Avoid Farm Debt While Growing Your Business

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By building the business slowly, Joel Salatin and his family have managed to keep Polyface Farms in Swoope, Va., free of burdensome debt.
By building the business slowly, Joel Salatin and his family have managed to keep Polyface Farms in Swoope, Va., free of burdensome debt.
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Joel Salatin with his mother, Lucille; his wife, Teresa; and two younger generations of Salatins who are carrying forward the farming tradition.
Joel Salatin with his mother, Lucille; his wife, Teresa; and two younger generations of Salatins who are carrying forward the farming tradition.
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In high school, Joel Salatin started his own business selling butter, chicken and eggs at a local farmers market.
In high school, Joel Salatin started his own business selling butter, chicken and eggs at a local farmers market.

In light of our modern love affair with fast growth and fast money, I’d like to propose embracing the opposite: As you grow your market garden or farm business, slow down. A debt-free farm is a thing of beauty — but you can’t build it overnight.

A common business axiom is that financial collapse usually doesn’t result from a poor product, poor marketing or poor service. Instead, collapse is frequently a consequence of a cash-flow crunch: A growing business is strapped for cash because accelerated sales require increased infrastructure and labor, which often must be paid for faster than the business’s growth can afford. Before you know it, the business is mired in debt. With proper planning, however, you can avoid yoking your farm business or market garden to paralyzing debt.

My own trajectory as a farmer followed a path of slow growth and low debt. I’m nearly 60 years old; I started my first chicken enterprise when I was 10. When my wife, Teresa, and I review our current farm financials — our staff, infrastructure and expenses — we sometimes shake our heads and ask each other, “How did we get here?” We never planned or even expected to be at our current scale. The growth happened largely without farm debt, and the business developed so gradually, for the most part, that we didn’t even realize where the trajectory was headed.

You could say it snuck up on us — over the course of 50 years.

Live Below Your Means

  • Published on Jul 9, 2015
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