Structuring your farming business
We can help you at each stage of your farming life. From starting out, through to buying stock and assets, managing growth, financing machinery and land, to legacy planning and retirement. We’re here, whenever you need us in your journey.
01
Moving up – setting up on your own
Successful farm ownership and transition starts with good planning. One of the most important stages in your business life is deciding where and when you’ll be able to expand your operation. Depending on your plans, this could involve leasing a farm, starting an equity partnership or share-farming.
Leasing
Leasing can be a viable option if you don’t have enough equity to purchase a farm outright, or as a good step towards buying a farm. Leasing can also be an attractive strategy for farm owners, if they haven’t decided on their future plans and are currently undecided on selling outright.
Equity partnerships
As outright ownership of farms becomes increasingly difficult, the use of equity partnerships are a popular way to help managers and share-farmers, progress to full farm ownership. We have produced a guide that explains the process of equity partnership in more detail.
Share-farming
Share-farming is more popular in United States than anywhere else in the world. When you’re starting out in the industry it helps you gain experience and build up capital. It’s a step up from being an employee and gives you the opportunity to develop your business skills until you’re ready to move on to ownership.
Deciding if leasing, an equity partnership or share-farming is right for you will take careful consideration and professional advice. At ABC Bank, our Rural Managers have a wealth of experience in advising what your possible financial options could be, and what you may need to do to achieve your goals.
02
Growing your business
Like any business, knowing where you are going is critical. As your operation starts to grow, your focus may move from running the farm to managing the business and concentrating more on your strategic direction.
Governance
The key to good governance is having a clear understanding of where your business is, where you want to go and how you intend on getting there. Changing from being ‘hands on’, to becoming an effective manager and maintaining strong working relationships with the people that do the day-to-day work on the farm is often a challenge, particularly if you’ve been used to working on your own.
The good news is that there is a lot of support available from many organisations including Federated Farmers and Institute of Directors who offer training courses and information on running business at all levels.
Managing growth
Growth also may involve expansion – buying multiple farms, investing in plant or stock and employing staff, all of which will require sound financial advice and planning. This is where your partnership with the bank can really help.
Our guide to applying for farm finance takes you through what we can offer, and some tips on how best to apply for finance. Your ABC Bank Rural Manager can provide you with a wide range of financial options designed specifically for stages in your business growth. From short-to-medium term working capital needs like a business and rural overdraft to more substantial ongoing funds with a revolving credit facility or a committed cash facility.
When you’re looking for more long term financial options, like our flexible rural term loan, your ABC Bank Rural Manager will be happy to meet up to talk about the best loan structure and financial arrangements to support your current and future business requirements.
03
Succession planning
When you’re busy managing and running your farm, dealing with the day-to-day is often more than enough, let alone thinking about what’s next. A succession plan can be one of the most important things you do to secure your future and that of your farm, but it’s often forgotten.
The biggest obstacle is just starting the process to decide what you want. That means discussing your options with your family and working out the way forward – you’ll probably need some expert legal and accounting help to formalise plans.
There’s plenty to consider, which is why we’ve put together a separate guide to succession planning.
Next steps
Talk to your local rural banking specialist
Find your nearest ABC Bank Rural Manager.
Other helpful guides
ABC Bank’s terms apply.
