As a Community Development Financial Institution that invests in the prosperity and well-being of farmers, ranchers, and fishers who have limited access to financial resources, California FarmLink (FarmLink) recognizes that the state’s farms and ranches face unique challenges as small business entrepreneurs. For small-scale farms and ranches to prosper, they first must succeed as businesses.
To meet this need, FarmLink received Western SARE funding to increase the capacity among small business advising organizations to effectively serve sustainable farm and ranch businesses. Over 70 service providers serving small-scale sustainable and organic agriculture participated in the trainings.
What became apparent during the tenure of this project is that specific, “down and dirty” bookkeeping training for small-scale producers was in demand.
In response, FarmLink created Bookkeeping in Practice, an 8-week virtual course designed to help small-scale farmers and ranchers implement or improve their bookkeeping system using QuickBooks Online. Two cohorts have completed the course, with a third being planned.
“Our goal is to set producers up with a good bookkeeping framework and structure, improving their ability to communicate about their business with others, such as service providers,” says bookkeeping trainer Frances Andrews. Frances was one of the participants in the Western SARE Professional Development Program funded project.
Frances explains that in the course, FarmLink provides a template chart of accounts, trains participants in its use, and helps them set up their own. They leave the course with a solid chart of accounts that makes sense to them, service providers, and tax preparers.
“Without a good chart of accounts, producers can’t get good reports that lay the foundation for better cash flow management and long-term financial resilience.”
Frances stresses the “balance sheet mentality” as a central principle. This is a focus on creating a good asset list, which lenders need and often producers don’t have in their bookkeeping systems. Producers completing the course learn how to get that into their system and understand a balance sheet.
Bookkeeping in Practice is open to farmers and ranchers who have completed FarmLink’s Resilerator or El Resilerador program. That program is more conceptual, and this bookkeeping course takes what was covered and puts it into practice.
“There has been a build-up of demand for this training. In our second year, we had about 20 people participating and more wanted to get in. The majority already used QuickBooks but maybe not as well as they could. The others were supported in getting QuickBooks and setting it up correctly,” says Frances.
That can create a challenge with some participants being brand new to QuickBooks and others who are more experienced.
She notes, “We are learning more from clients about what they need. For example, many have farm business income and expenses that are not technically “agriculture,” such as grant-funded projects or agritourism, so we need to look at expanding our chart of accounts.”
One rancher took advantage of the one-on-ones offered with Frances and did all her homework enthusiastically. She was starting from scratch, new to QuickBooks, and recognized that by putting in time, her life would get easier. She noted with relief that having her books in order would be great next time she met with her tax preparer.