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Is Agri-Tourism Right For You?

Agri-tourism is defined as a commercial enterprise at a working farm that is conducted for the enjoyment of visitors that generates supplemental farm income. The three basics of agri-tourism are that you should have something for visitors to see, to do, and to buy! How well you relate these three things will determine the success of your agri-tourism business. Things to see and do are often free; but there’s a lot of money to be made in retail sales. Tourists mainly buy food, beverages, and souvenirs.

There are many examples of agri-tourism. Retail sales opportunities exist for PYO’s, farm and urban markets, garden centers, and ag-related foods, crafts, and gifts. Educational experiences include farm tours and agri-related classes on things like gardening, flower arranging and cooking. Festivals could have a food or agricultural theme. Living history farms are popular. You could consider offering hospitality services such as farm stays and B&B’s. You could offer entertainment such as special events, mazes, and petting zoos. Outdoor recreational activities such as horseback riding, fee fishing/hunting, wildlife viewing, and camping are in demand.

There are “pros” to starting an agri-tourism business. It’s a “clean” form of economic development that requires relatively less capital outlay for infrastructure development. Agri-tourism also yields benefits to recreational, hospitality, and other businesses in the community. It creates employment opportunities for family members and supplements farm income. Your business should create new networking contacts and forge stronger links within your community. Agri-tourism provides farmers with the ability to show and tell people what agriculture is about.

There are “cons” to starting an agri-tourism business. These include modest returns, interference with the main farm operations, loss of privacy, and increased responsibilities, labor needs, and liability risk. Farmers also have to realize their limitations! Farmers are excellent producers but tend to be less skilled at marketing, public relations, communications, and human relations techniques. Farmers have less experience and education in these areas and usually have little time or interest in becoming skilled in these important retail and tourism related areas.

When you are assessing your assets, begin your inventory with what you already have
! Consider your physical resources; land resources, climate, farm developments and improvements, and other attractions. Consider how you will operate and manage the operation. What are your farm’s strengths, goals, and resources? List intangible assets that can assist you. What are your people/staff resources? What activities appeal to the public? What are the products and/or services that you can offer to the public?

You need to evaluate your marketplace and identify your potential buyers
. Who will buy your products and services? What exactly will be sold? What requirements or specifications will your visitors have? When will the harvest and/or sale occur? You need to coordinate the timing of the harvest with the requirements of your buyers. What types of agri-tourism already exist in your area? Can you fill a niche or will you complement or compete with others?

You need to evaluate the technical feasibility of your prospective business. Where and/or how will your products will be grown or acquired, harvested, packaged, and distributed? Discuss your plans with Cooperative Extension specialists and NJDA experts in these areas. Visit similar operations and ask questions. Can you accomplish what you desire to do with knowledge, staff, and equipment that you already possess?

You need to evaluate the financial feasibility of your prospective business. A budget needs to be developed, preferably with the assistance of a production specialist and a business planning specialist. The budget should itemize fixed and variable costs, and expected gross and net revenues. An inventory of owned resources and time and labor cost requirements for starting and running the business are needed. Can you make more money doing something else? Is this worth all of the investment?

You must develop a business plan
. It’s the most important document needed by anyone approaching a lender for financing. It’s a blueprint to follow in the development and operation of an enterprise. Include detailed info on the personal, market, technical and financial evaluations. Gather data and review and update it for accuracy. Summarize it clearly and concisely. Business plan formats are available from Cooperative Extension and Small Business Development Centers.

A marketing plan must be created. It can be a part of your business plan but is usually kept separate for annual updating. It is mainly used internally by your business. Detail what you wish to accomplish, factors that may affect your efforts, local resources, and specific groups or potential customers interested in your business. The importance of image, name, and word-of-mouth advertising can’t be over stressed. Excellence in these areas will make the difference between success and failure.
There are many issues related to regulations, permits, and insurance. There are zoning, fire and building codes, health regulations, and food and safety laws to be considered. Talk to those people who work in these areas. Work through compliance issues in a spirit of cooperation. It’s also the law! Pay special attention to edibles, the potential introduction of exotic insects and weeds, and products to be shipped. Utilize bankers, accountants, insurance agents, and lawyers! They will help you to safeguard your farm from unforeseen perils.

There are also many “right to farm” related issues that will affect your business
. Realize that you have the right to process, package, and market your agricultural products, not necessarily someone else’s products. Plan ahead with the advice and guidance of Cooperative Extension and NJDA. This can help you to avert many problems beforehand. Neighbor relations are most important. Make your plans known to people. Seize every opportunity to talk to neighbors or to give presentations about your agri-tourism business. Manage the physical growth of your business. Engage your adversaries. Municipal relations are very important, so introduce yourself to all of your local municipal officials. Belonging to Farm Bureau and other related agricultural and industry associations will provide you with the opportunity to be “current” in your business field and provide you with references for information and guidance.

Take advantage of tourism industry resources. Join your local Chamber of Commerce and N.J. Regional Tourism Council. The N.J. Office of Travel & Tourism can help you to participate in free & cooperative promotions, source research information, and meet travel agents and tour operators at international and domestic trade shows. They offer educational seminars at the annual “Governor ’s Conference on Tourism”. Offer your brochure at the N.J. Visitors Welcome Centers to over 6,750 tour buses & 5.2 million visitors annually (’01). Their www.visitnj.org web site is great. Make yourself a friend and a resource to all of the above agencies.

For more information, contact Bill Walker, Agricultural Marketing Specialist, New Jersey Department of Agriculture, at william.walker@ag.state.nj.us.

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