Thinking of an alpaca investment? The alpaca industry is still in the early stage of growth. The animal is much more valuable than the luxurious fleece they produce. The fiber is mostly obtained through cottage businesses right now.
Alpaca herds are not large enough outside of South America to produce enough fiber for mills to process. Therefore, alpaca fleece is considered rare or exotic.
Some have called alpacas a pyramid scheme because the animals are costly. Breeding livestock always costs more than the average animal of that breed. There are expensive breeding horses, cattle, etc.
In the early growth of the alpaca industry, every sound animal is considered breeding stock. With alpacas producing only one baby a year, all mid to high quality animals must be bred for the herd to grow. Mid quality animals must be bred to high quality to increase the quality of the entire herd.
Once the herd reaches a point where a viable fiber industry can exist, then only high quality animals will be bred and command high prices. So, yes, the majority of animals will decrease in value eventually. Right now it appears that a fiber herd is still a ways out in the future because of the slow growth of the herds.
If you are considering an alpaca investment, here's ten questions to ask yourself before you buy:
1. Why do I want alpacas?
- Do I want them because they're cute and it would be cool to have one on my property?
Get a pet quality animal.
- Do I want to spin the fiber for myself, family, and friends?
Get excellent fiber producing animals.
- Do I want a business?
Get mid to high quality alpacas.
2. What are my long term goals with an alpaca investment? Do I want a breeding business or a fiber business?
Select the right animal for the type of business you plan.
3. Am I in need of a quick buck or do I want a long term steady
Don't even think of an alpaca investment if you need a quick buck. This is a slow long term business to build.
4. What can I afford?
If you can afford to buy top quality breeding animals already producing high quality offspring, go for it. If not, purchase mid-quality animals and breed for better quality in the next generation and the next until you have high quality. Realize this will take longer.
What can I afford for equipment, shelters, etc.?
5. Do I have enough time to devote to animal care, showing, continually educating myself, and to the promotion of animals and fiber?
6. Do I have the perseverence and flexibility it takes to run my own business?
Instead of becoming discouraged at set-backs, you must look at each problem as a challenge to conquer and a lesson learned towards the betterment of your business.
7. Do I want a full-time or a part-time income?
Sell an occasional alpaca and develop an outlet for the fleece for a part-time income. Run a full breeding business for full-time income.
8. Do I have property or will I have to move or board my animals?
If you don't have a minimum of five acreas to start, you will probably have to find someplace to raise your animals.
9. Do I like working with animals or will I hire someone else to maintain my herd?
The extra cost and overseeing of employees may not be for you. If you don't like working with animals and don't want employees, don't buy alpacas.
10. After researching the alpaca industry, do I believe in its long term viability? Do I believe it has a future?
You must believe in the future of the alpaca industry to make an alpaca investment work. Understand the end goal is to produce luxurious fiber from these animals.
If you can give yourself a satisfactory answer to these questions, then you are on the road to determining if an alpaca invesment is right for you.
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