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Take your farm to the next level in ‘22

Getty/iStockphoto Person calculating finances
Look at these three aspects – even if you had a good 2021.

We’ve entered the new year, and hopefully you’ve had a chance to reflect a bit on 2021 – both personally and professionally. In your farm operation, did you have a good year in 2021?

While I hope you can answer that question with a resounding “Yes”, there can sometimes be a hidden downside to a successful year on the farm. I know that sounds strange – but hear me out.

A closer look

Sometimes what can happen on the farm during or after a good year is that areas of weakness get overlooked – because things seem fine overall. To keep that from happening, it’s important to be able to hone in on those areas before they could have the chance to be exposed when the next “bad” year does come.

So the right question to be asking after a successful year is: How can I take my farm to the next level? Maybe you’ve come far in improving your operation, and that’s great! But the truth is that there’s always still room to “level up.”

Another question you can ask yourself is: What’s the biggest (or most important) area we could do better in? Asking this can help keep an area of weakness from being covered up when things are going well.

Three to try

Try to think beyond improving yields – obviously, improving yields is extremely important, but let’s consider other aspects of your farm business, too. Here are three areas to start thinking about taking it to the next level in ’22.

  1. Farm measurements. I’m not talking about how big your farm literally is in terms of acreage, but about how you are measuring success numerically and financially. How do you know your operation is on the right track financially? What metrics do you use throughout the year to monitor that? Are you ready to have conversations with your lender because you understand and can speak their financial “language”? Think about what you can work on in 2022 to run your business even more by the numbers or work with an ag-savvy financial advisor on that.
  2. Efficiency, efficiency, efficiency. I wrote that word three times because it’s so important for farms that produce a commodity product. Farm leaders always have to keep working to be the lowest cost per unit (bushel) producer – and particularly in successful years, inefficiencies can sneak in and send that goal flying in the other direction. Increasing efficiency – across the operation – is something to strive for in 2022. You might do an “efficiency audit” of your operation – including all your farm’s processes and standard operating procedures – to find areas to adjust for increased efficiency.
  3. Marketing plans. How are you doing with creating a marketing plan for 2022? How did marketing go for your farm in 2021 overall? If you would like a partner in creating plans for the year, our market advisors work with farm leaders and bring education around different marketing tools. They also help farmer clients with planning and execution around marketing decisions.

Get a free two-week trial of our marketing information service (MarketView Basic). Your free trial includes regular audio and video updates, technical analysis, recommendations and more. Or learn more about our market advisor programs and offerings at www.waterstreetconsulting.com.

The opinions of the author are not necessarily those of Farm Futures or Farm Progress. 

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