Just like highly successful people share several traits, highly profitable farms share consistent attributes. Regardless of farm type or geography, there are farmer traits and business management practices common to profitable farms.
“The number one practice driving farm profitability is lifelong learning and your commitment to building your skills,” says Heather Watson, executive director of Farm Management Canada. Her organization has researched the common elements of farm profitability and put it all together into a handy list, discussed in the interview below.
Another key aspect of successful farms? Not trying to be the master of all things, and being willing to hire on experts.
“Do the things you’re passionate about, do the things you love to do and that you’re good at, and you will excel at those things. And if you’re not so good in the books, or you’re not interested…then hire it out,” Watson says.
You’re better off surrounding yourself with good, talented people, rather than trying to do it all yourself.
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And speaking of books, successful farmers spend the time on written plans. Financial plan, risk management planning, business planning — those that go through the process to build a plan to suit everyone’s needs are more likely to be profitable, even if the plan changes.
“The plan can change and that’s totally fine — no problem. (The value is) more about the process of planning,” she says.
The rest of the list includes:
- Business decisions made with accurate financial data
- Cost of production monitoring and use
- Risk assessment and management
- Use of financial plan with budget objectives
For a lengthier discussion on this research, download the report here or click the link below.