If one sector of the economy thrives, irrespective of the country’s economic state, it is agribusiness. 

Think of this. Food is one of the necessities for survival. 

So, if you are thinking of how to start your agriculture business, you are on your way to entering a market that is evergreen. 

Many things sure must improve with agribusiness. But do not panic.

Thankfully we are here to walk you through valuable tips from industry experts. 

And to answer the question of how to start your agriculture business.

The common challenges with running an agribusiness

Although agribusiness is quite an evergreen sector. It comes with a few challenges. Here are a few difficulties outlined by our experts that you may face when starting your agribusiness. 

Poor skilled and managerial workforce 

“When last time did you hear someone say they wanted to make agribusiness their career? Let me answer that, never,” says Jaison Mathew John, the Global origination manager at Tridge. 

Jaison continues to add, “ Agribusiness suffers from rural-urban migration. What does this mean? Well, many agribusinesses cannot attract skilled workers or educated professionals to work in their business.

You may ask. The urban populace doesn’t want to move to agribusiness. What about the rural population? 

The need for high-quality education centers in rural/remote areas is also causing hiring problems. 

It is easier to handle agribusiness with the proper workforce in these areas.

No marketing channels 

What’s your KPI? Farmers buy your product/service. So, your product/service typically has no value unless sold/consumed. 

Typically, agribusiness has a lot of marketing issues. 

It needs more marketing channels, networks, promotional facilities, support systems, and intra-competition with other medium and large-scale agri-enterprises.

“As a learner just starting your agribusiness journey, you would likely not possess any marketing organisation. 

Hence, you must focus on designing a service or product that wins the hearts of your end consumer. That’s the most effective marketing strategy.” Adds Stephanie. 

Inefficient equipment and tech 

Dr Tony Torres, Agribusiness Leader in Marketing and Data Analysis, has an exciting piece to add here, as he says, “ Technology and agribusiness are in a vicious cycle. 

“They are both co-dependent on each other. If one works well, the other works too, and vice versa. 

With technology, you add a competitive edge to your agribusiness and allow yourself to compete with others.

A simple example can help us understand the vicious cycle here. Tech empowers rural farmers to sell their produce/products quickly. 

But access to this tech is simply impossible, considering they are either inefficient, expensive or just lack the people to execute such tech. 

This is one of the crucial challenges faced by newbies in agribusiness. 

Tech such as GIS (geographic information system) promises improved efficiency and effective management of resources for agribusiness. 

However, implementing such tech could be improved in the industry because deploying GIS in rural areas is challenging. 

So all this affects the quality of products, which in turn makes the products/service in the agribusiness costly.” 

High operation and distribution costs

Deborah Perkins, the Global Head of Food and Agribusiness at ING, says, “Transportation facilities is simply one of the pre-requites for a successful agribusiness. Most agribusinesses are located in rural areas and suffer from transport problems. 

As a result, relocating the product or produce by your agribusiness happens only at a higher cost, making the product inaccessible to several strata of people.

To simplify, imagine you have a tie-up with a farmer for organic potatoes that grow on a hill. 

Now, because of the lack of warehouses on a hill, your surplus potatoes are transported to warehouses which are not on the hill (read plain areas) 

When this same potato needs to be transported again for anything from quality check to packaging during the off-season, this will cost your agribusiness twice the amount of money because you have effectively transported it twice, without any profit.” 

A step-by-step process for starting and running a successful agribusiness

Here are some steps you need to take to build a successful agribusiness.

Step 1 

What services and products will your agribusiness offer? 

The first step to setting up your agriculture business is to determine what products and services it will offer. 

Before starting your agribusiness, you must define the products and services you will provide to your customers. This acts as the business plan for your agribusiness. 

In this agribusiness plan, you must also include

• Profits you intend to make in a designated time
• Supplies you will need to design your product/service 
• Correct licenses you will need to acquire your agribusiness 
• Emergency and contingency preparations 
• Marketing plans 

In the business plan, you will also need to discuss 

• What differentiates you from completion? 
• What is your plan of action? 
• What is the structure of your organisation?
• What are the associated costs?
• What are your target markets and customers?
• Your SWOT analysis
• A fiscal forecast for the next 1000 days (which covers the costs and expenses) 

Step 2

Finances 

You need to seek a suitable form of financing for your agribusiness. There are several alternative financing options, such as fundraising, capital loans, and equity-based fundraising. These may help you start your business. 

Agriculture businesses require you to understand and control cash flow.  

As an agribusiness owner, you may face pending invoices and orders, hence having a better understanding and control of your finances is essential for the growth of your business. 

Step 3

Registering your business 

Now that your business exists in some form, it’s time to cement it in the legal sense. So you will need to establish a physical office space that best suits your agribusiness’ purpose. 

Remember that this place will act as the place you store your tools, materials, and machinery. 

Furthermore, depending on the type, you must register your business. You can register it as

• Private Limited
• Public limited 
• Partnership 
• Proprietorship 
• LLP – Limited Liability Partnership 

You can also hire a legal team or agency to get these things done for you, which is more accessible and time effective. 

Step 4

Setting up the right tools 

As an agribusiness person, you need heavy machinery to produce your product. You will also need tech integration to provide enhanced customer service. 

This is where tools/tech comes in.

For example, connect with your customers who stay in rural areas. 

You will need a tool that will facilitate that connection. 

Grptalk is the tool that will help you connect with 50,000+ people at once. It doesn’t even need an internet connection. Grptalk is already in use by several agribusi`ness owners who connect with their customers daily.

So invest in tools to help you widen your reach and provide enhanced customer experiences. 

Step 5

Marketing your products/services

Now that you have all the groundwork ready, the next step is to market your services/products to your target customer. 

So, you need to conduct market research and build your customer persona. With this customer persona in hand, you will have to validate the same in your market research and ensure that they tick off all the checkboxes.

You can market your services/products via TV, radio, and social media ads. However, you must be wary of your customers and understand their channels. 

Mistakes to avoid when starting an agribusiness

Like every business, it is advisable to avoid simple mistakes that can throw your business off balance. 

If you avoid these mistakes, you are practically cementing the success of your agribusiness. 

Don’t ignore the gaps 

Agribusiness is more than farming, livestock, and growing produce. It is a market-dominated industry with complex data. 

So don’t ignore the market gaps and look at the local trends to find where you can make a difference with your agribusiness. You must strike the right balance between filling gaps in the market and meeting industry demands. 

No accurate records

This is a huge mistake in any business, especially a costly one in agribusiness. Accurate record-keeping is crucial to improving your operations. 

Always ensure that you have precise documentation of your agribusiness. For example: note the equipment maintained monthly to understand which tools aren’t performing well. 

Failing to keep accurate records can easily lead to overspending and poor business decisions that can harm your agribusiness. 

Inappropriate equipment 

Having the right tools is essential to running a commercial agribusiness. 

Having the wrong equipment is a common mistake you must avoid making early on in your business. 

Ensure you do the appropriate research and consult experts before investing in the right equipment for your agribusiness. 

Fiscal unpreparedness 

It’s easy to get your finances wrong and super challenging to get them right.

As a starter in the agriculture business, you may end up overspending or underinvesting, affecting you in the long run.

Hence understand the balance between investing in your agribusiness and building a fiscal plan with your financial advisor. 

Essential tools for starting and running an agribusiness

For your agribusiness, you will need a lot of machinery and tools to help your business function and scale. You will also need tech to support your business in customer experience, management, and data management.

So here are a few must-have tech tools for your agriculture business when you start. 

Salesforce

A CRM helps you collect, organise and analyse your customer information. 

All of the information gets displayed on the dashboard. 

A CRM such as a salesforce or Microsoft CRM will help you build and maintain these customer relationships. 

Trello

Whether you are a one-person team or have a small group when starting, having project management software like Trello is useful as Trello keeps track of your company’s projects. 

With project management software, you can create and maintain workflows in a more organised manner. 

Project management tools also help in inter-team communication and information sharing. 

Grptalk

Building an agribusiness from scratch means you’d need to keep in touch with your customers more than others. 

As your customers are predominantly farmers and from rural areas, you need a tool that helps you achieve connectivity even in rural areas. 

Grptalk is a premium communication tool that Telebu offers, which helps you connect with 50,0000+ customers simultaneously. 

Your customer would need to answer a call. They don’t need the internet to connect. 

With their dashboard, you’ll have complete control over the ring and its participants. You can mute, unmute, and control the flow of the call. 

Grptalk is a must-have tool that has both big and medium agribusiness entrepreneurs. 

Drop Box

You will need to store loads of data. Where do you want to keep it? On a physical drive? 

You’d risk a lot, as physical drives can be corrupted or hacked. 

So, put your money in tools such as Dropbox, which offers cloud storage and easy access to information regardless of the physical location. 

With Dropbox, not only do you get cloud backup, but you also have an extra layer of protection. 

Best practices and tips for starting and running a successful agribusiness

You want to start your agribusiness, and you don’t know what works and doesn’t. 

Well, fret not! Our experts are here to help you determine the best practices you need to employ for a successful agribusiness. 

Knowledge is power 

Jaison Mathew John, the Global Origination Manager at Tridge, says,” The first step for anyone entering an agribusiness is to seek knowledge. Knowledge helps you build and create a business without any gaps. 

We live in privileged times, so you can search for information with your fingertips and find it without spending hours in a library.

So, take advantage. Actively seek knowledge about your industry and agribusiness. This search is the internal drive that will make or break your business. 

After all, your passion is what runs your agribusiness.” 

Tech is vital 

“Most of us dissociate agribusiness and tech at first thought. But I beg to differ; this is one of the earliest occupations, and humans have perfected it a lot. It’s only natural that you would add tech to improve efficiency,” articulates Stephanie Sneff, a senior Food Research Scientist at MIT 

Stephanie further adds, “ Technology in agribusiness today is more of a requirement. The agribusiness right now is undergoing disruption. 

Technology acts as a catalyst that helps maintain productivity and profitability.

So, deploy tech that suits your products and services. Do that very early on. Tech is the deciding factor that helps grow your business. 

The People-first approach 

Dr Tony Torres, Agribusiness Leader in Marketing and Data Analysis, adds that “people are the key to success for any company. This holds especially in the agribusiness.” 

Dr Tony continues to add, “ As each of your employees is essentially handling a significant growth component in your agribusiness, it is essential to understand what motivates your employees.

As a team leader/CEO, you must facilitate creativity and team spirit and always celebrate wins. A team that wins is a business that succeeds. 

So, remember that people are the soul of your agribusiness. Treat them the right way.”

Plan everything 

Deborah Perkins, the global head of food and agribusiness at ING, says that “ planning is a key component in all business areas. In agribusiness, it’s a determining factor for your success.”

Deborah continues to add, “planning is the key. For example, in the context of a rural agribusiness enterprise. The critical planning phase would be the soil and harvest. 

Care for soil is very important. It demands detailed planning. 

Drainage, mapping, correction, zone, earthmoving adjustments, and preparation. 

So, in my expert advice, break down each aspect of your process and assignment and plan your action items. That’s the simplest and most efficient way to achieve success.”

Start your agribusiness with ease

Starting a new venture in any field of business takes work. 

However, now that you are armed with the type of mistakes to avoid, the tech you need, and the best practices to employ from experts, you can start your agribusiness.

What’s more, follow the steps to set up your agribusiness and the best practices to grow it. 

Doing this will place you ahead of the game. 

So take advantage of the present and start your agribusiness venture today.