Understanding heterogeneity in farm development strategies is important in order to design effective policies and support programs to increase the sustainability of agriculture in relation to its socio-material context. Using a unique case study of 102 dairy farmers in The Netherlands, all operating in a highly similar socio-material context, this paper studies the differences in the relation of farms with the socio-material context. To this end, the concept of three-fold embedding is developed and tested using the ideal-typical characteristics of three patterns of farm development that were identified in the case study: (1) maximising total milk production; (2) optimising milk production using mainly on-farm resources; and (3) diversified on-farm production. Three-fold embedding was conceptualised in relation to the following dimensions: (1) value chain relations; (2) socio-cultural relations; and (3) natural resource relations, while using a scale ranging from a Close to a Stretched set of relations. The concept of three-fold embedding proves to be useful to identify in a non-normative and non-binary manner meaningful differences between patterns of farm development. These differences relate to differences in opportunity identification and strategic decision-making. The concept supports a relational perspective in studying farm strategy development using a sociology of entrepreneurship approach.