Not every producer is waiting on a government check or a market miracle. Some are already profitable, and their mindset tells you everything.
While on the road, an unexpected airline delay created a unique opportunity for a group of progressive, business-minded producers to engage in a private, wide-open discussion about agriculture, the industry’s future and their own operations.
In the hotel conference room seated around a round table, a two-hour session provided a glimpse of how top-level owners and managers are not just coping but also actively positioning their businesses for the future.
What was unique about this group: All were involved in the depressed grain and row crop industry, where many producers are waiting for the magic wand or government payments to cure their deficits.
These producers drew on my experience, wisdom and futuristic outlook as an educator and business owner. But my listening and nonverbal communication antenna also was in high gear to gain nuggets of wisdom from this unique group. An important note: All four of these producers generated accrual-adjusted net income over recent years despite operating in a depressed industry.
Peer groups helpful
The first observation was that they participate in peer groups that directly discuss management practices. The peer groups also hold member businesses accountable through planning, monitoring and responding to changes in their operations.
Beyond their core business in the commoditized, economically depressed grain and row crop industry, they also explore opportunities for diversified and dimensional revenue streams for resiliency, agility and nimbleness.
They took a deep dive, critically examining existing resources such as land, facilities and equipment. They already liquidated underutilized equipment through their network connections. Every land and rent contract was evaluated on quality of land vs. cost, logistical considerations and landlord relationships, including future ones.
Family member, manager and employee assessments often resulted in tough decisions. This group focused on risk management and marketing, and from what I observed, they made decisions with objectivity and logic rather than emotion and ego. When emotion did creep in, the group collectively filtered it out.
Planning for next generation
A major challenge with this collaboration was bringing the next generation into the peer group. I suggested they develop a written history, including both the successes and the challenges they have faced, along with revisiting and updating their core values.
Next, I recommended the group conduct a good, old-fashioned analysis of the business and industry called SWOT for strengths, weaknesses, opportunities and threats. Out of this strategic plan, they could develop a written guide to managing the transition process.
With the snowstorm bearing down, we broke with that assignment as their final charge. Time will tell whether this positive thought-sharing networking session will result in this group moving forward with their plans to address their transition challenges. The answer lies entirely within their control.
The profitability of these producers was not accidental. It was the result of intentional decisions, honest self-assessment and a willingness to be held accountable by people they respect. If your operation is waiting on better prices, a government program or the right moment to make a move, consider this: The right moment is a choice, not a circumstance. Find your people, do the hard work and put it in writing.