Our commitment to farmer and rancher education helps set Farm Credit apart from other lenders. Because supporting agriculture is our mission, we understand the unique challenges ag producers face and are committed to providing tools that can help our customer-owners overcome those challenges. That is why Farm Credit supports educational programs that help farmers develop their financial and business skills so their farm operation can grow and thrive in this generation and the next.
Young, Beginning and Small Farmer Resources
- Farm Credit partners with national and local farm organizations, land-grant universities, state departments of agriculture and programs like Annie’s Project to support their farmer and rancher education. Some of those resources are linked here. For more information about educational opportunities in your area, contact your local Farm Credit office.
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Annie's Project
An educational program focused on strengthening women's role in farm and ranch enterprises where they may be partners, spouses, or otherwise engaged. The program offers an introductory course in finances.
Annie's Project - Managing for Today and Tomorrow
The Annie's Project course targets business, succession, growth, and estate planning for women in agriculture.
Growing the Next Generation of Farmers
This roadmap for new farmer training is an excellent place to start when assessing how best to address the needs of your trainees with appropriate training materials. Developed by the Land Stewardship Project.
Land Stewardship Project
The Land Stewardship Project is a private, nonprofit organization founded in 1982 to foster an ethic of stewardship for farmland, to promote sustainable agriculture and to develop sustainable communities.
Contact: Karen Benson, lspse@landstewardshipproject.org, (507) 523-3366
One Page Planning Spreadsheets
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The One Page Planning Webinar will walk you through completing these documents.
One Page Planning
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No matter what type of farm or ranch enterprise you envision - small, big, conventional, or organic - a business plan will serve you well. So before you head off into new business territory, we'd like to share some tried-and-true tools for getting that plan underway.
The One-Page Planning Suite provides essential tools for getting started. If you do not answer the basic questions in these straightforward plans, you will likely come back - over and over - to square one. Complete these plans first, and you'll find you're an example of a food system pioneer who made it all the way! The One Page Planning Webinar will walk you through completing these documents.
One-Page Cash Flow Plan
Budgeting for and managing cash flow should be a high priority for farmers and ranchers who want to know how they can plan for success by establishing measurable goals. The interactive spreadsheets below illustrate a simple approach to budgeting based on benchmarked results from many farms and ranches that develop realistic expectations for farm business performance.
Also available is a helpful guide, Twelve Steps to Cash Flow Budgeting that can be used in classroom training or as a self-teaching aid by beginning farmers and ranchers to develop accurate budgets.
The Monthly Cash Flow Budget for "Tyler's Tip Top Tomatoes" is based on a typical small-scale direct-to-retail vegetable business with annual sales of $134,000. In this example, Tyler's Tip Top Tomatoes sells vegetables through several marketing channels, including Community Supported Agriculture (CSA) shares, farmers' markets, and farm stand sales. This example illustrates farming on rented land, a low overhead (low fixed cost) strategy typical of a beginning farmer business that does not own land.
Download this Vegetable Interactive Spreadsheet to experiment with putting in your own numbers for the type and size of small-scale vegetable business you are planning for. Note that the spreadsheet is built from the 5 Line Income Statement described in the One-Page Financial Plan (rows shown in green on the spreadsheets) and your checkbook/cash flows (rows shown in yellow). In addition, the spreadsheet is also based on the One-Page Business Plan.
Planning monthly cash flows is essential when raising livestock with long production cycles. This resource package includes a PowerPoint overview presented initially at the Grassfed Exchange in Bismarck, ND, in August 2013, the Grassfed Beef Cashflow Presentation that introduces the importance of managing cash flow. The grass-fed beef business described in this spreadsheet operates on rented land, which is a low overhead (low fixed cost) strategy typical of a beginning farmer business that does not own land.
This interactive budgeting spreadsheet, Interactive Budgeting Spreadsheet, is a valuable tool that can be downloaded and customized with your data - providing a budgeting and decision-support tool for your specific operation. Again, note that the spreadsheet is built from the 5 Line Income Statement described in the One-Page Financial Plan (rows shown in green on the spreadsheets) and your checkbook/cash flows (rows shown in yellow).
When planning for specific enterprises (cow/calf, finishing steer, etc) of your grassfed operation, The Enterprise Budgeting Spreadsheet) can be useful in your decision support. Also, check out the Budgeting for Grassfed Success: Real Life Numbers - 2014 resource for additional and updated tools.
One-Page Cost/Benefit Analysis
When considering capital or other investments in your operation, making an informed decision through a process that identifies all likely costs and all likely benefits will allow you to determine if you expect to get a return on your investment. The One-Page Cost/Benefit Tool builds on "The 5-Line Income Statement" developed for your enterprise by applying your required Gross Margin percentage to the considered investment to ensure it meet your enterprise's performance expectations.
For real-world examples of the One-Page Cost/Benefit Tool, please reference the High Tunnel, the Tractor, and the Flexible Pasture Fencing examples.
One-Page Pastured Pork
The latest One Page material for Pastured Pork—the live spreadsheet, the One-Page Business Plan, the One-Page Financial Plan, and the PowerPoint slide show.
How To Train
While farmers and ranchers might rather be out planting fence posts, tending livestock, or tilling the soil, they also need to know the business side of farming. Financial record-keeping, understanding the various statements, and using a business plan to guide decision-making is equally essential to their enterprise's success. Some are inclined to dismiss these financial skills as only crucial if and when they may need to borrow money: when the lender asks for these documents before considering a loan. However, financial literacy and business planning are first for the benefit of the farm/ranch owner/operator, irrespective of any need for borrowing. Therefore, convincing trainees to learn these business skills for their benefit should be a priority in any training, setting the stage for full engagement in the learning.
To that end, the trainer can provide the required business training directly in his program if he has the knowledge. Or there may be a benefit in engaging external resources, such as bankers, farm credit loan officers, ag business school instructors, or others to help deliver the training program. A side benefit of using external experts is that they can bring independent third-party credibility to your program. Additionally, by engaging lenders as instructors, your training program can foster commercial relationships and access to the capital they can provide. Bankers are often willing to critique business plans and help farmers get to the creditworthiness.
Also, when training, be mindful not to overwhelm the trainee. Start simple (for example, with a tool like the Farm Credit 1-Page Business Plan or the 1-Page Financial Plan) and integrate the financial discussion into all aspects of the training ("…the reason we decide to place this fence-post here is that it contributes to future sales…").
In your training, continually reiterate the value of financial literacy and business planning knowledge. As the BFRDP program trainer, engage training partners who can vouch for the value (bankers, extension agents, the USDA FSA, etc.). And remember, the social aspect of coming together for training can also lead to informal relationships and mentoring – classmates comparing notes and challenging each other to develop the skills and then tracking towards success in their respective enterprises.
Minnesota Institute for Sustainable Agriculture
The University of Minnesota's Minnesota Institute for Sustainable Agriculture brings together the diverse interests of the agricultural community with interests from across the university community in a cooperative effort to develop and promote sustainable agriculture in Minnesota and beyond.
US SBA Small Business Development Centers
The US Small Business Administration offers excellent primary resources that, while not targeted at agriculture, might be of value for specific needs on the basics of running a small business. SBDC services are available to all small business populations, with specialized programs for minorities, women, veterans, people with disabilities, 8(a) firms in all stages, and individuals in low and moderate-income urban and rural areas. Resources are distributed nationally.
University/Cooperative Extension
State land grant universities and/or extension services may have subject matter experts and enterprise-specific agricultural economists or trainers. Contact your local extension agent or search for them on-site.
Curricula
Ag Biz Planner
An online course from Farm Credit University that guides participants through the process of developing a business plan. This college-level course is available nationwide in an on-demand, online training format for farmers to use from their homes or place of business. In addition, Farm Credit University is making this program widely available to serve Farm Credit's mission: to help prepare young, beginning, small, and minority farmers and ranchers for a more prosperous and fulfilling business, family, and personal life by improving their management and business planning skills.
One-Page Pastured Pork
The latest One Page material for Pastured Pork—the live spreadsheet, the One-Page Business Plan, the One-Page Financial Plan, and the PowerPoint slide show.
One-Page Cost/Benefit Analysis
Making an informed decision through a process will allow you to determine if you expect a return on your investment. The One-Page Cost/Benefit Tool builds on "The 5-Line Income Statement" developed for your enterprise. It applies your required Gross Margin percentage to the considered investment to ensure it meets your enterprise's performance expectations.
For real-world examples of the One-Page Cost/Benefit Tool, please reference the High Tunnel, the Tractor, and the Flexible Pasture Fencing examples.
One-Page Cash Flow Plan
Budgeting and managing cash flow should be a high priority for farmers and ranchers who want to know how to plan for success by establishing measurable goals. The interactive spreadsheets below illustrate a simple approach to budgeting based on benchmarked results from many farms and ranches that develop realistic expectations for farm business performance.
Also available is a helpful guide Twelve Steps to Cash Flow Budgeting that can be used in classroom training or as a self-teaching aid by beginning farmers and ranchers to develop accurate budgets.
The Monthly Cash Flow Budget for "Tyler's Tip Top Tomatoes" is based on a typical small-scale direct-to-retail vegetable business with annual sales of $134,000. In this example, Tyler's Tip Top Tomatoes sells vegetables through several marketing channels, including Community Supported Agriculture (CSA) shares, farmers' markets, and farm stand sales. This example illustrates farming on rented land, a low overhead (low fixed cost) strategy typical of a beginning farmer business that does not own land.
Download this Vegetable Interactive Spreadsheet to experiment with putting in your numbers for the type and size of small-scale vegetable business you are planning for. The spreadsheet derives from the 5 Line Income Statement described in the One-Page Financial Plan (rows shown in green on the spreadsheets) and your checkbook/cash flows (rows shown in yellow). In addition, the spreadsheet comes from the One-Page Business Plan.
Planning monthly cash flows is essential when raising livestock with long production cycles. This resource package includes a PowerPoint overview presented initially at the Grassfed Exchange in Bismarck, ND. In August 2013, the Grassfed Beef Cashflow Presentation introduced the importance of managing cash flow. The grass-fed beef business described in this spreadsheet operates on rented land, which is a low overhead (low fixed cost) strategy typical of a beginning farmer business that does not own land.
This interactive budgeting spreadsheet, Interactive Budgeting Spreadsheet, is a valuable tool that can be downloaded and customized with your data. This provides a budgeting and decision-support tool for your specific operation. Again, note that the spreadsheet comes from the 5 Line Income Statement described in the One-Page Financial Plan (rows shown in green on the spreadsheets) and your checkbook/cash flows (rows shown in yellow).
When planning for specific enterprises (cow/calf, finishing steer, etc.) of your grassfed operation, this tool (Enterprise Budgeting Spreadsheet) can be useful in your decision support. Also, check out the Budgeting for Grassfed Success: Real Life Numbers - 2014 resource for additional and updated tools.
NxLeveL® for Agriculture Entrepreneurs
This course targets entrepreneurs who have started or are considering starting an agricultural venture unrelated to large-scale, commodity-style production. The materials are designed for individuals pursuing innovative ideas and enhanced marketing opportunities in agriculture. This 10–session course is usually delivered over 12 weeks.
Launch Pad Orientation Curriculum
Farm Credit University offers a "Launch Pad Orientation Curriculum" that could be invaluable to farmers and ranchers interested in understanding the lender's needs. The curriculum also aims to train new associates within the Farm Credit System.
Growing Farm Profits Online Course
The Southern Sustainable Agriculture Working Group offers the Growing Farm Profits Online Course developed for farmers and for those who help farmers grow more sustainable farming enterprises. While this course will have a vegetable production slant, many of the concepts and principles discussed will be informative to other producers. It includes:
· A video series that helps farmers understand some of the hidden factors influencing their profitability.
· A wide variety of Record Keeping Spreadsheets because we understand no record-keeping system fits everyone.
· A collection of Documents that farmers have found helpful.
· The Powerpoint Presentations are used in the Growing Farm Profits classroom training. Farmers can use the presentations as a refresher for those who have participated in the training.
Fearless Farm Finance
A book that will help your trainees navigate through the basics of farm finance. by Jody L Padgham and Paul Dietmann (of Compeer Farm Credit) updated 2017
Business Tools Publication
Northwest Farm Credit Service recognizes the vital role of management decisions in the success of an agricultural business. It offers publications discussing various management topics for producers. The Business Tools Publications suite includes seven resources on the following topics:
· How Lending Decisions are Made
· Preparing Agricultural Financial Statements
· Financing Agriculture: The Business Borrower-Lender Relationship
· Understanding Key Financial Ratios and Benchmarks
You can download these publications from the website link below or complete the form by contacting Northwest FCS at BMC@northwestfcs.com.
Building Sustainable Farms, Ranches and Communities
Building Sustainable Farms, Ranches and Communities: Federal Programs for Sustainable Agriculture, Forestry, Entrepreneurship, Conservation and Community Development. 2009. This 108-page publication catalogs the broad range of federal programs that might be of interest to BFRs. Sustainable Agriculture Research and Education Program, with the Michael Field Agricultural Institure, and the National Center for Appropriate Technology.
Building a Business Plan for Your Farm: Important First Steps
This 20-page document (PDF) offers both business planning and enterprise budgeting tools, and provides a good overview of how to get started. Prepared by Rodney Jones for the 2003 Risk and Profit Summer Conference in Manhattan Kansas. August 14 - 15, 2003.
Budgeting for Grassfed Success: Real Life Numbers - 2014
Building on the "Budgeting for Grassfed Success – 2013" experience, this set of resources was presented at the Grassfed Exchange in Columbia, MO, in July 2014. (Grassfed Beef Cashflow Presentation).
An update on the Grassfed and broader beef sector, "Real Life Numbers," was presented (Grassfed Beef Statistics).
An overview of the competitive context followed this, and the market reality of the 2014 row-crop corn profit (loss) projections (Row Crop Profit Projections) brought on with the 2014 projected bumper crop. This spreadsheet can be downloaded and updated with current numbers for your county/region.
Specific grass-fed enterprise (cow-calf, stocker, finishing, direct marketing) numbers have been updated in this tool (Grassfed Calculator - Enterprise Budgeting 2014) that now includes 5-year cash flow models in support of longer-term projections and building resiliency into your enterprise.
New for 2014 is the (Beef Carcass Breakdown) calculator that shows both primals and cuts.
The Investor and Rancher Returns Calculator, developed by an Arkansas cattleman, allows a rancher to project cash returns to his operation and the outside investor when bringing in an outside investor to expand your finishing operation.
Realizing that the dynamics of the grass-fed sector are continually changing in the context of the local economy and volatile markets, these insights were shared (ReRegionalization and Resiliency Presentation) in the interest of challenging grassfed farmers and ranchers to continue to adapt.
Budgeting for Grassfed Success - 2013
Budgeting for and managing cash flow needs to be a high priority for farmers and ranchers, particularly when raising livestock with long production cycles. This resource package includes a PowerPoint overview initially presented at the Grassfed Exchange in Bismarck, ND, in August 2013 (Grassfed Beef Presentation) that introduces the importance of managing cash flow.
This interactive budgeting spreadsheet (Interactive Budgeting Spreadsheet) is a valuable tool that can be downloaded and customized with the farmer/rancher's data - providing budgeting and decision-support tools for their specific operation.
A helpful guide (Twelve Steps to Cash Flow Budgeting) can also be used in classroom training or as a self-teaching aid by BFRs as they do their enterprise budgeting.
When planning for specific enterprises (cow/calf, finishing steer, etc.) of your grass-fed operation, this tool (Enterprise Budgeting Spreadsheet) can be helpful in your decision support.
Also, check out the Budgeting for Grassfed Success: Real Life Numbers - 2014 resource for additional and updated tools.
Evaluation
- When training beginning farmers and ranchers (BFRs), it's essential to benchmark and measure progress in the knowledge transfer and adoption of new skills. This applies to specific programs and across the broader field of BFR training. This section includes several sets of pre-session, post-session and follow-on evaluation tools that can be used by your training program to assess progress.
- Quality evaluation tools are objective and measure against the broader base of skills required. The tools presented here are easy-to-use Qualtrics® online surveys that include solid analysis and reporting. The surveys are supported by Iowa State University's Research Institute for Studies in Education, an entity specializing in measuring progress in teaching and training.
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How to Use The Farm and Ranch Business Health Assessment Training Tools
Start with the Evaluation
The Farm and Ranch Business Health Assessment and companion Farm and Ranch Business Readiness Assessment and Succession and Transition Readiness Assessments (for current owners and for potential successors or heirs ) are designed to help farmers and ranchers systematically evaluate their operation and guide them in developing personal learning goals to increase their skills or knowledge. The secondary function of the tool is to guide farmer and rancher training programs in developing curricula, resources, and technical assistance programs that will effectively help trainees accomplish their goals.
The assessments are targeted to three distinct groups:
Aspiring farmers and ranchers who have not yet started their own operation Farmers and ranchers at any stage of an operation Farmers and ranchers considering planning for a transition or in ownership or succession planning, and potential new owners considering taking over an existing operation.How to use these tools:
Programs for aspiring farmers and ranchers who have not yet started their own operation.
Use the teaching guide to design your program. You may also consider using the teacher’s self-assessment tool to help you determine which parts of the program you can teach with existing staff and which you would teach through partners or online resources.
If internships or tours are part of your program, consider having your trainees use this Internship or Tour Questions document to help them ask questions about the business operations of the places they work or visit. It is keyed to the Business Readiness Assessment.
Set a goal of trainees scoring mostly 2 and 3 on the Farm and Ranch Business Readiness Assessment when they exit the program.
Administer the Business Readiness Assessment at the end of the program. Ideally you will have time at the end of the program for review and goal setting – if so, use the “BRA with Goals” version of the tool. Trainees can create a personal learning and action plan for getting ready to start their business – ideally when they score mostly 3s and 4s on the assessment. If you have capacity for follow up, the personal learning plan can also be used to guide one on one follow up technical assistance.
Programs for farmers and ranchers in year one through ten of business
Use the teaching guide for preliminary program design. You may also consider using the teacher’s self-assessment tool to help you determine which parts of the program you can teach with existing staff and which you would teach through partners or online resources.
Administer the Business Health Assessment at the beginning of the program, either as an application to the program or as the first assignment once the trainee has entered the program. Compare the assessment scores across the group and use the information to refine your program design.
For farmers and ranchers who are already in business your goal should be to move people scoring mostly 0s and 1s to scoring mostly 2s and 3s and to move people scoring mostly 2s and 3s to scoring mostly 3s and 4s. Moving people from a 3 to a 4 is the most difficult and resource-intensive part of training and may require the most outside support and one on one technical assistance.
The Business Health Assessment is designed to be re-administered every two to three years. If you use it as a pre-assessment at the beginning of your program of instruction you can use the “BHA with goals” version at the end of the program as frame for a review discussion and an exercise in creating a personal learning and action plan for moving forward. The personal learning plan can also be used to guide one on one follow up technical assistance.
If you have the capacity to follow up with program graduates re-administering the BHA 2-3 years after the program should help you understand how they are doing after leaving your program and might provide opportunities for you to re-engage with alumni to offer continuing trainings.
Farm incubators
Depending on who you serve and how you structure your program you can use either of the options above, or both depending on how long people stay in the incubator program. For people who will leave the incubator in 1-3 years and establish their own operation elsewhere it may make the most sense to focus on preparing them to complete the Farm or Ranch Business Readiness Assessment as they exit the incubator. For people who may farm at the incubator indefinitely it may make more sense to focus on the Farm and Ranch Business Health Assessment which can be re-administered every two to three years.
If internships or tours are part of your program, consider having your trainees use this Internship or Tour Questions document to help them ask questions about the business operations of the places they work or visit. It is keyed to the Business Readiness and Business Health Assessment tools.
Farm and Ranch Succession and Transition Programs
Use the Farm and Ranch Succession and Transition Readiness Assessment tools either as an application to the program or as the first homework assignment once people have entered the program. The tool can also be used simply to motivate people to look into getting more information on succession and transition planning.
The Succession and Transition Readiness Assessment tools are designed to focus people on the many small pieces of information and authority that have to be transferred. Succession and estate planning is a big project and it can be hard for people to take on something large and complex. These tools helps people break succession and transition down into many small pieces, many of which can be immediately addressed with minimal outside help. The complex parts of planning and the need for legal counsel are addressed in this tool, but some people may be more comfortable working on a few smaller tasks before they commit to the larger project.
There are two versions of the tool – one for the current owner/operator and one for a person who reasonably expects to become an owner, or part owner, or an operator or part operator. For the current owner/operator everything assessed with this tool is within their ability to change, and with assistance they can move all their scores from zeros and ones to threes and fours. For the person who expects to become an owner/operator it may be beyond their control to move any of their scores beyond what they currently are – but a person scoring mostly 0s and 1s should understand that their situation is far from certain and that at a minimum they can prepare themselves by learning as much about these topics as possible, for example by taking some sort of beginning farmer or rancher business training program. It may also be appropriate for a person in this situation to complete the Business Readiness Assessment as a way of evaluating their plan for being ready to take over operations even with great uncertainty and lack of information.
About the Business Health and Readiness Tools
These Business Health and Readiness Tools were originally created in 2016 by Poppy Davis working through California FarmLink and SAGE with funding from the Farm Service Agency. Since then the tools have been refined and expanded through various partnerships with training programs around the country, and with funding from Farm Credit Council. Farm Credit Council is funding Iowa State to create an online version of the assessment to facilitate use of the tool and generate data for comparisons across meaningful groups of farmers and ranchers, over time, and across various training and technical assistance programs.
Topics and Scoring
The tools are aligned with each other across nine topic areas. Most questions are scored from zero to four with a 0 representing total unfamiliarity with the concept, 1 representing mere familiarity, 2 indicating some level of understanding without the ability to apply the knowledge to the business operation, 3 indicating that the knowledge has been applied to the business but the farmer or rancher has questions and needs assistance in fully applying the skill or knowledge, 4 indicating that the knowledge has been fully incorporated into business operations.
The ten sections of the BHA include nine topic areas and one demographic section. Your program may choose not to cover each of the topic areas, but we ask that you provide participants with the full assessment so they can understand the importance of seeking out additional information about topics not covered by your program.
The sections are as follows:
A. BUSINESS FORMATION This section identifies how well the farmer/rancher understands limited and unlimited liability and business entity types. For entities with multiple owners, it assesses if the entity been properly formed and capitalized and if the governing agreement address critical issues.
B. LAND This section assesses if the farmer/rancher has secure land tenure, if the farmer/rancher understands how and why to keep land ownership legally separated from business operations, and if s/he understand tax implications of improvements to the land.
C. ACCOUNTING The purpose of this section is to assess if the farmer/rancher has an adequate double-entry accounting system sufficient for tax and managerial accounting, and if s/he understands how to manage from a balance sheet perspective.
D. TAXATION This section assesses if the farmer/rancher has adequately addressed common tax issues.
E. LABOR AND CONTRACTORS The purpose of this section is to verify that the farmer/rancher is in compliance with State and Federal labor protections.
F. PRODUCTION AND MARKETING This section identifies crops, production methods, and marketing outlets and evaluates the farmer or rancher’s knowledge of related regulatory issues and USDA programs.
G. CREDIT This section evaluates if the farmer/rancher has the necessary skill and knowledge to identify credit needs and successfully apply for credit.
H. BUSINESS PLAN, INSURANCE, ENERGY, AND OTHER This is currently a “catch-all” section. Depending on need this section might be split into multiple sections and each part enhanced.
I. PERSONAL INFORMATION This section gathers data about the participant including their experience and training before they started farming or ranching and their current methods of continued learning.
J. OPTIONAL DEMOGRAPHIC DATA This optional section is to gather demographic data for analytical purposes.