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15 Ways to Make Your Farm More Profitable

15 Ways to Make Your Farm More Profitable

FromFarm4Profit Podcast


15 Ways to Make Your Farm More Profitable

FromFarm4Profit Podcast

ratings:
Length:
10 minutes
Released:
Sep 2, 2019
Format:
Podcast episode

Description

This list is from INC.Com. Written by David Finkel a professional business coach.
Here is a quick list of the simple things you can do to increase your company's gross and
operating profit margins. 

Speed up your design cycle (Decision Making).  This can allow you to accomplish
more tasks in half the time, potentially increasing your profits over 30 percent. The
faster you can make a decision the more efficient your team can become.
Eliminate tasks and activities that don't add value to the company or customer.
 Every dollar you save by eliminating the cost of things that don't add value to your
company drops directly to your bottom line.
Increase pricing.  If you bill hourly, review your billing rates and push them higher.  If
you charge per product, look for ways you can command a higher price.  Could you
bundle more value into a package?  Improve your marketing and sales scripting to
effectively sell at a higher price?  Or could you just boldly increase your pricing?  Most
farms/businesses set their prices when their business was first launched, and since
they were so hungry for business, they set pricing levels low. Over time, the business
likely only made nominal increases to pricing every few years, but rarely did the
owner ever sit down and fundamentally rethink his or her pricing model. Well take a
close look at your pricing now.
Regularly review your administrative and operational staff levels closely.  Let your
revenues grow faster than you’re hiring. If you have underutilized staff create
methods of task that can add to your bottom line.
Shorten your sales cycle.  How can you close your sale faster?  This will decrease
your sales cost per transaction and free up a lot of hidden cash flow that previously
was locked up in your sales staff. – biggest ones are early season discounts, interest
expenses, and product condition.
Increase the dollar value of every sales transaction.  Ask, How can I get each
customer transaction to be for a larger dollar amount?"  What upsells, cross sells, or
resales could you strategically implement?  What package offers could you test and
introduce?
Do the trucking yourself
Manage quality (in the meat, grains, etc)
Deliver to final destination
Deliver on their schedule
Beware the steep cost of attrition/retention. Customer retention is a strategic
expense if spent wisely.  How can you increase your customer retention?
Landlords
Private Meat Sales
Grain Merchandisers
Employees
Feed your winning sales people more leads (even if that means you starve your
lower performing sales people of leads.)  This is not a time to be "fair", but to be
strategic.  If every lead you give to John is worth $2,100 and every lead you give to
Sarah is worth $3,200, then you've got to take this into account when you divide

leads. Be transparent about this and let it be a spark to help John learn how to
increase his own dollar value per company lead given to him. Think of this with
employees. If one employee is better at a task, give them the option for overtime and
send the others home. More worth your money.
9. Strategically map out systems. Look for ways to educate your staff on the ideal use
of their time with your product or service.
10. Shift a cost from a fixed to a variable expense to give yourself greater flexibility.
 This is a way to protect your cash flow.  It is extremely important for unproven
tactics and strategies.  Flex leases, variable rate loans (inverted now), basis
contracts.
11. Shift a cost from a variable to a fixed where the value is proven.  Make this shift
only when you can negotiate a substantial price savings by doing so. Fertilizer, seed,
insurance, interest rates (now)
12. Consistently look for ways to lower your fixed overhead.  Scrutinize your base
expenses to eliminate non-strategic expenses that just don't add value to the
company or to the customer.
13. Negotiate hard.  Take the time to plan out your negotiation strategically.  Create
competition for your dollars.  Create a li
Released:
Sep 2, 2019
Format:
Podcast episode

Titles in the series (100)

Our mission is to provide farms and operators an independent and unbiased outlet for information related to increasing the profitability of their farming operation. We will be providing farms and operators of all sizes and experience levels access to the latest trends, projections, and the tools necessary to increase farming profitability. We will take each episode to deliver latest news, what's working for active farms, and a topic of focus each episode. Remember, if you aren't farming for profit you won't be farming for long.