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 the three different homestead businesses that provide income to make money or live from your homestead.
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, but it does not provide a full-time income. Perhaps it’s more seasonal, such as raising meat chickens in spring and summer, or selling honey from beehives in the fall, then taking the other seasons off.
- The third kind of homestead business would be considered a large-scale business that covers all your family’s financial needs and provides a large service to your community and beyond.
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
Finally, it’s important to know your local laws and be very informed about the decisions you’re making when entering into a homestead business. There are many workarounds to the laws, and if you’re considering moving in this direction, we recommend watching this podcast episode with Joel Salatin on Starting a Homestead Business.
We’ll continue this conversation in our upcoming podcast episodes on starting a homestead business.
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