Long-term planning for your agribusiness
09 September 2022
With New Zealand now in a high inflationary period, rising interest rates are creating more pressure for everyone, and costs seem to rise every time you open an email. So, it’s important for agribusiness owners to consider what kind of agribusiness support will help their business not only survive but thrive in this environment.
As experts in agribusiness NZ, we’ve compiled some strategies you can implement that will help you be proactive in your business approach. Creating a plan for changes that you cannot control can help you as a business owner prepare for the worst and best-case scenarios and anything in between.
Set long-term goals
It’s important for the financial and non-financial management of your agribusiness that, as a family, you create long-term goals together so that you can make difficult decisions that are right for your future.
When setting long-term goals, it’s important to incorporate the following tasks to develop a well-rounded picture of how you’ll get there, and the agribusiness support you’ll require.
Analyse your spending and current costs
Be disciplined in your approach to managing costs as it is easy for these to be masked when returns are good. Consider what your current spending looks like with lower returns.
Run business cases
Include the Return on Investment for proposed purchases of equipment, vehicles, additional land purchases or debt repayment and determine what your business looks like after making each of these decisions. This will also assist with understanding the long-term impacts of decisions made now on the future viability of your business.
Learn about ongoing compliance changes in the agricultural sector
Increasing costs and compliance changes in the agricultural sector are likely to impact your business and may make for a challenging future. Be an early adopter wherever possible and take any opportunities that arise from this.
Work with experts in the agricultural sector
Working with can help your business advisory experts in agribusiness can help your family or business to analyse its strengths, weaknesses, opportunities and threats (SWOT) and formulate your long-term goals.
Identifying your strengths, weaknesses, opportunities and threats will help:
Highlight your weaknesses so you can improve on them.
Take advantage of any opportunities.
Play to your strengths.
Have strategies in place to plan for any threats.
Conducting a SWOT analysis can be a very valuable exercise as it enables everyone involved to understand the direction and likely outcomes in certain situations and provide the necessary agribusiness support that you’ll need.
Understand financial management for your agribusiness
As an agri-accounting and business advisory expert, I can never stress enough the need for agribusiness owners to understand their numbers.
Whether it’s from an accounting and tax perspective, feed production, milk production, carrying capacity, water monitoring, staff turnover, staff engagement, productivity or any other aspect of business, you should be collecting all the data available from your history and using it to maximise your future potential.
These days, most financial management for agribusiness is done through digital systems and tools giving you up-to-date and instant access to your financial data. A good accountant will be able to help you identify the most appropriate systems to use in your business and provide support to help you implement them.
With over 40 years of agribusiness expertise in New Zealand and more than 20 clients across most agribusiness sectors, Findex has deep, personalised expertise providing agribusiness support. Our Partners combine hands on experience with access to a unique breadth of services, including tax advisory, internal audit, risk insurance and wealth management to meet all your financial needs in one place. To see how we can help your agribusiness, get in touch with us today.