Planning for Financial Success
Fruit growing can be a really rewarding career, but it is financially risky and requires hard work, good planning and a bit of luck here and there. Over the years I have seen many growers come and go. I have seen growers leave the industry in circumstances that suited them, while others have had that decision forced upon them. During the same period, I have also seen both new and established growers survive and thrive.
We are at a point now where some individual growers and even crop types are struggling to survive in the current market. Yet others are thriving, embracing the challenges and ready to push for bigger and better things. I am sure this is a time that will be looked back at as another window of great opportunity. But having winners often means there are losers. It is a good time to decide what you want to get out of the industry going forward and plan how you are going to get there.
There are currently many options for fruit growers and landowners in Hawke’s Bay. Different crops, different varieties, different growing systems, different price points. Some involve lots of commitment in time, effort and finance, with growers accepting potential increased risk but targeting the maximum return on investment for this effort. Other arrangements allow growers or landowners to reduce their exposure by sharing risk, responsibility and potential returns with business partners.
We are seeing lots of options available for joint ventures, contract management, and land lease scenarios.
Whatever age, stage or risk appetite you have as a grower, it is important to plan, to help ensure your future is as successful as possible. Whether you are looking at increasing your current growing business or reducing your risk but still be part of the industry, the following themes are very important for fruit growing success.
Take-Home Messages
- Most mistakes have been made before. Where possible, learn from other growers’ experience rather than making every mistake yourself.
- The path to success is littered with the bones of the innovators, therefore try to be a fast follower not a bleeding edge innovator.
- Current excellence does not guarantee future excellence, so be sure to find a way to continually improve. This year’s excellent will be average in the future. Make a plan around what improvements you are looking to make for this season.
- Successful growers take risks but try to grow at a rate that is sustainable for the business.
- Chasing production of the highest paying fruit is generally a more effective way of reducing cost per unit than trying to focus on cutting out a fundamental cost. Not all cost savings are profit making.
- Understand the greatest limiting factors in your business. It is easy to go down rabbit holes in this industry trying to achieve excellence in one area that is a personal passion, when another area of your business is only achieving average results and has better potential for improvement.
- If you decide there is a future for you in this industry, there probably is. If you decide there is no future for you in this industry, you are also probably correct.
Jonathan Brookes
