Finance with Don Fraser Fraser Farm Finance

In my work I notice there seems to be a disconnection between the farmer and his team of professionals – so holding a stakeholders' meeting will have a huge upside for your farming business.

Farmers need to acknowledge you're literally running a multi-million dollar business off the kitchen table. So where is the board meeting and the governance? You will have a solicitor, accountant, banker, advisor, suppliers, insurance people, not to mention key staff and your wife.

Sadly, in many farming businesses there are no meetings, often no team work and generally a lack of communication between these important people in your business. A very wealthy and successful rural commentator recently told me his accountant and solicitor did not like each other, so you wonder how would that play out in his business.

Your accountant does the books, solicitor performs the legal stuff, consultant sorts the production, your banker does the bank detailing and so on – but without your consent, they're really unable to liaise or discuss your business.

The most exciting improvement in farming business I've seen lately is farmers who call a stakeholders meeting. Why, because all these important professionals get together in one room and discuss your business.

A simple plan might look like this:

You will need a designated meeting room, then email all your stakeholders, put on coffee or lunch, depending on when you have the meeting, and have a whiteboard available.

The best way to start this meeting of professionals is to record assets and liabilities on the whiteboard. Discuss these and look for improvement in interest rate cost and so on.

Move on to review the balance sheets. Did you make a profit? What are the issues?
Again, summarise the details onto the whiteboard.

Then maybe stock numbers, and strategies for maintaining/improving production, could be discussed. Is the effluent system up-to-date?

Are the leases formalised? What about employment contracts and job descriptions?

What is the plan for the coming season? What are you doing about your succession issue?

Who is going to do what, to ensure all the loose ends are tied up?

Work through a list of topics and planning important to you and your farming business.

Everybody gets an email of the conclusions; and they'll look forward to next year's stakeholders meeting because it is effective and positive.

These meetings are very essential if you are a director or trustee. Take time to get everybody focussed on your business. The improvement in management planning returns and dropping of stress levels are nothing more than spectacular.

So, Mr Farmer, take time to organise and run a stakeholders meeting with a formal invite and agenda. You will be amazed at what comes from the meeting and the general improvement in your business outcome.

These are the opinions of Don Fraser of Fraser Farm Finance. Any decisions made should not be based on this article alone and appropriate professional assistance should be sought. Don Fraser is the principal of Fraser Farm Finance, and a consultant to the farming industry. Contact him on 0800 777 675 or 021 777 675.