We’ve all heard the saying, “When the going gets tough, the tough get going.” Farmers demonstrate that in their lives very clearly. They’re some of the most hard-working, persevering, committed people I’ve ever known.
When times get tough, and uncertainty runs high, farmers tend to have a deep reserve of courage and resolve to get through whatever they have to tackle. I’ve seen it recently in the actions of farmers who are not just surviving right now, but are truly thriving – even in the midst of any uncertainty and challenges their farm may face.
One of the most important actions of a farmer who’s committed to their future legacy is to get a game plan in place for that future. A financial strategy based on the farm’s actual numbers – paired with accrual-based, forward-looking projections – should always be at the center of that plan.
For the future
It would be difficult for the farm’s leaders to think wisely about the future of the business if they don’t know exactly where the operation stands today. Getting that nailed down clearly – through a financial analysis of the farm – is the first right step.
Then the farm’s leaders need to think about where the operation is headed – and where they want it to be in the future. They all need to get on the same page with each other. The farm’s goals should be agreed upon and laid out.
But then there must be a financial game plan for how the farm is going to achieve those goals. Otherwise, it’s like heading out to play the biggest game of the season without any sort of strategy – offensive or defensive.
What’s the goal?
Many farms have found that working with an ag finance advisor to first determine where their operation is at, and then consider where they want to go, to be the cornerstone of their farm’s strategy and game plan. Once the farm’s leaders and their advisor get a clear grasp on where the farm is at right now, they can discuss the farm’s goals and the types of financial decisions that can be made to get there.
Because of their belief and commitment to their farms and families, the best farmers take smart action to help make sure their operations will not only get through tough times, but come out even stronger and better on the other side. The plans and decisions they make – and the trusted advisors they seek out to be part of that – are keys to the level of success and progress they ultimately achieve.
On a scale of 0 to 10, what level of planning for your farm’s financial well-being are you currently engaging in? Do you use your farm’s numbers and plans to help inform every decision you make? Do you have a trusted financial advisor who helps with crunching the numbers and provides additional perspective as you’re making decisions?
Read the current issue of the Smart Series publication, bringing business ideas for today’s farm leader. This issue includes perspectives on what to do when a landlord asks for higher rent, how to find the right new employee, a farm business checklist for the spring season, and more. Get your free online issue here.
The opinions of the author are not necessarily those of Farm Futures or Penton Agriculture.