Considerations for Business Owners and Farmers
As the calendar turns to July, business owners and farmers find themselves at a crucial juncture, reviewing the year ahead and considering strategies for success.
The challenges and opportunities that lie ahead require careful planning.
“For farmers, a range of factors come into play during this review period,” says Daniel Bartkowski. “First, they’ve got to analyse interest rates as any fluctuations can significantly impact their financial stability.”
“Additionally, farmers closely monitoring commodity prices should use insights into market trends to make informed decisions about planting choices and selling strategies.”
Another crucial consideration for farmers is the weather.
“After a few seasons of above average rainfall, we’re now preparing for the possibility of a dry season or below average yields, which means adjusting crop selection and risk management strategies.”
Farmers should also evaluate their cash flow requirements, particularly in light of recent machinery investments.
“Many have taken advantage of the temporary full expensing available on new assets,” says Daniel. “A high proportion of these purchases will have been made on finance, resulting in increased cash commitments for the following years. Balancing this cash outflow with ongoing operational needs is essential for maintaining financial stability.”
On the other hand, business owners have their own set of concerns, including interest rate flux, with sudden changes impacting borrowing costs and profitability. Diligent cost analysis and finding ways to optimise operations become crucial in this regard.
“Some businesses will experience a drop in demand with the temporary full expensing incentive now ended so adjusting marketing and sales strategies becomes imperative to ensure a steady flow of customers,” says Daniel.
The rising cost of inputs and overheads also presents a challenge for businesses.
“From raw materials to transportation expenses, every aspect of the supply chain can impact the bottom line.”
As business owners and farmers embark on a new financial year, July also provides an opportunity to evaluate the effectiveness of their accounting systems for making informed decisions. Platforms like Xero offer a range of features that streamline financial management with real-time reporting, stock tracking and simplified invoice processing.
“Cloud computing has revolutionised how business is done including accounting. Adaptability, informed decision-making and embracing technological solutions prove instrumental in navigating the evolving business landscape,” Daniel added.
Carrick Aland are Certified Xero Advisors offering a range of cloud accounting set-up and support services. Request a quote at CAConnect—Tools or call the CAConnect Team on 4669 9800.