Business Plan for Ginseng Root Business Plan

Excerpt from Business Plan :

Despite these fluctuations in pricing levels, current projects indicate that demand for ginseng will continue to increase in the future due to greater demands from a burgeoning middle class Chinese market (How to grow ginseng, 2012). Although wild-grown ginseng commands higher prices, cultivated alternatives typically weigh more but the Chinese highly prefer the wild-grown version (How to grow ginseng, 2012).

As shown in Figure 1 below, West Virginia is located within the zones (3-8) that are regarded as being especially appropriate for cultivating wild-grown ginseng.

Figure 1. United States Zone Map for Planting Ginseng.

Source: Adapted from

While West Virginia is located in a highly desirable geographic location for cultivating ginseng, the task is fraught with opportunities for failure, weather conditions can adversely affect the growing cycle, the plants are sparse and difficult to locate, and the actual growing process, as well as its clinical effects, remain better described than understood in the relevant literature. For instance, Werner (2008) emphasizes that, "Above the ground, ginseng is easily overlooked, growing ten to fifteen inches high, with five long-stalked compound leaves, modest greenish white flowers, and red berries in season. The authoritative Missouri Botanical Garden's plant guide judges it to have little ornamental interest -- 'not particularly showy'" (p. 36).

What is known for certain with respect to West Virginia is that, "Ginseng is typically found in scattered populations. Population size ranged from 1-348 individuals in 43 populations located in West Virginia during two summer field seasons. The majority of populations had fewer than 10 individuals (65%), 21% had 10-25 individuals and 14% had over 25 individuals. Only two populations had more than 100 individuals" (Van Der Voort et al., 2003, p. 283). Clearly, planting and cultivating ginseng in these settings, especially using the wild-simulated planting techniques envisioned in this business plan, makes good economic sense despite the eventual lesser value of the product which can still approach the value of wild-grown varieties (How to grow ginseng, 2012).

Operating procedures

The company's operating procedures will comply with West Virginia Ginseng Law and Regulations as set forth below:

1. No license is required to harvest wild ginseng on private land in West Virginia, though written permission must be obtained to dig ginseng on private property in the state.

2. Ginseng dealers in the state must register with the West Virginia Division of Forestry to obtain a permit.

3. The harvest season for wild ginseng in West Virginia is from September 1 to November 30.

4. Ginseng harvested during this season must be sold to a registered dealer by March 31 or "weight receipted" to hold over to the next season.

5. Under West Virginia law, all harvested ginseng plants must have at least 3 prongs and 15 leaflets, and the berries must be red in color.

6. Ginseng diggers in West Virginia are required to replant the seeds of harvested wild ginseng where the plants are harvested (West Virginia Ginseng Law and Regulations, 2012).


Although the company will be a sole proprietorship, part-time personnel may be hired temporarily from time to assist with the cultivation and harvesting activities on the 20-acre tract set aside for this purpose.

Capital equipment and supply list

Because the principal already owns the 20-acre tract in West Virginia, requisite cultivation and harvesting tools, and an all-terrain vehicle, the remaining supplies required will consist of appropriate State of West Virginia licensure as well as ginseng seeds and rootlets which are available for purchase for approximately $1,000 per 35,000 ginseng seeds and 250-350 rootlets (How to grow ginseng, 2012).


This business plan was founded on two main assumptions as follows:

1. The regulation of ginseng cultivation and harvesting in the United States in general and in West Virginia in particular will remain unchanged; and,

2. The market for ginseng will continue to increase in the future.


Guo, Z. (2000). Ginseng and aspirin: Health care alternatives for aging Chinese in New York.

Ithaca, NY: Cornell University Press.

How to grow ginseng. (2012). Retrieved from

Mccabe, S. (2002). Complementary herbal and alternative drugs in clinical practice.

Perspectives in Psychiatric Care, 38(3), 98-100.

Van Der Voort, M.E., Samuel, D.E. & McGraw, J.B. (2003). Recovery of populations of goldenseal (Hydrastis Canadensis L.) and American ginseng (Panax Quinquefolius L.)

following harvest. The American Midland Naturalist, 149(2), 282-283.

Werner, L. (2008, March-April). An enduring panacea: A lucrative export for nearly three centuries, American ginseng -…

Online Sources Used in Document:

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