By Connor Lynch
NORTH GOWER — Amongst the seven habits of highly successful farmers, there is a consistent theme: Take the guesswork out of farming.
Farm Management Canada’s Executive Director, Heather Watson, was on-hand at an FCC Ag Knowledge Exchange event at North Gower in early December to break it down for farmers.
Back in 2015, the organization pulled together the Dollars and Sense study. It was an attempt to figure out what were the consistent behaviours of Canada’s most successful farmers.
According to the study, the difference between the top 25 per cent of farms in the country and the bottom 25 per cent, was $84,000 in annual profit.
Researchers found seven success factors that had a measurable impact on a farm operation’s financial success. Here are seven things that successful farms do:
1. Learn new things. That also means when someone goes to a conference or learns something, there is a plan to integrate the new ideas into the business.
2. Make business decisions with accurate financial data. Don’t wing it. Check your finances before making a decision.
3. Work with business advisors and consultants. Farmers are better off sticking to what they know best and hiring professionals to handle the rest, Watson said.
4. Have, follow, and review a business plan annually. Knowing the plan puts things in context. Is an unforeseen change an opportunity or a problem? What am I going to do about it?
5. Monitor cost of production and know how it relates to profitability. Do you know what parts of your farm are making you the most money? The least?
6. Plan for risk both good and bad. What are your major risks to your operation? And are they an opportunity more than a problem?
7. Set a budget and have a financial plan to monitor options. Cash is still king. Knowing where individual decisions fit into your overall plan makes those decisions easier.