Overview & Core Concepts
This step covers the third building block: Operating Model — how the farm business is organized. It answers three key questions: Who supplies the inputs (chicks, feed, medicine)? Who manages daily farm operations? Who takes responsibility for selling the birds and bearing market price risks?
Primary Operating Models:
- Independent Farming: The farmer owns or leases the farm, buys all inputs from suppliers, manages daily flock care, sells output directly to buyers, and retains all profit or loss.
- Contract / Integrated Farming: The farmer provides the land, shed, labor, and utilities, while a contracting company (integrator) supplies chicks, feed, medicines, and technical guidance. The grower receives a growing charge payment based on agreed performance standards.
- Company-Owned & Company-Operated (COCO): The company owns the land, builds the farm facilities, and directly manages operations using employed farm staff.
Each operating model distributes financial risk, daily workload, and commercial independence differently.
Why This Matters
Understanding operating models helps prospective farmers match their available capital, risk tolerance, and management capability to the right business arrangement before building a shed or signing contracts.