DO YOU HAVE A CLEAR VISION FOR YOUR BUSINESS?

We’re a month into 2024, the holidays are over and for many of you, work on the farm has probably ramped up. But no matter how busy you are, you need to take some time to set business goals, both for the year ahead and for the longer-term.

Goal: “the object of a person’s ambition or effort; an aim or a deserved result”.

But it’s not simply a case of setting the goals, or even printing them out and sticking them to the whiteboard. To achieve your short and long-term goals, you need to work out the steps to get there.

You need to be clear about the simple, actionable steps you need to achieve your goal, so you can ensure your day-to-day activities are actually working towards your goal and not against it.

In this blog, I want to share a bit about my vision and goals for Purvis Agrifinance this year. I’ll then cover setting short and long-term financial goals and how I can help you achieve these.

MY VISION FOR PURVIS AGRIFINANCE

From the beginning, my vision for Purvis Agribusiness has focused on you and your business. By providing tailored finance solutions, I’ll help you achieve the financial stability you need to reach your goals. I am the broker in your corner.

MY GOALS FOR 2024

I’ve set a few goals for myself this year, both in my business and personally. These include:

• Creating more networking opportunities for my clients. I really enjoyed the events I organised last year and I’m looking forward to creating some opportunities for the men.
• Following up on how my clients came to contact me. I want to make sure I recognise those referring people to me.
• Reading more books.

SETTING LONG-TERM GOALS ON AND OFF THE FARM

Having clear long terms goals is important for any business. Knowing where you want to be in 5, 10 or even 20 years helps you make the right decisions. Clear, well-researched goals are also essential when seeking new finance or changing banks.

I know the idea of setting goals can seem daunting, but it’s something I can help you with.

First, we’ll do a thorough assessment of your farm business and look at strengths, weaknesses, opportunities and threats (aka a SWOT analysis).

Then we’ll look at areas for improvement, like optimising productivity, identifying new markets, or improving resource management.

 Once we’ve been through this process, I’ll help you set realistic, measurable and time-bound goals to help you achieve your business vision. 

SHORT-TERM FINANCIAL GOALS TO SUPPORT YOUR SUCCESS

While setting long-term goals is important, setting short-term goals will not only support your success, but it will help you stay on track.

Here are some ideas for short-term goals you could set for your business in 2024.

Revenue goals

Create achievable goals for the amount of income you’re likely to earn in the next year. Set goals for how you’ll achieve this revenue.

For example:

• Increase lambing percentages by 5%
• Increase contracting income by 10%

Benchmarking goals

You can benchmark your business against similar businesses to yours, but of far greater value to your business is using benchmarks to compare your business against its own historical and budgeted performance.  

              For example:

• Debt to gross farm income
• Finance cost ratio
• Interest cover ratio
• Gross farm income to farm working expenses
• Livestock and crop gross margins

Cost reductions

Determine where the biggest opportunity cost is within your expenses. Then, aim to reduce it slowly.

You won’t always get instant results, but decreasing costs should always be one of your financial goals. Every dollar saved is another you can put towards growing your business.

For example:

• Managing the use of inputs such as seed, fertiliser and fuel
• Negotiating more competitive pricing
• Reviewing and monitoring drawings

For more ideas about managing costs, have a look at the Profit Driver blog series I wrote last year.

Improve financial margins

Work to increase your business profits by focusing on your margins.

Are there parts of your business that are not performing as well as others? Look at your overhead and operating expenses.

For example:

• What is the cost of production for the commodities you produce? 
• How does that compare to the gross income? 
• How do I improve this?

Manage your debt

If the level of debt in your business is holding you back from achieving your goals, I can help you create a plan to keep debt under control. We can then identify ways to reduce your existing debt over time.

For example:

• Negotiate terms with your lender
• Identify cost reduction opportunities
• Look at strategies to increase income
• Monitor budget and actuals to identify problem areas

Improve your cash flow

Managing cash flow is difficult for many businesses. But cash flow planning is an opportunity for your business to better manage expenses, unexpected costs, reductions in income and debt.

Improving your cash flow might include:

• Restructuring your debt and repayments
• Controlling your farm expenses better
• Reviewing the efficiency of your equipment.

This blog will also help you take control of your cash flow and develop a cash flow budget.

Setting personal and family goals

Of course, goal setting shouldn’t just be about your farm and business.

Take some time to create some goals for you and your family. These could include supporting your kids though school, taking a holiday or improving the house. Knowing there are things you are your family want to achieve will provide extra incentive to achieve your business goals.

Reviewing your goals

When was the last time you reviewed your business and personal goals?

While setting goals is important, it’s also important to check your progress throughout the year.

Are your goals still relevant to your business?

Have there been changes to your circumstances or the industry that means you should adjust your goals?

Make time in your schedule to review your goals. You should review your short-term goals regularly, perhaps every month. You can review your long-term goals quarterly or even annually. Look at your progress, considering both qualitative and quantitative measures.

By regularly assessing your goals, you can ensure you’re on track to achieve your long-term vision for the business. Depending on how your business is tracking, you might need to adjust your strategy.

There is also another benefit to reviewing your goals regularly. It provides an opportunity to celebrate your success, acknowledge milestones, and recognise your team and their efforts.

ARE YOU READY TO SET YOUR BUSINESS GOALS FOR 2024?

So, over to you. Have you set your business goals for 2024? What about your personal and family goals? Have you reviewed your long-term goals?

If you’d like some help to set your goals or have comments and questions, please get in touch. Finally, if you liked this article, I’d love you to share it.