Own business: Greenhouse business with high profitability

* The calculations use the average data for the World

It is no secret that the agricultural industry in our country is going through hard times these days. Nevertheless, business in this area can be very profitable, especially if the entrepreneur has the necessary knowledge and experience.

Among the most promising areas can be called the so-called greenhouse business, which is most relevant for the central part of Russia, where in the pre-season and off-season there is a shortage of fresh vegetables.

Greenhouse business profitability

Competition in this area is assessed as relatively low. The most difficult thing is to accurately assess the profitability of such a business project. This indicator depends on many variables and, first of all, on the geographical location of the greenhouse. On the one hand, as mentioned above, the cultivation of fresh vegetables in a greenhouse is more in demand for the middle strip and the northern regions of our country than for the south. In the south, competition is much higher, and the off-season is much shorter.

On the other hand, the central part of Russia is characterized by sharp temperature drops and even frosts. In addition, there is a lack of sunlight. Consequently, additional costs for lighting and heating of greenhouses will be required, which, in turn, will increase the cost of production. Thus, it may be disadvantageous to grow greenhouse vegetables, for example, in Moscow and the Moscow Region due to the high cost of local greenhouse products and given the fact that large quantities of fruits and vegetables are brought into the region from the south at lower prices.

Of course, profitability directly depends on what is grown in greenhouses. Most often it is greens, flowers and vegetables. In addition, experienced agronomists undertake to grow various exotic cultures for our country in greenhouses. The latter option is not suitable for a novice entrepreneur for two more reasons: its implementation requires considerable investments, and the business itself is characterized by high risks, which are associated, firstly, with the whims of such plants, and secondly, with the inability to accurately predict the demand for such products for Russian market.

In the first place in terms of profitability in the greenhouse business are flowers, but investments in the flower business will be the most impressive, since you will need vast areas for the construction of greenhouses. But if you still have neither a large starting capital, nor special experience in growing greenhouse plants, experts advise you to start with greens (onions, parsley, dill, lettuce, etc.), which is much less whimsical to weather conditions, is distinguished by good “ productivity ”and is always in high demand.

Basic requirements for growing vegetables

If you still intend to engage in growing vegetables, it is recommended to pay attention to the so-called eco-direction. Recently, residents of large cities of our country began to think about their health and give preference to environmentally friendly products. However, in order for your products to be called “green”, you will need to issue an environmental certificate for it. Environmental Certificate of Conformity is a document that confirms the environmental safety of products, including their operation, storage and transportation.

It is issued only after the manufacturers have passed the environmental certification procedure, during which the conformity of the entire production process and the product itself with established environmental standards is established. Environmental certification is a voluntary procedure, but passing it significantly increases the competitiveness of your products.

To issue an environmental certificate, you will need to submit the following documents: a free-form application, product specifications, a full package of technical documentation, a GOST R certificate of conformity, if any, a certificate of state registration of the applicant enterprise. This list may vary, depending on the type of product being certified. The process of passing environmental certification is quite complicated and long.

It consists of several stages. First, the applicant company submits to the certification center all the necessary documents, as well as an application for a certificate of compliance with environmental safety. Then the certification center analyzes the provided product documentation, gets acquainted with the production process, makes a decision on the submitted application, signs the contract for the execution of the application, analyzes the test protocols, audits the production or the technical process, selects test samples, conducts product testing and, finally, accepts decision to issue or refuse to issue a certificate of environmental safety.

If a positive decision is made, a certificate of conformity is issued with its subsequent transfer to the applicant. The cost of passing the environmental certification procedure is from 55 thousand rubles.

So to summarize. Investments in the flower business turn out to be 4-5 times higher than investments in growing vegetables. And growing greens is 4 times more profitable than growing vegetables. Nevertheless, the final decision about what exactly you will grow on your site should be made only after a thorough marketing research of the region where you live and the local market.

Pay attention to what products are most in demand, what your competitors offer and at what prices, how they sell their products. Also take into account the climatic features of the region and your opportunities for starting a business. For example, if you plan to work at first only with retail, then you should give preference to greens (dill, salad, parsley, onions), radishes, strawberries. In addition, you can increase your profits by growing and selling in early spring seedlings of various horticultural crops.

If you are counting on large incomes and quick payback, then you need to bet on wholesales. In this case, experts advise to pay attention to tomatoes and cucumbers. Finally, if you already have access to the owners of restaurants and cafes and agree with them on direct deliveries, then you can take the risk and start growing more fastidious plants, the cost of which, accordingly, will be higher than the cost of common crops.

Also consider the distance between your farm and potential buyers. The farther your greenhouses are from the city, the more profitable it will be to grow “light” products (that is, those that will weigh less and not be too demanding on storage and transportation conditions).

Finally, profitability depends on the process chosen. But here it is not so simple. For example, the maximum yield at minimum cost when growing vegetables provides the hydroponic method. This technology can equally well be used by both small greenhouse farms and large agricultural enterprises. However, its main drawback is the low taste of the finished product.

Often vegetables grown in this way, although cheap, have little to no taste. Accordingly, they will not be in great demand either. For this reason, it is recommended to use even the more costly, but in this case the traditional fertilizer system that justifies itself, for growing vegetables.

The industry average margin is estimated at 15%. In some cases, with the right niche and production technologies, it can reach 25%!

How to draw up documents for growing vegetables

If the land for the construction of greenhouses is your property and you do not plan to work on a large scale, hire additional workers and sell finished products to legal entities, then no special documents are required to organize such a subsidiary farm. To implement the harvest, it will be enough to take a certificate stating that the land on which the greenhouses are located belongs to you.

If you are going to attract additional labor, organize larger production and sell your products through shops, retail chains, as well as supply it to catering establishments, you will have to register as an individual entrepreneur or organize a private agricultural enterprise. In the latter case, you will receive the right to certain tax benefits, but keep in mind that in practice it will not be so easy to achieve many of them.

State registration of peasant farms (peasant farms) is carried out in the same manner that was established for state registration of individuals as individual entrepreneurs. In this case, only the head of the farm is registered. To do this, he must submit to the registration authority the following documents:

  • application for registration (statutory form);

  • agreement on the establishment of a peasant (farm) economy (if necessary);

  • copy of the main identity document of the head of the farm (passport);

  • document on the payment of state duty (original);

  • copies of documents confirming the kinship / property of members of the peasant farm.

Please note: an application for the transition to a special taxation regime (USN or tax for agricultural producers) is filed simultaneously when submitting documents for registration of a farm. Then the selected mode can be applied from the moment of registration of peasant farms.

The farm is registered by the authorized body at the place of permanent registration (registration) of the head of the farm. Its terms are an average of five working days from the date of submission of documents. As a result, you will receive a certificate of state registration of the head of a peasant farm, a certificate of registration with the territorial tax authority, an extract from the Unified State Register of Individual Entrepreneurs and an information letter from the State Statistics Committee with OKVED codes.

If the farm is organized not by one person, but by several, then an agreement must be concluded between all participants, which provides the following information:

  • about members of the farm;

  • on the recognition by the head of the farm of one of the members of this farm, the authority of the head of the farm and the procedure for managing the farm;

  • on the rights and obligations of members of the farm;

  • about the procedure for the formation of farm property, the procedure for ownership, use, disposal of this property;

  • on the procedure for accepting members of a farm and the procedure for withdrawing from members of a farm;

  • on the procedure for the distribution of fruits, products, and income received from farming activities.

The list of this information may be expanded. Copies of documents confirming the kinship of citizens who decided to create a joint farm are attached to the agreement. In addition, the agreement is signed by all members of the farm.

What equipment is needed for a greenhouse business?

Regardless of which crops you have chosen to grow in greenhouses, whether the land for their construction is owned or leased, are you planning to manage your savings or plan to take loans, you need to start a detailed business to start organizing this type of business -plan.

In it, you can assess the situation on the regional market, determine the format of your future business (it can be either seasonal using cheaper and simple farm greenhouses, or permanent with the construction of industrial greenhouses with constant heating and lighting), evaluate sales and search opportunities buyers, calculate costs and profits, sources of financing for the project, etc. The costs of organizing such a business directly depend on the type of greenhouses that you will use. The most widespread in our country are greenhouses of two types - film and glass. Film or polyethylene greenhouses have a lower cost.

The disadvantages include the low light transmittance of the film and its insufficient strength, as well as increased humidity inside the greenhouse. On average, once a season such greenhouses are subject to replacement. “Productivity” using film greenhouses will also be lower, because plants will have to be planted later, which, accordingly, increases the ripening time of the crop. Glass or winter greenhouses have a more complex structure and are more expensive than film greenhouses.

The advantages include their durability, relative strength and good light transmittance. Under certain conditions, they can grow vegetables even in the winter season. Nevertheless, glass is a rather fragile material, and the cost of replacing broken glass will be higher than the cost of replacing broken polyethylene, which should also be taken into account when drawing up the estimate.

Recently, greenhouses of the third type, made of polycarbonate or acrylic, which is more durable than glass and film, have good transparency and light scattering, are becoming more widespread. The level of illumination in a polycarbonate greenhouse is two times higher than in a polyethylene greenhouse.

Its additional advantage is the absence of the need to make a foundation, as is the case with glass greenhouses. But nevertheless, unfortunately, polycarbonate greenhouses are also not perfect and have their drawbacks. First of all, this applies to arched structures, which are the most common. Their popularity is explained only by the fact that it is more profitable for manufacturers of greenhouses to produce such structures, since the standard polycarbonate sheet is 2.1 in 6 meters. There are also sheets up to 12 meters long, but they are difficult to transport, and they are inconvenient in operation.

The standard polycarbonate sheet is bent into an arc so that the height of the structure is usually 3.8 meters and the length, respectively, 6 meters, although if necessary, these parameters can be increased or decreased. Such a greenhouse is considered small in size. With intensive cultivation, the land in it quickly depletes, so you need to fertilize it regularly. The main disadvantage of the polycarbonate greenhouse of the arched construction is the unevenness of lighting and the high reflection of light, as a result of which only part of the plants is well lit. To eliminate these shortcomings by increasing the flow of light, you can make the roof of the greenhouse not semicircular, but flat, and the northern part of the greenhouse - opaque.

Plants in polycarbonate greenhouses can be planted directly in the ground, but in this case it will be difficult to maintain the recommended temperature regime. Experts advise nevertheless to use the so-called flooring, which is a metal mesh stretched over a wooden frame. Along the perimeter of such a greenhouse there are several rows of decks, between which a small free space is left to provide access to them.

As in ordinary greenhouses, in polycarbonate structures it is necessary to ensure constant air exchange, for which through fans are used. In the summer, they can be turned off to save costs. One mechanical pass-through fan will cost 6.5-7 thousand rubles.

The hydroponics system mentioned above, with all its shortcomings, can reduce the vegetable growing cycle to 2-3 weeks (which is 5-10 times faster than with traditional cultivation methods) with a yield of up to 2-3 tons of products per hectare. To service such a greenhouse, 5-7 workers per hectare of usable area will be required.

When calculating the cost of constructing one greenhouse, consider the following expenses: obtaining design documentation for the greenhouse itself and all its external networks (electrical, water supply, etc.), which should include a specification for all equipment used; purchase of planting material plus funds for operating expenses until the first profit.

If you are only looking for a plot to house your greenhouse, then consider the location of the necessary communications. The further they are located from the site, the higher will be the cost of summing up. Pay attention to the area around the proposed greenhouse installation site. It should be flat and spacious enough to organize access roads. If you rent land, prefer prefabricated greenhouses. They cost more than non-separable, but these costs are justified, because in which case you can easily transfer them to a new place.

A lot of controversy among entrepreneurs working in the "greenhouse" sphere raises the question of the need to invest additional funds in heating greenhouses. Some believe that you do not need to invest a lot of money in modern expensive equipment. Others are convinced that higher costs in the first stage are subsequently offset by higher production efficiency. Whatever opinion you hold, experts recommend that you nevertheless begin to save money from profit and gradually upgrade the equipment used. Do not forget that it is heating and electricity that make up 90% of all current expenses for the maintenance and maintenance of greenhouses.

How much will we spend and how much will we earn?

Among the main expenses for organizing a greenhouse economy are the following: lease of a plot, construction of greenhouses and purchase of necessary equipment, working equipment, purchase of plants, fertilizers, wages for farm workers. Renting a land plot will cost in the amount of 80 thousand rubles per year. For one greenhouse with an area of ​​one hectare with all necessary equipment, 300 thousand rubles will be required (the final amount depends on the type of greenhouse). Another 200 thousand rubles will be spent on inventory, seedlings / seeds, fertilizers.

Serving a large greenhouse will require a minimum of two to three workers. The functions of a farm manager can be performed independently at first. For medium-sized enterprises, about ten workers per hectare of land allotted for greenhouses are taken into account. Using the latest technology and modern equipment (with automatic irrigation and heating) will significantly reduce the number of staff.

It is very difficult to determine with high accuracy the estimated income from the greenhouse, since, as in the case of profitability, it is directly affected by several significant factors: the region (in some regions it is quite possible to get up to four crops a year, and in others - not more than two), the remoteness of the farm from the city (which directly affects transportation costs), distribution channels, etc. The payback periods of two to three years are most realistic.

Sysoeva Lilia

(c) www.clogicsecure.com - a portal to business plans and guidelines for starting a small business 08/18/2019

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