Farm Support Services

The US farm support services industry includes about 85,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of $15 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 revenue per worker for a typical company 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, crop farm management services, and farm labor contracting 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 ...