What are the Charactersitics of NZs Top Farmers

OPINION: Many years ago I can remember a farm survey with one of the questions being: "Do farm men feel they are above average drivers?".

Unsurprisingly, 92 per cent replied definitely yes and from that point on I have always been careful about interpreting survey results. With that said, my suggested 30-odd point list as to what the top group do, think and say would be:

· They are almost invariably a couple with decision making being more or less equal, even on the crunchy issues.

· They listen well and dwell on a problem, but don't necessarily act on it.

· Top farmers spell cash with a capital C, because for part of every year it can rule their cashflow and their life.

· They are well aware that historically low interest rates have camouflaged their financial results for the past 10 years. They don't want to see any change, but they expect it sooner or later.

· At the beginning of every year they budget for a profit, but when a loss occurs they focus on recovery and never turn the lights out because of a farm loss.

· Their family personal drawings are only a little higher than normal – they don't believe that as their farm income rises that their personal drawings should also necessarily rise.

· They feel the education of their children is more important than fertiliser for the farm.

· They have "iron disease" under control and tend to want as few wheels on their property as possible, but what wheels they do have must be in top order.

· On every back road in New Zealand they are farmers out-performing other farmers on the same road by as much as 25-50 per cent.

· The timing of their farm actions is sound – the only difference between the top 10 per cent group and the next 10 per cent group down tends to be in their timing.

· They tap into top advice on a regular basis – they have found that there is no half way house when it comes to advice.

· They are in regular contact with their bank manager regarding their interest rate and loan structure options. Their total interest costs are often about 15-20 per cent of their gross farm income but are usually less than their net farm profit and sometimes a lot less.

· They manage their income taxes. They don't enjoy this because they are quite sure they could spend these income taxes much better than the government, but they don't downgrade their farm management and decision making because of this.

· They lead from the front and are known in the district as preferred employers who work just as long and hard as their employees.

· The best farmers don't wage war on a key issue or problem on more than one front at a time – they deal with wars early on and are always prepared to settle, even when cash is involved.

· They understand about compound interest (the eighth wonder of the world).

· They like work and get job satisfaction about 90 per cent of the time and they want their employees to have the same satisfaction.

· With innovation they may not be the first movers, but they would not wait until the third bounce either.

· They are strong on grass renewal, soil testing, good seed, feeding stock and people management. They don't sweat the small stuff.

· They are very good at implementing new ideas. They do their homework, talk to other farmers and advisors and do the groundwork – they have long found that guessing in farming can be horribly expensive.

· They tend to network well, but quietly. They attend well-run farm seminars and field days and tend to learn more from what they see rather than what they read.

· They are strategic thinkers and seek improvement, but not at the expense of their family. Many of them do not have a good work/life balance as profits are not everything, but they come second, usually after breathing.

· When they return a borrowed vehicle they ensure the gas tank is full.

· They are not afraid to say "I made a mistake", but they won't make the same mistake again and their mistakes tend to be a long way apart.

· They under promise and over perform.

· They manage risk and they don't fight, defer or ignore it. They separate risk into financial, personal and production categories.

· They delegate well but with a major structural problem they deal with it themselves and fix it.

· Top farmers have long found that losses manage themselves well but profits seldom do. They find losses need focus, their time, good decisions and usually money to reverse.

· They don't throw money at issues without a lot of planning, but they have found that short-term losses are sometimes unavoidable.

· Lately, almost everything they action with capital expenditure has overrun its budget. They have found that even the best budget and the best quotes have extras and over-runs. Sometimes they feel that about 93 per cent of their property's potential should perhaps be their objective.

· The benefit of quality on all fronts has never been at issue for them, though the cost of providing continuous quality on all fronts is something they find hard going and expensive and demands constant focus.

· Do they want to retire? No, because they are profitable. Will they retire gracefully? Yes, when they are ready. Are they concerned their well educated children may not take over the farm? Years ago they might have been, but today they are more relaxed about it. It also means that they can treat their children equally, which is a subject that gets a fair amount of air space.

Pita Alexander is an accountancy and agribusiness director at Alexanders.