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Farm Support Services
First Research, Feb 2012, Pages: 10
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Executive Summary
Brief Excerpt from Industry Overview Chapter:
The US farm support services industry includes about 8,500 companies with combined annual revenue of about $13 billion. No major companies dominate the industry, which is highly fragmented.
This industry includes companies that support crop and animal farm operations but don't themselves harvest crops, raise farm animals, or own farmland.
COMPETITIVE LANDSCAPE
Demand is driven by domestic trends in crop and livestock production. The profitability of individual companies depends on establishing a value-added benefit to farms and keeping wages low. Large companies have advantages in vertical integration and in offering a wide range of services. Small companies can compete effectively by specializing in a niche industry or service. The industry is labor-intensive: average annual revenue per worker is $140,000.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major services include post-harvest crop activities like drying, cleaning, shelling, sorting, grading, and packing (45 percent of industry revenue); animal support activities like breeding livestock and pets, boarding and training horses, spraying cattle with insecticides, and stud services (25 percent); and soil preparation services like plowing, fertilizing, and planting, cultivating, and protecting crops (15 percent). Other services include machine-harvesting crops, farm labor contracting, and crop farm management services on citrus groves, vineyards, and orchards.
Among all US farm support service providers, half specialize in crops and half in livestock. However, crop-related activities account for 75 percent of total farm support service revenue.
Crops are at their most delicate and fragile at initial planting and just after harvest. To minimize...
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