1. Resource list:
When we are going for starting a agricultural farm we must do a list of present resources. The plan become successful when an accurate inventory is done properly.
a. land: We must give top priority when doing a resource inventory for a agricultural farm. It is a fixed resource.
b. building: We must keep the building in the list resource with their size capacity and potential uses.
c. labor: We should consider labor with the term of quantity and quality. It is difficult to measure the labor quality, but special training, experience and skill must be considered.
d. machinery: It is a fixed resource. We must cosider the size capacity and number of the machinery.
e. capital: It is most important for planning a agricultural farm.
f. management: Management means not only overall management ability but also special skill, training, strengths, weaknesses of manager. Best management brings highest yield of a farm.
2. Identifying enterprises:
On the basis of resource inventory, a farmer must decide to make a farm of crops or livestock or others so that he can get maximum utility from his resources. We must be conscious to include all possible enterprises to avoid missing. we must consider the profit potential of the farm enterprise. We may consider custom and tradition of a locality, this custom and tradition should not be restrict the list of enterprise.
3. Estimation of co--efficient to assess the size or resource for each enterprise:
Enterprises must be well defined on small unit as for example one acre or hectare for crops and one head for livestock. We must estimate the resource needed for each enterprise ( per unite ). The technical coefficients which a fact and become very much important to determine the maximum size of enterprise and the final enterprise combination.
4. Estimating gross margins:
We estimate the gross margin for a single unit of each enterprise.It is required for the farmer to estimate the yield for each enterprise and expected yield.
5. Developing the whole farm plan:
Identifying the most and important limiting resource and identifying those enterprises with greatest gross margin per unit of resource id the systemic procedure to whole farm planning.