Loans to farmers are a very important component of the business. It is increasingly noticeable that successful farmers finance their businesses with loans. In this article, we will look at the benefits of a loan for a horticultural farm that decides to take out a loan to grow their farm.
We will see that a loan to a horticultural farm can significantly ease farming conditions, increase farm competitiveness and profitability. A loan to the horticultural farm also helps to significantly accelerate farm growth and improve farming conditions.
An example of a real horticultural farm
We have a small horticultural farm that covers 5 hectares. This farm produces potatoes, carrots, onions and cabbages. The farm supplies its produce to caterers such as bars, cafes, restaurants, kindergartens and other caterers. The rest sells its products on the market. The farm gains the highest profit and the lowest time by supplying its produce to caterers. In the meantime, the farmer earns very little profit and costs a lot of work time by trading in the market.
Caterers are very happy with the produce of this farm, they would be happy to buy more farm produce, but they would like to see this produce not only raw material they have bought so far, but also processed and ready for production. Caterers would like to buy frozen, sliced potatoes, french fries, sliced carrots and various sliced salads.
The farm catering offer is very favorable, but there is one problem. The farm does not have sufficient funds to purchase the necessary equipment for processing vegetables. For processing such vegetables, the farm would need vegetable washers, potato and carrot shavers, vegetable cutters, vegetable drying machines, refrigeration equipment and packaging lines. It would take years for the farm to save on this equipment, and other advanced horticultural farms could take its place on the market. As a result, the farmer began looking for solutions to obtain the money to purchase this investment.
Opportunities for the farm were discovered
The farm found opportunities to use EU support and borrow the rest. From his own funds, EU support and the loan he received, the farmer bought a vegetable washer that can wash all the vegetables grown on the farm. Also a potato and carrot shaver that shoots vegetables quickly and efficiently. Purchased vegetable slicer cuts vegetables for salad or prepares vegetables for frying. Vegetable dryers dry the lettuce to make it suitable for packing. The packaging line packs processed vegetables. Refrigeration equipment is needed to maintain the quality and freshness of processed vegetables.
So, after purchasing this equipment, the farmer started producing the following processed products: sliced potatoes, fries fries, sliced carrots, sliced carrots, finely grated carrots, coarse grated carrots, finely chopped cabbage, cabbage and carrot salad.
With the commencement of production and supply of these products, the farm’s sales revenue has grown significantly, the circle of farm buyers has expanded, and the farm has become more competitive and profitable. The equipment purchased by the farm paid off within 2 years and during this year the farm was able to repay the farm loan taken. The farm now plans to expand its production capacity once more by acquiring more land and new equipment. Of course, the farmer plans to use the farm loan provided by Good Finance for these investments.
Good Finance – the perfect solution for your farm
Good Finance provide financial assistance to farmers when and where they are most needed. Helps the economy grow faster and earn significantly higher profits. In the example shown, the farmer would have had to save at least 5 years on new equipment based on farm income at the time. And while he would have saved this equipment, his money would have been depreciated and the saving period would probably have continued.
Meanwhile, with the loan the farm received equipment immediately and was able to significantly increase its income, and from the increased income was able to repay the loan taken in just 2 years. This is one of the great examples of when a loan helps you take your business to the next level and opens up new financial opportunities for you.
Good Finance is designed specifically for small farms. It is particularly important to us that the loan be granted to the farmer at the most favorable time and on the most favorable terms. We do not ask for excess financial plans, but simply help you fulfill your dreams. You can submit your application form in just a few minutes. And our staff will start evaluating the application as soon as it is received. You will receive an answer on whether you are granted a loan on the same or another business day. And you will be able to use the loan for your investment within 1-2 business days of completing the application.