Exploring Relationships between Business Plan Development and Meeting Projected Goals for Maine Farmers

Over the past century, more than four million small, American farms were replaced by large factory farms. This decades-long trend toward consolidation of food production has produced severe environmental damage, food security concerns, and economic distress in farming communities nationwide. It has also resulted in prominent international bodies, including the United Nations, calling for the return of small farms to improve the long term sustainability of food production. This study investigated 1) whether writing business plans helps small farmers in Maine meet their sales projections and ultimately remain in business, and 2) which material characteristics successful small farms have in common. While writing business plans is an activity that is widely endorsed by business schools and government agencies, business and academic communities lack consensus regarding the value of this practice. This study employed a mixed methods approach; Mann Whitney U tests were used to evaluate the research questions quantitatively. The results found that farmers who wrote business plans were significantly more likely to meet their sales goals (Z score: 2.462; p-value: 0.014). Farms that had met their predetermined sales goals were more likely to have certain characteristics in common with each other. Those characteristics include the number of years of farming experience (Z score: -2.371; p-value: 0.018), farmers' age (Z score: -2.007; p-value: 0.045), the ability to access adequate financing (Z score: -4.055; p-value: 0.000), the farm size, in the context of long-term needs (Z-score: -2.124, p-value: 0.034), adequate supply of long-range building and equipment needs (Z score: -3.816; p-value: 0.000), the perception that business plans are useful (Z score: -2.962; p-value: 0.003), and having a written business plan in the past (Z score: -2.566; p-value: 0.010). Farmers who had met their sales goals were also more likely to report a willingness to write (another) business plan (Z score: -2.118; p-value: 0.034). The qualitative portion, in which a multiple case study was constructed, consisted of 20 additional surveys, and it was found that farmers who met their sales goals were more thorough and dynamic with their planning process. Additionally, the qualitative results were used to identify elements for future research.