David Carlson
Econ 331
Business Proposal
Carlson Ag Enterprises
The final business concept I am pleased to propose will be called Carlson Ag Enterprises. This company will perform custom services for silage, corn, and soybean harvesting. This business will be located in rural Pocahontas County, Iowa and will be available additionally in surrounding areas. I believe this will be a good location for my company, because of the large quantity of crops and livestock produced in this area. Many local livestock producers in this area do not have a silage chopper and demand this custom service. The target livestock operations include many small cattle herds, several large scale feed lots and a few large dairies. Many livestock producers are demanding these services, due to not having enough time to perform these tasks themselves. In addition, many farmers are demanding custom corn and soybean harvesting due to the high cost and financial risk of purchasing combines and additional harvest equipment to justify their earnings.
The customers of this service will likely be farmers, land owners and livestock producers within a 45-mile radius. This service will be offered to these customers at the average state price according to Iowa State University. According to my calculations there should be plenty of room for this company to make profits at these rates. The larger customers may be offered a deduction in price, depending on size and loyalty. It is important to gain customer relationships by gaining trust to keep this business running. I would like to get to know each of my customers and meet with them throughout the year one-on-one. Being local will help me to get better acquainted with my customers. I will use several products to help the customer including Ag Leader, to provide and print accurate yield results. This will allow the customer to further gain my trust and compare seed varieties. I will also use the maps program to locate the correct fields. Customers will gain from this product by being assured high quality service and work with this company. In addition, customers will also gain from this service by not having to worry about these high equipment financial risks. The corn and soybeans will be harvested on the customer’s fields and transported to local cooperatives, ethanol plants or personal grain storage sites. The silage will be chopped at the customer’s corn fields and will most likely be delivered to a feedlot site to be stored in bags or in a silo. This service is unique, because there are few existing companies in the area that offer these services and there is a growing demand for these custom services. I believe I will be able to sell this service, because I will hire a great team of individuals and I will build a great reputation with my customers. I believe this will be a great opportunity for many farmers to look into, and help their farming operation out financially by taking advantage of these services. There is a great potential market for these agricultural services in Iowa.
The experience I will bring to this company and have acquired are growing up on a family grain and livestock farm, my education background at Iowa State University, and internships with Ag Partners, LLC and Pioneer. I have also built a network channel with farmers and other agricultural companies in this area over the past several years that will benefit me on getting this business started. A line of equipment will need to be purchased and financed to get this company started. This company will need to purchase and get financed for a large combine, corn and soybean heads, two semis, two grain trailers and two grain carts to get started with the corn and soybean harvest equipment. For the silage equipment I will need to purchase a silage chopper, and two silage wagons to transport to the storage location. It is important I purchase the right amount and size of equipment in order to have a successful company. In the offseason I will have the two semi trucks hauling grain and feed products over the road. I believe there is plenty of growth potential with this company.
I will need to hire an entrepreneurial team of individuals that have skills in the livestock and grain business. It is important these individuals have these management skills and are hard working and honest. These skills are important to bring ideas to keep improving this company. It is important to gain insight from individuals within the company.