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Developing Business Plans for Ag Producers Texas Cooperative Extension

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Developing Business Plans for Ag Producers Texas Cooperative Extension Role of the Business Plan Learning experience for producer All pertinent information in one location Historical financial information Resource inventory SWOT analysis The Curriculum

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role of the business plan
Role of the Business Plan
  • Learning experience for producer
  • All pertinent information in one location
    • Historical financial information
    • Resource inventory
    • SWOT analysis
the curriculum
The Curriculum
  • Is there a need for a business planning curriculum in agriculture?
    • Tomorrow’s Top Ag Producer ($1,000 reg fee)
    • Changed definition of Business Plan to Management Plan
the curriculum4
The Curriculum

The Purpose:

… to provide Extension faculty and staff and paraprofessionals with lesson plans designed to develop business plans for their agricultural producers.

the curriculum who s involved
The CurriculumWho’s Involved?
  • Texas Cooperative Extension (authors)
    • Stan Bevers
    • Dr. Blake Bennett
    • Dr. Jason Johnson
    • Wade Polk
    • Bill Thompson
    • Brenda Duckworth
  • SRRMEC (funding)
the curriculum6
The Curriculum

Each topic/section includes:

  • Publication
  • Worksheets
  • Case Study- TTAP Enterprises
the curriculum7
The Curriculum
  • Executive Summary
  • Business Organization
  • Business History
  • Mission Statement
  • Resource Inventory
  • SWOT Analysis
the curriculum8
The Curriculum
  • Legal and Liability Issues
  • Setting Goals
  • Production Plan
  • Financial Plan
  • Marketing Plan
  • Completed Business Plan for Case Study
the curriculum10
The Curriculum
  • Detailed
  • Complete
  • Includes both financial and production
  • Plan to identify and promote strengths and opportunities
  • Plan to identify and compensate for weaknesses and threats
the curriculum11
The Curriculum

Lesson 6…

S.W.O.T. Analysis

s w o t
S.W.O.T.

Strengths

Weaknesses

Opportunities

Threats

s w o t13
S.W.O.T.

For each weakness or threat, there should be an off-setting strength or opportunity to compensate.

strengths
Strengths
  • Internal element
  • Low-cost producer
    • Financial Plan
  • Competent and reliable employees
    • Resource inventory
  • Marketing niche
    • Marketing plan
  • Expertise in production (A.I.)
    • Production plan & resource inventory (skills)
weaknesses
Weaknesses
  • Internal element
  • Highly leveraged
    • Financial plan
  • Poor brush control, underutilized grassland
    • Resource inventory
  • Not utilizing futures market
    • Marketing plan
  • Inadequate facilities or machinery
    • Resource inventory
opportunities
Opportunities
  • External element
  • Are there new technologies that would lower costs?
  • Will diversification of enterprises increase profit?
  • Can my operation command a competitive edge?
threats
Threats
  • External element
  • Ethanol explosion to a cattle feeder
  • Drought causing water shortage
  • What’s happening in the market that might effect your enterprises?
  • Are there siblings fighting over family land?
the curriculum18
The Curriculum
  • Publication
  • Worksheets
  • Case Study
ttap enterprises s w o t
TTAP EnterprisesS.W.O.T.

See handout for SWOT Analysis on TTAP Enterprises.

implementation of curriculum
Implementation of Curriculum
  • TTAP I
    • Four week-long sessions, November and January
    • Time spent on each section
    • Each session includes a study hall, panel discussion, social event, & homework
    • Extension personnel and experts in each field head the discussions
ttap agenda session i
TTAP AgendaSession I
  • Lesson 2- Business Organization
    • Organizational Structure (Stan Bevers)
    • Business Structure (Bill Thompson)
  • Lesson 3- Business History
    • Stan Bevers
  • Lesson 4- Mission Statement
    • Greg Clary
  • Lesson 5- Resource Inventory
    • Jason Johnson
ttap agenda session i22
TTAP AgendaSession I
  • Lesson 6- SWOT
    • Blake Bennett
  • Lesson 8- Setting Goals
    • Goals & Objectives (Jason Johnson)
  • Lesson 10- Financial Plan
    • Introduction to Financial Statements (Brenda Duckworth)
    • Management Accounting (Brenda Duckworth)
  • Lesson 11- Marketing Plan
    • Sources of Risk (Wade Polk)
ttap agenda session ii
TTAP AgendaSession II
  • Lesson 5- Resource Inventory
    • Personality Tests (Don Tyler)
    • Family Issues (Don Tyler)
    • Personnel Management (Don Tyler)
  • Lesson 9- Production Plan
    • Wade Polk
ttap agenda session ii24
TTAP AgendaSession II
  • Lesson 10- Financial Plan
    • Advanced Management Accounting (Brenda Duckworth)
    • Financial Plan (Stan Bevers)
    • FARM Assistance (Wade Polk)
    • Family Financial Plan (Jason Johnson)
ttap agenda session iii
TTAP AgendaSession III
  • Lesson 7- Legal & Liability Issues
    • Contracts (Wayne Hayenga)
    • Crop Insurance & LRP (Ken Stokes)
    • TRAMM (Ins. Game) (Stan Bevers)
ttap agenda session iii26
TTAP AgendaSession III
  • Lesson 11- Marketing Plan
    • Requirements for an Effective Market (Stan Bevers)
    • Strategic vs. Tactical Plans (Stan Bevers)
    • Agricultural Policy (Joe Outlaw)
    • Concurrent Marketing Sessions
      • Livestock- David Anderson
      • Grains- Mark Waller
    • Introduction to Futures & Options (Mark Waller)
ttap agenda session iv
TTAP AgendaSession IV
  • Lesson 1- Executive Summary
    • Stan Bevers
  • Lesson 7- Legal & Liability Issues
    • Legal & Liability (Judon Fambrough)
    • Intergenerational Transfer (Wayne Hayenga)
ttap agenda session iv28
TTAP AgendaSession IV
  • Role of Participant to Mentors (Jason Johnson)
  • Mentor Training (Jason Johnson)
  • Presentation of Business Plans to Mentors
ttap agenda session iv29
TTAP AgendaSession IV

and finally…

ttap agenda session iv30
TTAP AgendaSession IV

Graduation!!

(whew….)

implementation of curriculum31
Implementation of Curriculum
  • Each section relies on information from other sections
    • Resource inventory includes fixed (depreciable) assets
  • Sections should reconcile
    • Resource inventory & depreciation schedule
implementation of curriculum32
Implementation of Curriculum
  • When completed, producer has a

Management Plan of Continuation

  • Process is as important as end product!
implementation of curriculum33
Implementation of Curriculum
  • Goals are determined according to information gathered in process
  • Goals must be revisited each year
    • Were they attained? If not, why? If so, set them higher.
availability
Availability
  • Texas Cooperative Extension Personnel (handout)
  • Website
    • http://agrisk.tamu.edu
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