Module 6

Wrapping it UP with The Business Side

 

Week 14 | April 9-14

Business Plan

A well written business plan is the foundation and roadmap for managing a successful business. From seeking funding to bank loans or partners, your business plan will help you with investments and will also determine what your needs are. Many times you will also need a business plan when applying for specific farm grants.

Keep in mind that there's multiple ways of creating a business plan that goes from a more traditional very detailed type of plan to a lean startup plan that is high-level focused, fast to write and contains all key info from your business. Regardless of what type of plan you choose to follow, we highly encourage you to take some time and do a solid outline of what you envision your farm business to be, this will help you focus on what's important to you.

Below is a list of educational resources that will help you navigate through business plan types and how to build one that fits your current and future farm needs:

WEBINARS

Before you start your business plan, make sure to watch the webinars below:

Please don't hesitate reaching out if you have any questions, concerns or need any guidance through our Business Plan chapter. We want you all to succeed and we're always here to help you!

Week 15| April 15-22

Business Structure & Insurance

Business structure is a key piece to the way you manage ownership amongst yourself and the other owners. Additionally, the business structure impacts the way federal and state taxes are applied.

To define and understand your business structure, please visit the following link: https://www.sba.gov/business-guide/launch-your-business/choose-business-structure

After reviewing the Business Guide by the SBA, please complete the following checklist:

Farm Insurance is a MUST!

As we all know, insurance should always be part of your risk management strategy when offering a product to your consumer. Each of these types of insurance has various options to consider. You won't need all types of insurance, but you should look into which one is the best fit for your and your farm. When offering a product, you want to make sure your product is fully insured, so there's no risks for you.

Always make sure you contact an insurance professional for your needs. It is important to read the policy, fully document any claims, and talk to your insurance agent in the event of any changes to your operation. The resources provided will give you more insight on how to proceed when choosing your insurance. 

Learn more about Farm Insurance Coverage here:

Insurance companies that usually have Farm Insurance Coverages. Remember it is important that if your farm is also located where your residence is, that it is less expensive usually to do a farm coverage that includes your residence - not 2 separate policies.

Potential Companies to Seek Quotes From

State Farm | | Nationwide | Farm Bureau Financial Services | American Family Insurance | Great American Insurance Company | Travelers Insurance | Grinnell Mutual

Farmers (this is one that you will need to contact local agent and they will find a company that will underwrite the policy on Farmer’s behalf)

Local Independent Agents : Don’t be afraid to call a hometown independent agent. These types of agents work independently and shop the best quote and policy for you! Many times this can be your best option and quickest result!

***If at any time this week you need to speak one on one with a mentor, don’t hesitate to reach out! We are here to walk through this with you!

Week 716 | April 23-28

Financial Sheets

This week we will be covering the importance of record keeping and working with an income and balance sheet. While it might not be one of our favorite tasks, it’s definitely one of the most important parts of a farm operation.

Understanding farm financials is important not only to make sure your operation is profitable and efficient, but also to be compliant with legal requirements for tax purposes. Accurate financial records are also an important tool to make any investment or liquidation decision and explore uses of capital/investments in your farm.   

“The financial position and performance of a farm business can be summarized by four important financial statements. The major statements and their purposes are as follows:

  • Net Worth Statement (also known as Balance Sheet) —summarizes the property and financial assets owned, the debts owed, and the net worth of the farm business at a point in time.

  • Net Income Statement (also known as Profit and Loss Statement) — summarizes the income generated, the expenses incurred, and the net income earned by the farm business during a period of time.

  • Statement of Cash Flows (also known as Cash Flow Projections) — summarizes all the sources and uses of cash by the business during a period of time.

  • Statement of Owner Equity — shows how net worth changed from the beginning to the end of the year.” (Source: University of Wisconsin-Madison)

For this week, please watch FACT’s webinar “Understanding Your Farm Balance Sheet” with guest presenter is Andy Larson, Farm Outreach Specialist at the Food Finance Institute (FFI) at the University of Wisconsin, Madison.

Here is a PDF fillable income/expense sheet and an “account book” spreadsheet by Cornell that you can use as a template/customize for your own farm.

You can also learn more about Farm Financial Statements here.

***If at any time this week you need to speak one on one with a mentor, don’t hesitate to reach out! We are here to walk through this with you!

Meeting #6 | April 29

It’s time to meet up! Join the group at 700PM at the following zoom link: https://us02web.zoom.us/j/84448369206?pwd=dVlJaFB1R1ptbVdOS3Zza014enluZz09