Organic Path microsite

This project was funded through the New Opportunities and Business Development Investment Initiative (NOBDI) under the Renewal Chapter of the Canada-Nova Scotia Agricultural Policy Framework Agreement.

Canada

Nova Scotia

Understanding Costs and Revenues

In the 80s, we were using a lot of fertilizers. One year, someone did soil sampling on my fields and said, ‘you don’t need those fertilizers, you can do it with manure.’ That year I saved thousands of dollars.

Herman Mentink
Kipawo Holsteins, NS

Successfully managing your farm business through the transition period (and beyond) and achieving your financial and personal goals requires a sound understanding of the farm’s costs of production and revenues. This information is critical to understanding the impacts of organic transition, making choices and evaluating results. It is essential in order for you to maintain control over your farm’s finances and therefore your destiny. If you are already farming using non-certified organic methods, the collection of the information will enable you to make a fair comparison between the two systems.

Understanding your costs can help you identify areas for attention, where to look for substitutions and efficiencies and when to look for other opportunities. It is critical to calculate what you are earning from farming and ensure that each sale contributes to profits as opposed to a loss. Understanding your costs are the foundation for making choices about how and when to market your products. With this knowledge, you can make informed decisions on pricing, how much time to spend on marketing and how much mark-up is appropriate when selling through a cooperative.

Integrated Budget Models and Resources

The spreadsheets include sample budget number and hyperlinks to relevant enterprise budgets, cost of production analysis and discussion papers.

Adjustable Variability

How will your market price, yields, operating costs and labour costs be impacted by the decision to transition to certified organic production? You may or may not have an exact answer at this time. The Organic Path spreadsheets will enable you to easily adjust those numbers up or down by 10%, 25% or 50%. You will be able to easily play with the numbers and run “What if” scenarios - What if I have to pay my staff 25% more, what if feed goes up 50%, what if I only get a 10% premium? You may not know for sure, but at least you can plan for different outcomes.

The spreadsheets can be downloaded in Microsoft Excel Format: