It’s tempting to believe this is true, that if you can sell more, and generate more revenue, you will be more profitable.

The Truth: Sales don’t equal profits.

Sales tell you just what your customers paid you.

Sales don’t tell you want it cost to grow the case of vegetables, the bouquet of flowers, or pound of meat.

Inside The Farmer’s Edge, you'll learn  how to calculate your cost of production, and with custom excel templates; and how to set your prices for profits.

Certainly, you need to file your taxes; and having a bookkeeping system to organize all your business sales and receipts is key.

The Truth: Bookkeeping for taxes is different than bookkeeping for business management and decision making.

For example, for your taxes, you have one category for “supplies.” And for the IRS, that’s enough.

But that does not help you understand what you spent on farming/production supplies vs. office supplies vs. selling supplies (like packaging, farmers market signs, or scales).

If you wonder, how can I improve profits, then you need to know which expenses are out of control, and which expenses are in line. Just knowing what you spent on “supplies” isn't enough. "Supplies could be so many things: for the office, greenhouse, selling, or field, so you want to have more details in your books. You want to know what you’re spending on payroll, so you know if you’re managing your staff efficiently, or if you need to make adjustments. And you want to know what you spend on selling so that you can evaluate if each of your sales channels bring in enough revenue to justify the expenses.

Much of this can be solved quickly and easily in how you set up your chart of accounts, using parent accounts and children (or sub-) accounts. This helps you organize all your expenses in easy to understand and easy to analyze chunks.

...And the corollary to this myth is that if you don’t have cash in the bank, then your business is tanking.

The Truth: Cash and profits are two different things. You can have cash in the bank because you got a loan or a grant. While these are helpful tools and may help you improve the profitability of your farm, they are not profits. 

Similarly, you can have a profitable business – but no cash in the bank because you paid back a loan or purchased equipment like a new paper-pot transplanter.

In The Farmer’s Edge, you learn how to organize all the different transactions of your business, so you understand your cash flow (and make sure you don’t get yourself in a cash flow jam), understand your profitability, and know if and how you’re working towards paying yourself and taking time off.

People often believe they’re bad with numbers because they didn’t do well in math in school, or maybe they made a mistake, and got themselves into debt.

More often, it’s not that people are bad with numbers, they just don’t know how to organize them. That is, how do you organize all your costs so that you can calculate your cost of production? How do you organize your income statement so you can understand what the numbers tell you?

As one client said, I know I’m supposed to look at my numbers every week, and I do. I just don’t know what I’m looking at.

In The Farmer’s Edge, I’ll show you how to organize all your numbers so you can calculate your cost of production, set sales goals, understand if you need to borrow money (and if you can afford to pay it back).

And if you are truly bad at math (which I don’t believe!), then you can use excel templates and tools that have the formulas already built in, so you don’t even have to do the math.