Do you have a business plan for your cow/calf operation?
Producers should research what they can do in their cow/calf operation to improve assets and profits.
One of the best ways to improve your business or start one is by having a firm business plan in place. This allows you to make sound investments and decisions in your operation to bring you to the top of the industry.
Business plans can also be very helpful in getting loans from banking institutions by providing evidence that you have taken time to review the items that you are require and how you will pay it off.
Business plans typically focus on several main aspects of your operations, which consist of pre-developed questions relating to your operation. Answering these questions results in a business plan layout that you will bring together for your final product.
These questions have been compiled by companies and institutions to prepare you to look into the future of your business.
The first section in a typical business plan is developing your operation's principles. This consists of questions that reveal why you feel it is important to have this operation. It will give clarity of the benefits this business can provide to society.
Some typical questions include: What are your personal values? What are your economic values?
After preparing your operation principles, a business plan will guide you through a series of questions compiling your operation history up to where you are at today. Questions in this section will range from what are your current marketing strategies? What are your current assets? Also, they will have you building a balance sheet of your current operation or future operation.
With the history of your operation developed, the next step in a business plan is to create goals and visions for the long term of your operation. You will need to create a mission statement in this part which is developed from your visions and goals. Visions and goals will be needed to plan for the next 5, 10 and 20 years of your operation.
Your mission statement, created from your visions and goals, will lead you to creating a strategic plan that will allow you to reach those goals and visions.
The strategic plan involves developing what your market will be. How much you can potentially sell and for how much? Also who is your competition? How will you reach your potential customers through advertising?
The final step after having your business plan developed is to review it and come up with what direction you want to take you business. Then, with this direction, you will be able to compile your information into a final business plan.
The most important thing once have this business plan is to have checks in place to monitor your progress toward your goals and visions.
At the same time, remember that even though you have set goals you can keep making new goals after completion of others to move your business forward.
And maybe the most important thing of all is to keep good records of your operation. Without well kept records you will not be able to bring your business to the forefront.
The University of Minnesota's Farm Business Management has developed such a program over the years to allow entrepreneurs to create business plans in a straight forward process. This software program is called FinPack, which will walk you through the steps of building a business plan, through a full set of questions to answer.
With all the talk about creating a business plan many of you are asking yourself whether your business really needs one? Here are five reasons why you should create a business plan for your beef operation.
- You are starting a new cow/calf operation.
- You run more than 60 cow/calf pairs on your operation.
- You would like to take advantage of NRCS and EQUIP funding programs.
- More than $25,000 of your living expenses come from your cow/calf operation.
- You are changing the type of operation you are currently running to a new enterprise.
If any of these reasons fit into your cow/calf operation then it would be a good idea for you to take the time and focus on developing a business plan. The goals, visions and financial layout of your business will bring you large benefits in taking your cow/calf operation to being a successful one.