Minor farming expenses can play a big role in your profit if they’re not kept under control. This can result in “cost creep”, which occurs when small costs add to up large amounts, a phenomenon that is commonly seen across balance sheets, particularly related to labor costs or inputs.
So how can you combat it?
- Evaluate your opportunities. Evaluating costs means thinking critically about decisions. Do you need to hire out spraying on those last 30 acres? Evaluating cash rent, equipment needs and other opportunities means wiser spending and little cost creep.
- Stick to original plans. When it comes to sticking to a plan, nobody knows adaptability better than farmers. But not deviating from plans when not necessary usually means cost savings.
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