A financial analysis program could benefit custom forage harvesters, just as it has helped grain harvesters since the 1990s, say Kevin Dhuyvetter and Terry Kastens.
With assistance from U.S. Custom Harvesters, Inc. (USCHI), the two Kansas State University ag economists developed Custom Harvesters Analysis and Management Program (CHAMP).
“From the beginning, a core group of custom grain harvesters took ownership in CHAMP,” says Dhuyvetter. “But it just hasn't taken hold with forage harvesters. We've developed forms for them, but they don't take the time to fill them out. Completing the forms the first year is intimidating, but in subsequent years it's much easier and only takes a few hours.”
Participants supply data on expenses, revenue, employees, etc. After completing an analysis, the economists send each harvester a detailed report, then meet one-on-one with them at USCHI's annual meeting.
CHAMP has helped participating harvesters save money and become better record-keepers, they say.
“We rely on some of the same information that is reported in a harvester's tax return and then we supplement that with the additional information to get at economic profits. While tax-return data can be a reasonable estimate of your true economic profits in some cases, it can also be misleading. So it's important to consider economic returns when evaluating your business,” says Dhuyvetter.
CHAMP also shows trends and how harvesters compare to their peers. “The program pinpoints what they're doing right and what they're doing wrong. For those harvesters who aren't doing as well as the average, we want to know why and identify the problem.”
The program cost is $175 for USCHI members, $250 for non-members. Various corporate sponsors also make contributions to the program. This year, Case IH donated $9,000.
For details, visit www.aganalysisplus.com and click on the CHAMP link.