Is your farm a zero cost factory floor?
Tue 07 Aug 2018
Farming and farming incomes are as volatile as they have ever been and we are yet to see how Brexit will impact them in the coming months and years. Rents and nance repayments are not so volatile, giving rise to an imbalance between income and outgoings.
At Shoulers we believe volatility will continue and we are helping clients analyse their existing business and to plan for the future – often this includes advice on succession planning too.
To properly counter the danger of trading losses caused by the volatility of world commodity prices it is important to change attitudes to the home farm, and think of it as (at worst) a zero cost factory oor for all the pro t making enterprises and at best a contributor to profit.
Below are some bullet points which are an extract from a checklist to aid analysis and business planning:
- What is the current business structure and could it be improved?
- Where is profit generated?
- What are the main activities and objectives?
- How are assets held?
- Are all assets performing?
- Profitability of core farming enterprise
- Benchmarking
- Finance arrangements
- Taxation
- Occupation of buildings & land
- Succession
- Existing and potential non farming activities