What is Urban Farming and is it Profitable?

What is Urban Farming and is it Profitable?

Urban farming includes a wide array of food-producing projects and activities. And with the recent resurgence of farming in and around cities, people have been reconnecting to agriculture by growing food themselves and visiting farmer’s markets. This fast-growing phenomenon has the potential to nourish communities and create economic opportunities. Urban farming is popular for several reasons such as sustainability, affordability, health, and convenience.

Today urban agriculture exists in many forms including: community and backyard gardens; rooftop and balcony gardening; growing in vacant lots, parks the list goes on.

What is Urban Farming?

urban farming

Urban farming is a term that is often interchanged with other concepts such as community gardening, homesteading, or subsistence farming. However, it’s important to differentiate them. Urban farming primarily aims at cultivating produce for commercial purposes, focusing on selling the yield, rather than growing for personal consumption or sharing, which is the focus of homesteading or subsistence farming.

In contrast, community gardening usually has a broader social focus, often aiming to enhance community connection and wellbeing, as well as growing food.

The practice of urban farming can support the well-being of individuals and communities in numerous ways:

  • Providing fresh produce: Urban farming makes fresh, locally sourced produce more readily available for communities, particularly in urban areas where access to fresh food can be limited.
  • Creating a sense of community belonging: Urban farms often become community hubs, bringing together diverse groups of people to collaborate and share experiences.
  • Job creation: Urban farming initiatives can provide job opportunities within local communities, promoting economic growth and reducing unemployment.
  • Promoting healthy lifestyles: By increasing access to fresh fruits and vegetables, urban farming can encourage healthier eating habits, reducing the risk of chronic diseases.

As a community enterprise, urban farming plays a significant role in stimulating the local economy through job creation, income generation, and fostering the growth of small businesses. Moreover, urban farming makes fresh food more affordable and accessible, positioning it as a crucial component of a city’s food system.

From the stages of production and processing to distribution, urban farming orchestrates a plethora of community benefits. The specific benefits can vary based on the type of urban farming involved, whether it’s primarily for personal consumption, educational, institutional, for-profit, or nonprofit.

Regardless of the model, successful urban farming projects necessitate considerable planning, commitment, and a thorough understanding of local community needs.

Space and pollution are significant challenges for urban farmers, particularly in densely populated areas. These challenges, however, often serve as catalysts for innovation, prompting urban farmers to devise new farming strategies and adopt technologies like vertical farming, hydroponics, and aeroponics.

Despite these hurdles, urban farms have a distinct advantage due to their proximity to local restaurants and supermarkets, allowing them to supply fresh produce faster and easier, ultimately reducing food miles and ensuring the delivery of fresher, more nutritious produce.

Is Urban Farming Profitable?

Urban farming can be profitable, but its success largely depends on various factors such as location, scale of operation, types of crops or livestock raised, and market demand. Urban farms can benefit from reduced transportation costs and direct access to local markets, which can increase profit margins. However, challenges such as limited space, higher land costs, and urban regulations can impact profitability.

To enhance the profitability of urban farming, consider the following tips:

  • Specialize in High-Value Crops: Focus on crops that are in high demand and have higher market prices, like organic vegetables or exotic herbs.
  • Utilize Vertical Farming: Maximize space by growing crops in vertically stacked layers, which can increase yield per square foot.
  • Adopt Innovative Techniques: Implement hydroponics or aquaponics to improve efficiency and productivity.
  • Direct-to-Consumer Sales: Engage in direct sales to consumers through farmers’ markets or community-supported agriculture (CSA) to eliminate middleman fees.
  • Community Engagement: Host educational workshops or tours to create community involvement and generate additional income.
  • Diversify Product Offerings: Expand into value-added products like preserves, pickles, or herbal infusions to increase revenue streams.
  • Leverage Technology: Use smart farming technologies for precision agriculture, optimizing resources and increasing yields.

By strategically addressing these areas, you can potentially increase your profitability and sustain successful urban farming ventures.

How to Get Started

Do Your Research

The initial step in embarking on your urban farming venture is to comprehensively educate yourself on best practices in the industry. This includes exploring different farming techniques, understanding soil and plant health, and researching sustainable farming methods.

A good place to start would be online platforms, books, webinars, and workshops on urban farming.

Additionally, each region or state may have unique rules and regulations related to farming in urban areas, so it’s crucial to check your local, state, and federal laws for necessary permits and restrictions. This might involve understanding zoning laws, health and safety regulations, or obtaining specific licenses for selling. produce.

Here are some important ways to do your research:

  • Study Local Climate and Soil Conditions: Research the specific climate and soil conditions of your urban area. Understanding local weather patterns, seasonal changes, and soil types is crucial for selecting suitable crops and farming methods.
  • Explore Urban Farming Techniques: Familiarize yourself with various urban farming techniques like hydroponics, aquaponics, container gardening, and vertical farming. Each method has its advantages and challenges, so choose one that aligns with your space, budget, and goals.
  • Understand Legal Regulations: Investigate the legal aspects of urban farming in your area. This includes zoning laws, permits for selling produce, health and safety regulations, and any restrictions on the types of crops you can grow.
  • Market Analysis: Conduct market research to understand the demand for certain types of produce in your area. Identify potential customers such as local restaurants, farmer’s markets, and community members. Also, analyze pricing strategies and what other urban farmers are successfully growing and selling.
  • Attend Workshops and Training Programs: Look for workshops, webinars, and training programs focusing on urban agriculture. These can provide valuable knowledge about sustainable farming practices, pest control, crop rotation, and other essential farming skills.
  • Network with Other Urban Farmers: Connect with other urban farmers in your community or online. They can offer practical advice, share their experiences, and may even collaborate on larger projects or community initiatives.
  • Learn About Sustainable Practices: Research sustainable and eco-friendly farming practices. This includes understanding how to use water efficiently, composting, using organic pesticides, and reducing your carbon footprint.
  • Identify Potential Challenges and Solutions: Prepare for potential challenges such as limited space, water access, pollution, and funding. Research how other urban farmers have overcome similar obstacles and consider innovative solutions like community partnerships or technology integration.

Identify the Urban Farming Project and Define its Purpose

Before plunging into your project, it’s vital to clarify your purpose and set clear goals.

Start by identifying your target customers – are they health-conscious individuals, restaurants seeking locally sourced produce, or neighborhood markets?

Next, decide what produce to cultivate considering factors like local climate, demand, and your personal interests.

Also, plan your distribution strategy, taking into account logistical aspects such as transport and storage. Research the existing market, including the popularity of urban farming in your area, price ranges, and customer preferences. This information will prove crucial to the success of your business.

Engage the Community

Becoming an urban farmer is not a solitary journey. Involving community members and friends can help identify local needs and desires, contribute diverse ideas, and build valuable networks.

Hold informal meetings or community gatherings to discuss your plan and hear out potential customer preferences. Engage with local community centers, schools, or sustainability groups to create a sense of shared ownership and support for your project.

Here are some ways you could engage the community:

  • Conduct Community Surveys: Gather community input through surveys to understand local food preferences and dietary needs. This helps tailor your urban farming project to meet the specific demands of the community.
  • Organize Community Workshops: Host educational workshops on urban farming techniques and sustainable practices. Collaboration with local experts enhances community involvement and spreads awareness about the benefits of locally sourced food.
  • Establish Community Partnerships: Forge partnerships with schools, community centers, and non-profits. This integration facilitates community engagement and provides hands-on farming experiences.
  • Create Educational Programs for Youth: Develop programs targeting children and teens to educate them about urban agriculture and healthy eating habits. Activities like field trips to the farm and interactive sessions can significantly raise awareness among the younger generation.
  • Utilize Social Media for Engagement: Leverage social media platforms to share updates, educate, and engage with the community. A strong online presence can help build a supportive community around urban farming and keep them informed about various activities and progress.

Check out the Competition

An important aspect of urban farming is understanding the competition. This involves visiting existing urban farms, understanding their business models, and learning from their experiences.

How do they grow their produce? What unique selling points do they have? This gives you an idea of how your project can be the same or different.

Connect with other urban farmers; they can provide invaluable lessons they have learned from their journey.

Plan how to be Profitable

Developing a viable business model is an essential step in your urban farming project. Identify your customer base and determine what you will produce that will attract them.

Decide on your sales strategy: will you be selling directly to consumers through a farm stand or CSA (Community Supported Agriculture), supplying to local restaurants, or participating in farmers markets?

Establish the type, scale, and method for the project. Will it be vertical farming of microgreens, which is space-efficient, or will it involve aquaponics or hydroponics systems that minimize water use?

Maybe you want to go for organic farming to cater to a specific market. Consider starting small, such as growing in a small plot or rooftop, to test the market, gain experience, and reduce initial costs.

Then, if you see the demand growing and can maintain the quality of your produce, consider gradual expansion. Always remember, success in urban farming, as with any business, requires careful planning, perseverance, and a keen understanding of your customers’ needs.

What Types of Urban Farming are There?

More and more people are pursuing urban agriculture as a business venture. Focusing on niche markets, higher-margin products, and specialized services. Some urban farming enterprises are successfully negotiating the profit landscape.

Start-up expenses for an urban farm can vary widely depending on location because many of the components (such as land or utilities) are site-specific. Start-up expenses can be broken down into a few categories, location, site preparation and structures.

Structures include both infrastructure necessary for growing (such as high tunnels) and storage (such as a cooler). The type of structure you need will depend on location, types of crops grown, and the length of the growing season.

Vegetable Landscaping

Also called edible landscaping, this includes mixing flowers and vegetables throughout the garden. This allows for flexible opportunities with a small startup capital. Your investments will mostly be investing in tools to grow vegetables either on freshly tilled soil or in containers.

You have wide repertoire of plants to work with from herbs, onions, garlic, to strawberries and even fruit trees.

Products and Services

Besides your urban farm, you can generate another revenue line in your business through providing seedlings and compost. With a growing market for environmentally friendly products and services, many are starting to look at waste in a new way.

Composting today is no longer a method of disposal in rural areas. It is fast becoming a common way to manage waste and produce a usable product- creating a viable business opportunity. Your customers could be landscaping companies as well as fellow urban farmers.

Hydroponic Farming

Hydroponics is the process of growing crops with nutrient-rich water kept in contact with the plant roots without using soil. This process is touted to significantly reduce the risk of wastage and pollution that can harm the produce and cause diseases, making it popular to health-conscious consumers.

A well-designed hydroponic system is characterized by less wastage of water and nutrients than soil-based farms. Both water and nutrients are fed directly to the root structure of the plants and recycled through the hydroponic system. This also eliminates the typical land and water pollution possibilities due to overland flow and runoff.

Mushroom Farming

Mushrooms are relatively easy to cultivate. A profitable mushroom will depend on knowing which mushroom strain to cultivate and how to maximize your production. Growing mushrooms doesn’t require a full-time commitment.

You can still have a full-time job, and produce enough to become a steady supplier to other businesses. Mushroom farmers harvest an average of 25 pounds of produce per square foot every year. Prior to harvest, contact local restaurants and take orders from them for a quick sale.


Beekeeping can help you produce extra products for you, as well as having other indirect benefits like making your existing crops better pollinated. Having bees around your vegetable plants will dramatically increase your yield.

You will however need to do a thorough research before embarking in apiculture. You will need to consider the size of the bee colony, the health of the work force, weather conditions, the availability of nectar for the bees to collect will affect your bottom line.

Rooftop Tea Gardens

Finding the right amount of space is often a challenge in cities. Rooftop gardens provide a solution for those with an inclination towards trying their hand at urban farming but don’t have a plot of land to use. By starting a rooftop tea garden, you can grow a variety of aromatic and medicinal herbs and greens to sell directly to your customers.

Urban Chicken Farms

chickens on an urban farm

Backyard chicken keeping is an easy and popular way to get into urban farming without spending a lot of money or the need for a lot of space for gardening. Chickens require relatively little space for the number of eggs and meat they produce and are easy to care for. Therefore you can initially start by investing in a modest chicken house in your background and gradually grow in capacity.

Organic Farming

Generally speaking, organic farming is a method of raising crops and livestock and has evolved into a niche of its own. A growing number of restaurants and supermarkets market specifically for organic produce.

These businesses rely on organic farmers to supply them with organically grown fruits and vegetables and organically raised, or free-roaming livestock. Organic farming is highly sought because they provide customers with safe, wholesome food from a toxin-free environment.

Flowers Growing

If you know your roses and lilies well and have a green thumb, perhaps you should look into growing flowers. There are ample avenues you can pursue from selling to florists (cut), for nurseries, direct to the public and others. Growing flowers can also dramatically increase the yield of your land.

Cannabis Farming

If you live in a state where cannabis use is legal, you might take advantage of the available space and start your own small cannabis business. If you have a large backyard it can helps keep your investment low, while giving you a flexible space with which to work. You can also grow your business by building a small greenhouse.


Beyond selling simply farm produce, you can also venture into value-added products. By transforming the raw farm products into food, personal care, craft products and more. Value added products can help boost your income and expand the market season.

Deciding to get involved in creating new products generally calls for a long-term commitment in that it requires additional capital for infrastructure, compliance with food safety and labeling requirements, liability insurance, and marketing.

Type of Urban FarmingBrief DescriptionStartup NeedsPotential Revenue Streams
Vegetable LandscapingMixing flowers and vegetables throughout the garden.Investment in tools for tilling soil or containers.Sale of a variety of vegetables, herbs, and fruits.
Products and ServicesSale of seedlings and compost as an addition to the urban farm.Facilities for composting and seedling production.Revenue from sale of seedlings, compost, and waste management services.
Hydroponic FarmingGrowing crops with nutrient-rich water without soil.Initial investment in a hydroponic system and nutrients.Sales of nutrient-rich, pollutant-free crops to health-conscious consumers.
Mushroom FarmingCultivation of various types of mushrooms.A suitable environment for growing mushrooms, knowledge on mushroom strains and cultivation.Sales of mushrooms to local restaurants and businesses.
BeekeepingKeeping bees for honey production and pollination.Beekeeping equipment, knowledge of bee behavior and colony management.Sales of honey, other bee products, and benefits of better crop pollination.
Rooftop Tea GardensGrowing aromatic and medicinal herbs on rooftops.Rooftop access, planting containers, and initial investment in plants.Direct sales of unique aromatic and medicinal herbs to consumers.
Urban Chicken FarmsRaising chickens in urban areas for eggs and meat.Modest chicken house, feed, and care equipment.Sales of eggs and chicken meat.
Organic FarmingRaising crops and livestock without artificial inputs.Organic seeds, natural pest management solutions, and organic-certified inputs.Sales of organic produce and meat to restaurants and supermarkets.
Flower GrowingCultivation of various types of flowers.Initial investment in seeds or bulbs, knowledge of flower cultivation.Sales to florists, nurseries, or direct to the public.
Cannabis FarmingGrowing cannabis for medicinal or recreational use.Cannabis seeds, suitable growing environment, and knowledge of cannabis cultivation.Sales of cannabis to licensed dispensaries or direct to consumers.
ProcessingCreating value-added products from farm produce.Additional infrastructure, compliance with food safety and labeling requirements.Sales of processed food, personal care, and craft products.

Urban Farming Takeaways

urban farming

To start an urban farming business, you don’t necessarily need a background in urban farming. All you need is to educate yourself on the abundant resources on urban farming found online. Today there are many small businesses popping up across America focusing on urban farming. The demand is not only for green thumbs but also for people with sales, marketing and other skills in the value chain.

If you can reach large production capacity look towards a business to business farming model. This is a business method that farmers use when producing agricultural products to supply business clients. Businesses prefer to deal with farmers directly for the low cost and quality by getting produce directly from the source. Examples of business clients are grocery stores and restaurants that re-sell these products in their original or processed form to customers.

The key to profits is creating a niche for your business. While creating your business plan, be sure to include opportunities to get small business grants to help fund your new venture. For this reason, always look towards diversifying your revenue streams and build strong relationships with your customers.

Urban farming is all about making the most of the space you have. You can start off using your own garden to start growing food, and may eventually expand and start growing on other plots in your area.

Having an urban farming business can be particularly satisfying as you get to make your own contribution to making the world a better place as well.

Images: Depositphotos, Canva

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Samson Haileyesus Samson Haileyesus is a staff writer for Small Business Trends and has been a member of the team for 5 years. He has several years of progressive experience in media, communication and PR working with government, NGOs and private sector.