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Things the most successful farmers (and their advisors) get right

Presentation to 1st International Seminar – Ecuador, March 2019

“Designing Profitable Dairy Businesses for the Next Decade”

By Bill Malcolm & Alex Sinnett, University of Melbourne and David Beca

BACKGROUND

The original paper was developed by Associate Professor Bill Malcolm & Alex Sinnett from the University of Melbourne and presented in New Zealand. Subsequently David Beca provided some further input to the paper and presented it in Australia, South Africa, Argentina, Uruguay and then this latest version in Ecuador for this seminar.

SUMMARY

The following ‘things’ are what the most successful farmers and their advisors get right:

  1. They think big
  2. They have well considered goals
  3. They use the whole farm approach
  4. They distinguish between cash, profit and wealth to judge business performance
  5. They understand growth, gearing and the principle of increasing financial risk
  6. They know their costs
  7. They know how to sensibly value farm assets
  8. They understand that risk creates return
  9. They appreciate that uncertainty is trumps
  10. They pursue continual improvement…the Status Quo is not an option
  11. They know that the quality of management is the key
  12. They understand there are few (if any) economies of scale, and that any economies of size are often eroded by diseconomies of size
  13. They recognise that growth and intensification increases mean and variance of profits
  14. They reject unsound advice based on average technical ratios
  15. They compare themselves with themselves
  16. They make good decisions
  17. They keep their business afloat

To view the full presentation in English please click here.

To view the full presentation in Spanish please click here.

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