Yearly business plan - realistic or not? What else should I account for?

[westernbeekeeper]

Hello all,
I am looking at buying out my boss. He has 150 hives, and would like to sell out, as he is getting older (65 years old). He treats for most of the pests and diseases, but I would eventually like to go treatment free. He currently only sells honey, no nucs or other hive products. I would like to become migratory when I own enough colonies. Is this a reasonable business plan? Please let me know if there is something you would change. I'd like to be as realistic as possible. Thanks in advance.

150 colonies - annual business plan

Expenses:
Treatments
- 2 Tylan DC-120 ML
- 1 Bee-vert sugar 50lb SG-850 ML
= $134.50
- 5 Mite Away II Quick Strips DC-640 ML
= $684.00
- ParaMoth 35lb bucket DC-132 ML
= $119.95
- 2 Fumagilin-B 9.5g bottles DC-115 ML
= $289.90

Candy/feed
- 7 Bee Pro 50lb bags FD-201 ML
- 115 bags GV Sugar 25lb from Walmart
= $1980.65

Propolis traps
- 100 traps @ $5.95 each = $595.00

Queens:
- Queen rearing supplies = $500
= $500.00

Nuc supply:
- 20 cardboard nuc boxes @ $5.95 each = $119.00
- 20 Nuc box entrance caps @ $0.16 each = $3.20
- 100 deep frames w/ foundation @ $2.30 each = $230.00

Gas:
- $1500

Total cost: -$6,156.20


Profit
Honey:
- 50 lbs per hive = 7500 lbs @ $2 per lb = $15000

Propolis:
- 3 oz per hive X 100 = 18 lbs @ $30 per lb = $540

Pollen:
- 50 lbs of pollen @ $17 per lb = $850

Nucs:
- 20 nucs @ $125 each = $2500

Queens:
- 100 Russian queens @ $30 each = $3000.00
= $3,000.00

Total gross income: $21,890.00

Total net income: $15,733.80

[Rader Sidetrack]

Hmmm, its a start, but if its a business plan, there are some key items missing.

At a minimum, the plan doesn't mention any extracting operations, but you are selling honey. How are you getting the honey ready for market? Even if you plan on using your current employer's equipment, presumably some payments are involved.

If you are paying for purchasing the business over time, you need to determine if the cash flow is adequate to make those payments. So where is that in your plan? What is that gas going to be used in? If it is a vehicle, that is likely a depreciable asset.

And, FYI, the heading where you show "Profit" should be Income. Profit is whats left over after everything else is paid for. Terms like this may not be important to you, but they will be to the banker that reads your plan.

[westernbeekeeper]

Thanks Rader,
That's a help. Yes, I understand this is not a correctly termed plan, but it is supposed to be the gist of it. I am not very knowledgeable yet as far as business goes, so everything is a help. Yes, I plan to purchase just the working hives from him, and rent the extraction facilty. I don't know yet if I will buy or rent the Hummerbee forklift. Anyway, thanks for the help! I look forward to more.

[BMAC]

Thanks Rader,
That's a help. Yes, I understand this is not a correctly termed plan, but it is supposed to be the gist of it. I am not very knowledgeable yet as far as business goes, so everything is a help. Yes, I plan to purchase just the working hives from him, and rent the extraction facilty. I don't know yet if I will buy or rent the Hummerbee forklift. Anyway, thanks for the help! I look forward to more.

So if you want to be successful (and we all think we are) you really need to know the business portion. You are going to have to carefully plan out all your expenses. If you rent the extraction facility will it be for 1 month or 12 months? Then powering, heating, etc... can get aweful expensive 12 months out of the year.

If you are going to manage 150 colonies why cant you move the extraction to say your garage or basement, or put up a small outbuilding that you can heat for extracting? You dont need much room to extract 7K lbs of honey. You also will NOT be able to afford to sell all your crop wholesale. You will need to get as close to or over $5.00 a lbs so you can start to afford migratory beekeeping expenses.

[westernbeekeeper]

You have a good point, Jim; thanks for the response. Also, BMAC, thanks too, I am learning and everything y'all give me helps. My boss has a large steel building where he does his extracting. He owns two 60-frame extractors, a dakota gunness uncapper, and two conveyer belts. He uses the rest of the space in the building for storage. I would plan to rent it for 1-3 months out of the year.

[dback]

Ben,
After these folks are done adjusting/shredding your business plan....... take all their input and double your expected expenses & halve your anticipated income, now you'll be approaching a realistic number.

[Roland]

Where is CCD covered?

[Mbeck]

This might be worth look


http://api.ning.com/files/4N20pw7eZD...ingworbook.pdf

[Roland]

Where is CCD covered?

Crazy Roland

[westernbeekeeper]

Roland,
Thanks for the reminder! I forgot to factor in losses. What is wrong with me? Thanks! I will factor that in too.

Mbeck,
Thanks for the link! I really appreciate all the replies so far.

[Haraga]

Treatment free? Migratory? Nothing like spreading your diseases around.

[westernbeekeeper]

Treatment free? Migratory? Nothing like spreading your diseases around.

When I become migratory, I don't think I'll be treatment free. I kinda counted on not being TF because of all that gets spread around. That's one of the reasons I counted treatment in.

[odfrank]

Labor?
Four tons of honey is a lot to lift.
The empties into the truck, off the truck, onto the hives, fulls off the hive, onto the truck, off the truck into the extracting room, into the uncapper, into the extractor, out of the extractor, back onto the truck empty, out of the truck, onto the hive, off the hive, onto the truck, off the truck, into the storage room. Now ad all the motions of medicating, pollen trapping, propolis production, feeding, making nucs........all by your lonesome?

[westernbeekeeper]

Labor?
Four tons of honey is a lot to lift.
The empties into the truck, off the truck, onto the hives, fulls off the hive, onto the truck, off the truck into the extracting room, into the uncapper, into the extractor, out of the extractor, back onto the truck empty, out of the truck, onto the hive, off the hive, onto the truck, off the truck, into the storage room. Now ad all the motions of medicating, pollen trapping, propolis production, feeding, making nucs........all by your lonesome?

Yes, I plan to do it all by my "lonesome self." I do most of it by myself currently, and it's only a part time job now.