By Morgan Stutrud
Originally published by Dakota Farmer at farmprogress.com
What happens to the farm when the person who normally knows everything is suddenly unavailable?
On many farms, there is one person who knows where everything is, who to call and what needs to happen next. They know when the next payment is due, which fields are rented, what equipment needs service and how the livestock are supposed to be fed.
It works because that person is always there. But what happens when they are not?
An accident, family emergency, unexpected hospitalization or even an extended trip can leave the rest of the family trying to figure out information that normally lives in one person’s head.
Who knows when the next loan payment is due? Who has the insurance agent’s phone number? Who knows which fields are rented? Who knows what the cattle need to be fed? Who knows where the important paperwork is kept? These questions can expose a vulnerability that many farm families do not recognize until they are faced with an emergency.
One simple way to prepare is to create an emergency farm binder. The binder does not need to contain every detail about the operation. It does not need to be a hundred pages long or perfectly organized. Its purpose is to give someone enough information to keep the farm moving if the person normally handling those responsibilities is unavailable.
Start with the people who need to be contacted. Keep a current list of important phone numbers near the front of the binder. This could include family members, employees, the lender, insurance agent, veterinarian, agronomist, landlord, equipment dealer and other suppliers or service providers the farm depends on.
Financial information should be included as well. Someone stepping in should be able to see what bills or loan payments are coming up and know where the farm’s financial records are located. The binder does not necessarily need to contain bank statements or other sensitive information. It can simply tell someone what needs attention and where the records can be found.
Basic farm information is another important part of the binder. Include a list of owned and rented land, field locations and current crops. If the farm has livestock, include information about where the animals are located and who normally handles their care.
Equipment information can remain simple. List the major pieces of equipment and include the name and contact information for the dealership or person who normally services them. If equipment keys, manuals or important records are stored somewhere else, make a note of where they can be found.
Livestock information may be one of the most important sections for a livestock operation. Someone unfamiliar with the daily routine should be able to find basic feeding instructions, medication information and contact information for the veterinarian. If certain animals require special care, make note of that as well.
Important documents should have a designated location. The binder can include a list showing where insurance policies, leases, legal documents, tax records and other important paperwork are stored. The goal is not necessarily to put every document inside the binder. The goal is to make sure someone can find them when they are needed.
Digital information deserves attention, too. Many farms now rely on online banking, accounting programs, crop records, grain marketing accounts and other digital services. A trusted person should know how to access the information needed to keep the operation running. Passwords should be stored securely rather than simply written in the binder.
Perhaps the most useful part of the binder is a simple list of responsibilities. Who feeds the cattle? Who handles crop insurance? Who talks to the lender? Who works with the agronomist? Who is responsible for equipment repairs? Who makes marketing decisions? These may seem like obvious questions to the person who normally handles them, but they may not be obvious to everyone else.
Creating the binder can also reveal areas where the farm relies too heavily on one person.If only one person knows how to operate a particular piece of equipment, manage the books, work with the lender or handle crop insurance, that is a management risk. Cross training family members and employees can make the operation more resilient.
The process can be simple. Sit down with the family and ask, “If I could not come to the farm tomorrow, what would you need to know?” Then write those things down.
The answers will be different for every operation. A grain farm may need detailed information about crops, field locations, landlords and marketing. A livestock operation may need more information about feeding, animal health and daily chores. A diversified farm may need both.
The binder should be kept somewhere that the right people know about and can access when needed. It should also be reviewed regularly. A quick update once or twice a year can keep phone numbers, crops, livestock numbers, equipment and financial information current. It can be helpful to review the binder before planting and again before harvest. Those are busy times of year when losing the person responsible for a major part of the operation could create significant problems.
The binder should not be viewed as a replacement for good communication. It is simply another management tool. Farm families should talk about responsibilities before an emergency occurs. Everyone does not need to know everything, but more than one person should know the basics of how the operation functions.
Farmers spend a lot of time preparing for uncertainty. Weather, markets, equipment breakdowns and input costs are all part of managing an agricultural business. Preparing for the possibility that the person running the operation may suddenly be unavailable deserves the same attention.
An emergency binder will not solve every problem. It will not make an unexpected situation easy. What it can do is give a family, employee or business partner a starting point when they need it most. The best time to figure out what happens when you are not there is while you are still there to explain it. Start with a binder, write down the important information, and make sure someone else knows where it is. Then keep it updated. The most important information about the farm should not exist only in someone’s head.
Stutrud is a North Dakota Farm Management Education Program instructor at Dakota College at Bottineau and writes from Rugby. The North Dakota Farm Management Education Program provides lifelong learning opportunities in economic and financial management for persons involved in the farming and ranching business. Visit ndfarmmanagement.com, Facebook @NDFarmManagementEducation, or contact Madison Bodine, State Supervisor for Farm Management Education, at hlang@nd.gov or 701-328-2308 for more information. The ND Farm Management Education Program is sponsored by the North Dakota Department of Agriculture.