3 tips to buy (or sell) a farm

Do you dream of working for yourself, spending time in the great outdoors, and being self-sufficient? Buying a farm could help you achieve all of that, even if you know little about farming. Follow these three tips to get it right when buying or selling a farm.

3 tips to buy (or sell) a farm

A small, niche business

Traditional farms are competing with mega-large operations run by international companies. You stand the best chance of success if you think small and find a place where there is a good local market for your product, be it potatoes or dairy. Think slow food and sustainability. Slow food emphasizes local cooking and ingredients. Sustainability repeats the message, by rejecting traditional distribution chains in favour of purchasing goods locally.

There are pockets of slow food and sustainable practices all over Canada. Plug into national networks such as My Sustainable Canada for more information on stores and restaurants that practice sustainability. The next step would then be to research what kinds of food sustainable businesses may buy. Forget the notion of making a lot of money, and think job satisfaction and green practises instead.

For sellers, having a viable niche business means buyers will sit up and take notice.

Face the hard facts

If you have some romantic notion of farming, think again. It goes beyond hard work, and throws in the vagaries of weather and natural disasters. If you don't have substantial experience in the field, think about taking on an experienced partner. If you have found a farm you are interested in, talk to the existing owner about staying on for a given time to help you transition. Early on in the process, decide what kind of farming you want to do and seek out classes and resources that can help you learn the business. If possible, work on a farm as an apprentice or trainee. The more experience you have on your side, the better.

If you are a seller who is an experienced farmer, consider offering potential buyers post-sale advice and support.

Information is key

Buying a farm is simply buying an existing business, so all the points that apply to buying a business apply to buying a farm. You will need to see several years' worth of audited accounts. You will need to hire an accountant and a lawyer experienced in business acquisitions and have the financial health of the farm analyzed before purchasing. You will need to determine exactly what you are buying, from land to equipment. Ask questions and remember you should be prepared to negotiate.

Sellers should be willing to provide buyers with reliable, up to date financial information. Being as helpful as possible in providing information will pay dividends.

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