Saving and investing money on rural property?
What can ensure that your rural property goes through crises without major impacts is to rely on the main resources of sound financial management, such as investing, saving and saving money.
For many people, these three words mean the same thing, but in this content you will find that they are very distinct, and always complementary. Understanding the true meaning of each of these terms and applying them in the reality of your endeavor will transform your relationship with finances .
Taking care of this is crucial to the success of your business. Without the correct focus for the resources obtained, the chances of seeing it undergoing continuous crises or never growing is great.
What is the difference between saving, saving and investing?
As stated above, the differences between these words are enormous. See below.
You’ve probably saved money, both in your private and business life. This custom is the simplest of the three, for it means limiting spending and avoiding wasting money on superfluous things-things that are not necessary.
Many think that only this practice can guarantee the financial health of the enterprise , which even makes a little sense. The problem is that many rural owners save on some parts (sectors) and end up spending on others, neglecting the process.
This way, all the effort in the cut of expenses is impaired. Sometimes some can not reap the rewards of their commitment and abandon the practice of economics as business capital improves. As a result, it loses a great opportunity to optimize rural property and suffer less during off-season or low (seasonal) periods.
When you save money and manage to raise money regardless of the goal, it is saving. This routine is so relevant to maintaining the economic stability of the venture that it has become one of the top advice given by economists for those who wish to succeed.
Therefore, it is fundamental that every entrepreneur has stored capital for contingencies and make investments.
Who understands this importance very well are the autonomous: after all, being your own business, it is indispensable to have a half-way to meet the needs in case of problems.
On slightly larger, multi-employee farms, an efficient way to save money is to have a separate account for storing thirteenth salary and vacation provisions, for example.
When saving is already part of the routine, the ideal is to look for alternatives to make this capital render, that is, to make it multiply while it is stored or invests in some improvement for the business.
So if you do not want to risk your financial reserves in high risk situations, you can opt for more conservative actions to make your money grow safely. The ideal is to look for investments that yield above inflation. Thus, you avoid the loss of capital over time.
The second option is to invest in the business. For example, targeting a portion of capital to legalize it or acquire technologies that simplify operational work intelligently, such as ordering software, billing, and issuing invoices. Sometimes the return may even exceed the rates offered by banking institutions on traditional investments.
How to save money?
Now that you already know the difference of each of the three financial terms, let’s start with our step by step. Here’s how to save money on your country estate .
Identify all the costs of your production
There are a few criteria to identify each of the costs, which can totally change as you handle your professional activity.
Costs are divided into two categories.
Fixed cost: is one that does not vary according to production. This is the case of wages, taxes, rents of machines and equipment. That is, the values are the same month by month.
Variable cost: varies according to production, such as the volume of feed to feed the animals or the raw material used in a given task. Note that if productivity falls, you spend less on these resources and if it increases, the opposite occurs.
Raising all costs is crucial to devising more accurate strategies and getting better results.
Plan and create a strategy
After completing the previous step, create schemes to save money without this resulting in a decline in the quality of your products. After all, if you understand what you can and can not avoid, you can think of solutions.
With the creation of budget planning, for example, it is possible to design costs and revenues and thus accurately understand cats with their rural activity. One suggestion is to negotiate with your suppliers the early purchase of inputs to lower their price. Another possibility is to buy animals or agricultural resources in the most favorable time.
Visualize opportunities in the productive chain itself
When it comes to reducing costs, it is important to define some actions, noting the reality of your rural property. Therefore, give due attention to your production chain. This will cause you to see actions to reuse inputs, procedures and resources that could be ignored.
During soil fertilization, for example, this is exactly what happens, since some items of production (animal droppings and leftovers) are reused. Rainwater reuse is also an affordable solution to reduce cleaning costs.
The key is to abuse creativity to ensure benefits without having to spend. When you value your rural culture, ideas emerge over time and have a positive impact on the production process.
Reduce energy costs
This is an easy expense to generate savings. This is because there are many sustainable practices that can generate savings without compromising the progress and quality of your work .
Nowadays, it is already possible to prioritize wind or solar power, the famous mixed solutions, to reduce consumption and maintain production.
If your business still can not build this structure, consider the most common alternatives in the electric market. LED bulbs, for example, consume about 80% less energy than conventional ones.
Take care of logistics
It is no use for you, the producer, to take care of all the handling during the harvest if there is no efficient distribution management . And this covers not just shipping but also stock (storage).
As Brazil has a predominantly tropical climate, having resources that guarantee the conservation of perishable foods is essential for the products to reach the customers ready for consumption. Therefore, it is necessary that the flow of production be fast to guarantee productive efficiency and to avoid waste and complaints.