Business Planning Part II

Business planning is a must. Every grower does it, but most do not record the intregal parts on paper. I talked last time about establishing benchmarks to shoot for. Examples are bu/acre, dollars/bushel, etc. The one I forgot to mention and the one I think is most improtant is revenue/acre. This measure puts everything on the same level. It can be used to measure efficient input purchases and grain sales. Total revenue per acre is dependent upon purchasing inputs correctly as well as selling grain products correctly. Since I am most familiar with seed costs, lets look at that input cost. There are many different levels of seed investments. The companies with the leading genetics and technology will have higher investment costs, while the companies with smaller market shares can gian more share by lowering their costs. Lets assume there is a $10 differnce in bags cost and they produce at the same level. On a 180 bushel yield there is a difference of $0.023/bushel. If the higher investment has other benefits available to you, then that differnce can be overcome very quickly. One way of overcoming the difference is by using Al Kluis Marketing to help move your grain. After being associated with Al for over a year now, I can testify that he will gain more than 2.3 cents inprovement in your marketing dollars. Al is confident that he will add an addtional dime per bushel on corn to your revenue per acre. A dime in 180 bushel yield will add $18/acre to your revenue stream. Another way to look at it is that Al adds $43.75 value to the bag of seed corn. So if my bag of Lewis Hybrids is $15 per bag more, I am confident that bag brings an additional $28.75 value to you. This is a good example of fine tuning your business plan.

Another part of business planning is to plan for your personal improvement. This adds more to your day, but getting better at a task will greatly improve your life. This could be anything from improving your health, reading a book, or taking classes. What can help you free up enough time to do something like this? Lewis Hybrids, Al Kluis, or myself can help you to free up time. Lewis Hybrids intern program will guarantee that your fields will be visited at least three times a year for scouting, root digs, or revenue estimations. This makes taking a family vacation easier. Al Kluis will help you have more free time by advising you on marketing timeliness so that your time can be spent doing other things instead of pondering on whether or not to sell or wait. I concentrate on year round contact with you to help with seed placement, field scouting, agronomic advise, ect. When I wanted to go on vacation this past summer, the customer service department at Lewis called my customers, a few days into my vacation, to make sure all was going well and answer any questions. We are here to help you out and to make your life run easier, if you want us to.

There is a lot more to a professional business plan. It takes more than I have mentioned to complete one and then evaluate how you did over the year. If I have the chance I will help you complete a plan and keep track to see how it measures up.

Have a merry Christmas.

Perri

319-929-7851