The KFF Profit Finder Tool

LISTEN TO THE AUDIO VERSION HERE

Bringing the next generation of farmers and ranchers into the family operation is exciting and creates opportunities for growth. But adding another family to the payroll may be a concern if the operation's finances haven't been fully evaluated. Keep Farmers Farming, the Farm and Ranch Transition and Estate Planning Branch of the South Dakota Ag Foundation can be a resource in helping producers run the numbers.

Legacy Consultant Shannon Kubik explains they offer clients their Profit Finder tool to evaluate the financial status of the farm or ranch.

“It basically shows the business at a high level and then goes into detail into expenses, income, and then just making sure that there's enough room within the operation to bring that next generation in.”

The Profit Finder tool also addresses equity and compensation for both generations in the business.

“We want as a collective group to be profitable and make sure that the operation can continue and making sure that people are building equity individually and also as the larger organization. And so we work through that with families. We talk through the compensation side specifically and making sure that that is a topic that is discussed because you can't live on equity alone.”

Kubik says Profit Finder can work with numerous accounting systems to evaluate the financials. It also creates opportunity to take the numbers out of the shadows for the incoming generation.

“A lot of times they haven't really ever seen the numbers. That's pretty normal. And so this allows a conversation to be had. And then also we use our Profit Finder tool for budgeting.”

Learn more about the Keep Farmers Farming program here.

Taken from a conversation with Pam Geppert of Dakota Farm Talk.