BUSINESS Planning & RISK ANALYSIS
Independence underpins our service and as such the integrity of our recommendations is not compromised by product sales. All recommendations are supported by evidence based science. Detailed planning and in-depth knowledge of what drives farm profit means that our advice will improve your farm businesses’ bottom line.
INDEPENDENCE & INTEGRITY
Astute enterprise selection underpins resilient and profitable farm businesses. It is uncommon on a farm that a single enterprise will remain profitable for the long term. Having two or three enterprises spreads the risk to of failure of a single enterprise. To achieve the best enterprise mix several planning issues should be considered:
Cash reserves and seasonal cash flow
Labor, skills and workload requirements
Synergies between enterprises
Risks: Market fluctuations, labor availability, weeds and diseases, climate factors, availability of finance, etc
Infrastructure and equipment needs
Enterprise selection decisions are quite complex. AgriStrategies and associates have the necessary skills and experience across many agricultural enterprises to be able to help with most enterprise planning decisions.
Stocking rates and feed planning:
Most graziers would say that most common risks on a livestock property relate to stocking rates and the occurrence of drought. However, unless stocking rates are adequate pastures will tend to be inefficiently grazed, resulting in reduced carrying capacity due to accumulated dead pasture material. Regular assessment of pastures and putting those figures through a feed budget allows feed on offer to be quantified. By considering this information with changes in livestock condition, rainfall forecasts, and the status of drought feed reserves, feed risks can be managed. Timely adjustment of stock numbers based on such information is critical to successful feed risk management.
The 2018 drought was one to remember. After droughts some important questions need to be asked.
Considering past droughts what was normal and what was different this time?
What happened to the farming business during this drought?
How prepared was the business?
What was learned?
Droughts are an integral part of life on the land but the damage that a drought can inflict on the average grazing business and it’s owners mental well-being cannot be overstated. The financial and personal impacts and the disruption to farming enterprises can take years to recover from. What can farmers do to be better prepared? Talk to us if you would like help putting together a DROUGHT MANAGEMENT PLAN. Every farm needs one and now is as good a time as ever to prepare yours.
Business & Risk Analysis:
In order to run a profitable business, decisions need to be made in a timely manner based on accurate information. Key performance indicators (KPIs) should be chosen for the whole business and individual enterprises to regularly compare farm performance to industry standards. Regular monitoring allows continuous improvement.
Best practice enterprise management advice is readily available and should be followed whenever possible. Businesses commonly get into financial trouble when basic principles are forgotten and key decisions either don't get made or are inadequate. The day to day stresses of life in addition to fatigue during busy times or crisis can exacerbate this problem.
The risk appetites vary but it is important not to take unnecessary risks. It is also important to take time to analyze and understand the level of risk that your decisions are exposing the business to. Many farmers find that they are completely unaware of quite obvious risks that could have serious repercussions.
Clients seeking more structure in planning and business analysis are encouraged to participate in the FARM ADVISORY BOARD program. The Farm Report Card used in that program allows ongoing monitoring of KPIs.