Keeping farm profit simple

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Posted by Brendon Walsh on 11 August 2014

As a sheep and beef farmer, have you ever stopped to ask yourself if you really know the pattern for generating profit from your farm business? Have you ever mulled over how it should be a lot simpler than our industry (and our annual results) seems to make it? Well, the good news is that creating profit from a sheep and beef farm business comes down to exactly that - keeping it simple!

Simplicity is a major key to success in anything, especially in farm business. Be aware that simple may not necessarily mean doing things very basically, although it may do. It specifically means being very clear and using proven systems to leverage your resources and abilities to create the results you are after. Leverage is essential because a multi-million dollar farm business will require effort - it just needs to be targeted, focussed and driven towards outcomes far greater then the sum of the inputs. Using linear thinking (1 unit of input equals 1 or 2 units of output) can easily see you working harder and harder for less and less. This is just not wise!

Clarity on how to create profit in sheep and beef farm businesses begins with defining where you and the business are at now, and where you want to head to. Hardly startling I agree, but essential nonetheless to frame up how you can move your business forward from here.

Once you understand what profit actually is in a sheep and beef farm business and how it is calculated, you increase your chances of moving forward exponentially. GrowFARM® clients learn this early on and it allows them to easily understand how decisions can be made to create or eliminate profit. Here is a tip for free: Every kg DM that goes down an animals throat must be converted into profit as well as possible, if you want to capture profit. The pattern that allows each sheep and beef farmer to create profit can then be learned, which allows these farmers to set up to bank profit well ahead of time. Being proactive is a nice result of knowing this stuff. Capturing the profit is even better!

One of the biggest issues any sheep and beef farmer faces is staying on track to ensure they deliver on their plan. Climate variation, market value changes and other challenges often blow out well made plans. This is where the training and coaching systems of GrowFARM® come into play. Clients get to use proven systems of communication, support and analysis from GrowFARM® (and other clients) to keep focused and make profitable decisions.  Scenarios will have been run (along with risk analysis) through ProfitLIVE® - the unique live, cloud-based analysis system owned by GrowFARM®. Because of these tools, GrowFARM® clients can get themselves into a position to proactively respond to challenges and threats as well as proactively capture the opportunities available to them.

This is where leverage enters the picture. Clients can easily leverage their own skills and abilities alongside the tools available to them to bank profit, not just work harder and harder for a meagre result.

This clarity and leverage is the difference between the Profit Paradigm and the Income Paradigm. End of year annual profit is a result of profit management and decisions during the year, which in turn comes as a result of knowing and carrying out the pattern for generating profit. Knowing this pattern comes from accurate knowledge of profit. The great thing is many farmers "get" this concept of profit vs income, they just need the system to help them understand the best way forward, use it and deliver results. GrowFARM® is that system.

A final thought: Being profitable in sheep and beef farming is not about looking at the top 20% of farmers and doing what they do, although I recommend you do examine their examples to take lessons away. It is really about the process behind it all that leads them to make their decisions, which then results in what they do. GrowFARM® has systemised that, and anyone can do it if they choose!

Contact me here now to book a time to talk and find out how.

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