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Positioning for Success - Dr. David Kohl

Now, three years into the economic reset, what’s around the corner and down the road with the global and domestic economy, land values, cash rents, and the overall bottom line? This session will examine the economic and financial picture of both short and long run. What are the adjustments producers and lenders must make to position for success. A new look at burn rate not only on working capital but also on core land equity will be provided along with trends that will impact the industry now and by 2025. Also, find out how to be a better borrower in these economic times. Come with your questions to this high energy session that will get you prepared for one of the most critical periods in agriculture.

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Positioning for Success - Dr. David Kohl

  1. 1. POSITIONING FOR SUCCESS Macro Clinic Video Blog: Road Warrior of Agriculture: Ag Globe Trotter: Dave’s GPS & Dashboard Indicators: Dr. David M. Kohl Professor Emeritus, Agricultural and Applied Economics Virginia Tech, Blacksburg, VA (540) 961-2094 (Alicia Morris) | (540) 719-0752 (Angela Meadows) | February 9, 2017
  2. 2. Four Cornerstones of Success 2 Planning Strategizing Execution Monitoring Business & Lifestyle Success
  3. 3. Crossroads for a Better Borrower/Business Better Borrower/Business Questions: Yes No 1. Do you have a one page recovery plan? 2. Do you have business goals for one and five years? 3. Do you have a projected cash flow? 4. Do you check credit score and get report? 5. Do you practice modest family living? 6. Do you invest in productive assets? 7. Do you work with a team of advisors? 8. Are you open to education and seek education opportunities? 9. Do you plan, strategize, execute, and monitor? 10. Do you have an accurate balance sheet and income statement? 3
  4. 4. Goal Setting  establish or update  family, business, personal  six degrees of goal setting  80-16-4 Rule  S.M.A.R.T. goals 4
  5. 5. Family Living Budget  $65,000 to $90,000 average  high & low - $60,000 competitive edge  non-farm capital expenditures  Family Living Rule  Corvette Rule 5
  6. 6. Source: Nebraska Farm Business, Inc. 2015 Family Living
  7. 7. Time Management Rules  part-time: small business owner- 500/1000 hour rule  full-time: 3,000/500 hour rule  high tech: 2,500 hour rule  younger & older generation views  business and lifestyle
  8. 8. Financial Tips for Women  Are you investing 5%-10% of net farm income outside of the farm business?  Do you teach the 50-25-25 rule of finance to your children/youth?  Do you plan to have your kids pay for some of their college expenses?  Do you know what you are financially obligated for?  In your family transition plan, do you follow the 3-1-1 rule?  Do you meet with lender and financial advisor in person annually? 8