Perhaps the most basic concept in business – you need to price (and sell) your products for more than it costs you to produce. You may not realize you’re losing money on one crop if you only look at your business as a whole unit. And if you’re losing money (or only making 10 cents a pound) then no volume of sales will create a sustainable business. In this section, we’ll learn how to calculate the cost of production so that you know how to price your products, and earn enough to cover your overhead and pay yourself!
At the end of this section, participants will understand:
Cost of production’s impact on pricing strategies
How to calculate the cost of production for vegetables, livestock and value-added products
QuickBooks features to better track time and expenses, enabling easy cost of production calculations
How to utilize cost of production to understand your break-even sales target
Julia Shanks consults with food and agricultural entrepreneurs to achieve financial and operational sustainability. Working with a range of beginning and established farmers, she provides technical assistance and business coaching that empowers them to launch, stabilize, and grow their ventures.
