15 Ways to Make Your Farm More Profitable

This list is from INC.Com. Written by David Finkel a professional business coach.

Here is a quick list of the simple things you can do to increase your company's gross and

operating profit margins. 

Speed up your design cycle (Decision Making).  This can allow you to accomplish

more tasks in half the time, potentially increasing your profits over 30 percent. The

faster you can make a decision the more efficient your team can become.
Eliminate tasks and activities that don't add value to the company or customer.

 Every dollar you save by eliminating the cost of things that don't add value to your

company drops directly to your bottom line.
Increase pricing.  If you bill hourly, review your billing rates and push them higher.  If

you charge per product, look for ways you can command a higher price.  Could you

bundle more value into a package?  Improve your marketing and sales scripting to

effectively sell at a higher price?  Or could you just boldly increase your pricing?  Most

farms/businesses set their prices when their business was first launched, and since

they were so hungry for business, they set pricing levels low. Over time, the business

likely only made nominal increases to pricing every few years, but rarely did the

owner ever sit down and fundamentally rethink his or her pricing model. Well take a

close look at your pricing now.
Regularly review your administrative and operational staff levels closely.  Let your

revenues grow faster than you’re hiring. If you have underutilized staff create

methods of task that can add to your bottom line.
Shorten your sales cycle.  How can you close your sale faster?  This will decrease

your sales cost per transaction and free up a lot of hidden cash flow that previously

was locked up in your sales staff. – biggest ones are early season discounts, interest

expenses, and product condition.
Increase the dollar value of every sales transaction.  Ask, How can I get each

customer transaction to be for a larger dollar amount?"  What upsells, cross sells, or

resales could you strategically implement?  What package offers could you test and

introduce?
Do the trucking yourself
Manage quality (in the meat, grains, etc)
Deliver to final destination
Deliver on their schedule
Beware the steep cost of attrition/retention. Customer retention is a strategic

expense if spent wisely.  How can you increase your customer retention?
Landlords
Private Meat Sales
Grain Merchandisers
Employees
Feed your winning sales people more leads (even if that means you starve your

lower performing sales people of leads.)  This is not a time to be "fair", but to be

strategic.  If every lead you give to John is worth $2,100 and every lead you give to

Sarah is worth $3,200, then you've got to take this into account when you divide

leads. Be transparent about this and let it be a spark to help John learn how to

increase his own dollar value per company lead given to him. Think of this with

employees. If one employee is better at a task, give them the option for overtime and

send the others home. More worth your money.

9. Strategically map out systems. Look for ways to educate your staff on the ideal use

of their time with your product or service.

10. Shift a cost from a fixed to a variable expense to give yourself greater flexibility.

 This is a way to protect your cash flow.  It is extremely important for unproven

tactics and strategies.  Flex leases, variable rate loans (inverted now), basis

contracts.

11. Shift a cost from a variable to a fixed where the value is proven.  Make this shift

only when you can negotiate a substantial price savings by doing so. Fertilizer, seed,

insurance, interest rates (now)

12. Consistently look for ways to lower your fixed overhead.  Scrutinize your base

expenses to eliminate non-strategic expenses that just don't add value to the

company or to the customer.

13. Negotiate hard.  Take the time to plan out your negotiation strategically.  Create

competition for your dollars.  Create a list of concessions you want, with extras for

you to trade off.  Research the market to better understand the best deal you can

expect.  Even hire an experienced negotiator to help you make the purchase on the

best price and terms you can.  If the asset you're buying for your business is large

enough, the ROI on your negotiation work can be immense.

14. Get clear on all the costs of inventory: cost of capital; storage; insurance; etc.  This

will help you make informed stocking levels. – placing insurance premium

equivalents into a reserve account can add up over the years and create a pool of

income generating self-insurance.

15. Set optimal inventory levels and stick to them.  Constantly be on the lookout for

ways to safely reduce your inventory levels.  If you have inventory you're unlikely to

sell, scrap or donate it so that you can free up the space and write off the inventory.