Farming Talk: Understanding costs is key for arable growers
Growers in Shropshire and the West Midlands region produce around 13 per cent of the nation's potato crop. Arable crops form a significant part of this region's agricultural production.
Those growers who know their true costs of production can effectively analyse risk and are in a strong position to make critical decisions about an acceptable return on investment and land commitment.
Potato Council has developed the Arable Benchmarking Model, which is a free-to-download, Excel-based tool to break down growers' financial and cost data, so they can analyse their arable enterprises and assess the profitability of each in a consistent way – www.potato.org.uk/benchmark
The system allows growers to "benchmark" their financial results based on their sales and cropping records and their variable and fixed cost data. Once the model is downloaded, it can be used offline as needed for individual business analysis.
Potato Council's business improvement programme encourages growers to join a benchmarking group enabling group members to compare data in a secure environment and discuss what improvements could be made to help individual businesses.
"The best growers use benchmarking to ensure that they know how their performance compares to others", says Neil Cameron of Bidwell's, one of the UK's leading agri-business consultants.
"This allows them to focus on the areas that they can improve. Farming success is rarely about a single issue. It is about the sum of many incremental improvements."
The Arable Benchmark model is an essential part of understanding the profitability of each of your arable enterprises.
These and other questions enable growers to examine their costs, take decisions and make those 'incremental improvements'.
So if you're a grower of potatoes or any arable crop, and want to gain a more in-depth analysis and understanding of your costs simply visit the Potato Council website at www.potato.org.uk/benchmark complete a straightforward registration procedure and download the tool for free.
Remember, all data is secure and if you need some guidance, I can advise and help as needed on 07776 492 274 and phil.bradshaw@potato.ahdb.org.uk
Phil Bradshaw, Technical Executive, Potato Council.
