2017 Fall Farm Outlook

2017 Logan County Fall Farm Outlook Magazine LINCOLN DAILY NEWS Oct. 25, 2017 Page 39 Five critical areas to focus on with your lender Y our relationship with your farm lender can be summed up in one word: Trust. Trust is a tricky item to manage. It is a commodity you can never have too much of. It is a value that can be damaged easily and can be irreparable. You can’t buy trust, you have to earn it. You can’t control whether someone will trust you, but you can certainly influence it. You can damage or destroy your trust relationship with one word misspoken to an unrelated third party. And your entire future is built on your treasure trove of trust. In order to approach your farm lender, today’s farmer needs to really understand five critical things. These things will convey to your lender that you have the necessary knowledge, procedures, and focus in place. Without these critical things, trust will not grow and the relationship will not deepen. What is at risk - everything! By Jim Youngquist The first area of a lender’s focus includes three management elements: risk management, marketing plan and business plan. The definition of business (and farming is indeed a business) is to take a measured risk to bring about a measured positive outcome. This process is called risk management. Risk can never be left to manage itself because the result is usually failure. Risk must be quantitatively weighed and balanced with known guarantees. The outcome must be calculated beforehand, and is backed by faith and personal endorsement. It isn’t enough to have the materials, expertise, and equipment to produce a product. You must balance your ability to produce with your plan to trade your product for MONEY. Your marketing plan must factor in what quality your final product will be and what return you will receive for it. It needs to have details about who will buy your product, and what your plan B will be if your plan A falls through. Continued ►►