A Taste of Life at Windrush Alpacas

December 21, 2007

Alpaca Farming on a Budget

Filed under: alpaca, Alpaca Care, Alpacas, camelids, Crias, General — Tags: , , , — alpacalady @ 7:28 am

I recently received an email through our website that asked the following question:

“I was especially intrigued by the comment in the site that you built your farm on a budget.  Please tell me how.  I’m living and working outside Atlanta and have always wanted to live on a farm.  I’m becoming fascinated with alpacas and am looking for various options to finally make my farm dream come true.  How did you do it?”

The question is one we are often asked, there are many people who would dearly love to have alpacas but cannot see how they can afford to and be able to cover the operating costs of their farms as well. 

When we first started looking at alpacas we too thought that there was no way we could manage to establish an alpaca farm, but having decided that we really wanted alpacas to feature in our future plans we started researching ways that we could be creative and save costs to help us reach our goals.

It will probably take me a few posts to cover this subject adequately, but hopefully the information will be helpful to those looking to get into the alpaca business.

To have a successful alpaca business on a budget you have to be creative, you may end up taking a longer route than others to get to your goals, but the key I feel is to keep your eye on your end goal and keeping working steadily toward it.  It may take you longer than others to build your business, but it can be done.

One piece of advice we have always passed on to our clients is to always buy the best alpaca you can afford.  This has always applied to the alpaca industry and applies even more so today as the alpaca community becomes more knowledgeable of desirable traits in alpacas and the quality of alpaca continues to improve dramatically.  As you make your plans to start your alpaca business, make sure you plan enough time to learn about alpacas prior to making your first purchase.  There is a lot to learn and you will not be able to learn it all overnight, we took 18 months researching and learning before purchasing our first alpaca, and the average new alpaca buyer spends two years researching prior to making their first purchase.  It is oh so easy to let your heart rule your head when buying alpacas, but remember that you are making a significant investment (both financially and in your commitment to taking care of your alpacas) and you need to be adequately prepared before you make your first purchase.

We were fortunate that we had sold some real estate prior to becoming interested in alpacas and that allowed us to purchase our first alpaca outright.  I had initially intended buying two older females, but then I came across Jenny, a young pregnant female, and knew as soon as I looked at her that she was what I wanted to establish our herd.  I decided to go for quality over quantity and thus it was that Jenny became our first alpaca.  I have written about Jenny before in this blog, but she was the cornerstone of our breeding program and never failed to produce an outstanding cria.  Certainly the decision to go for one female of high quality rather than two females of lesser quality paid off for us.  The fact that we had cash to pay for Jenny in full also allowed us to negotiate a discount on her price, which is often the situation when buying alpacas.

But what if you cannot afford to purchase an alpaca outright, what do you do?  Well there are a few ways you could go.  You could obtain financing from a bank or financial institution, but to be honest not many banks will finance the alpacas themselves so unless you are lucky and have a lenient bank, that option is not usually a viable one.  I have heard of people taking an equity loan against their home to purchase their alpacas, this makes me nervous, perhaps because I am somewhat conservative, but to risk your home against buying into an industry that you are brand new to is a significant risk.

Some people borrow money from other family members, or perhaps sell some assets that they own.  It may be that you may not be able to raise enough money to buy that stunning show winning alpaca that you came across on a farm visit, but maybe you have enough to purchase her dam or grand dam.  Older dams are usually less expensive and come with the added bonus of having a proven track record when it comes to breeding, birthing and milk production.

Another option is to finance the alpaca though the seller.  Many alpaca farms offer financing on their alpacas and usually at a very competitive rate.   Some form of down payment will be required and there will also be a contract to be signed outlining the details of the financing. 

Typically when an alpaca is financed the seller retains possession of the alpaca until the contract is paid in full, some buyers aren’t too thrilled about that prospect and are anxious to get alpacas on their property, but you can really use that time to your advantage.  Take that time to use your capital to set up your farm, fencing and barns all take money and with your alpaca safely agisted at the farm you are purchasing her from you do not need to rush your planning and construction of your farm and farm buildings.  The time that you are agisiting your alpaca is also a great time to learn more about the management and day to day care of alpacas.  We agisted our first alpaca until our property was ready, but used to visit her every month and spend a day at the farm where she was agisted.  We learnt so much in that time period including many small tips that you would never find written in a book; that time prepared us well for the day that we finally brought our alpacas home.

If none of these options work you still have the option of purchasing some fiber quality males.  These boys are usually significantly less in price and are a good way to learn about managing alpaca on a daily basis.   After a time with them you will be able to decide if alpaca farming is still for you and if you really do want to raise alpacas.  Fiber males will still produce fleece that can be harvested and marketed, so there will be some income from them too, but not the level of income that you will receive from selling breeding stock or

breedings.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

So that is an introduction to starting an alpaca farm on a budget.  Tomorrow I will write about other things you can do to keep your costs down while still remaining effective.  Of course as with any of my posts, if this post prompts other questions please feel free to post a comment to the blog or drop me an email.  I look forward to hearing from you.Rosemary

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