It’s a fact: Positive cash flow can be a powerful performance metric. But to ensure the long-term viability of your farm or ranch, you’ll need to look beyond the bottom line. Consider adopting perspectives and behaviors that share much in common with proven business management techniques. These effective methods not only boost revenue but also improve production, reduce stress and help you plan for the future for your farm or ranch.
1. They Analyze the Business on an Ongoing Basis
Most of your time is probably spent on day-to-day operations, such as harvesting crops and feeding livestock. Focusing on tasks is important, but the key to successful farming is proper farm management. Review your business plan and adjust it annually. Perform monthly reviews of projections against cash flow and adjust expenditures as needed. Staying on top of your business will allow you to make smart, timely decisions before revenues or production dip.
2. They Manage and Reduce Risk
The business of farming and ranching can be uncertain, just like the weather. However, managing agriculture risk upfront with strategies that range from diversification and vertical integration to crop insurance and off-farm employment can help protect your agricultural business.
3. They Have a Team of Advisers They Can Count On
You know that it takes a village to run a successful farm or ranch. For those times when you have questions or need assistance, you’ll want a strong team of professionals you can call on. This can include lenders, veterinarians, agronomists, insurance agents, extension agents and equipment dealers. Overseeing an effective farming or ranching business means having the right experts available in case something falls out of place, which is bound to happen eventually.
4. They Regularly Evaluate Effective Farm Technology
Conduct frequent technology reviews to ensure you’re using the right farm management software. Implementing new technology — like yield mapping or soil mapping with GPS — while phasing out ineffective technology can help improve productivity and profitability. Keep in mind that the software you choose will depend on the specifics of your operation.
5. They Reach Out to Other Farmers and Ranchers
This might be a surprising successful farming tip, but connecting with other farmers and ranchers can bring both social and economic benefits. A strong network can lead to new business opportunities, much-needed help around the farm and even equipment sharing arrangements. Join national and regional farm or commodities associations to connect with others and stay on top of issues in the industry.
6. They Engage in Continuing Education
The most successful farmers and ranchers are always learning. Look for training sessions, webinars, social media groups, seminars and conferences to expand your knowledge and skills.
7. They Have a Farm or Ranch Succession Plan
A farm succession plan not only preserves your agricultural legacy, it protects the heirs — usually family members — who will inherit the farm. Many farmers and ranchers have succession plans in place long before retirement and take steps to ensure a successful transition from one generation to the next.
Adopting these seven habits of successful farmers and ranchers can increase the chances of long-term business viability for your farm or ranch. Connect with your Farm Bureau agent to schedule a SuperCheck® to ensure your insurance is meeting your needs.