Global uncertainty offers industry opportunity for agribusiness advisors
At a time when the global environment is facing increasing uncertainty, agribusiness advisors could be, if they choose, on the verge of exciting new times for the accounting industry, writes Paul Buchanan.
Whether it’s the tractor pull, a new pair of Red Bands, or simply devouring a whitebait fritter, there’s certainly a lot to see, buy and do at the Southern Hemisphere’s largest agricultural event.
More than 130,000 Kiwis gathered at this year’s National Fieldays to learn more about our primary industries – the engine room of our economy.
MYOB took hold of the opportunity.
Across fours days, we spoke with hundreds of people at Mystery Creek in Hamilton – ranging from farmers to advisors and primary industry leaders – and it was clear there’s optimism, but also a growing sense of unease in the local rural market.
And the evidence is on their side.
In the past year, New Zealand primary sector businesses did not enjoy the same level of growth as non-farming rural businesses, the latest MYOB Rural Report shows.
Our study – which polled more than 1,000 small and medium-sized enterprises – found only 23 per cent of primary industry operators said their revenue had increased since last year, compared with 32 per cent of rural business operators. A further 19 percent of primary sector businesses expect their revenue to be down by March 2020.
New research by the Government supports this outlook.
Last week, the Ministry for Primary Industries launched its latest Situation and Outlook report for the sector.
Primary industry export revenue is expected to jump by more than seven percent this year to $45.6 billion, but given the uncertain international backdrop and despite strong export performance the downside risks to the forecast are heightened over the next few years, the report says.
The clouds include slowing global economic growth expectations, rising protectionist sentiment and uncertainty caused by Brexit, United States-China trade tensions and outbreaks of African swine fever.
The bigger concern for New Zealand is their potential impact on consumer demand in Britain, America and China.
So, what does this mean for agribusiness advisors like their accountants? Opportunity.
Undoubtably, farmers and growers will soon need more financial support. As economic pressures mount so, too, will scrutiny of the books.
MYOB has had the good fortune to work alongside New Zealand agribusinesses over the past two decades, and has seen how good data can empower agribusinesses to make the right decisions. From receiving instant alerts on employee payroll logs, to confirmation on the level of milk they’ve supplied, to getting instant feedback on kill weights at the freezing works, to keeping a handle on cash flow.
But too many agribusinesses aren’t capturing the value in the data their businesses create – and they’re missing an opportunity.
MYOB has a raft of features for MYOB’s online products aimed at getting the most out of an agribusiness’ data.
For example, farmers can now track specific on-farm quantities like changes in stock levels, amount of milk sold, weight of grain and wool produced – all numbers which can help them gain a deeper understanding of their businesses.
It also makes pesky compliance work easier come tax time.
MYOB gives the ability to interrogate that data instantaneously, meaning business advisors can provide higher-value consulting services to agri-clients.
So, at a time when Kiwi farmers are facing unique market challenges, new tech is allowing accountants and agribusiness owners to focus on what they do best.