16 The Business of Prairie Agriculture Better Farming | January 2024 THE BUSINESS APPROACH Despite a growing need for a more business-oriented approach to farming, few producers are adopting the tools they’ll need to ride out challenging times. Being your own boss, working outside in nature and alongside family, and producing food for the world have all come under the umbrella of “farm lifestyle,” a lifestyle that’s lured many to farming and kept them going for generations. But lifestyle alone isn’t enough to sustain a business. And while research shows that farmers in Canada see the benefits of running their operations more like a business, few are making the necessary changes. Declining adoption According to Farm Management Canada (FMC) research, there’s been an overall decline in the adoption of business practices by Canadian producers, says FMC executive director Heather Watson. Between 2015 and 2020, farmers with a written business plan declined from 26 per cent to 22 per cent, while those with a financial plan dropped from 51 per cent to 43 per cent, she says. Farmers with an HR plan fell from 25 per cent to just 12 per cent, while those who regularly used business advisors to help meet business goals declined from 32 per cent to 23 per cent. “According to our research, less than half of Canada’s farmers report they have an in-depth understanding of their financial information, and around 40 per cent have a structured approach to financial planning to ensure sufficient capital to withstand changes to their business environment,” Watson says. But it’s not as though they see no value in a business approach. In fact, the opposite is true, according to a national survey FMC and Farm Credit Canada conducted in January 2023. “We learned that producers recognize the importance of farm business management practices and believe their goals are more achievable with solid business practices in place, such as monitoring finances and financial performance,” says Watson. “In fact, this was the No. 1 way they felt they could reach their goals.” The joint survey found producers would like to engage in farm business management practices more often than they do, but struggle to find the time, Watson says. Good times impede change But it’s not just time. It’s also a matter of necessity. Tracy Miller photo IS FARMING MORE OF A LIFESTYLE FOR YOU? BUSINESS MANAGEMENT: STILL ROOM TO IMPROVE By RICHARD KAMCHEN
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