed stock, raw fiber, processed fiber, end products, boarding, shearing, training?
    • What benefits are you selling with your product/service
    • What makes your alpacas, products/services different from other farms?
  • Market
    • Who is your customer? Who will buy from you?
    • Is the alpaca market growing, steady or declining?
    • Is your share growing, steady or declining
    • Are you segmenting your markets? How?
    • Are the markets large enough for you to expand?
  • Competition
    • Write down your closest competitors (alpaca, sheep, goat, fiber farms)
    • Who are your indirect competitors  (Walmart, Joann Fabrics, Local yarn stores)
    • What have you learned about your competition’s advertisements?
  • Product Development
    • What products/services are you considering?
      • Huacaya, Suri, Both
      • Produce high quality seed stock or mid range?
      • Boarding, shearing, sorting, training services?
      • What are you going to do with the fiber?
        • Process yourself, mill, co-op, donate
      • Are you going to sell end products?
        • Made by you? Made in USA? Made in Peru?
      • Where are you selling finished products
        • Online, farm store, farm market, craft fairs
  • Marketing
    • How will you attract buyers?
      • If selling alpacas how will you get your name out to others?
        • Show alpacas, AlpacaNation, OpenHerd, AlpacaStreet, Other?
    • Print advertising? Online? eBay? Etsy? Road Sign?
    • What markets do you plan on entering?
    • How do you price your products/services?
      • Location Location Location!
      • Is your farm easy to get to?
      • How far do people have to travel to visit your farm store?
    • What kind of space do you need?
      • Barns, Pastures, Hay storage, Farm Store
      • How is your land zoned?
      • Do you have parking and wide enough driveway to accommodate traffic for a farm store or for trucks with gooseneck trailers for alpaca transport?
    • Other demographic/market shifts in your area
  • Sales Plan
    • Weekly, Monthly, Quarterly Sales goals
    • What other checkpoints do you have
      • # of cria born per year
      • If you own a stud # of outside breedings sold
      • How many alpacas do you want to board
      • How many head do you want to shear/sort
  • Personnel/Operations/Management
    • I combine these because chances are you are your only employee
    • What is your background/experience? What skills do you have?
    • What are your strengths and weaknesses?
    • What are your plans for training and education?
    • Clearly define your duties
    • What additional resources do you have? (Day job?)

I’ve tried to incorporate many of the alpaca specific questions you would need to ask yourself when writing up your business plan.  Do not expect to answer all of these questions immediately!  I will be going in to many of the headlines over the next few weeks to give you a better idea of how you go about collecting and computing the information needed in your plan. 

Click Here for the Overview and links to other articles

For more personalized help with your business plan stop by your local chamber of commerce, the business department at your local college or university or http://www.sba.gov

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Keeping Alpacas Cool

Alpacas are native to elevations of 14,000 feet or more.  Staying warm is their biggest concern hence the luxurious thick warm fleece they grow and we harvest.  In other words they are cold weather animals, not warm.

Here in NY we are having a rather warm weather spell with temps in the 80-90s and high humidity.  Unfortunately, I wasn’t able to schedule my shearer until June 1st which means 3 more weeks of alpacas in full fleece in hot temps!  I can only imagine how miserable they must be. As their caretaker I have to do the best I can to keep them cool.

The best way to keep an alpaca cool is with water.  Hosing down their legs and bellies gives them much reprieve and then they sit in front of the high velocity fans and air out.  One problem for me though, I have a full time job Monday through Friday!  I’m not able to go out every few hours and cool them off, instead I have to find away to hose them off without actually physically being there.

Thankfully alpacas seem to naturally love playing in water.  If anyone sees me dragging a hose around the alpacas come running and line up at the fence for a spray.  The question is, if there’s a hosing station will they come over and spray themselves off and if they do will the dominant ones hog the spot light. There’s only one way to find out, try it.

My solution to the problem was to set up sprinklers on a timer set at chest height so the alpacas could walk through it and cool themselves off.  Here are photos of the products I used thanks to a quick trip to Home Depot.

I “broke” the cheap sprinklers so they didn’t oscillate anymore and set them at a fixed height so the alpacas could get their legs and bellies wet and not their backs.  I have the timer set to 3 minutes of sprinkle time every 4 hours (6am 10am 2pm 6pm).  I’m thinking of upping it to 5 minutes so they have more time to get to it before it turns off.

I was worried that the alpacas A) wouldn’t want to walk into the sprinkler and B) wouldn’t know when it turned on so they could cool off.  My concerns were both unfounded.  The alpacas loved the idea of the sprinklers and the wide range the sprinkler put out allowed even the timid ones to take part.  Also, when the sprinkler turns on the trapped air spits and sputters much like the sound of a garden hose and they all come running.  Actually while I’m writing this the 10am sprinkler just turned on and I just watched all my girls run from grazing out in the pasture to the sprinkler.  It they definitely know it’s on :o)

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Carpenter Bee Traps

One thing about bringing an abandoned farm back to life is dealing with the years of neglect and with all the pests that have called the place home.

One of the most annoying pests an old log home and wood barn has, is the carpenter bee.  This fat dumb looking bee can easily be confused with the fuzzy bumble bee.  The biggest differences between the bumble bee and the carpenter bee are their butts.  Bumbles have fuzzy butts and carpenters have shiny ones.  Bumbles also happily buzz around flowers and just look like they are having a great time.  Carpenters are territorial and will hover in one spot and attack any insect that enters its territory.  Thankfully, for as hostile as the carpenter bees are to other insects they really could care less about people or livestock.

Why are carpenter bees so bad? They destroy wood!  The little buggers drill perfect little round holes in any solid wood, be it beams in the barn or logs in our home.  At night I can actually hear them chewing away in the logs making new tunnels, drives me nutty!  We’ve been fighting the carpenter bee battle with toxins which works amazingly well but has one big flaw; you have to find the hole! Sometimes the hole they call home is out of reach or you just can’t seem to find it which does you no good to puff nasty killing powder into it. 

My husband has been doing some research on killing these annoying pests and found a guy who makes a carpenter bee trap.  To be honest I thought the whole idea sounded silly especially after seeing the trap.  They look like little bird houses with plastic bottles screwed into them. 

Carpenter Bee Trap

The wood house has several holes drilled into it the same size as the average carpenter bee hole.  As I had said, these bees are territorial and will fight one another and try to overtake each other’s dwellings.  It turns out that these bees quickly locate the bee trap holes and enter to investigate, they end up falling into the plastic bottle and because they are so big and dopy they can’t fly or craw out.  Tada, they are trapped.   

2 Trapped Carpenter Bees

I really didn’t think they’d work but after just 15 minutes of the first trap being set out 2 of them found their way into the bottle.  I’m an instant believer in these traps and set 3 other ones up in problem areas.

The creator of these traps can be found at http://www.carpenterbeesolutions.com/ He has many great videos and information about Carpenter Bees.

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Shredded Straw Bedding

Recently we purchased a Wallenstein BXM Chipper Shredder to help with chipping all the trees and scrub brush we took down in our soon to be new orchard area. When considering buying a chipper we thought about going all out and getting the shredder to see if we could make our own livestock bedding.

If you’ve read my past posts about my experiences with different types of bedding you’ll know my distain for straw. I just hate picking through traditional straw bedding.  The waste is just awful, it takes me much longer to muck a stall and once I get it out to the manure pile it takes forever and a day to compost.  The price of straw vs. the wood pellet bedding I’m using now is night and day and right now I need to bring down the cost of doing business.

In comes the shredder.  I’ve read about how shredded straw composts faster and is used at some dairy farms and also by mushroom farmers.  So I decided to give it a try.  I purchased a 500lb bale of straw for $40 and fired up the shredder.  We aimed the shoot into our little red TSC dump trailer, stood up wind from the shredding and let her rip.  3.5 of the big flakes of straw filled the dump trailer really quickly and  it filled one of our 11×11 stalls.  1 trailer full gave a great 4-6” deep bedding and covered the whole stall evenly.  For comparison 4 ($7) bags of wood pellets gave me the same results.  That’s $28 for pellets vs $8 for shredded straw. At this point I have a really big smile on my face.

With pellet bedding I have to add 1-2 bags per week for a stall with a mare and foal.  There’s very little waste and I only have to take out the soiled areas.  I know from past experience that with traditional straw bedding 3 flakes of straw would give me nice bedding but I had to strip the bed every day and add another 3 flakes.  How would the shredded straw do?

Shredding the straw brought down the stalk size to 2-3 inches in length and even broke the stalk open so it no longer was a tube.  The result is a very light fluffy bedding that sifts right through my favorite Dura stall fork just like wood shavings would.  It doesn’t fall though like pellet bedding but with a few shakes of the fork the horse apples remain and the clean bedding falls through.  Pee areas are sucked up nicely and are easy to spot and scoop up with minimal waste.  I managed to pick through 3 stalls using just 1 wheelbarrow! Try that with traditional straw bedding!

Handful of Shredded Straw Bedding