Help Is Here: Survival Strategies for Food and Farm Businesses

This on-demand course features FFI Director, Tera Johnson, walking you through how to use FFI’s 13-week cash flow template. We encourage you to follow along with the video, it will make completing your own 13-week rolling cash flow forecast much simpler and faster.

We are offering this course for free as there is an immediate need for all businesses to manage their cash amid this pandemic. This is the tool to help them do so. If you have any questions please do not hesitate to reach out!

Survival Strategies for Food and Farm Businesses

We’re facing an unprecedented time in the food industry, and there are enormous ramifications for all of us. With COVID-19 sweeping the nation and Americans social distancing and sheltering in place, so many food companies and farms are facing precipitous sales declines, some falling to zero. On the flipside, other food and ag businesses are experiencing 100%, 200%, even 500% sales increases and can’t meet demand fast enough.

Without question, the entire food system as we know it has been disrupted—and nobody knows how long this will last or what it will look like on the other side. The old adage “it’s a marathon, not a sprint” rings piercingly true right now.

All that said, crises such as this do spring new opportunities. After all, before the pandemic struck, 54% of all food purchases came from foodservice. Though that percentage has since dropped considerably, people still need to eat, so those sales must shift to brick-and-mortar retail, online and direct from farmers. Some food and ag businesses are responding by shifting to e-commerce. Others are seeking new retail accounts, as most grocery stores have been deemed essential and must remain open but are struggling to fill their shelves. Some food manufacturers are even shifting gears to produce more in-demand products for the foreseeable future.

But for all food companies and farmers out there, the primary goal is keeping the business alive. And to do that, it’s time to zero in on managing cashflow. That was the focus of both our most recent podcast featuring Ted LeBow of Kitchen Table Consultants and Monday’s virtual huddle with FFI-trained consultants and entrepreneurs we’ve worked with.

Businesses should immediately create a 13-week rolling cash forecast (here’s FFI’s template) to see where they can free up money. Go through your P&L and look at cost of goods sold (do you have inventory left to pay for?), rent (will your landlord allow deferred payments?), debt service (can you defer or go interest only?) and labor (can you reduce staff and possibly share employees with other businesses that are hiring?). Also talk to your insurance agents and ask your bank about credit lines for working capital.

Food and farm businesses should also look into relief programs from government, private organizations and nonprofits. For example, the U.S. Small Business Administration has enacted its Disaster Loan Assistance program, and many states have or will offer financial help.

Once companies take a thorough comb through their cash forecasts, some may discover it’s wisest to hit the pause button for a while. This may be the best way to avoid digging a deeper hole and ensure they’re financially able to resume business once the dust settles a bit.

None of this stuff will be easy or painless, but it’s necessary given our reality right now, and there are excellent resources to help businesses through it. Reach out to us at FFI, and please join next Monday’s virtual huddle—open to everyone—to chat with other entrepreneurs in the same boat, along with trained consultants who can offer advice. When we all pull together, we can weather this storm and pick up valuable lessons along the way.

With all food and ag businesses facing major changes due to COVID-19, we’ve created weekly virtual huddles to unite entrepreneurs and consultants. Every Monday, we’ll answer questions, share important info and ideas, and discuss best practices.

Weekly on Mondays at 2:30 pm | 1 hour | Central Time
Click here for log in information!

Weekly on Mondays at 1:00 pm | 1 hour | Central Time
Click here for login information!

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