They say that if you drop a frog into a pot of boiling water, it will leap out right away. But if you put a frog into a pot filled with cool water and gradually increase the heat until it starts boiling, the frog will not become aware of the change until it is too […] Read more
Stories by Terry Betker, PAg
Farm ownership changing with times
When asked what they want to be when they grow up, a lot of young children will answer, “I want to be a farmer.” This hasn’t changed much over time, but the likelihood that the wish will come true has changed, depending on the definition of a farm. The number of farms in Canada continues […] Read more
Summer is great time for mid-year review meeting
Another meeting? Farmers will protest, fairly, that they already have too much to do, but that’s exactly what I’m suggesting. The summer, mid-July perhaps, is a great time to step back from the urgency of production and review where things are at. It’s a state-of-the-union concept but presented in the form of a meeting. Mid-July […] Read more
Determine gross margin efficiency to make better decisions
Although farm business analysis is not restricted to the use of ratios, they can be useful tools to analyze performance. A great example of this is gross margin efficiency. Expressed as a ratio, gross margin efficiency measures how efficiently a farm uses specific, productive inputs. To demonstrate, the calculation looks like this: Gross margin by […] Read more
Farm succession plans start with a meeting
Lots of farm families are trying to develop a succession plan for their farms, or think that they should be. However, they typically find that it’s difficult to get started. This is not unusual, but it can lead to future difficulties if the succession planning is deferred too long. In the worst cases, deferral can […] Read more
Enterprise analysis helps manage time and investments effectively
Most farmers have multiple enterprises within their farm. However, although they work each day within those enterprises, they may not have given a lot of thought to enterprise analysis. Enterprise analysis is a form of financial analysis that looks at a business in terms of each individual entity or enterprise within the farm business so […] Read more
New year ideal time to review performance and make plans
The beginning of 2011 is a good time to take a look at last year’s performance and make plans for the coming years. But how do you get started? Spend time analyzing financial, production and marketing performance. That involves financial and production ratios and results from the marketplace compared to predetermined targets and costs of […] Read more
Take control of financial difficulties early to maximize options
It doesn’t take long for farmers to slip into financial difficulty. Management decisions in the 1980s and 1990s contributed to financial hardship, but the problems were compounded by outside factors, including low commodity prices, high interest rates and weather. This year, a many farmers are experiencing financial difficulty, largely because of adverse weather. Learning how […] Read more
Contingency planning requires having Plan B
In the movieKelly’s Heroes,Donald Sutherland modified a tank to go as fast in reverse as it did going forward. As he explained, he wanted to be able to get out of trouble as fast as he got into it. Well-developed contingency plans are critical for creating successful outcomes. They can help farmers survive the fast-paced […] Read more
Ratio analysis can help evaluate financial performance
Successful farm operators know the importance of continuously evaluating their business performance. However, to do a thorough examination, farmers need to look at more than sales, profits and total assets. They must be able to read between the lines of their financial statements and make the seemingly inconsequential numbers more accessible and comprehensible. This may […] Read more
