There are a lot of people who want to start a homestead business. Learning how to make money from your homestead and living off your homestead are two very different things. In this series, we’ll discuss three different methods for making a living from your homestead.
If this post looks familiar, it’s because we’re continuing to update it with our series of podcasts on starting a homestead business. So keep scrolling until you find the podcast or video you’re looking for!
Homesteading vs. Farming
First, let’s establish what homesteading is. For us, how we approach our homestead isn’t from a mindset of making money. It’s a way to maximize our assets and reduce our overhead and costs by producing a portion of our needs. In our opinion, the goal of self-sufficiency isn’t a good one. We all need community, and reliance on others shouldn’t be viewed as a weakness.
Even the Amish, or the homesteaders of old couldn’t live without a community or an income. We all have tools, supplies and equipment needs/repairs that will cost money (or trade/time) at some point. Furthermore, there are costs to simply setting up a new homestead for gathering supplies and getting systems in place. Sure, the ultimate goal of these systems is to eliminate (or drastically reduce) that overhead cost, but they still have an upfront investment.
We’ve discussed how to start a homestead business before with Joel Salatin. If you missed that interview, I highly recommend checking it out. We cover more of the nitty-gritty and legalities of starting a homestead business versus considering the types of businesses.
This post will eventually include the full three-part series on starting a homestead business, so we may not cover everything all at once. We will continue to add to this post as we film the whole series.
Different Kinds of Homestead Business
There are three types of businesses you can build from your homestead. We’ll go into more detail about each of these in the various Pantry Chat episodes:
- The first kind of homestead business is a small hobby business that creates a product based on the excess of what you already do for yourself.
- The second kind of homestead business is a bit larger than the hobby business. It could eventually provide a full-time income for a family, but it will likely take a few years until that happens. This is turning your homestead into a farm.
- The third kind of homestead business would be finding ways to live off your homestead while working from home. This would cover all your family’s financial needs and still allow you time to manage and run your homestead.
Homestead Hack: If you’ve never run a business before, we don’t recommend starting a homestead AND a career at once. Jumping straight into a homestead business to provide income for your family would likely create stress and cause homestead burnout. Remember that learning basic homesteading skills will teach you a lot of what you need to know about running a business, but more layers will be developed once you’re ready.
Small Hobby Business
Making supplemental income from your homestead is a great way to start augmenting your income by selling some of the surplus. These are smaller businesses that are born out of the excess of what you already do for yourself. Often times they include more than one of the following:
- Selling Eggs: If you’re already great at raising backyard egg-laying chickens to provide enough eggs for your family’s needs, it’s not too difficult to increase your flock size and sell your surplus.
- Selling Raw Milk: Do you have a dairy cow? If you’re like us, with quite a large family, having one cow provides what your family needs, but having two cows could mean selling the surplus. Or, if you have a smaller family and constantly find yourself with excess milk from one cow, consider selling the extra for a bit of supplemental income.
- Selling Dairy Products: If you’re already making homemade butter, maybe you want to increase the amount and begin selling the extra butter (although, in our family, there’s no such thing as “extra” butter). The same could go for homemade yogurt, homemade soft cheese, or any other dairy product you find yourself making regularly.
- Making Soap: Do you make soap for your family? Consider doubling or tripling the batch and selling the extras to friends and family.
- Extra Produce: If you’re growing a garden and have excess vegetables, consider selling your surplus!
Those are just a few ideas of ways you can help offset your homesteading costs while also providing a great service to your community. If your ultimate goal is to turn your homestead into a commercial business, starting as a smaller hobby farm is a fantastic way to dip your toe into that market.
Learn How to Self-Audit
In healthy homesteading, we apply permaculture principles where we take care of people and the land, which provides us with a surplus to then take care of people and the land.
If you don’t know how much it costs to produce your product, you won’t know if you’re actually making a profit or losing money. Any healthy organism, whether a person, a business, a household, etc., for it to be healthy, it must produce more than it consumes.
For example, if you’re raising backyard egg-laying chickens, they will have an upfront cost to obtain the chickens (or chicks), get or build a shelter or chicken coop, and buy feed.
Count these costs as part of your business investment! Once your chickens start laying eggs, it’s important to figure out how much it costs to produce each egg. If it costs you $35 in feed costs to feed your chickens for a week and they provide you with 10 dozen eggs/week, then you know that a dozen eggs costs you $3.50 to produce (or about 29-30 cents per egg).
If you turn around and sell a dozen eggs for $3.50, you’re not making a profit on your business, and, eventually, you’ll have to stop.
A healthy business needs to provide enough income to cover the production costs (for the eggs, that would be $3.50 per dozen, plus any other fees that go into raising the chickens – water, supplies, wood shavings for using the deep litter method in the coop, etc.), plus enough profit to pay the employees (or yourself) and some surplus of money to then put back into the business (think replacing chickens, coop repairs, etc.).
Work With Your Boundaries
It’s important to know your local laws and be very informed about the decisions you’re making when entering into a homestead business (more on this below).
But keep in mind that there are many workarounds to the laws. If you’re considering moving in this direction, we recommend watching this podcast episode with Joel Salatin on Starting a Homestead Business as he discusses this topic further. Then, you’ll also want to grab a copy of his book, You Can Farm: The Entrepreneur’s Guide to Start & Succeed in a Farming Enterprise.
Turning Your Homestead into a Farm
In the second Pantry Chat Podcast (above), we’re discussing ways to earn money from the homestead. Essentially, turning your homestead into a farm.
Some examples of farming are:
- Raising animals
- Raising grains
- Orcharding
- Selling produce/Market gardening
These are just a few ideas, but farming is any enterprise in which you grow your sustenance out of the soil.
Before You Start a Business
If you’re looking to start a business from your homestead, don’t quit your day job. You should ideally have three years’ worth of living expenses saved up before quitting your day job and going full-time with your homestead business.
Beyond the living expenses, you should also have three years of business start-up costs saved up. On average, most businesses take three years to become profitable.
Now, if this sounds impossible, don’t let that dissuade you from starting a business. We’ve started four successful businesses over the years and didn’t have this kind of savings. Though ideal, very few of us have this luxury. However, when you “count the cost” of starting a business, you step into it with your eyes wide open and fully understand what it will take.
Starting a Business
Before you start a business, you need to have a business plan. It can be very basic and written on a napkin or extremely detailed and laid out in a spreadsheet. Regardless of its presentation, it needs to be well thought out.
Some things to consider in your business plan:
- Who is your market? This is who you’ll sell to or who your product will help.
- How will you sell? Knowing how you’ll sell your product to your customers is important.
- Is there a demand? It makes no sense to go into business if the demand for what you want to sell isn’t there. Knowing this ahead of time is imperative to building a successful business.
- What are you passionate about? It’s important that you enjoy, are good at or have a passion for your job.
The 3 Pillars of Business
I’ve always been taught a business is like a three-legged stool. A three-legged stool will support you, but a one or two-legged stool will topple over. Over the years, I’ve added in a fourth leg, which I think makes the stool even more sturdy:
- Production – This is simply producing the product you will sell, whether a physical product or the necessary production that goes into providing a service.
- Marketing – You have to market your business. Very few people have ever become successful by word of mouth. You have to sell your product. Most farmers don’t like the aspect of selling, which is why much of the selling was taken over by brokers who would sell their products for them. Unfortunately, this took a portion of the profit from the farmers.
- Finance – You must know how to manage money and resources. There’s no guessing here. I do think hiring a professional bookkeeper is a great solution, but it’s still important that you understand what’s going on within your business.
- Legal – While the stool will still stand on three legs, the fourth leg that adds even more stability is being informed legally about your business. The world has become very litigious and it’s just not something you want to mess with. Check out the Farm to Consumer Legal Defense Fund for more resources.
Having a deep understanding of all pillars of business is pivotal to success. I’ve seen so many great tradesmen, whether carpenters, plumbers, welders, etc., go out and think that just because they’re great at what they do, they’ll have a successful business. Sadly, far too many have failed in their business ventures because they didn’t understand the necessary pillars.
What’s the “Unfair Advantage”
An unfair advantage in business is something that gives you a leg up. It could be that where you live, you have an unfair advantage that crops can grow and be harvested earlier than anywhere else, or your soil is perfect for growing “XYZ.”
Another example of an unfair advantage is knowing a business will be successful because there are other successful businesses like it in your area. However, you want to be careful that the market isn’t over-saturated, which could lead to a failed business plan.
Be sure that your unfair advantage doesn’t risk your bottom line. Selling a product at the lowest price isn’t a good business plan. Know the value of your product and charge accordingly. If your business doesn’t make enough money to keep the lights on, it will fail.
As an example, a good friend of ours raises dairy cows and sells all organic, grass-fed A2/A2 raw milk. She charges more per gallon than all the other raw milk sources in our area, but she’s always sold out with a waiting list. She knows the value of her product and has found a market that agrees.
We’ll be back soon with part three of this series on building a homestead business. Part three will discuss other, less conventional methods for earning a living from your homestead.
Why We Think Home-Based Businesses Are Crucial
We are hearing more and more about people who don’t want to have to leave their families for 8+ hours a day. Ideally, they’d love to work remotely or as a family unit but aren’t sure where to start.
Unfortunately, we’re seeing first-hand what happens when the family is fragmented, with everyone going in different directions every day (parents to jobs outside the home, children to public schools, etc.). Not only are families falling apart, but we’re also losing the morality center that would get passed on from generation to generation.
Before modern industrialization, the norm of most families was that people both managed a productive homestead while also running a family-centered business. After modern industrialization, it’s interesting that we’re now seeing a trend where families want to bring back the centrality of their homes by not only homesteading and homeschooling but working from home as well.
It seems people have a desire and a draw to come back to the norm of what used to be.
Creating a Home-Based Business
Ironically enough, though modern industry and technology initially tore families apart, it’s now one of the ways that allows families to come back together. When COVID hit, so many companies were forced to work remotely, and many of them stayed this way, realizing that not only was it possible, but many people preferred it.
With the advances of the internet (and services like Starlink that provide internet to even remote locations), there are so many jobs that can be done from home. If you’re looking for inspiration or ideas, we highly recommend grabbing the book Durable Trades: Family-Centered Economies That Have Stood the Test of Time by Rory Groves. From carpentry, metalworking, soap-making, sourdough baking, etc., there are so many ideas that might fit your circumstances.
Consider the Challenges
Running a home-based business can have its challenges. For example, if you’re used to going to a nice, quiet office to work, there can be some adjustments and challenges that arise when transitioning to working from home.
For us, it was children needing attention, dogs barking and trying to hush the hustle and bustle of a busy household. This was quite stressful, especially if one of us needed to have a business call. There may be an adjustment period for everyone (including the spouses and children), and this is worth thinking through prior to working from home.
Many people ask us how we got started with Homesteading Family. It actually started with us sharing the surplus of knowledge and skills we’d picked up over the years on YouTube. Little did we know it would turn into a full-time job and business.
If starting a YouTube channel is something you think you want to do, it’s important to walk into it with an entrepreneurial mindset. This means you’ll likely be putting in 60+ hours per week for the first few years. This is quite different than the 40 hours per week a regular 9-5 job holds.
Online Presence
In our opinion, having an online presence is a must, not a bonus. It may seem ideal to build a business that serves your local community, but you have to understand that we live in a digital-first world. Even the local people in your town are likely going online to fulfill their needs.
Having an online presence, such as a website, and an understanding of how people will find you (like creating a Google business listing) is mandatory. Don’t worry if this isn’t your expertise; there are companies out there who can help get you set up (at a cost), but don’t write it off just because you don’t know how to do it.
You may find yourself saying, “But I can’t afford that.” We get it. Most people starting a business set out with a DIY mindset and scrape every penny they can. This is fine, but it may mean learning some marketing strategies and implementing them yourself until you can afford to hire help.
These are spend time or spend money conversations you must have to weigh what’s most important.
Invest in Education
We understand that money doesn’t grow on trees (and it doesn’t grow from the soil, either). However, if you want to create a successful business, consider investing in education that will accelerate your learning curve and give you a leg up.
We recommend this education include financial planning and management, marketing, and education specific to your trade.
Again, if you think you don’t have the money to invest in education, we would argue that you don’t have the money to not get a good education. It will take you so much longer to learn everything you need to know about running a business by bootstrapping it.
What Are You Passionate About?
When thinking through what job you want to do, it’s important to think about the things you’re passionate about. What do you enjoy doing? Ask yourself if you’d enjoy doing that every day, all day, for years to come.
Instead of thinking about what would make a good business, consider the things you’re passionate about and whether you can turn it into a business. Carolyn never imagined she’d be talking about egg preservation or baking bread every day for her job, but thankfully, she’s very passionate about homesteading, and these topics are part of that.
What a drag this job would be if she hated preserving eggs!
In Conclusion
Building a home-based business has a far-reaching impact, not only on your life and the lives of your family but culturally. By bringing this way of living back home, we are building the economy and a way of life for generations to come.
While the entrepreneurial journey and making money on a homestead have many challenges, they are also very rewarding and have huge impacts, especially as more and more people (like you) embark on them.
More Posts You May Enjoy
- Does Homesteading Save You Money?
- Our Homestead Journey (Apartment to 40 Acres)
- 8 Things You Need to Know When Buying Homestead Property
- How to Get Started Homesteading
- 7 Things You Must Do On Your New Homestead
- Preparing the Homestead for Winter
- How to Pivot When Things Go Wrong on the Homestead
- Good Enough is Perfect
