Build A Team Of Experts To Strengthen Your Farm Operation
Running a successful farming operation is a complex undertaking. It’s especially difficult for beginning farmers to know it all: Production expertise along with accounting, finance, risk management, human resources, technology and marketing.
The good news is that you don’t have to go it alone. Instead, you can build a team of experts to guide and advise you.
Planning for success
Most farm advisory teams include an accountant or bookkeeper and a lender. Many also include a business or labor management consultant, and still other teams incorporate specific ag sector or business model expertise, such as an agronomist, nutritionist or conservationist. An experienced local farmer in the same ag sector can also provide valuable insights as you plan for your farm’s success.
Your advisory team can help you assess your performance, plan for future opportunities and make decisions. For example, when considering a major purchase, team members might help you in the following ways:
- Your lender can advise whether you have the capital or can borrow it.
- Your accountant can tell you the tax implications.
- A local farmer and soil expert, after reviewing your yields, might suggest that you change your crop to one better suited to the ground you farm.
- Your lender can advise you to cut back expenses to maintain working capital when considering profitability.
- The topic areas for your team to consider are unlimited and you will benefit from multiple perspectives.
Building your team
As you build your team, consider what outside resource insights will help you improve your business. Do you need to learn about a specific topic? Do you need a fresh perspective about a future project? Answering these questions will help guide you through the selection process.
It’s important to choose the right individuals for your team. Look for people you respect and trust and who are solutions focused and dedicated to helping your operation improve, grow and change. Make sure team members have the time to dedicate to your operation. Remember that you don’t need to find all your experts at once. In the interim, you can ask your advisers for advice to fill in key roles. You can also seek recommendations from the cooperative extension service, the local farm bureau or local industry groups.
Some farms may have two advisory teams: one focused on financials and a broader team that includes production, agronomy and/or marketing resources. This approach helps maintain confidentiality of financial details you may not want to share with the broader group.
Managing your team
Using an advisory team doesn’t have to cost a lot. Some of your advisers, such as your accountant or business consultant, may charge for their time. A cooperative extension educator or local farmer may provide their expertise pro bono. Your lender or agronomist may roll their costs into the products or services you already purchase from them.
How often you meet with your advisory team is up to you. Most farmers will meet at least annually with their financial team to discuss performance, projections and plans for the coming year. Others meet biannually, once to set the budget and project revenues and expenses, and then later to compare performance against projections and identify any necessary adjustments.
Advisory teams also may meet quarterly, monthly or when farmers need to make a particularly impactful decision such as buying land, equipment or livestock. Beginning farmers can start with more frequent meetings, especially as they’re learning and have many action items to complete, later adjusting the schedule to fit their changing needs.
In addition to your outside resources, invite everyone involved in your farm management – including family members – to your meetings. When meeting with your team, a facilitator is key to help manage the people and personalities sitting around the table. With no stake in the meeting decisions, the facilitator can provide an objective viewpoint and ensure the meeting goes smoothly.
Working with outside advisers can give you more confidence in your decisions and peace of mind from knowing other experts support your direction. Your team can also provide the comfort of knowing that whatever you’re experiencing, they’ve likely seen it before and can help you through it.
Source
Horizon Farm Credit
