Whilst there is some economic wisdom in applying economies of scale, such as being able to purchase resources such as feed, at much more reduced prices...
You do not need an operation with large operational cost or huge capital investment to make money in raising fish..
Having a large fish farming operation does not necessarily translate into larger profits.
The fact is that the bigger your fish farm the more skill and experience you need to make it work
The key to making money in fish farming is:
- Knowing what the key factors are that drive profit in the business and
- Your ability to take the required action to master those key factors
Here are 10 key Suggestions that I suggest you consider when raising fish to make more money.
Fish Farming Success Tip 1 - You Need To Produce What The Market Wants
A major mistake most fish farmers make is they hear about the fact that there is money to be made in fish farming,
they get someone to teach them how to raise fish, they set up shop, get a team together, produce fish and then try and find buyers.
That's like putting the latch on your horse shed after the horse has escaped!!!
Too often... those farmers can't believe it that buyers are not rushing to take their fish off their hands
A week passes by and they drop the price... only to do so the following week again
Pretty soon you are at the mercy of the fish buyers...
The problem is that if you run your farm this way... you are much more likely to be held to ransome by your buyers or
you will have to spend a size-able amount of your earnings trying to convince people to buy from you.
I often do come across and do get some emails sometimes from disgruntled fish farm owners complaining about their customers (usually the retailers e.g market traders) often forcing them to accept prices that virtually leave no profit for them (The fish farmers) considering that the price of things like petrol and fish feeds are on the rise.
I listen as I often do ... and can't help wondering if these fish farmers wouldn't do the same if the roles were reversed or
if there was a case where fish feed suppliers had too much fish feed on the market...
I will do the same... wouldn't you?
The bottom line is this ....
A lot of fish farmers who use the strategy of producing fish and then trying to find a market to sell to afterwards tend to find out ..
that in order to get rid of their fish they have;
They have to sell below market price.
If you are intent on making money from raising fish as a business...
do what the successful fish farmers do...
find a market and then produce what the market wants.
This brings me safely unto my 2nd tip which is...
Fish Farming Success Tip 2 - Do your Market Research First
The key here is to do your market research first
I am not just talking about doing a survey or asking people if they would buy your fish if you open a fish farm nearby or not....
That's no research...
If you do things that way...you are more or less getting people to tell you exactly what you want to hear.
which is "That they would buy from a newly opened fish farm"
Market research is a process rather than a one time activity.
You want to use the opportunity to find out what the market really wants
To be honest...
if you did your market research well you might in fact find out that the demand is for something you never thought about such as..
production of fish fingerlings rather than table sized tilapia fish
Once your market research is done you can then produce exactly what the market wants
Fish Farming Success Tip 3 - Plan your Production so that your fish are ready when the Market wants it
I often come across some fish farmers who seem to take pride in telling everyone about the size of their fish pond or the number of ponds they have.
I hate to say this... but making money in fish farming is not about the number of ponds you have or the size of the pond you have...
what makes you money in this business is how much fish you can grow to reach your targeted market size in the shortest possible time and at minimum cost to make maximum money.
Making money is about meeting the needs of your targeted customers...
It not about what you want to sell ... its about your business being able to supply the products and services that your customers wants to buy
Just because you have a lot of ponds does not mean that you use all the ponds immediately to produce fish.
You need to have a plan of production in place to ensure the quantity of fish you have ready at harvest time coincides with what the market wants and needs at that particular point in time
Off course before you can put together a production plan for your fish farm,
you need to know what the market wants and when the market wants it,
hence the reason why you needed to start with market research in the first place
What is the point of oversupplying the market and getting a lower price if your motive is to make money?
Remember this formula
when supply is more than demand... the price you get for your fish will tend to be low
when demand is less than your supply... the price you are most likely to get for your fish will be high
Fish Farming Success Tip 4 - Grow The Market For Your Tilapia Farming Business Organically
Once you get to a stage that you have done your market research,
found a market to sell what you produce to and
that you are now producing specifically for your targeted market.
The next step is to start to grow your fish farming business organically
Your aim at this stage is to organically grow the market that you sell your fish to
in lay man terms.. you try to increase your market share
the more you can increase your market share... the more likely you are to make more money
The income you make from the business is used to grow your fish farming business
How do you do this?
There are 4 well documented business strategies for doing just that...
that you can use for your fish farming business too... which I am afraid is not a subject for this write up
but I will touch on these lightly
The 4 main business strategies that you can use to increase your market share and most likely make more money are ...
- You get your existing customers to buy more of the fish products you produce currently - market penetration strategy
- You add additional value to your product and increase your margins by targeting your current market... an example here will be that you start to provide fish cleaning services before selling on to your customers - product development strategy
- You add an additional segment of the market to your current customers.... so if you were selling to market traders before... you might start to target high value hotels and restaurants in your area - market development strategy
- You look into a new market with a new product... so you decide to open a chain of fish shops and restaurants throughout the country.... diversification strategy
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