Benchmarking — What Can We Learn from Others?
Ever wonder why or how the neighbor down the road seems to keep growing their farm business year over year? Why is it that your cost of production is higher than what you hear or see as an average for your area? Are your financial records organized, summarized and analyzed in a way that allows making comparisons of your ag business financial data to those that have similar size farms and enterprises?
While we aren’t able to know financial details about any one individual farm or ranch (other than our own), we can utilize information from a peer group of similar operations to help us improve our own operation. Organizing our farm and ranch production and financial data and then utilizing this information to look back historically and to benchmark with others, provides a way to measure our operation’s financial health. In turn, these measurements and comparisons can provide clues to assist in important management decisions.
Learn more about benchmarking — comparing your information to other similar size farms and ranches — and how it can make a positive impact on your operation in this Center for Agricultural Profitability article.