Business planning does not need to be as complex as
many may think… some ‘meeting structure’ to follow
with ‘key people’ in your business and the ‘minutes’
of your business planning meeting can become your
business plan!
The business planning framework focuses on 3 stages—
“NOW” (or your ‘resource’ stocktake), “WHERE” are you
going (or your preferred business future) and “HOW” (the
strategies) do you plan to get from “NOW” to “WHERE”)
—see below.
For success, your business planning meeting should
involve all of the ‘key people’ involved in your business.
More heads are better than one and when later it comes
to ‘implementation’ if they are only ‘your ideas’ it may
well be harder to implement than if they were ‘our ideas’.
‘Key people’ could even include your bank manager,
accountant and/or your farm consultant!
At your business planning meeting, realistically define
the present situation (“Now”), past history and how past
business performance compares with against industry
benchmarks (a role for your bank manager, accountant
and/or farm consultant?).
As with all businesses in agriculture, the ‘target’ (“Where”
you are going) is influenced by ‘forces’ beyond your
control—milk prices, seasons, $A, fodder prices and
processor requirements for example. A simple tool
(SWOT analysis) that takes into account these constantly
changing business variables, can help to create ‘new
thinking’ (new strategies) at your business planning
meeting just as it may confirm ‘existing thinking’.
Good business plans are practical and may not only be
used just for loan applications, starting a new business or
attracting investment. They can also be useful for:
• Reviewing the business’ direction, and setting goals
and responsibilities to guide it. Defining agreements
between partners.
• Evaluation of new ideas towards enterprises, capital
expenditure and expansion.
• Assign actions, measure and track implementation
• Succession planning.
There should be time set aside for regular review of
your business plan. In past years ‘forces’ beyond your
control—milk prices, seasons, $A, fodder prices and
processor requirements for example have affected the
dairy industry in such dramatic ways that a regularly
‘revised’ business plan could help to build ‘business
resilience’. Therefore it is important to keep it simple as
nobody likes reading a long business plan.
The business plan is not the endpoint but merely a
means of communicating future plans. The end point is
discussion and communication.
DairySA
Business Planning
for Dairy Farms
Hope is not a plan!
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