Farming and agribusiness

Run the farm as a business

business.gov.au notes that many things affecting farm businesses are outside their control, including global commodity prices, weather, biosecurity outbreaks, water availability and consumer trends. That makes good business management even more important.

• Know your numbers by enterprise: costs, yields, prices and margins for each crop or livestock type.
• Keep good records: production, inputs, sales, labour and machinery. Digital farm management tools can help with records, traceability and biosecurity.
• Benchmark against similar farms where you can, through industry groups or advisers.
• Review the whole business at least once a year: what’s making money, what isn’t, and why.

See Bookkeeping basics.

Plan for variable years

• Budget by season, with a cash flow forecast that shows the lean months before harvest or sale. See Financial planning and cash flow.
• Build buffers in good years where you can.
• Have a plan for bad years: drought, flood, fire, disease or a price fall. What would you cut, sell or change, and when?
• Spread risk across products, markets and timing where it makes sense.
• Talk to your lender early if things are getting tight. See Business credit cards, credit scores and managing debt.

This guide doesn’t recommend lenders, finance or insurance products. An accountant, rural financial counsellor or licensed adviser can help with your situation.

Diversification

New income streams can reduce risk and use existing land, skills and equipment. Common options:

• Farm-gate sales and markets: selling direct to customers.
• Value-adding: processing, packaging or branding your own produce.
• Agritourism: farm stays, tours, events, pick-your-own.
• A new crop or livestock enterprise.
• Contract services: offering machinery or skills to neighbours.

Before you invest:

1. Test on a small scale: a market stall, a trial plot, a few events.
2. Check approvals: food business rules, council permits and planning for tourism or on-farm processing. Use ABLIS on business.gov.au to find licences.
3. Cost it properly, including labour and your own time.
4. Make sure it fits: a new enterprise shouldn’t stretch the family or workforce too thin at peak times.

See Small business ideas that work in Australia.

Succession planning

Succession is one of the hardest conversations on many farms, and one of the most important.

• Start early, well before it’s urgent.
• Involve the whole family, including those who won’t take over the farm, and talk about expectations openly.
• Separate the questions: who will run the business, who will own the land and assets, how the retiring generation will be supported, and how fairness to other family members will be handled.
• Get professional help: an accountant, lawyer and, where useful, a facilitator experienced in farm succession.
• Put the plan in writing, and review it as circumstances change.

The structure of the business, and agreements between family members, matter. See Joint ventures and business partnerships and Sole trader, partnership, company or trust?.

Safety and wellbeing

Farms combine machinery, vehicles, animals, chemicals, heights and working alone. Under work health and safety laws, you must manage these risks for yourself, family members, workers and visitors. See Workplace health and safety.

Long hours, isolation and seasons outside your control also take a toll. business.gov.au lists free support, including NewAccess mental health coaching for small business owners. In a crisis, call Lifeline on 13 11 14.

Free financial counselling

The Rural Financial Counselling Service provides free and independent financial counselling to eligible farmers, fishers, foresters and small related businesses experiencing, or at risk of, financial hardship. According to the Department of Agriculture, Fisheries and Forestry, counsellors can help you:

• understand your financial position through budgets and cash flows
• develop an action plan
• negotiate with lenders
• build financial skills and resilience
• apply for other government programs and assistance.

The program’s aims include improving business profitability or helping with a dignified exit through sale or succession.