If you sit a moment and reflect on what you enjoy most about farming and what it is you value most about it, you'll probably come up with something rather quickly. Whether it's working the land, being around family and people you enjoy, the values you employ in making your farming decisions, or any number of other things, it'll probably come to mind without too much effort.
What sort of plans do you have in place to ensure that future generations in your operation are able to enjoy that same aspect of farming? Have you prepared the operation and its future leaders to keep your legacy intact when it's time for you to step down?
In Darren Frye's latest Finance FIrst blog post he discusses the idea of giving your farm a more solid grounding for years to come by running it today as a future-minded business. This includes detailed financial analyses and business plans for your farming operation as well as any side businesses. The crafting of these plans should involve all major stakeholders of your operation, and you might even seek out an external advisor you can trust. Read More
Any farming operation that's seen a degree of growth over the years is familiar with the addition of more people. And whether it's more family members joining in to help or more hired hands, inevitably there will be miscommunications, disagreements or interpersonal strife of some sort along the road. As a farm leader, you're not only going to have to deal with all the regular challenges and issues farming brings, but you'll have to sort out more people problems as well.
People problems can not be awfully complex, and dealing with them can take up a lot of your time and energy. Water Street Solutions Account Manager Jason Ladman says that alleviating people problems and inspiring the cooperation and commitment of others on the farm begins with gaining a better understanding of yourself and others. He recently spoke with KRVN's Dewey Nelson on just this topic. Read More
In talking with members of the younger generation who have recently returned to the family farm, Water Street Solutions Senior Director Dean Heffta has noticed a pattern in what sort of concerns they tend to share regarding their role on the farm. A frequently repeated theme is, "How do I become more of a leader on the farm?" Or, "How can I get a chance to show my abilities and prove I can take on more responsibility here?"
Heffta says it's quite common for young adults to return to the farm and have trouble "proving themselves" to the current farm leader. He believes that shaping farm leaders is the responsibility of not only the younger generation itself but also of the older generation. They must work and decide together what the right amount of preparation and grooming is before there's a handoff of responsibility. Expectations should be very clear and attainable.
Heffta recently spoke with ag broadcaster Dewey Nelson on this topic, and he revealed four questions to ask yourself when working to prepare the younger generation for more leadership roles on the farm. Listen to the whole interview below. Read More
As the average age of a farm landlord has been increasing in recent years, you'll find a lot of land changing hands pretty soon. If the land you're renting becomes available to purchase, you could find yourself in a sticky situation. It's not ideal to increase your cost to farm that ground while keeping the same revenue, but Water Street CEO Darren Frye has come up with a four-step assessment to help you decide whether such a land purchase would be a good investment. Read More
In the Early Summer 2017 edition of Smart Series you will find business ideas for the farm leader on such vital topics as farm management, leadership, crop & farm insurance, and ag finance--penned by our own expert advisors and members of the Water Street Solutions team of directors.
You can read it FREE on our website or even download a PDF for later viewing. Just visit waterstreet.org/smartseries to find out more. Read More
The agricultural industry has seen a lot of ups and downs, especially over the last five years. Farmers are now looking at tight margins, high uncertainty, and a major swing in profitability since 2012. But despite today's ag business environment, there continue to be farmers out there whose businesses are not merely staying afloat, but actually thriving.
Water Street Director Jason Ladman recently spoke with ag broadcaster Dewey Nelson on this topic. Ladman outlined three steps he believes are crucial to a farm's success in this environment:
- Do a thorough financial analysis of the farm so you know where it currently stands
- Set the farm's goals
- Write up a game plan for how to reach those goals
These steps, along with accurate financial updates along the way and possibly the assistance of a financial advisor specializing in the ag industry, will greatly help a farm leader keep an eye on the prize as they course-correct along the way, shifting cash flows and other facets of the plan to realign the operation toward its goals. Read More
Our farming environment has changed. Today's farm leader faces challenges and opportunities that simply wouldn't have come up on the farm of yesteryear. A successful farm leader in this environment approaches the farm as a business and functions as sort of a farm CEO, making analytical decisions while keeping the meaning and tradition of farming alive.
These farm CEOs rely on unbiased resources to make sure they have the right plans and structures in place to move the farm forward toward its goals. Among these resources might be a team of trusted advisors and up-to-date, accurate financial information. We're not necessarily talking about simple tax records or the farm's books. We're talking about carefully prepared, forward-looking projections.
Water Street Solutions CEO Darren Frye recently penned a more in-depth article about this on his Finance First blog Read More
Despite the economic downturn farmers have seen over the past three years or so, some farms have continued experiencing success. Of course there are individual, unique factors that might contribute to those success stories, but there is also a common thread woven among all of them which is something every farm can use to influence its own success: It's the decisions made on that farm, and the process of arriving at those decisions.
Every decision ever made on a farm in the past has directed that farm's path, impacting the financial state and success of the operation, and shaping where it stands today. The farms managing to pull success out of today's poor farm economy have leaders who keep the operation's goals front-and-center in their decision-making process. They know the farm's numbers and use them in that process. They seek counsel from trusted advisors in making the difficult decisions that their own emotions sometimes won't let them make. These leaders know that every decision counts--even the ones that don't immediately or obviously affect the bottom line.
Dean Heffta explores the impact of empowered decision-making on the farm with KRVN's Dewey Nelson Read More
It's no secret the ag community is in an economic downturn. This makes closely managing cash rent costs even more important to your farm's overall success. The farmers that are having the most success with their cash rent situation are really good at doing three basic things while keeping their operation's overall success foremost in their minds:
- They know the exact cost of farming each piece of rented ground
- They track whether that ground is performing at a satisfying level
- They build strong landlord relationships and work to hone their own negotiation skills
In this week's Finance First post, Water Street CEO Darren Frye discusses how to achieve these goals with some self-analysis questions to get you on the right track. Experiencing more success with cash rent ground requires dedication and a willingness to have some tough conversations or make difficult decisions, but it can be done. Start with Darren at FarmFutures.com. Read More
As a farm leader, you're responsible for seeing the operation through its day-to-day business, which can be challenging in itself, especially during planting and harvest. Orchestrating when and how each moving part operates to get the tasks done correctly and in the right time frame is no easy chore. But another vital facet of your leadership is providing the vision of what success looks like for the farm in ten or twenty years, and providing the guidance to keep the operation moving toward that goal.
To keep on track toward those clearly defined goals, a leader needs to utilize solid navigational tools and regularly track the operation's progress, making tweaks and adjustments here and there as needed. The tools best used to gauge a farm's path are not simply production numbers, but also financials such as forward-looking accruals and projections. When used as part of an integrated decision-making plan incorporating a reliable feedback loop as well as unbiased insights and advice, the path toward your vision of success becomes much clearer.
Listen to Dean Heffta discuss this topic with KRVN's Dewey Nelson. Read More
A necessary facet of farm growth is the addition of more workers. When your operation started maybe a handful of family members was enough to get the job done, but growth brings more complexity and it takes more hands to get through the farm's day-to-day. That usually means that you, as a leader, are now saddled with not only getting through that day-to-day business, but also with handling the inevitable issues that come along with a larger staff...and that's what you might call "people problems."
Nobody thinks the same as any other person. Each individual brings their own psychological baggage along for the ride, and their own experiences throughout life have shaped who they are and how they interact with the people around them. But there are ways to inspire the dedication and cooperation of every employee, and it all starts with gaining a level of understanding about each person.
In this installment of Finance First, Water Street CEO Darren Frye discusses the benefits of personality assessment tests and how to use them in your farming operation to make your "people problems" more manageable so you can better focus on the big-picture direction and leadership every farm needs. Read More
Jason Ladman continues last week's discussion with Dewey Nelson, getting in depth on the topic of deciding whether buying or leasing new equipment is the right decision for your operation. Ladman shares a series of questions to ask once the decision has been made that your operation will assuredly benefit from new equipment, to help you evaluate individual leases -- or calculate the right amount for a down payment, should purchasing outright be the best decision.
Ladman urges caution when approaching leases, saying though competitiveness in the market has enticed dealers to offer some really good deals, not all all of them are as good as they might seem upon initial examination. He shares another series of questions to help you dig down to the meat of the lease and recommends enlisting the assistance of an ag finance expert to help put together a clear analysis of all the lease data. This data, paired with your current and projected farm numbers, will help you make the best equipment decisions to move your farm forward. Read More
Water Street Solutions CEO Darren Frye's Finance First piece this week concentrates on next generation farmers returning to the operation. Frequently we hear the question "How do I become more of a leader on the farm?" from these returning younger farmers. Frye says this is good; it's the right question to ask. It's being proactive, versus the alternative, "When are they going to train me?"
Frye shares additional questions to ask yourself as a future farm leader, as you work with the older generation to acquire the skills and knowledge you'll need to one day lead the operation. You can check it out, only at FarmFutures.com. Read More
Managing cost on the farm is a challenge at times. Typically things like input and fixed costs are the first that come to mind, but a big cost management opportunity that can affect the farm for years to come is your machinery cost. It's important to take a close look at your financials when evaluating your machinery cost, including a metric we've found to be very helpful - machinery investment per acre, which is the value of your machinery spread across the total acres you farm.
A big question many farm leaders face is whether to buy or lease new equipment. A good way to deal with this issue is to first determine the need, and that could be related to a gap in your production due to a shortcoming in your current equipment, or just because you have the opportunity to get a really great deal on something better that can serve you well into the future. If you find the necessity is there, that's when you can turn to the numbers to take some of the emotion out of the decision at hand.
Water Street Solutions Account Manager Jason Ladman recently spoke with ag broadcaster Dewey Nelson about this topic, including the story of a farmer client of ours who dealt with the same issue on his operation. Hear about how he talked these issues over with his ag finance advisor and what kind of metrics the two looked at to come to a decision in this week's radio interview. Read More
It's hard to get to where you're headed if you don't know where you're starting from. Successful farms in today's ag economy are run by leaders who have a clear financial strategy based on that farm's actual numbers, paired with accrual-based, forward-looking projections. And it all starts with an up-to-date, complete financial analysis of the operation.
Water Street Solutions CEO Darren Frye discusses this topic in more depth in this week's "Finance First" column at FarmFutures.com. Read More
Where the farm is today is a result of all the decisions its leaders have made up to now. Better decision-making leads to better results, and key decisions define the direction of the operation as well as its potential.
Dean Heffta shares with farm broadcaster Dewey Long six questions farm leaders should ask themselves when faced with major decisions on the farm. These questions help a farm leader focus on the objective at hand without losing sight of the operation's long-term goals. They'll help a leader to overcome the anxiety and fear that often accompanies a big decision, and boost his or her confidence in making the tough, defining choices. Read More
There's a common thread among farmers who have remained successful in the current downturn, and it's something all farmers have control over...it's their decision-making. A major key to success is making the right choices with the right information, staying ever-cognizant of how those decisions will impact the operation's finances and ultimate goals.
It takes an incredible level of dedication not only to farming - but also to the business of farming - to be able to thrive in this ag economy. It's about always knowing the farm's financials and keeping its long-term goals at the forefront at all times, through every decision.
Water Street Solutions CEO Darren Frye discusses this in his new Finance First blog post over at FarmFutures.com. Read More
Planting season brings with it a lot of responsibilities as far as the farm's day-to-day operations go. But that's not all a farm leader has to worry about. There's also the matter of the overall vision of where the farm is headed and how to get it there. It's not an easy task, keeping the farm progressing toward its goal while juggling everything else on a farm leader's shoulders.
Any navigator is only as good as his tools and resources, and how he utilizes them is just as important. Water Street CEO Darren Frye compares leading a farm to guiding a ship on the ocean in this week's Finance First. Find out which financial tools best help a farm leader steer his course toward the operation's long-term goals by reading Darren's column at FarmFutures.com. Read More
Gone are the days when a banker made a handshake deal based on a farmer's reputation in the community and his character. Though being known as a reputable businessman with honest and forthright character certainly can't hurt one's odds of securing a loan, today's regulated environment requires lenders to be more thorough in screening potential borrowers. It's not as simple for today's farm leader as it might have been for their grandfather.
Water Street Solutions Account Manager Lance Burditt talks with ag broadcaster Dewey Nelson about what today's bankers want. Burditt says lenders are looking for borrowers who have a firm grasp of not only their operation's financial standing, but also of where it is headed and how to achieve that goal.
Listen to this week's KRVN interview and find out the three main traits to master which could help you secure that loan. Read More
As you gathered your numbers for this tax season, what shape did you find the farm's books in? How long did it take to pull everything together? Was it all well organized and "easy as you please" to assemble the final financial data for your tax preparer, or did you find yourself undertaking a massive chore in digging up all the necessary paperwork?
An increasingly popular opinion in the financial world today says that the time is coming when lenders will be looking to certain farmers to begin providing audit-ready books. That means always having accurate, up-to-date financial records available. Water Street Account Manager Jason Ladman provides an argument for all farmers to keep such detailed and consistently updated, starting today. He shares this logic with ag broadcaster Dewey Nelson in this week's KRVN radio interview. Read More