How to Start an Egg BusinessNov 10, 2020
Working toward a sustainable lifestyle is an intricate part of having a homestead. An important part of that sustainability is to produce and manage your own food supply and too effectively manage your income. If you are actively working your homestead then why not use it as a source of income? One easy way to do that is to start an egg business.
One of the best parts of getting started with poultry is that it is easy, inexpensive, and there is a short learning curve. There are a number of different ways to make money with poultry. However, starting an egg business is one of the easiest. An egg business is easy to mange logistically, financially, and legally. It is also extremely easy to start on a small scale.
Starting an Egg Business
Due to increased awareness of the health benefits of consuming farm fresh eggs, the market for these eggs continues to grow. According to the American Egg Board (AEB) the per capita consumption of eggs in the United States was 279 in 2017. And this figure continues to rise. So, the market demand exists.
Even with a small flock of a dozen egg layers, after a few months they will produce far more eggs than two to three people can eat. This is what happened to us. We started selling eggs to people we knew. We then added more birds to our flock, which was really not any extra trouble. Before we knew it, our chicken operation was not only paying for itself, but we were making a little extra money. We sell at $4/dozen in Colorado but market price will vary depending on where you live.
You may not exactly get rich selling eggs. However, if you do a little research and know your local market, you can make a tidy little profit with a small flock. Our start in the egg business was somewhat accidental.
Tips on Starting an Egg Business
We started out with just a few laying hens to produce eggs for ourselves. Even then, we were always ending up with more eggs than we could consume. Our egg business started by selling an occasional dozen eggs here and there. But once we started seeing a profit, we decided to expand little. Now we only have a dozen hens and they consistently produce more eggs than we can consume. We do not make a lot of money doing this. But our small flock pays for itself.
Know Your Local Market
Depending on where you are there could be a shortage or an over abundance of farm fresh eggs. If you are in a small town or a rural area, a lot of other locals may be raising chickens with same idea that you have. But, if you are more urban and dealing with a local food co-op, they may have a much higher turn over. So it is important to determine up front where and how you are going to sell your eggs.
Consequently, if you want to get into the egg business, it is important to first investigate and define your local market. Can you line up buyers prior to your hens even hatching eggs? Can you sell at local farmers’ markets or through a CSA program? Or perhaps you do not even want to go that far just yet. To keep it even more simple, set up a network through family and friends. This is often the easiest way to start. This is what we did. Word of mouth recommendations worked great.
Know the Laws
Contact your local county extension agent or your local state poultry or agricultural specialist. They can be a great initial resource to learn about local, state, and federal laws regarding your egg business. This is especially important if you want to make specific claims about your eggs. Also, keep in mind that if you want to use the “organic” label, you are going to have to jump through a lot of hoops and pay a lot of money to use that label.
Depending on where and how you sell your eggs, you may be required to set up egg washing facilities. You may also be prohibited from recycling egg cartons from other manufacturers in order to package your eggs.
Write a Business Plan for Your Egg Business
Once you investigate your local market and the legal aspects of selling eggs, the next step is to write a business plan. A little forethought and planning will go a long way toward ensuring the success of any business. This still holds true even with a small scale egg business.
Even if you are going to keep things on a small scale, sit down and go through the basic steps of writing a small farm business plan. It will help to identify your local market, set the price of your eggs, look at distribution costs, and what it will actually cost to produce your eggs.
The business plan can be very informal. If that is the case, maybe this is something that only you will see. But if you have much bigger aspirations and want or need to borrow money, this plan will have to be a lot more formal.
If you have never done this before, then read my post Making Money on the Homestead: How to Write a Small Farm Business Plan
Estimate Your Start Up Cost
Baby chicks are inexpensive to purchase. Waters and feeders are also inexpensive. What can get expensive is the initial cost of housing. Even a small barn facility can be upwards of a thousand dollars. Or you may opt to start with a small homemade chicken tractor.
The shelter that is needed is dependent on your geographical location. Chickens need to be protected from changes in the weather as well as from predators. If you are starting from scratch, you may have to spread the start up costs over several years in order to actually turn a profit. If you have good carpentry skills, you can save a lot of money by building things yourself.
Decide How Many Eggs You Want to Sell
This is where your business plan will help. How many eggs you want to sell determines how many chickens you need. First decide how many dozen eggs you want to sell each week. The average backyard hen lays between 3 to 5 eggs per week. Expect that the average well fed backyard chicken is going to lay around 250 eggs the first year.
For example, if you want to sell 10 dozen eggs per week, that is 120 eggs. Divide that total by 4 eggs/chicken/week = 30 egg laying hens.
Next you need to total up your production costs. Total what it costs to feed each month plus any other related expenses. Divide that by how many dozen eggs you plan to sell. This will give you a production cost per dozen eggs. Now price each dozen well above your break even point so that there is a profit margin for your egg business.
Purchase Your Chickens
It goes without saying that a successful egg business depends on reliable egg production. Consequently, you need to purchase birds that are the best producers. There are many possibilities to choose from depending on your goals.
The best egg layers:
- White Leghorns: white eggs
- Rhode Island Reds: brown eggs
- Plymouth Barred Rock: brown eggs
- Ameraucanas: blue eggs
Dual purpose birds (eggs or meat)
- Buff Orpingtons
- Sussex breeds
- Barred Rock
Raise Your Chickens
When choosing the breed of chicken that fits your needs, you not only need to consider egg laying ability, but you also need to look at hardiness as related to your local climate. For example, if you live in a cold climate then choose a breed that is cold tolerant. If you live in a hot climate, choose a breed that is heat tolerant. If you live at a higher elevation, stay away from heavy bodied birds.
Chickens generally starting laying their first eggs at about 18 weeks of age. The first eggs they produce are generally much smaller than a standard size egg. The eggs then slowly get larger and larger. What this means is that if you purchase baby chicks, it is going to be around 5 to 6 months before you are producing eggs consistently.
If you want to get a little bit of a head start, then purchase a few older birds. Four week old birds are easy to find. You can also search your local markets via the internet. These birds of course will cost you a bit more. But at least you can start producing eggs a bit sooner even if the eggs are only for your family.
Estimating Feed Costs
A successful egg business means managing your costs effectively. Feed cost is a large factor. There are a variety of factors that are going to affect the amount of feed consumption per bird. Weather, ambient temperature, and access to other food sources (pasture, free range) are a few examples. But, in the interest of your small farm business plan, below are some general guidelines of what to expect. Included are several different types of birds just for the sake of comparison.
Feed Consumption for Newly Hatched Birds
- Laying hens: 9 to 10 pounds/bird in the first 10 weeks
- Broiler chicks: 8 to 9 pounds/bird in the first 6 weeks
- Turkeys: 71 pounds per bird in the first 12 weeks
- Geese: 54 pounds/bird in the first 8 weeks
- Ducks: 23 pounds/bird in the first 8 weeks
- Game birds: 9 pounds/bird in the first 8 weeks
Feed Consumption for Laying Birds
- Chickens: 1.5 pounds/bird/week
- Turkeys: 4 to 5 pounds/bird/week
- Geese: 3 pounds/bird/week
- Game birds: 1.5 pounds/bird/week
Keep in mind that feed costs can be reduced by free ranging birds. To produce the best quality eggs, hens need a variety of things in their diet. This can be a combination of commercial feed, grit, greens, bugs, high calcium oyster shells, and even occasional diary products. A varied diet such as this will produce eggs with strong shells, dark yolks, and excellent flavor.
What to Expect for Egg Production
Consistent egg production is a sign of a healthy laying hen. Laying hens will generally produce their first egg at 18 weeks. It takes about 24 to 26 hours to produce each egg. For the first year, you can expect about one egg per day from each hen. Egg production generally slows down in the fall as the days get shorter. This also corresponds with the time of year that most chickens are molting. However, if you want to keep egg production consistent then add supplemental light. Use a full spectrum light bulb to give the chickens a total of 14 to 16 hours of light per day.
Higher producing egg layers are going to produce around 250 eggs their first year. Egg production will naturally decrease every year after that. Most laying hens are going to enter retirement at about 6 or 7 years.
Yearly egg production is going to go something like this:
100% egg production is considered 1 egg/hen/day. However, 80 to 90% egg production is considered excellent. Additional there are several factors that are going to affect egg production. For example, weather, nutrition, parasite load, management, housing, breed type are all things that will affect a hens egg production. Keep in mind that egg counts are naturally going to decline as hens get older.
- Year 1: 100% (250 eggs per hen)
- Year 2: 80% (200 eggs per hen)
- Year 3: 70% (175 eggs per hen)
- Year 4: 60% (150 eggs per hen)
- Year 5: 50% (125 eggs per hen)
- Year 6: 45% (112 eggs per hen)
- Year 7: 35% (88 eggs per hen)
Strictly from an egg business production point of view, you should retire your laying hens after they pass their prime. Most larger production operations will cull laying hens at 2 years. This is strictly due to economics. As long as hens are laying at their prime, they are paying for themselves. Once they pass that prime, it cost more money to maintain them. Consequently, they loose money. This is why they are culled.
However, for a smaller operation, you can at least keep a laying hen for three years, maybe longer. But keeping consistent egg production requires a little planning. Prior to culling any hens, start introducing new members to the flock and get them up to speed with egg production. Then cull the older hens and sell them as stewing hens or use them for family consumption.
Collecting and Cleaning Your Eggs
Collecting eggs in a timely manner can prevent several problems. If at all possible, collect eggs twice daily. For one thing this will help prevent fecal staining and reduce the cleaning process. It will also prevent other chickens from stepping on the eggs and breaking them as they enter the nest box. Broken eggs not only stain other eggs with yoke but they are also a tempting snack for other birds. Cleaning nest boxes of yoke also makes for even more work.
When eggs are collected, check the nest boxes for any fecal material or other debris. Clean out any soiled straw and replace it with plenty of clean material. Keeping lots of padding in the nest box will also help prevent breakage. Clean, fresh nest boxes encourages chickens to lay their eggs in the boxes.
Properly cleaning the eggs also ensures they are fresh and safe for handling and consumption. In the egg business, there are two ways to clean eggs: dry cleaning and wet cleaning.
Dry cleaning: This is the preferred method. Eggs naturally have an antibacterial layer on the shell, which is called the bloom. If left intact, you can store the eggs unrefrigerated. Dry cleaning is performed by just wiping the outside of the shell with fine sandpaper or an abrasive sponge to remove any dirt or fecal material.
Wet cleaning: If the outside portion of the egg has an excessive amount of debris, such as dried yoke or fecal material, wet cleaning is likely necessary. This is done by rinsing with slightly warm tap water. Once the egg is clean, dry it throughly with a towel and disinfect the shell with a dilute bleach solution. Dry the egg in a rack before storing.
If you plan on selling your eggs at a local farmers market, check with your county extension agent about proper washing techniques prior to selling to the public.
After the eggs are clean, they should be placed in cartons with the date they were collected. Eggs will last longer if they are refrigerated. However, dry cleaned eggs can be stored at room temperature. Eggs are considered good for one month after the collection date. But, if they are older than that, then use them for baking or hard boiling.
If the freshness of an egg is in question, perform the float test. Place the egg in a bowl of water. If it floats, it contains a large air pocket. This means that a good portion of the contents has evaporated and it is likely spoiled. If it sinks, you’re good.
Packaging and Selling
Some states prohibit using recycled egg cartons for packaging. Be sure to check the local laws. If you have a logo for your egg business, then attach it to the carton. Doing so may help with future sales by establishing your brand. Most likely the eggs are going to have to be labeled with the date collected, your name, business name, address, and maybe your phone number.
Also, be sure to price your eggs accordingly. Figure your production cost per dozen and set your price well above the break even point.
Possible points of sale for your egg business may include any or all of the following:
- Local farmers markets
- Locally owned grocery stores
- CSA programs
- Friends and neighbors
- Putting a sign stating “farm-fresh eggs” at the end of your driveway
- Placing an “honor” stand at the end of the driveway.
On-going Business Assessment
Even with an business, it is necessary to keep track of income and expenses on a regular basis. Make sure that you are sticking to your original business plan and you are actually turning a profit. If this is not the case, you need to reassess your market position, perhaps even decide if the egg business is something you want to continue.
Keep in mind that you are not going to get rich with a small scale egg or poultry business. It may only be a small part of your over all homestead strategy. But if it is successful enough that it is financially sustainable, meaning it pays for itself, then you and your family have a source of fresh eggs and meat that only costs the time of your personal labor.
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