As ag producers in today’s world we have so many resources available to us to obtain our goals. Those goals can vary widely from growing or changing your operation to reducing debt to a more efficient operation. All operations no matter what size need to have goals to measure progress.
From an ag finance perspective goals vary widely and might even depend on which side of the desk you are on. As a producer it is necessary to have an open communication line with your loan officer to help realize these goals. This also allows for planning, financial and otherwise, and ensures that you and your loan officer are on the same page. It is important to keep records so you have a means of evaluating progress. Completing a thorough annual balance sheet at the same time each year will help monitor net worth. Tax records are not the best source of evaluating profit as not all transactions occur within the calendar year. A better tool to evaluate profit is through cash flows for the production year. A software tool can be used for this. We use the Farm Service Agency balance sheet and cash flow, which allows for historical records, current year and projections for upcoming year.
We are fortunate to have a large amount of information at our fingertips through the Internet. For those that embrace technology, apps have the ability to provide immediate information on current market conditions as well as track our own operations status if we so choose.
The local Extension office, government offices and local suppliers are also great resources. If you are looking at changes to your operation or just need another perspective, there are numerous professionals and tools available to you free of charge through these offices.
Never underestimate the power of just talking to another producer. Once again technology can help with this through blogs and social media.
Sometimes you just need to sit down with a cup of coffee and a producer or group of producers and talk about things. I am fortunate enough to be a part of such a group through my work. On a regular basis we get together a group of cattle backgrounders to talk about various topics. We like to have a banking topic such as record keeping, inventory reporting or risk management. We also discuss topics that are necessary to make each operation successful such as vet practices, price protection and nutrition. It is great to share common practices and helps evaluate what has worked and not worked for each operation. It is great to learn from someone’s successes and shortcomings.
As ag producers, we are fortunate to be a part of a multi-billion dollar industry in Missouri. It is the goal of each lender, producer, supplier and other resources to be successful together. Find what works for you and communicate with those that will help you along the journey.
Janieca Hancock is the Senior Vice President and loan officer for Mid Missouri Bank in Bolivar, Mo.
