During the seventh episode of African Farming, the agricultural television show on Mzansi Wethu (channel 163), Praveen Dwarika, Managing Director of Lemang Agricultural Services, explained to the show’s host, Angie Khumalo, why a well thought out business plan is crucial to any farming operation.

Kleinjan Gasekoma is a different breed of farmer. He is a first-generation livestock breeder who made history by being the first black farmer to be crowned South Africa’s best commercial cattle farmer in 2015. Gasekoma also farms with eland, springbok, gemsbok, sable antelope, impala, and red hartebeest.

The one thing that separates a successful farmer from the rest, is the fact that he takes his business plans very seriously. Lemang Agricultural Services deals with a lot of farmers and their finances.

“A business plan is important because it is the building block of any business. Especially when it comes to farming operations,” said Dwarika.

“If you look at Kleinjan’s business and his achievement of being honoured as the most successful cattle farmer of 2015, all that had to start with a plan.”

A business plan serves different functions.

“At some point in time you would want to go and speak to your financier about an extended or bigger credit line. You will fill in an application form and supply certain documents. But, if a business plan is not there, none of your applications will even be considered,” cautioned Dwarika.

He further stated that it is critical for farmers to understand that what goes into a business plan serves as the basis of what the farmer is going to get out.

“It could be for a credit application, but we must not forget about the possibility of farmers looking for co-investors in their operations. What your business plan talks to, is not just the past but also what you are planning for the future. And that is so important because as Kleinjan is expanding his herd and his operation, he is going to need extended working capital and financing arrangements.

His business plan will be used to address that for his bank manager, or for any business, he decides to approach for funding or co-investment.”

For information: visit https://www.afgri.co.za/lemang-agricultural-services/