“If you’re not growing you’re dying,” is a phrase that I have heard from a number of farmers, maybe you have even said it. The thought is that growth, typically measured in terms of acres or heads of livestock, leads to a healthy farm and prosperity. Farmers, being the entrepreneurial type, thrive on growth and their ability to adjust to the challenges of a larger operation.
The notion of growth comes naturally for farmers as it starts every spring with planting and ends that same year with harvest. Growth is good. So is all growth good? Well maybe and maybe not. Let’s take a look at some areas of growth important to all farms:
1. Personal growth: While farmers are entrepreneurs for sure, they also are very giving. Sometimes so giving that they forget about themselves. Working long hours and pushing against weather and financial deadlines will propel a farmer from year to year with little regards to their own development, because there just isn’t time.
But the leading farmers find time to learn about new ideas, from outside of farming and agriculture. It is interesting that when you invest time to learn about something other than your specialty you reshape your ideas and have the opportunity to approach challenges on your farm in a totally new way. What would happen if after reading and studying about business management, a farmer had a new idea about how to plan differently for his future farm decisions? Breaking out of old ruts is difficult, but it is possible when you change perspective with new ideas.
2. Size of the farm business: Is the size of the farm business always a good measurement? Is growth in acres alone always good? The best answer is …it depends. The heart of the answer is about internal motivation. If the motivation for growth is fueled by the need to be noticed or it creates identity for you within the community, all kinds of complications can arise. Debt, high risk decisions and stress can be outcomes for a farmer and farm families when growth in acres is associated with and needed for personal identity.
When the size of the farm is an outcome of solid business planning and agronomic practices, then by all means growth is good. When family participation is an opportunity and not an obligation, then by all means growth is good. When debt and lines of credit are used to fuel the business plan and not a means of last resort, then by all means growth is good. When a well-constructed succession plan is communicated and understood by all stakeholders, then by all means growth is good.
3. The farm business’ mindset: The Cambridge Dictionary defines mindset as a “a person's way of thinking and their opinions.” The current commodity prices can place pressure on farmers, their margins and their mindset. Growth in acres won’t cure low soybean prices, but a change in mindset can change the way of thinking.
Why do some farmers grow, in acres, when prices are low? How do some farmers buy land when grain prices are low? Why do some farmers have a different mindset than everyone else?
It seems like some farmers aren’t phased by the low soybean (and corn) prices because of their mindset. They don’t look at farming as ‘one crop a year’ cycle. They have plans that are 5-7 years long and they expect downturns. They save when times are good and invest when the low cycles occur (and these cycles always occur). Growth to them is an outcome of the plan, it’s part of their mindset when they make decisions on their farm from a long term business perspective.
Every spring farmers participate in the annual event of planting and witness crop growth each day. Plant growth and its health is due to the right seed, soil ingredients, planting practices and moisture to be healthy and prosperous. Something similar can be said for the farm business. With the right mix of personal growth, the right type of farm growth and the right mindset your farm business can grow the right way.