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A Typical Alpaca-Ranching Investment
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The Dream
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There are many financial scenarios for beginning alpaca-ranching. However, the one described here would not be unusual.
Historically, alpaca production has been concentrated in the high Andes Mountains of South America where the availability of high quality pasture limits their number. Yet 99% of the world’s 3 million alpacas are still found in Peru, Chile and Bolivia.
Initial Cost - $25-$35,000
for a combination of two pregnant females and/or yearling females (does not include land, fencing, facilities etc.)
Estimated Income - $10-$12,000/year
(assumes average sale prices and typical expenses at $200-$400 per alpaca/yr ) The average young female sells between $8,000 and $12,000 and young males sell for $1,000 to $5,000.
Estimated Tax Benefits - $25-$30,000 plus
( all expenses are deductible, all development costs are depreciated )
- Year I - expenses + $20,000 depreciation.
- Year II - expenses + $5-$10,000 depreciation.
- Year III and on - expenses + remaining depreciable costs e.g. alpacas, home office, truck, barn, fence, computer, camera, etc.
Key Ingredients For Success - We have been very successful as a medium-sized ranch, however some others have not. Discussions with many newcomers indicate the following as important ingredients for fiscal success.
- Love of the animals such that routine care is smoothly done by the owners without employees.
- Acknowledging the business aspect of alpaca-ranching and following a simple marketing and sales plan.
- Being in a financial position to take full advantage of the many tax benefits.
- Luck - the birth of females facilitates sales and herd growth. While the odds are 50/50 for males to females, at times one or the other can seem to predominate and thus slow or speed the process.
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© 2004 - 2008 Copyright Alpacas at Lone Ranch, all rights reserved.
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