There are so many issues that have an indirect impact on agriculture, but which individual farmers have absolutely no control over. The volatility in the world’s commodity markets is a case in point, as is the strength or weakness of the euro against the world’s other currencies.
Agri-business Donegal accountant Seamus McCaffrey has confirmed to AgriLand that farmers must, as a consequence, concentrate fully on improving the efficiency of what they do within the physical confines of their own business.
“Volatility, in terms of what happens on the commodity and currency markets, will be with us for the foreseeable future,” he said.“And there is not one thing that individual producers can do about this.”
“These are challenging times for every farming business. But the good news is that a commitment to improving efficiency will pay a handsome dividend.”
McCaffrey went on to point out that a commitment to improved business efficiency will have a direct and positive impact on all aspects of a farmer’s business activity.
He further explained: “The reality is that the banks are also taking a much closer look at farmers’ financial accounts with the aim of identifying how their clients intend to improve their management procedures and skills. They particularly want to see firm evidence of how farmers intend cutting costs and improving the overall efficiency of their businesses.
“As a result I am strongly advising my own clients to get involved in bench marking. In this way they can see how they are performing in comparative terms against other similar businesses. Benchmarking also allows individual producers to quantify the scope they have to improve performance across every facet of their farming operation.”
McCaffrey continued: “I would also advise every farmer to join a discussion group. In this way solutions to challenges can be identified and assessed in an informal environment. Discussion groups also allow participating farmers to identify new and more efficient ways of carrying out technical operations and introducing new management systems.”
McCaffrey also believes that farmers should become involved with buying groups. “This approach can deliver two important benefits,” he further explained. “In the first instance input costs can be driven down significantly. However buying groups also help participating farmers to improve their business discipline.”
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