As I wrote in last week’s blog, none of us knows what the future is going to hold – for ourselves or our farms. The unknown can loom large and lead to feelings of anxiety. But as I also mentioned last week, we have choices when it comes to how we’re going to react to what happens to us and to our farm businesses. We get to choose how we respond to the situations that come our way.
When it comes to preparing for an upcoming crop year, it’s key to plan by developing different responses for various potential scenarios. More specifically, contingency planning is a good strategy.
When a farmer has solid contingency plans in place, he can feel more confident. He knows that no matter what happens during that upcoming crop year, he has a pathway of actions to take to continue moving his farm toward success. This is one of the best ways to deal with the factors no farmer can control – like weather, prices and global markets.
Otherwise, when you don’t have contingency plans in place, everything feels like a fire drill. If things don’t happen exactly the way you think they will and according to what you’ve planned for, the whole plan and year can get thrown way off. This can leave a farmer with fewer choices and alternatives.
Plans are key
Failing to plan for different scenarios also means you’re really counting on your ideal or ‘plan A’ situation happening. It can create more anxiety. It can mean hanging on to hope that your ideal situation is still going to happen, even when it’s becoming clear that it’s not likely. And often, as time goes on, alternatives that may have been possible earlier are no longer available.
The best way to avoid that happening is to plan for as many different scenarios as possible, and then to watch what’s happening in your business closely. Agile, timely responses to changes in the environment are very important – this helps to keep your plan on track and relevant according to what’s going on. It keeps the business on track, moving toward the farmer’s vision of success, instead of getting totally derailed.
With good scenario and contingency planning for a new crop year, the farmer can gain more confidence. It can increase peace of mind, knowing that you already have a plan for what you’d do if X, Y or Z scenarios were to occur. Then, you’re not just hoping for a particular situation in order for your farm to be successful.
Do a check-up
How are you – and your business – doing in terms of getting contingency plans in place? How do you use those plans as the year unfolds? Is flexibility built into the plan – so you can respond in a quick and agile way to changes in the ag environment throughout the year? Are these plans built into all aspects of your business – so you can deal with quick changes in short timeframes?
As you consider this, you might work with a farm business advisor this winter to get your plans – including contingency plans – in place for the upcoming crop year.
The opinions of the author are not necessarily those of Farm Futures or Farm Progress.