The Farming Outlook: What Can You Do?
Key Learnings:
- Have a budget - Be honest and realistic when setting the budget.
- Identify areas to make savings that will have the LEAST impact on performance.
- Be prepared to make some tough decisions, i.e. Review and stop unnecessary repairs & maintenance or capital expenditure. What can be deferred? What, if any, surplus plant can be sold to help cashflow?
Talk to your Bank about:
1. Your Interest rates
2. Overdraft requirement
3. Interest only options
Most of all keep your bank informed on what you are doing or intend to do to proactively lessen the impact.
- Can you improve your current system? i.e feed, wintering, fertiliser (timing, area applied), stock policy, deferred payments?
- Keep close to your team, especially contract milkers, sharemilkers or those with any equity in rural, as they will also likely have financial commitments.
- As the owner/leader, try and remain positive and upbeat. Yes, it’s a challenging time, but remember this is a cycle and we need to proactively work through this cycle.
- Tax planning - Discuss with your accountant your upcoming Provisional Tax payments. Your income will be back, so the tax payments "in many cases" may need adjusted back.
- Personal Drawings - Always a difficult subject but again be honest, identify areas that can be reduced.
- Your wellbeing – Important you talk to others, take a break (even a half day to get off farm).
At Malloch McClean, we understand the unique and complex challenges you face and will stand beside you in business as a strategic partner. We know the best ways to drive your success — from cycles and managing your finances and assets, to risk management, succession planning and more. Our team has the experience and expertise to help you take your farming business to the next level. Get in touch today and experience the difference of an award-winning accounting firm.