Revenue model and milestones¶

Purpose¶

Describe how money is expected to enter the farm business over ~10 years: supplemental cash first, then operating margin discipline, then—only if metrics support it—a salary-replacement band for the household. Enterprise details on the 120-acre parcel may still move (stocker vs cow-calf, lease share, etc.); this page defines streams, horizons, and milestones without inventing your household budget.

Strategy link: Recommended enterprise strategy — phased East Tennessee path.
Milestone worksheet: Revenue milestone model — supplemental to salary replacement.
Hub: East Tennessee two-site farm business plan — planning framework.

Parcel / haul / market evidence (2026-04): Owned-grazing and direct channels remain hypothesis until haul distance, processor slots, and parcel access baselines are field-closed—Claxton and Demory — missing data register, Field verification program — Phase 0–1; ledger Business plan integration revision audit (2026-04).

Decisions supported by this page¶

Decision	This page provides
When to claim supplemental vs material farm income	Horizon table
When salary replacement is even discussable	Milestone rows + years of track
Which streams are core vs optional lift	Revenue architecture
What must be validated before scaling inventory	Pricing assumptions table

Revenue architecture (strategy family)¶

Stream	Phase	Role
Lease / contract (hunting, cash rent, custom graze)	1–2	Supplemental cash; can reduce early owned-herd pressure
Grazing (livestock sales)	2–4	Core operating business on 120 ac
Hay / value-add	3+	Only if equipment or hire is solved
Direct premium	3–4	Margin lift—not required to start

Horizons¶

Horizon	Target character	Notes
Y1–2	Supplemental: lease, small trades, minimal livestock after gates	Off-farm income dominant for most households
Y3–5	Growing operating margin; labor hours tracked	Do not claim salary replacement without 2+ years of books you trust
Y6–10	Salary-replacement architecture if sustained	Household cash from farm ≥ target % of need—fill number locally

Milestone table (fill locally)¶

Milestone	Target date	Metric	Owner
M1 Phase 1 complete		Land intel + go/no-go
M2 First livestock revenue		$ gross
M3 Positive operating cash year		$ after variable costs
M4 Debt service safe ratio		% of gross
M5 Salary-replacement band		% of household need

Pricing and market assumptions (explicit)¶

Item	Assumption placeholder	Validate by
Cattle price	Trailing auction average	Sale bills
Lease rate	County comps	Signed lease or comp sheet; starting 2024 NASS non-irrigated cropland county estimates: Anderson $28.50/ac, Campbell $27.50/ac (`NASS source-note`, `Claxton`, `Demory`)—not your rent
Direct premium	+$/cwt hypothesis	Trial lot

Known facts¶

ID	Statement
K1	Side business with profit intent; 10-year horizon in the plan.
K2	Primary revenue production is expected on the 120-acre parcel, not the 5-acre home base.

Assumptions¶

ID	Statement
A1	Household “salary” need from all sources = $___/yr (fill)—not wiki data.
A2	Tax and depreciation strategy is CPA-aligned (not maintained here).

Open questions¶

ID	Question
Q1	Default exit: auction-only vs direct vs mixed?
Q2	Seasonality of household cash need (school, insurance, debt)?
Q3	Health insurance source if off-farm job ends?

Iterative updates¶

Paste actual P&L lines annually; date each refresh.
When M3 is achieved, add one paragraph of what changed (herd size, channel, cost).