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Farm Business Management (FBM) generally refers to the techniques and
information required in managing primary agricultural production, on-farm
processing and client marketing activities.
The major elements of Farm Business Management are:
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Environmental Management planning involves the incorporation of sound
environmental practices into farm operations. Good environmental planning
promotes resource sustainability, long-term health benefits for farm families,
rural communities and consumers, land stewardship and other economic benefits
of a sustainable resource bare and market advantages benefits tied to a green
industry.
Farm Business Planning refers to the process of
setting goals and objectives for the farm business and devising ways and
means to accomplish these. This is the first step in business planning. It
focus on the organization of resources, such as land, labour and capital,
as well as "management" ability, and uses decision-making processes to achieve
the goals and objectives of the farm manager or owner/operator.
Financial Management involves the application
of financial resources (capital) such as equity and credit (debt), to
generate income for the farm business. Financial management includes:
record keeping
 (pdf - 61 kb);
financial management;
tax management (pdf - 81 kb);
risk management; and a number of decision making processes and techniques
for optimizing the financial performance of the farm business.
Human Resource Management describes the methods used in managing the labour
or human capital of the farm business. This can involve hired labour, other
managers or supervisors as well as unpaid family labour and ownership sharing.
The use of farm management teams, such as spouses, parents and children or
siblings are included in this area. Intergenerational transfer, estate
planning and some business structure considerations are all included in
human resource management for the agricultural business.
Marketing encompasses the process of selling
products to consumers and the associated pricing, processing, distribution
and timing decisions required. Market planning involves the identification
or development of a target market and the determination of a strategy to
penetrate that market. The 4 P's of marketing are: Place; Price; Product;
and Promotion.
Production Management describes the processes
involved in physically producing an agricultural product. These include:
land management; crop and livestock production; the use of machinery and
equipment; the application of fertilizers, pesticides and other controls
on pests and diseases; breeding; feeding and record keeping.
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