TEN Tips to Extra Income with Alpacas – Part 1

Kommander show blanket & fleece still on legs 5-11 pt1Alpacas need to be shorn in the spring before the weather and humidity become intense. The shearing process is not only healthy for your alpacas; it is a source of revenue for your business. If you prepare ahead of time and work with your shearer, you can get maximum return on your alpacas’ fleece.

In this photo you can see that we laid an extra large piece of plastic along side the alpaca’s body so that we could collect the blanket portion in one piece. We did this first before we sheared any other part of his body.

This post explores numerous ideas to make some income while you’re letting your herd grow. Your goal should be to achieve some extra revenue whether you have a small fiber herd or you are starting a breeding business.

Below you will find a list of a few possibilities:

1. Locate a local spinning guild and invite them to shearing day to help and purchase raw fiber.

2. Offer hand spinners the first choice of the raw fiber once it is bagged.

3. Locate local fiber artists and invite them to the ranch to feel your fiber. Show them the different grades of fiber and introduce them to creative ideas of how to use alpaca fiber in crafts projects.

4. Send some of your best fleece to mini-mills and have it converted into beautiful yarn. Introduce your yarn at “Farmer’s Markets”, Craft Faires & Country Festivals.

5. Knit, crochet, felt or weave accessories out of alpaca yarn and start a small farm/ranch Boutique, or take them to the “Markets” & “Faires.”

Here’s a link to our web store. We have it linked through our Ranch Home Page: http://alpacasav.com/alpaca-boutique/

[Side note: Even though I live in a warm & sunny climate, I’m still successful selling my yarn and hand made items at local Faires & Open Aire Markets especially from September through April. The rest of the year I devote to making more items to sell.]

So, with a modest initial investment, you could easily bring in several thousand dollars during the eight months of the year that you are promoting your alpaca items.

It’s a good plan to spend the other months creating items to sell. Or fix up your place so that you can invite the public to see your alpacas and take tours.

These are just a few ideas to get you started thinking about the potential for your situation. In the next post I will continue to explore other possible ways to bring in revenue with your alpaca business.

Julie

PS: Do you have an idea that you would like to share? Please post your comments below.

[Update] Section 179 Year-End Tax Planning for Alpacas

One Last Day in 2012

One last day to make a difference in your tax savings.

alpaca-brothersI found a news alert dated Dec 18, 2012 on the website Section179.org about some important tax planning implications updated for the 2012 tax year-end. Here is a reprint of a portion of it.

Even if you are not going to make a purchase today, I want you to think back about the purchases you have made over the year. There may be some qualified purchases in 2012 that you could claim for the Section 179 immediate deduction.

The main thing to remember is that alpacas qualify as used capital equipment even if you have only made a down payment so far this year. Other purchases you might have made to build your alpaca business could possibly qualify as well. To be sure, check with
your accountant about the details.

I just want you to have every advantage possible for your alpaca venture.

Here is the 12/18/12 article:

“Both the ‘Tax Relief Act of 2010’ as well as the ‘Jobs Act of 2010’ that passed in late 2010 affected Section 179 in a positive way for this 2012 tax year. Following are the highlights for the 2012 tax year:

To take advantage of this deduction, your Section 179 Qualified Financing and your equipment must be in place on or before December 31, 2012.

2012 Deduction Limit = $139,000
Section 179 Deduction limit after adjustment for inflation has increased to $139,000 (maximum allowance would have been only $25,000 prior to the new legislation).

2012 Limit on Capital Purchases = $560,000
Section 179 Threshold for total of equipment & software that can be purchased has increased to $560,000 (threshold would have been only $200,000 prior to the new legislation).

2012 Bonus Depreciation = 50%
The new law allows 50% “Bonus Depreciation” on qualified assets placed in service during 2012

Section 179 Deduction is available for most new and used capital equipment, and also includes certain software.

Bonus Depreciation can be taken on new equipment only (no used equipment, no software)

When  applying these provisions, Section 179 is generally taken first,  followed by Bonus Depreciation – unless the business has no taxable profit in 2012.”

Please Note:

Did you know that right now the projected 2013 Deduction Limit is sitting at $125,000 as the maximum amount you can deduct, and that’s going to fall to $25,000 in 2013. I really hope our leaders see that $25,000 just isn’t going to cut it and give Section 179 a nice bump up in 2013. They’ve done it before.

May you have an even better year ahead!! And if you haven’t started your alpaca venture, may 2013 be the year that you make your dreams come true. I’ll be here to share with you more valuable information from the alpaca community.

All the best,

Julie

Julie Roy
951-763-4222 (Pacific time)
Julie@AlpacasNextDoor.com

ProfitingWithAlpacas.com
AlpacasAV.com

September 11th Miracle

Hi Alpaca Enthusiasts,

I have something a little different to share with you today – September 11, 2012.

Tears, destruction, clouds of dust. Firemen, policemen, paramedics, ordinary citizens – all heroes. These are the images forever tucked into the most delicate corners of our minds.

Where ever you were – what ever you were doing… It’s impossible to forget all the feelings associated with that day.

Like the sound of silence that seized family rooms across the country. Loved ones huddled together around TV news reports – just staring in disbelief at the devastation. And the serene, eerie feeling of the unknown about our future.

No doubt about it, on September 11, 2001, a nation changed. It was…

The Day America Came Together

No more Republicans, no more Democrats. No more sports rivalries. No more arguing and yelling “talking-heads” on TV.

Just a deep, dark somber feeling of shock, sorrow, confusion and empathy and love for our families and fellow men and women.

The enormous weight of the tragedy urged every American to reach out to anyone who’d left footprints on their heart. I know I did… I’m sure you made different choices that day too.

Amid all the stories that have been written about that day and the aftermath, I felt very inspired by the following story of one tiny symbol of hope amid all the destruction.

A Small Miracle Among the Rubble

“In October of 2001, one month into the clearing of the debris, a 30-year old Callery pear tree was discovered.

It was badly burned, and had but one living branch. But the 8-foot tall stump of a pear tree, nonetheless, was still alive.

Soon the tree, covered in ash, was moved to a nursery in the Bronx where it wasn’t expected to survive.

But in the spring of 2002, that Callery pear tree now deemed “The Survivor Tree” showed new growth. And it continued to grow in its new home for years, even when temporarily uprooted during a storm.

In December of 2010, at a new height of 30 feet, “The Survivor Tree” was replanted at the World Trade Center memorial.

Keating Crown, who escaped the 100th floor of the South Tower before it collapsed, said of the miracle pear tree:

‘It reminds us all of the capacity of the human spirit to persevere.’

We depend on the capacity of the human spirit to persevere. It’s vital to our success as a people, a nation, and a globe that we keep on moving forward.

Despite heartache, despite destruction, despite tragedy…”

Times are somewhat different today than they were following 9/11; with some new struggles and new crises. I started my professional coaching certification that week and immediately jumped into the new crises at hand serving my clients.

As I look back, that’s when the seed of a new lifestyle planted itself in me. Though it took another two years to start the action that would later become our “Alpaca Lifestyle”, I relate to the story of “The Survivor Tree” in a very deep way.

So, wherever you are on your “Alpaca Lifestyle Path” remember the callery pear tree and the spirit to persevere.

Thanks for reading, and take care on this special day.

Your Alpaca Friend,

Julie Roy

Small Alpaca Farm with Big Returns

Recently the news endorsed the numerous benefits of raising alpacas as an investment. And for people who need tax deductions, it is a sensible venture that can earn them a huge ROI (return on investment) over time. Yet, that’s not the whole story. (CBS SUNDAY MORNING – http://www.cbsnews.com/video/watch/?id=7403164n)

Let me ask you a few questions. Are you looking for a small farm business with big returns? Have you researched all the agricultural benefits of raising livestock on your land? Have you considered raising sheep, goats, or cattle in order to take advantage of the benefits? Have you hesitated to proceed?

Well, if you are like me (a city dweller until 2004) the thought of killing something, milking something or cleaning up after big animals stopped me in my tracks! So we never imagined ourselves as “farmers” until we met alpacas and the alpaca farm business idea launched.

The goal of many small farm businesses is to “just cover expenses.” We have been doing more than “just covering our expenses” with a handful of alpacas since our 3rd year in the business. And now, over 7 years of alpaca farming, we are living proof… you can have a small group of very clean, cute, amusing critters, make a small profit with a relatively tiny up-front investment and you can even take time off for a little travel, see the grandkids, or go to a show if that’s your goal.

Presently we live in the country, deduct our legitimate agricultural expenses, use depreciation and other tools to offset other income and lower our property taxes through agricultural classification of our land.

Can you name another livestock business where you can make a profit with less than 20 animals? Can you do this with alpacas? Absolutely!

Alpacas for Fun and Profit

After watching the show on March 25th entitled Alpacas for Fun and Profit on CBS SUNDAY MORNING – http://www.cbsnews.com/video/watch/?id=7403164n I realized how much I related to the story of Amber and her alpaca lifestyle. She got into the business just before the prices started dropping (fall 2007.) So instead of panicking, she took advantage of the high quality alpacas available at lower prices and grew her herd and her income potential. As she recounts, her income over a 5 month period was greater than she had made the 2 years previously in the theater.

In 2009 our situation turned to “creative solutions needed” in order to keep our business growing. We started promoting “multiple services” from our ranch. We offered agisting (board & care), breeding and birthing services. We got a main stud and started filling his dance card with introductory breedings which have now grown in number, demand and dollar amount per breeding. We also increased our internet presence and educational products offered.

Another income focus we started is to proudly display, retail and wear alpaca accessories made from our own alpacas. Visitors to our farm love the idea they can take a photo of the alpaca which contributed the fiber made into the luxurious scarf or hat. And we are not alone, as word is spreading; more small alpaca farms are setting up “cottage industry” outlets and reaping the benefits of raising this gentle livestock.

So, whether you are looking for a business with numerous tax benefits, agricultural savings for your land use, an outlet for your creativity, or just pure enjoyment… alpaca farming could be in your near future.

If you are already a part of our industry, then take this opportunity to review your situation and make sure you are taking advantage of all the alpaca farming deductions you are legitimately entitled to at this time. Then go out in your field and smile at your alpacas.

Alpacas in Small Spaces…

 Alpacas in Small Spaces – Are They Too Crowded?
In this photo, you can see that all are eating together peacefully... for a short time.

In this photo, you can see that all are eating together peacefully... for a short time.

As I write this we are experiencing the 4th consistent day of rain and preparing for SNOW. This fact alone may not be newsworthy; however, we live in southern California! What I’m observing with my alpaca females applies whether you live in moderate or extreme climatic regions. It applies whether you raise your alpacas on pasture or in a dry lot environment. At times you may have to change their eating conditions, make other arrangements and possibly crowd them in for a short time. Now the question is: how do you know if they are too crowded?

The simple answer… I listen! That’s right; I observe and listen from a distance to figure that out. What I’ve observed boils down to … if they’re crowded they’ll do a lot of quibbling, a lot of spitting and posturing over who’s going to get to the feeder first and stake their claim. 

I count on enough space so that every single alpaca can be at the feeders all at once, without feeling crowded.  Best advise – just keep adding feeders, creating multiple feeding stations until you achieve that. And when the rains came and they all wanted to be inside at once… that’s what we chose to do. Normally these 12 wander among 3-4 other feeding stations… and they come and go at their will.

If you find yourself questioning the crowding issue in small spaces, then just spread out the feeders so that every alpaca could eat all they want simultaneously. You might consider creating special feeding areas for the cria – if they get squeezed out from the adults. Alpacas are extremely adaptable and that is why they make a great livestock business. You can start out small and expand as your needs arise. Your alpacas will let you know if they have outgrown the feeding arrangements!