Do you always wait until something is wrong to go to the Dr?  Most of the time the answer is yes.   When a problem has already presented itself, it always takes a lot longer and a lot stronger medicine to get better.  When if we would have gone in at the first sign, the problem may not have been able to be stopped but taken care of quicker.  Personal health is not unlike financial health. 

Should you wait till your next renewal apt with your lender to check how the year went?  Why not look at your income and expenses semi-annually or maybe even quarterly?  The only way to know that a change needs to be made is to identify and understand what has already happened. 

I recently attended the Hubbard Beef Focus meeting.  I was there as a Hubbard Feed dealer, to gain product knowledge and gain insight into the feed business, not to further my financial background.  Low and behold the first speaker was on marketing.  He presented a very good general overview of marketing, but the one thing that stuck out in my mind was when he said, “Forget the Market, know your Cost.”  It is one of the most basic principles, knowledge, to me knowledge is power.  In ag there are so many things out of our control that if there is one thing we have the ability to control, we need to focus on that.  Hindsight is always 20/20, but if you know your cost you don’t need to look in the mirror, you have all the facts to look forward and find what “you and your business” needs.  Whether we like it or not profitability or lack thereof is at the forefront of every business and especially agriculture this year.  How do we make a change if we don’t know what is wrong?

With the challenging winter and spring that have created higher costs and lower production, take the time to run a mid-year income/expense and compare it to last year to see how you are holding up.  Are your expenses 10% higher or your cattle or grain production down 5%, or more?  Ask yourself how these things are going to impact you when you come to settle up? 

Farming and livestock not unlike the feed business all have one goal financially and that is to generate a profit.  Now that can very to a degree, but no matter how much we all love something, if it is not making money it is not sustainable for a long period of time. 

Make it a point to schedule time to run the numbers, do a mid-year income and expense comparison and update your balance sheet.  If you cannot find the time, I would encourage you reach out for help.  As an Ag Finance Counselor, I can help producers with income expense analysis, balance sheet preparation or a full restructure with profitability analysis.  Again, knowledge is power and if you don’t have the right tools, I encourage you to reach out.  Financial health in today’s ag economy is just as important as the health of your livestock or your crops.  Don’t let the lack of knowledge force you into a bad situation or even worse allow you to miss out on an opportunity.

Call or email for more info 605-354-0682 or lisab@secog.org

As I sit in my kitchen for the first time in about 5 days, sitting down to eat, I look around at the aftermath that has been left from the last winter blast.  As I have stated before a Farmhouse during calving is not always “put together to say the least”, but during a winter storm, things just fall apart.  The dishes continue to pile up as the calf bottles need run through the dishwasher first, and the bathtub still covered in mud from thawing water hoses! 

This dirty Farmhouse is nothing compared to the aftermath that all livestock producers have been dealing with and will continue to deal with since the storm ended.  Everyone was praying for the livestock producers during the bad weather but what comes next is what really requires some prayers.  The struggle to find a profit producing food to feed the country is heightened by 100 times when you just spent money on anything you could to help to protect your livestock.  Not only that, if you were lucky enough to get through without any death loss, which I will tell you here that doesn’t often happen, there is the sickness that you now have to treat for.  Added vet costs and time spent treating calves, that no one has, adds to the stress as we are now even more behind as planting time quickly approaches. 

These struggles are real, I have been a cattle producer and not a finance counselor for the last week.  I did whatever I could to help my husband try to make good decisions that completely focused on the health and livelihood of the cattle, no matter what the cost.  But then, like the dirty Farmhouse, the reality of life and tight budgets comes back to haunt in the after aftermath of increased expenses and less production.  I as a cattle producer have done my job, focused on the health and well being of the animals.  Now I, as a finance counselor, will try to evaluate the numbers and see where else we can trim from an already tight budget or find more “work” to do to make up for the “aftermath” that the last 5 days have brought.

Being a livestock producer has its challenges on a regular basis but catastrophic events like these are heart wrenching for those trying to make a living doing what they love so that the world can have food.

Remember that the AFTERMATH is sometimes harder than the disaster.  I encourage all livestock producers to keep your head up and remember why it is you do this.  The sight of a new born baby being licked off by a mother or the sense of pride as a load of calves are sold at the sale barn.  I also encourage you, to after the dust or mud in this case, settles, take a look at your budget and see what you need to do. 

One of the most predominate trends in a Farmhouse right now, is the talk, or lack thereof, finances.  A farm or ranch, although is one of the most rewarding ways of life, is also one of the most difficult to manage in the area of finances.  With the lower commodity prices and the increased costs, it seems to be more difficult than ever to make the end number come up positive.

Farmers must be good at a lot of different things including agronomy, mechanics and animal health.  The list goes on and on, but one thing that continues to fall through the cracks is money management.  A farmer is a hard worker but at the end of a long day the last thing they want to do is sit down and look at breakevens. 

I want to bring to light the importance of knowing your costs, true costs, and how they affect your operation.   Knowledge is power.  If you don’t have all the tools in your tool box, the final product will not last, which is crucial to the long-term financial health of a Farmhouse. 

Financial management is a difficult item to address on a farm.  A local downtown business is allowed to talk about the struggle of a 20% decline in sales but not a farmer.  The reality of managing a farm operation, is that it must account for more than just cost in and out.  The true goal of all operators is to generate profit from what they are doing. Too many times in farming that does not happen.  Why, many people do not know, including some producers.  To get operators to a point of making decisions more on facts and less on emotion is difficult.  To take out emotion, one needs facts.  Sometimes things are so overwhelming that the facts seem to blur.

I encourage you to clean the line and give your operation the option to make good decisions.  Start small, while you are calving this year carry another book in addition to your calving book and keep notes of the unexpected costs.  Bad weather, creating additional bedding or a new sickness in the calves that you have to treat. 

Farmhouse Finances are not the most fun thing to talk about right now but if you as a producer identify things that are not working and actively try to fix them, your operation will be much better off.  Would you choose to not feed your livestock or not spray your field, I think not?  Then why has it become acceptable to just turn a blind eye to the financial side of farming.    

In the summer of 2018, my family decided to remodel an old building.  I needed an office for myself as well as the store front for our new business, 6B Seed and Supplies.  Well into the process I began to think about reusing some of the items that we were finding while sifting through 100 plus years of old iron and dust!  I wanted to put my ideas into action so where did I go…Pinterest.  I would search rustic or old farm decorating ideas, and what would always pop up? “FARMHOUSE” style.  I looked and yes, a lot of the ideas were so cute.  I thought how is all the old stuff that I am finding somehow the “new thing.”  I have been digging in trees and buildings since we moved onto my husband’s family home-place 6 years ago.  It is funny how much cuter things are on Pinterest than when you are digging them out of the dirt and wiping bird or mouse poop off!

I began to wonder as I saw picture after picture with a perfect set up of a mudroom with clean boots lined up or gleaming clean kitchen, all with a big FARMHOUSE sign.  I wandered into my dirty kitchen, hmmm, apparently these people have never been in a true farmhouse.  The mudroom should be full of muddy boots, hats, gloves and most likely a dirty dog of some sort, and the kitchen…during calving or harvest add a pile of dishes to the counter and maybe even a Tylenol bottle or something else!  It got me thinking, do these people who put up their cute signs with the “farm to table” or “home grown” really appreciate what that means. 

The idea of using something so new and trendy to reflect on one of the most well-respected lifestyles and professions of all time, The America Farmer, why not.  This is my inspiration to bring the real life Farmhouse to the forefront, real, raw and uncut!