The Alpaca: Investing
in the World's Finest Livestock Investment
Linda K. Davis, Owner, Alpaca.com L.L.C.
lofty claim is easily supported by recent history and realistic
projections into the future:
There is a growing demand for alpaca fiber in textile and
fashion centers throughout the world and a drastically limited
supply of these animals outside their native South American
homelands. Peru, Bolivia, and Chile have stringent export
restrictions on further transport of their national treasures
in order to avoid depletion of their own heads.
the slow reproductive rite of alpacas and the superb quality
of their fiber, consumers will continue to want more fleece
than alpaca farmers can produce, thus creating a market
where prices paid for alpacas and alpaca fiber will remain
Exciting and proven tax savings are another integral part
of the investment value inherent in alpaca ownership. While
these apply only to breeding animals and the infrastructure
needed to maintain them, over 25 established avenues for
tax savings are available to you as an investor in alpacas.
Depreciation on purchased breeding alpacas, structures,
machinery, equipment, and other items whose useful life
extends to more than one year.
Complete write-off on many maintenance expenses, such as
feed, veterinary fees, electricity for the barn, etc.
Deferral on capital gains through utilization of the compounding
plan which shelters profits until the alpaca is actually
in any business venture, you are urged to consult with a
qualified accountant before beginning your alpaca business.
Alpaca.com L.L.C. can also assist you in your research
in this area.
said all that, a simple truth remains: "A dollar legitimately
saved from taxation is a dollar earned."
Compared to other livestock, alpacas are inexpensive to
own. Aside from the initial purchase of your animals (which
can be depreciated over five years), the maintenance costs
for these hardy and healthy little animals are minimal.
They are "earth friendly" and coexist in nature in a positive
and productive manner. A little hay, grain, and clean water;
a bit of room to move around with other members of their
herd; safe fencing and shelter; and as much love as you
want to give them. These are the best requirements you need
to provide for your alpacas. You will quickly discover that
they give much more than they take.
Flexible ownership strategies are also available to you.
Proven plans for "hands-on care" and/or boarding your animals
(agistment) can be obtained from Alpaca.com L.L.C.
and several authoritative books dealing with different methods
of alpaca farming. While specific tax guidelines vary with
the type of plan you choose, the investment value remains
A fully operational alpaca farm can be started for an initial
set-up cost as low as $40,000. This includes a few breeding-age
alpacas and the infrastructure necessary to maintain them.
This figure does not take your land and your own housing
costs into consideration, but still, a financial expenditure
that is attractively affordable when compared to the startup
costs associated with most other home businesses or franchises.
Alpaca farmers who have been in business for four years
or more routinely report returns on their capital expenditure
which range between 25 to 60 percent. Many variables can
influence your actual profits, but as an alpaca owner, you
are investing your assets in a vehicle with a proven record
for profitability and which promises to become even more
financially rewarding in the future.
Demand for alpaca fiber continues to grow dramatically.
You will harvest your fleece each year and have the option
of selling it yourself or consigning it to the alpaca fiber
coop. The latter offers you an easy and guaranteed outlet
for your fiber and promotes a greater awareness of and demand
for alpaca fiber in the fashion world.
Unlike most other home business inventories, your alpacas
are fully insurable. Your modest premium costs will protect
you from catastrophic loss of animals and capital in much
the same way the FDIC covers your savings at the bank. Only
your investment returns should be much higher with alpacas,
But the positive reasons for investing in alpacas would
be incomplete without one more category simply called intangibles.
As you have already seen, the following values are measurable
for startup of your alpaca business:
Number of legitimate
tax deductions you will enjoy:
life of a healthy alpaca:
13 to 17
on your capital investment:
But the value
of your own personal sense of peace, pride, enjoyment, and freedom,
which is created by owning and being in the company of these wonderful