Get stuck in or get out

When poor business management is clouded by nostalgic longings ... we see farmers crying broke

NOTE: After fielding more than 100 comments on this article in a short space of time, Sam decided to respond to some of the points brought up in an article headed 'We are where we are, because of the choices we’ve made'. Click here to read his response.

HAVE you ever heard of a struggling takeaway shop owner putting their hand out or demanding the Minister for Small Business deliver government assistance in the form of tax breaks, grants and support?

Nope, they go broke with little consideration from anyone. So why do we tolerate whining farmers who are equally as poor at running their businesses?

I guarantee in every regional postcode across similar soil types, rainfall and water access you’ll find farmers with healthy farms, in a productive business operation - while over the fence, others will be struggling to make ends meet, on run-down properties with unfairly treated livestock in poor health.

“Management issues” is a very kind explanation for this, not forgetting both operations requiring hard work.

Farm management and business management are two completely different things - and the farmers that do both well are the ones who don't make the news.

They’re buying out their neighbours, leasing more land and getting better margins in their returns. They’re far more resilient to droughts and market fluctuations and with technology and constant learning they’re getting bigger and better at what they do.

But when poor business management is clouded by clinging to nostalgic belongings or hereditary ideals, then we see farmers wind up on the evening news crying broke.

Graziers and croppers seem the most common, as medium-term returns are perhaps easier to manage poorly - unlike intensive farming systems for pigs or chooks where planning, calculations and forecasts on a regular basis are critical.

The carbon-copy farm management styles of the early 1900s are bleeding wounds of the industry. Of course the media coverage doesn't help. It’s more interesting to see a farmer struggling with a sentimental asset, a ‘romantic’ lifestyle gone wrong than a takeaway shop owner who’s having to sell up or even threatening to shoot his potato cakes when it all goes pear-shaped.

Through the media, there’s a consumer perception that farmers are “whingeing”, “luckless” or “in-need”. As a result, we get a consumer who feels pity and negative emotion for that stereotype (along with that image of an old man in a shabby hat standing in a field).

Not a good motivator.

From here a bad attitude is brewing, with some farmers saying consumers have to “be thankful” for what farmers do - as if it’s the consumers fault.

It’s always someone else’s fault.

It’s easier to blame governments, consumers and retailers than work out that simple equation – that income must exceed expenses.

It’s no secret farming is made up of good years, bad years and everything else; it’s been happening for hundreds of years. So why with all the education, technology and knowledge out there are people still not ready for the untimely but inevitable challenges we face?

"We are not a farming family, we are a business - (if) you act like business people and you get treated like business people and if you think like business people, you will be successful," banana grower Barrie Mackay told ABC's Landline earlier this year.

I once heard that the definition of stupidity was doing the same thing again and again and wondering why you don’t get a different result.

So let’s swallow some pride, make some decisions and take full responsibility for farm and business management. Our ag industry is in need of some tough love.

  • Sam Trethewey is a third generation farmer from Tasmania, now based in Victoria. Sam's message is 'think clearly, get muddy': inviting everyone to be clearer in and on farming by rolling up their sleeves, learning and taking action.

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    Sam Trethewey

    Sam Trethewey

    grew up farming down south and now commentates on agriculture across Australia
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    READER COMMENTS

    Jacky
    9/07/2013 1:31:35 PM

    No one is forced to be a farmer.
    Charlie
    9/07/2013 1:58:07 PM

    Great article Sam & some great feedback. Totally agree that agriculture is a business & needs to be treated as such. Good business planning and contingencies make all the difference when times get tough. There is a but though, all the good business management in the world not going to help under situations like the live export ban or spc quota slashes.
    WA Farmer
    9/07/2013 1:58:14 PM

    Sam, I believe in a lot of what you have said, but your timing is poor. Even those of us with the right management skills, running a successful business can't make it rain, it kind of seems that this article is to sensationalise an already over sensationalised topic and to further your journalistic career.
    Bosco
    9/07/2013 2:02:45 PM

    Captain Average, your description of the business position of many farms is exactly what we are discussing here. That is, your strategy is not bankable. Given your "decade of drought, restricted irrigation, burnt out & flooded" situation, tell us what you have changed to make your business bankable? Alternatively, if it's that persistently bad, why are you still trying to make it work? Either way, you can't answer those questions without scaring off the next generation.
    get
    9/07/2013 3:18:12 PM

    Aussie farmer need to start taking more responsibility for their marketing and promote what is good about their products e.g. locally produced, organic, raised ethically whatever it is. Farmers in the US do this and have had great results. One problem in Aust is that consumers don't really care where their food comes from. If it aint in the local supermarket it ain't getting bought. One other point regarding perception, city peeps see farming as an enjoyable affair e.g. not having to be at a desk doing the grind. As such they think you should be paid less to do something that's enjoyable.
    TB
    9/07/2013 4:04:45 PM

    This article and the following comments indicate that there are many opinions to consider. Is this a forum for who is wrong or who is right? i dont believe that is the intention? Sam has stirred the pot, brilliant, now lets use this energy to consider how we can evolve farming, attract and retain new farmers (ANY generation) professionalise our farming practices so that we can own the distribution channels, interact with customers and deliver exceptional products... I am new farmer, 30ish and a business professional. I accept I have plenty to learn but we need leaders like Sam in this industry
    Deregul8
    9/07/2013 4:08:43 PM

    When you have to contend with guvmint mobilising against you this criticism is given unfairly. However in the grains industry, there are many going to the wall because their timing was off and I agree, it is not the role of the taxpayer to bailout those who overcapitalise at the wrong time. Now all grain businesses are going to wear the negative effects of deleveraging the great grain farm debt that has been accrued. Only the strong will survive and that means those with equity.
    jillaroo
    9/07/2013 6:56:02 PM

    Hi Sam, Segments of the industry are currently "doing it tough" not necessarily via their farming management. Currently there are approx another 20 businesses to go into receivership in Nth Qld. At a recent banking seminar, costs in the northern beef sector are running at an average of 103% to 100% income. Even the best of businesses are currently going backwards, costs outstripping income. The beef market glut, processors are naturally taking advantage of. Losing the floor price created by the "live export" industry which will take some time to reestablish has dramatically cut incomes.
    Jen from the bush
    10/07/2013 6:00:44 AM

    Hi Sam Can you please let us know how much debt you have and how you purchased your farm? And how big it is and whether it is viable by itself Did you buy the family farm and if so with what terms? If you don't own a farm can you please tell us when you are going to do so and how you are going to finance it? Your article struck me that you actually have little idea of debt so that is why I am interested. I also wondered if you were trying to get an off farm income while onfarm and while there are many openings for some, it is limited to those who can make time available. cheers
    John
    10/07/2013 7:39:51 AM

    1900's management styles? So what's all the rationalisation of farm numbers, the massive increases in output (from a dry continent) and the ridiculous amount of rural debt been all about then? Farmers have learnt nothing? The numbers don't add up. That's why farmers are a dying breed and sons and daughters don't want to farm. Your article is ridiculously, naive and shows you don't know what goes on around you. Time to grow up Sam
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    Get MuddyTo think clearly in farming and about farming, you need to get muddy - commit, roll up your sleeves and get involved. SAM TRETHEWEY gets stuck into some of the issues facing those on the land.

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