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Unit 1: Planning and Business Development

Evaluate strategic alternatives.

Evaluation is perhaps the most critical step in the planning process, yet it is sometimes forgotten in the excitement to move forward with a new idea. In your role as an advisor or consultant, you may need to help the farmer slow down and take a long look at their proposed business strategies and ask: “Will my idea really work?”

This process of evaluating strategic alternatives is often called feasibility testing or analysis. Some questions that may help promote this type of careful analysis include the following:

• Does the proposed strategy build on your internal strengths or take advantage of opportunities (use family members’ skills, capitalize on shared goals with a neighbor, fill a niche in the marketplace)?

• Will your strategy build resources for the future (soil quality, financial equity, employment for the next generation, food for the local food shelf)?

• How realistic are the business’ start-up and long-term resource needs?

• How realistic are the business’s marketing assumptions?

• Can the business financially survive the transition period?

• How high is the confidence of your planning team in the success of your strategy?

• What are the risks and how likely is it that one of these risks could dramatically alter your outcomes?

Adapted from A Strategic Management Primer for Farmers by Kent Olson, Department of Applied Economics, University of Minnesota, 2001.