Farm Business Management Programs focus much on a producer’s financial situation in regards to their operation. However, the program also offers guidance in many other areas such as tax planning, transitional planning, goal setting, overall growth and much more.
For the producers who have thrown their hat into the program, it has proven to be an invaluable resource. Many producers stay in the program for over two decades.
Though the past couple of years have taken a toll on the ag industry, there was a need for this type of program long before the producers of today.
“Go back to 1951. At that time there was really a need to help farmers learn about records, finance, seeing their operation from a business side. So, a group of folks at that time started a program in high schools, and by the time they got to 1955, they had really formed a statewide database,” said Keith Olander, director of Minnesota Farm Business Management.
While things have undoubtedly changed since the 1950s, the core of the program has remained the same: to help producers with their operations’ overall growth. A part of the growing process is taking a producer’s initial analysis of their farm, helping both the producers and their new Farm Business Management instructor understand where their operation stands and how it compares to other operations in their region.
Keith Olander is the director for the Minnesota Farm Business Management Program. (Agweek / Emily Beal)
“In Farm Business Management, you get an analysis done on your farm, so we identify your break-evens. Furthermore, that data becomes anonymously a part of the database, which allows us to start sorting out how you rank in expenditures and break-evens against your neighbors within the county, region or state, which is really powerful in a business mode,” Olander said.
The programs are offered through colleges throughout various states, such as Minnesota, North Dakota and South Dakota.
“There are eight colleges within the Minnesota state system that offer this program. It’s all two-year colleges. In most cases, we require participants to have a high school diploma. Most all of our students are farmers by practice. We do occasionally accept high school seniors in. In large, we have nearly 3,000 farms across these eight colleges and 67 faculty that are engaged in this program. But the classroom is not at the college; it is on the farm. It’s the kitchen table, often,” Olander said.
For the Minnesota Farm Business Management Program, tuition is around $1,900 a year. Students will also receive 10 credit hours worth of knowledge and be set up with their own personal instructor who resides in the area. Financial aid is available for the program for those who qualify.
A helping hand
Instructors assigned to producers in the Farm Business Management programs help guide the producer through important farm decisions, financial planning and much more.
“I get to work with producers one-on-one to really help them understand their financial situation in their operation. So it is more than their income and their expenses, it’s more than just their balance sheet and flow, but it is really helping those guys understand their numbers, understand where their operation is at. Getting them more prepared for when they go in and meet with their lender, and building their confidence on their understanding of the numbers and where their operation stands, and also helping them on the tax end of things,” said Kelcey Hoffman, North Dakota Farm Business Management instructor.
The instructor plays a vital role in the program, helping producers navigate difficult waters. Instructors are especially useful to young or beginning farmers as well.
“When we signed up, we were beginning farmers. We had just finished our second cropping year at that point, and we found that we needed to have a little bit better control of our finances, and by talking to other producers we found out that farmers are not amazing at keeping a really close eye on dollars in, dollars out. When we heard about the program, we were kind of impressed by how you end up getting down to the acre, by the enterprise and really getting a tight hold on your finances. We were paired with an instructor in the area and met with him throughout the year. He has really helped us. Everyone in ag right now knows that the margins are so tight that it almost falls under the category that ‘every penny counts,’ so getting help with financial planning has been great,” said Anne Schwagerl, farmer and student in Minnesota’s Farm Business Management Program.
Anne Schwagerl is a beginning farmer who has found the Farm Business Management Program to be a great resource. (Agweek / Emily Beal)
Another large part of the instructor’s role is to help their students set goals for their operation, goals that can be achieved while remaining financially sound.
“When we meet we talk about what are their goals for their operation? And are they achievable,” Hoffman said.
These discussions often act as a voice of reason for producers — encouraging them to think big, but to still remain realistic.
“It brings a healthy dose of honesty and reality to our finances. For us as beginning farmers, we have dreams, we have things that we want to do and innovations we want to do. Meeting with our farm business management instructor is always a healthy dose of reality,” Schwagerl said.
While the financial side of the program is a major selling point, many producers seek out their instructor’s help for things beside financial planning.
“We are currently in the transition planning of the farm. It has been one of the toughest things I have ever had to do, transitioning into the next generation. The program has been a great help through the process so far,” said Wayne Brendemuhl, farmer and student in Minnesota’s Farm Business Management Program.
Brendemuhl has been with the Minnesota Farm Business Program for 28 years, becoming a big supporter of what the program has to offer himself and fellow producers.
“I don’t plan on quitting the program anytime soon. I love the fact that after the analysis is complete we can compare. It just gives you a good benchmark to see how you are doing against your peers. I am just disappointed more producers don’t join the program. They should definitely take advantage of the resource,” Brendemuhl said.