A recent video conference with alumni who are graduates of Farm Credit University's Ag Biz Planner program provided some interesting points. This online course guides farmers and ranchers through the process of developing a business plan and working with agricultural lenders. Let’s look at what these producers had to say a couple of years after completing the program.

Before enrolling in the program, the panelists indicated that their priorities were production, business and then financials, respectively. After completing the program, they switched their priorities to focus more on the financial and business side of their operations. They found that having a better understanding of the financials, along with business and marketing skills, allows them to make better production decisions. Now, instead of visiting the financials at the end of the year, they are engaged each month and particularly each quarter when examining the cash flow.

Initially, their parents did not want them involved during meetings with the agricultural lenders. After the course, the program alumni are more comfortable with the financials. Many of the graduates have now taken over the responsibility of gathering information for the agricultural lenders and leading the meetings.

The panelists admitted that at the beginning of the course they were overwhelmed and a bit challenged. However, a few years after the course they each have a three-ring binder containing their business plan, which they refer to when making decisions. In tips on keeping records, they have found that using a smartphone for tracking everything and sending it to email has been invaluable, particularly when catching up on rainy days or slow times at the farm.

The panelists were grateful to the agricultural lenders who mentored and guided them with questions and for helping them overcome roadblocks during the course. They indicated that this increased loyalty to that lender for going the extra mile in establishing their education.

They indicated that they got to see the financials from the lender’s side of the desk. The program shed light on why accurate balance sheets, documentation of assets and liabilities, and projected cash flows with financial sensitivity analysis are important to lenders, but also important for managing the business.

Five years out from the course, their reflections were to use the business plan, but be flexible enough to adapt the plan to changing conditions such as weather, markets and costs. One last benefit was that completing the course enhanced communication among family members, lenders, accountants and other stakeholders and students who had completed the course and are now working in agricultural businesses.

A good method to jumpstart your business, particularly for the 2020s, is to enroll in, engage and complete a course that is designed to increase your business IQ.