Agriculture Business Management

Starting your own business can be frightening, but also exciting! The Colorado State University Extension Agricultural and Business Management (ABM) Team has a multitude of resources for both beginning and established producers to effectively manage risk in your agricultural operation and successfully jumpstart your business venture.

A business plan is a great place to begin when starting your agricultural business. It is an essential tool for the success of your farm or ranch and serves as a road map to guide your business, and it impacts your daily decisions, provides direction for expansion, diversification, and direction for future evaluation.

A good next step is to look at creating enterprise budgets for your farm or ranch. Enterprise budgets are a listing of all incomes and expenses associated with growing and harvesting a specific crop. The CSU ABM Team prepares enterprise budgets for all the major crops and livestock grown and raised in Colorado. These budgets indicate the incomes and expenses for an average producer in Colorado. You can use enterprise budgets to make decisions to determine your enterprise mix, help determine if you are a low-cost producer, and make sound production decisions.

A great publication and resource for you to add to your toolbox is the Custom Rates Survey. Colorado State University Extension annually conducts a survey of custom rates charged for various crop and livestock operations and lease arrangements in Colorado. Data is collected from agricultural producers, landowners and managers, lenders, agricultural consultants, machine operators, and Extension agents. The report is generated for the previous year beginning in February of each year. The latest published report is for the year 2025. View our Custom Rates Survey to determine costs for custom-hired labor and lease rates for agricultural ground to help you make production decisions and estimate labor costs.

Leasing your agricultural land is a great option to retain ownership of your property, while still generating profit from your land if you do not currently farm or ranch. A lease is an agreement giving use of an asset to another person for a specific period of time at a specified rate. A lease does not transfer ownership nor an equity interest in the asset.

Colorado State University Extension annually conducts a survey of custom rates charged for various crop and livestock operations and lease arrangements in Colorado. Data is collected from agricultural producers, landowners and managers, lenders, agricultural consultants, machine operators, and Extension agents. The report is generated for the previous year beginning in February of each year. The latest published report is for the year 2025. View our Custom Rates Survey to determine costs for custom-hired labor and lease rates for agricultural ground to help you make production decisions and estimate labor costs.

Every year the USDA National Ag Statistics Service releases county-level data for cash rental rates for irrigated cropland, non-irrigated cropland, and pastureland. The rates are based on survey data collected from Colorado agricultural producers from March through June. These rates represent an average of all rates reported for a county, including both recently negotiated rents.

The USDA’s National Agricultural Statistics Service in cooperation with the Colorado Department of Agriculture collect data and information from ag producers to publish the Colorado Agricultural Statistics Bulletin. The estimates available in this bulletin and what is published throughout the year are valuable tools for producers and agricultural industry professionals to make sound decisions. The report is issued annually each fall and contains county-level data for the state of Colorado

Ag Lease 101 helps both landowners and land operators learn about alternative lease arrangements and includes sample written lease agreements for several alternatives. Ag Lease 101 was created by and is maintained by a team of economists and attorneys with the North Central Farm Management Extension Committee. View the Ag Lease 101 Document Library for access to leasing publications and leasing forms and templates. As always, it is a good idea to have a legal professional review any contracts you develop to check for accuracy.

A business plan is an essential tool for the success of your farm or ranch. It serves as a road map to guide your business, and it impacts your daily decisions, provides direction for expansion, diversification, and direction for future evaluation.

View our Agriculture Business Planning Workbook for a step-by-step guide that will surely put you on your way to prepare a business plan for a successful business. This workbook is designed to provide an outline for developing a business plan for your agricultural business. Each section contains an explanation, examples, and space for you to begin developing a business plan of your own.

An estate is a person’s net worth in the eyes of the law at the time of the person’s death. An estate plan is an organized manner to distribute one’s assets and liabilities after the person dies. An estate plan also provides instructions for end-of-life decision making.

A Last Will and Testament is the most important document in an estate plan. It is a set of instructions for the personal representative to follow when settling the estate of a person who has died (decedent). A will should identify when, how, and to whom one’s assets should be disposed of and how one’s business affairs should be addressed, if applicable. In addition, a might also name a guardian for minor or adult dependents.

Succession planning – sometimes called transition planning – is the systematic process of transitioning management and ownership of a farm, ranch, or other business from one generation to the next generation. Logic would indicate that developing a succession plan should be an obvious requirement of management and business ownership. However complex forces are at work and despite recognizing the importance of a plan, most farm businesses decide to do nothing about succession.

Tax issues are important for agricultural operations because income and self-employment taxes are a major “cost” and because many USDA programs and farm and ranch loans use a producer’s federal income tax return. The National Farm Income Tax Extension Committee is a group of specialists from across the U.S. providing information and resources for farmers and ranchers about tax-related issues.

Agricultural producers are always looking at alternative production schemes (e.g. conventional tillage versus chem-fallow) or enterprise (e.g. selling calves at weaning or backgrounding). Partial budgeting is a process of estimating (1) additional returns, (2) reduced costs, (3) additional costs, and (4) reduced returns associated with the proposed change.

Financial ratios are created with the use of numbers taken from the various financial statements (balance sheet, income statement, cash flow statement, and statement of owner’s equity). The ratios are designed to help better understand the financial position of a business. Typically used financial ratios assess a business’s profitability, liquidity, solvency, and financial efficiency, although there are many other ratios used by financial analysts.