Digger magazine

Serving the Northwest Nursery Industry for Over 50 Years

  • Digger-Employment_banner-2020-728x90px.jpg
  • NG_banner-2020-728x90px.jpg
  • FW_banner-2021-728x90px-1.jpg
  • Home
  • Articles
    • Nursery News
    • Features
    • Plants
    • Growing Knowledge
    • Operations
    • Nursery Country
    • Meta
  • Issues
  • Events
  • Farwest
  • Columns
    • Director’s Desk
    • Mike Darcy
    • Pivot Points
    • President’s Message
  • Employment Classifieds
  • Advertise
  • Subscribe
You are here: Home / Nursery Operations / Money efficiency

Money efficiency

By Carol Suruki — Posted April 30, 2018

Money efficiencyThese tips will help growers spend their business dollars wisely

As a business owner, you want to spend your money on what provides true, long-term business value. Because nurseries can rely heavily on cash flow to keep their operations running, it’s important to understand where your money is going and plan for your capital investments.

Here are some ways to determine if you’re efficiently utilizing your company’s cash:   

Know your numbers

Many nurseries overlook balance sheets when they’re actually one of the most important pages of the financial statements. A balance sheet can provide a basic overview of a nursery’s financial health, a snapshot of its stability, and a roadmap for future decisions.

Balance sheets include a detailed summary of assets, liabilities, and equity. Assets are defined as probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events. Liabilities are probable future sacrifices of an entity’s economic benefits. The sacrifices arise from an entity’s future obligation to provide assets or services to other entities as the result of past transactions or events.

Not all liabilities are satisfied by assets. Sometimes, liabilities are satisfied through performance of services. Assets — including cash accounts — and liabilities are divided into short- and long-term resources and obligations, respectively.

Performing regular maintenance to your balance sheet is key to achieving your nursery’s business objectives. Balance sheets can reveal how efficiently a company is using capital and managing risks. Ideally, you should review your balance sheet on a monthly basis. If that isn’t possible, it’s important to review it at least once each quarter.

The stronger your balance sheet is — that is, the more the assets exceed the liabilities — the more likely your business will be to capitalize on future opportunities, grow sensibly and weather unforeseen challenges.

Reforecast before you spend

Savvy finance teams regularly use a reforecasting process to stay on top of multi-year projected financial results. Due to the long cycles of the nursery businesses, this is typically a five-year rolling forecast. Reforecasting is a process of factoring your actual to-date results, followed by projecting the balance of the fiscal year to determine expected full-year results.

Owners typically go through this process on a monthly or quarterly basis and simply add actual year-to-date results to the remaining budget. However, while updating your budget with actual year-to-date financial information is a fast process, it doesn’t provide the important benefits that come from examining the remaining future projections.

After examining the projections, you can fine-tune them to more accurately reflect current and anticipated business conditions and take the to-date budget-to-actual performance into account.

The suggested approach is to examine the remaining budgeted projections and fine-tune these forecasted results to more accurately reflect current and anticipated business conditions.

Reforecasting provides you with numbers that are both up-to-date and more refined, which provides the opportunity for better planning and earlier course correction.

Invest in people

People are vital to your business’s success. Investing in your most important assets may seem like a no-brainer, but it goes deeper than just giving raises or bonuses.

As you’re determining your business’s future goals, start identifying gaps in your current team and determining how you can fill those needs while putting together your business’s forecast. Start by filling missing roles and investing in your current high-performers by developing future positions within your business. Leadership can then help identify which elements of each position are most important and determine any necessary changes
in compensation.

The board is also responsible for helping develop a strong management team and determining potential leadership successors. Specifically, boards should address CEO and top-executive succession planning, considering both internal and external candidates.

During this comprehensive process, leadership should understand and be able to provide advice on the leadership development programs available for all employees. These programs are a critical aspect of preparing for appropriate succession throughout the business.

Consider your IT environment

Many nurseries aren’t making use of new information technology (IT) advancements that could enhance their efficiency and help their businesses operate more effectively.

Integrating technology requires a clear understanding of how your business is currently operating as well as a solid plan for implementing improvements moving forward.

Before investing in new IT systems, you can start with something simple like an IT assessment. This process can help you determine how systems, infrastructure, staffing, practices, and procedures can better meet your business’s present and future needs. It can also help you evaluate your current IT environment and focus on priorities.

Next steps

Using successful budgeting elements can solidify the connection between operations and finance, strengthen communication between department heads, and improve decision making. When combined with regular forecasting and reforecasting, nurseries and their management teams can better anticipate events and control their business.

Carol Suruki is the food, beverage, and agribusiness partner at Moss Adams. She has practiced public accounting since 1991. She specializes in providing assurance services to middle-market clients that sell products to retail and distribution channels, including e-commerce, grocery, mass, club, spas, and hotels. She can be reached at 818-577-1916 or carol.suruki@mossadams.com.

Assurance, tax, and consulting offered through Moss Adams LLP. Investment advisory services offered through Moss Adams Wealth Advisors LLC. Investment banking offered through Moss Adams Capital LLC.

Download a PDF of this article

efficiency flower Explore the EFFICIENCY ISSUE
Rising costs, labor scarcity and competition create challenges for growers. Greater efficiency can be the answer.

We talked to more than a dozen growers and industry colleagues who have become more efficient, and increased their bottom line, by improving their management, workflows, inputs and workspaces

Your efficient nursery business
Part one: Managing for efficiency
Part two: Creating an efficient workflow
Part three: Using your inputs efficiently
Part four: Arranging the workspace

Marketing efficiency – Ian Doescher of Pivot Group

Share this:

  • Print
  • Facebook
  • LinkedIn
  • Twitter
  • More
  • Reddit
  • Tumblr
  • Pinterest
  • Pocket

Filed Under: Nursery Operations Tagged With: Business, Digger, Digger magazine, Efficiency, Finance, moss adams

Avatar

About Carol Suruki

Nursery Guide LIVE

Booth spaces still available for Nursery Guide LIVE March 17–18

Nursery Guide LIVE virtual marketplace postponed due to winter storm damage

Keynote presentations at Nursery Guide LIVE virtual marketplace provide insight on green industry trends in 2021 and beyond

OAN announces Nursery Guide LIVE virtual marketplace, set to take place online

More Posts from this Category

CORONAVIRUS COVERAGE

Virtual is the new reality – for now

Trade shows in the time of COVID

A demand ‘renaissance’ for nurseries

Western Nursery & Landscape Association falls victim to pandemic

MANTS 2021 to move online due to COVID-19

More articles

NURSERY NEWS

Booth spaces still available for Nursery Guide LIVE March 17–18

Horticulture authors to speak at Penn State symposium

McHutchison and Vaughan to establish one Chicago office

Eason Horticulture Resources hires for national sales team

Gloeckner transitions business to Ball Seed

More Nursery News

FARWEST SHOW UPDATES

People’s Choice Award winners announced for the 2020 Farwest Show New Varieties Showcase

Augmented reality app allows New Varieties Showcase voting

Farwest Show launches virtual contest to crown 2020 New Varieties Showcase winners

MANTS 2021 to move online due to COVID-19

Growing with the industry: Farwest memories

More Updates from Farwest

From the pages of Digger

March 2020

February 2021

January 2021 – Nursery Country

December 2020

The Transportation Issue — November 2020

More issues of Digger

Connect with us online

  • Email
  • Facebook
  • Instagram
  • Twitter
​

News

  • Nursery News
  • Growing Knowledge
  • Nursery Operations
  • Meta

Features

  • Plant Features
  • OAN Members
  • Oregon Nursery Country

Columns

  • Director’s Desk
  • Mike Darcy
  • Pivot Points
  • President’s Message

Resources

  • OAN Home Page
  • Job Listings
  • Subscribe to Digger
  • Advertise in Digger
  • Online Plant Search

© Copyright 2020 Oregon Association of Nurseries · Admin