10 things to do in the new year
The start of a new year always comes with thoughts of reflection and improvement. To guarantee your readiness for a successful 2024, assess whether your operation is adhering to these 10 Keys of Success.
1. Attitude – Take a moment to contemplate your attitude. Are you filled with passion or facing burnout? If you find yourself lacking a sense of purpose, reflect on the initial spark that ignited your drive.
2. Goals – With your passion back on fire, consider where you want to be. It’s important to evaluate both short and long-term goals, spanning from 12 months to five years and beyond. Goals should be both ambitious and achievable while also being tailored to your current situation. And don’t forget to track your progress along the way as it’s crucial to stay on the right path.
3. Business Planning – As you look at the current year, create a detailed plan for the upcoming production cycle. Look at areas that are performing above average and identify additional areas that you have a competitive advantage in and lean into those opportunities. By working to elevate performance across all areas you are creating the right set of circumstances to earn the most return for your effort and investment.
4. Business Structure – Take a moment to evaluate how your business has evolved. Consider factors such as asset size, ownership, taxation, liability exposure, and potential dissolution and assess if your current structure suits your needs. When contemplating a change in business structure, it is crucial to fully comprehend and effectively communicate the rationale behind it. Remember, simplicity is often the key to success. Additionally, t is wise to begin considering estate planning early. It is never too soon to prioritize this aspect of your business.
5. Resource Management – As a business expands, its operations become increasingly complex. Seek outside expertise or mentorship when necessary. External resources can offer valuable guidance and reassurance in areas such as production, financial and human resource management, marketing strategies, and accounting, tax, and legal resources.
6. Risk Management Tools – When it comes to risk management, insurance is often the first thing that comes to mind. There are various insurance options to consider, such as production, life, disability, property and casualty, and business interruption. Other forms of protection include hedging, environmental and regulatory compliance risk. Diversifying income streams is a wise approach to consider.
7. Financial Management – Effective financial reporting enables you to closely monitor your progress towards goals and make informed business decisions. This entails maintaining accurate records such as a balance sheet, cash flow statement, and income statement. It is crucial that these reports are of high quality and completed regularly. Once the reporting period is over, it is essential to thoroughly analyze trends and establish benchmarks for future progress.
8. Production Management – It is important to also assess the production operations. This involves recording the yield production and comparing it to the input costs and break-even point. By understanding these trends, you can capitalize on any improvements, assess the effectiveness of various products, and embrace new methods, such as technology.
9. Marketing – Have a written marketing plan. Knowing your break-even-point enables you to approach the market from a profitability standpoint rather than solely focusing on price. A written plan outlines your avenues for reaching the market and highlights key factors to consider.
10. Balance – It is important to achieve a sustainable work/life balance. It may be helpful to develop a list of goals or priorities as a family and cross reference those with your business goals.
Take some time to reflect on these suggestions and choose two or three to incorporate into your own practices. It may also be beneficial to discuss your plans with a trusted partner for added accountability. Here’s to a successful 2024.
Kevin Gabbert a FCS Financial Senior Vice President, Commercial Farmers and Agribusiness
