Farm Progress

Face farm’s financial reality early and often.

Darren Frye, CEO

December 11, 2017

3 Min Read
Wavebreakmedia Ltd/ThinkstockPhotos

Our farm business – like life in general – can throw us various challenges and curveballs. And whether they’re big or small, they can sometimes catch us off-guard. When that happens, we might be reluctant to think very much about what happened or try to gain any sort of perspective on it. We might still be caught up in what happened, as well as our immediate reaction to it.

When problems and curveballs come up on our farm, we may not have control over what’s happening – but we do have a say in something else: what our response will be.

Depending on our personality, we may have a typical pattern when it comes to how we respond to a problem or challenge. We might want to analyze and think for days or weeks on end about the various options to solve it. We might have a knee-jerk opinion or judgment about it and the course of action we should take. Maybe we decide not to think about it at all. Instead, we dive deeply into some other aspect of the farm that we love and enjoy working on – and basically ignore the issue.

We may have any number of different responses, depending on our personality, the nature of the problem, the circumstances surrounding it and the level of importance we place upon it. It’s often tough to predict how we’ll respond to any given situation that can come up in our farm business.

What’s it really like?

Here’s another approach you can use to respond to problems on the farm. In particular, I’m thinking of financial issues and curveballs that can come up especially as we’re planning for the next crop year: Face them head on.

The first and best way of facing a potential problem around the next crop year’s financial outlook is to become aware of the reality of the situation. This is sometimes the toughest part. There can be a real temptation to live by the saying ‘ignorance is bliss’ for as long as possible.

The truth is, ignorance isn’t bliss. The anxiety and tension that can mount just from not knowing the farm’s actual situation can sometimes be worse than finding out what reality actually looks like. It may or may not be as bad as we’ve made it out to be in our minds.

Either way, finding out the truth of the situation allows us to decide to face it ‘head on’ and take action to improve things. Taking the reins of our operation as the leader and making decisions – sometimes very tough decisions – is our opportunity to meet each challenge in a positive way. Action is the key here. The only real alternative is sitting back and hoping that everything will turn out all right.

What’s your tendency when curveballs and issues come at you in your farm business – whether or not you anticipate them? Recognizing your own tendencies, what are some steps you can take to get the information you need and start creating a plan of action for 2018 to handle any potential issues? You might start working with our advisors to find out what reality looks like for you and your operation – and create a proactive plan to handle any challenges.

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

About the Author(s)

Darren Frye

CEO, Water Street Solutions

Darren Frye grew up on an innovative, integrated Illinois farm. He began trading commodities in 1982 and started his first business in 1987, specializing in fertilizer distribution and crop consulting. In 1994 he started a consulting business, Water Street Solutions to help Midwest farmers become more successful through financial analysis, crop insurance, marketing consulting and legacy planning. The mission of Finance First is to get you to look at spreadsheets and see opportunity, to see your business for what it can be, and to help you build your agricultural legacy.

Visit Water Street Solutions

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