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Diagnosing farm profitability problems

“Diagnosing a Farm Profitability Problem” is a University of Arkansas fact sheet that can help a farm manager identify factors impacting a farm’s profitability and help in isolating areas that need improvement.

Farms of similar type and size often have differences in net farm income. Net income on any farm depends on several factors, but much of the difference in net income between farms can be attributed to farm size, physical efficiencies of production, enterprise (crop or livestock) combinations, fixed cost structure and commodity marketing.

A complete analysis of these areas of the farm business should be conducted on a regular basis. “Diagnosing a Farm Profitability Problem” presents a diagnostic procedure for locating the source of a farm profitability problem.

A flow chart is used as a troubleshooting guide for identifying sources of profitability problems in a farm business.

“Diagnosing a Farm Profitability Problem” is available through Arkansas county extension offices, or it can be downloaded at: http://www.uaex.edu/Other_Areas/publications/PDF/FSA-9512.pdf.

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