Farmers should be planning now for how they’ll work with their financial institution during the coming season.
Farm Credit Canada, the country’s largest ag lenders, says it doesn’t matter if a farmer is dealing with them, their bank or a local credit union their financial partners need to understand their business.
“An up-to-date detailed balance sheet with what you own and what you owe, and a farm business plan are very helpful, “says Farm Credit Canada (FCC) Prairie vice-president Michael Hoffort.
FCC research shows that even though 90 per cent of respondents believed setting goals increases the likelihood of their operation’s success, only about 32 per cent said their goals are written down. The FCC research panel is made up of 9,000 producers across Canada.
Farming is a business. Like other businesses, a written plan helps owners to focus and keep on track, Hoffert says. The farm plan should include the short-term goals of the business (next 12 months) and the longer term goals, with an action plan of the steps required to get there.
During the coming year, FCC will run a series or workshops and learning tours across Canada to help producers learn more about managing farm finances, commodity price risk, human resources, succession and estate planning, and vision and goal setting.
“Managing and planning for cash flow is a key element in the farm plan. This facilitates purchasing and marketing decisions,” explains Hoffort. “It’s also very helpful if the customer can tell us whether they need to borrow, when, as well as their risk mitigation plans. In fact, one of the most important actions producers can take is calling their financial institution if their plans change. Understanding their business enables us to better tailor solutions to help them be more successful.”
For more information, visit the FCC Web site and learn more about