Scale of Production Matrix Template (.xlsx)DOWNLOAD FILE
This publication was created to be a helpful resource for beginning farmers when making decisions about infrastructure and equipment. We call it a “tool” in hopes that it will be, like other tools, something that helps you do your job as a farmer.
Purpose of the Scale of Production Tool
- Help farmers identify the possible infrastructure and key farm investments and costs they may be likely to expect at various scales of production
- Help farmers identify and prioritize key investments, based on investments that offer the best return. It could also help farmers who are thinking about increasing their scale or, to some extent, creating a leaner operation. The information is only presented here as increasing farm size but could also be useful for becoming leaner (e.g. more productive or efficient at the same scale).
- Expose farmers to some relative cost comparisons for better decision making
Decisions and Assumptions Made in Developing the Tool
- It is primarily designed for extensive (field-based, larger acreage), tractor-based, diverse, organic/sustainable, vegetable producers at the smaller scale in Michigan. This tool does not try to address the Biointensive or J.M. Fortier, or highly hoophouse focused or other highly intensive production approaches.
- It is hoophouse neutral; the tool does not assume that you should or shouldn't invest in season extension.
- The farm is business-oriented, income-generating, and on a path to reaching financial sustainability for the farmers (although using the Scale of Production Matrix spreadsheet will not guarantee financial stability), thereby assuming a trajectory of trying to reach at least $125,000–$150,000 in sales or $30,000–$50,000 in farmer income.
- Farm is on "average" (loamy) soil (neither pure clay or sand etc), avoiding some unique challenges of "pure" soils.
- Some things are rated as "Y" (yes), that are perhaps not a great financial return on investment, but have a good return on investment in quality of life and ease of work for the farmer and fellow workers.
- There is no infrastructure (buildings, well, greenhouse) or equipment on the farm at the start of the farm operation.
- Farmers tend to move from smaller to larger scale and/or from less to more mechanization over time and can often build upon the investments they have already made.
Limitations of the Tool
- Generalizations can only be made as to if, when or what, investment in a tractor, equipment or infrastructure or land is right for any given farm system given the incredible variability of farm operations in goals, experience and currents conditions of any one farm.
- It cannot determine the right way for you to farm or the best or most ideal system for you.
- It cannot determine what is a good financial return on investment for all cases, what is just plain necessary, cost aside, or what is just worth it because life is better. Every farm’s situation, at any given time, is different.
- It does not assume what water source is available to farmers. It assumes only that potable water for washing vegetables is an absolute necessity.
- It cannot predict how a farm is going to market its product, whether a farm is going to have to move most of its product off-farm for sale or sell it all on-farm, whether multiple large vehicles are needed, and so on.
- It cannot tell whether there is already infrastructure on the farm or if infrastructure must be built.
Layout of This Tool
The tool is organized based on farm sizes or scales, in acres, broken into five ranges:
- Less than 1 acre
- 1–2 acres
- 3–5 acres
- 6–10 acres
These ranges were chosen in an attempt to highlight points of transition in production style that may occur as a farm scales up in size.
Further, the tool has two different but integrated parts. The first is this document, a set of Excel tables (Scale of Production Matrix) that break the equipment and infrastructure investments into eight categories and show the likely investment needs going across the five farm size ranges. The second is a narrative, which includes some detail about expectations of work at each scale, a profile of a farm at that scale and some detail of equipment and infrastructure a farm might have at that scale, and a summary cost table of these likely equipment and infrastructure investments.
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