Posts Tagged ‘ Business ’

‘Grey hair’ in agriculture: Opportunities in the making

farmers silhouette

It is no mistake that grey hair is becoming more and more common in the agricultural industry these days. Grey hair normally suggests a particular stereotype, but it can also be viewed as an opportunity.

The average age of the Minnesota farmer, as reported in the 2012 census, was 56.6 years of age, with 52 percent of farmers being over 55 years of age. It is most likely that, as farm numbers decrease and farm size increases, the average age of a Minnesota farmer will also increase.

As we see the average age of the Minnesota farmer climb, we also see the same situation in the industries that service and work with farmers. Do you know an ag lender or seed dealer with grey hair? Most likely the answer is yes.

The aging population in agriculture opens the door for opportunity. There are opportunities for knowledge transfer, relationship building, as well as networking. The agricultural industry as a whole is rapidly transitioning and changing. This alone opens the door for many opportunities between generations.

The hot topic when it comes to the aging population in agriculture is “Transition Planning.” This topic has been coming up more and more, not only on farms, but also in every other agricultural service industry. When it comes to transition planning, it normally doesn’t happen overnight-and it can have some growing pains. It is most likely that the transition includes a Baby Boomer (age 55-71) and a Gen X’er (age 35-55) or Millennial (age 18-35).

We can see the transitions happening right in New Ulm and all of southern Minnesota. Most businesses and farming operations have an older generation and, potentially, a younger generation working side by side. This is not a new dynamic; this has been the case with every generation in every decade. The difference today is that the generations seem so much more separated in the way they go about business and adapting to technology.

The “Grey Hair” Baby Boomer generation has the opportunity to learn from the younger generation, be it in technological efficiencies or an openness to try something new. The younger generations have so much to learn from the older generation, as well. The transfer of knowledge about “The 80’s,” budgeting, negotiations, best practices, and anything in between can create an environment for opportunity and growth.

When it comes to agricultural lending, farming, and many other agricultural related industries, it is hard to teach a new person everything they will need to know in a matter of a few months. It can take years. Early planning and patience is essential for a smooth transition.

An example where transition planning is opening opportunities is right here at Citizens Bank Minnesota. All four of the bank’s branches-New Ulm, Lafayette, La Salle, and Lakeville-have been looking ahead and noticed there is a lot of “Grey Hair” between the clients and the lenders. In each of the branches, there are lenders that have been working alongside the same clients for many, many years.

Citizens saw this as an opportunity and-within the past seven years-has added at least one younger lender to each of the branches to begin the transition and transfer of knowledge. The relationships that exist between the “Grey Hair” lender and most of their clients often run deep and go back many years. Citizens recognized this and started bringing in the younger lenders to build their own relationships with these clients and their second generation years before the retirements were planned. This has been a successful strategy. It gives the farming clients comfort and knowledge that their lending relationship will continue and prosper.

Citizens is very excited about the opportunities in agriculture and is dedicated to the farming community.

By: Rose Wendinger, Assistant Vice President

“‘Grey hair’ in agriculture: Opportunities in the making” published in The Journal
31 Mar 2017: B3

Citizens Bank Minnesota hosts Ag Seminar

Citizens Bank Minnesota hosted an Ag Seminar at the Best Western Plus, in New Ulm, on the morning of January 12, 2017. With over 200 participants, the topic of the event was “Positioning for Success”. Senior Vice President Tim Hoscheit welcomed the participants and thanked everyone for coming, speaking briefly about Citizens Bank Minnesota and its commitment to agriculture. Next, Vice President Kevin Yager introduced the Keynote Speaker, Dr. David Kohl.

Dr. Kohl, Professor Emeritus of Agricultural and Applied Economics at Virginia Tech in Blacksburg, VA, captivated the audience with Global and National outlooks and statistics. He addressed global economic trends and what to watch for in the major trade countries. Dr. Kohl also addressed the national concern with the agricultural economy. He noted that some of the adjustments the top half of producers are making include cutting rent and input costs by $50/acre along with implementing marketing and risk management programs along with diversifying income streams. Health care and insurance cost concerns were discussed as a major expense for most farm families along with the general need to monitor all family living expenses. Dr. Kohl spoke on the trend of millennials in the workplace and farming operations. The need to implement innovation and technology for the sake of efficiencies was discussed as well as the need for “knowledge transfer”. With as many as 21% of American farms not having a next generation to carry out business, the need for transition planning is great. Dr. Kohl suggested getting the next generation active in the business planning early on, working with the 4 cornerstones of success: Planning, Strategizing, Monitoring, and Executing.

Vice President Duane Laffrenzen introduced the next speaker, David Scheibel, from Minnesota West Ag Services. David is a grain marketing consultant offering brokerage and accounting services. With the USDA January reports coming in just minutes before David spoke, he was able to give a brief analysis of the results and the projected outcomes for the 2017 crop year. He spoke on trends, costs and breakevens, as well as risk management options for the upcoming marketing year.
The 2017 Ag Seminar was a great success!

By: RoseAnn Wendinger, Assistant Vice President

Dustan Cross elected as Chairman of Citizens Bank Minnesota Board of Directors

Citizens Bank Minnesota Board of Directors Chairman, Dustin Cross

Dustin Cross

Citizens Bancorporation of New Ulm, Inc., parent company of Citizens Bank Minnesota, held its annual meeting on Tuesday, January 10, 2017. Citizens Bancorporation is owned by approximately 350 shareholders from the New Ulm and surrounding area.

Re-elected to three year terms were incumbent directors Lou Geistfeld, Bob Hinnenthal and Ted Marti. Other directors not up for election include Bill Brennan, Bryon Christenson, Dustan Cross, Mark Furth, Walt Luneburg and Jim Schuetzle. Dustan Cross was elected to serve as Chairman of the Board, replacing Mark Furth who will be retiring from the Board in March.

Stockholders in attendance were provided with a complete review of the financial performance of the bank for 2016. Highlights of the financial report were that the bank has grown to over $369 million in assets, has total equity capital of $38,930,000, and a net profit in 2016 of $2,770,581. Dividends paid to stockholders in 2016 totaled $0.76 per share.

Citizens Bank Minnesota was chartered in 1876 and has offices in New Ulm, Lafayette, La Salle and Lakeville.

Are You Ready to Leave Your Credit Cards at Home … and Pay by Smartphone?

nfc-logo-mono

Paying for purchases by smartphone is becoming increasingly viable. Three major companies now enable consumers to buy goods at participating merchants with their credit or debit card by just waving a smartphone over the payment terminal. In fact, a major smartphone manufacturer recently teamed up with many banks and merchants to make the service available to anyone buying the newest version of its smartphone. What should you know about using your smartphone to pay in a store or a restaurant?

You need the right equipment. Your smartphone must contain a contactless or “NFC” (near field communication) computer chip that allows it to “talk” to the payment terminal via a wireless connection, as well as a digital wallet to store your payment card information. If you are buying a new smartphone, you can ask the salesperson if it has an NFC chip. For a phone you already have, check the “settings” menu and look for “NFC.” Your phone may already have a digital wallet feature. You can also download one through an app store or other online marketplace.

You have to load your credit or debit card information onto the phone. The setup procedure can be as easy as taking a picture of the front and back of the card with the mobile wallet application. The app will then send it to your bank for approval and to confirm that it’s really you. Some mobile wallets may allow consumers to load “loyalty” cards from favorite retailers. You may also receive store or restaurant coupons or other offers through your phone, based in part on your recent purchase history with the company.

Most merchants that accept mobile payments are large national chains, but smaller stores are beginning to sign up. A merchant must first install card terminals that accept contactless payments; they look different than the swipe terminals you are used to and display the symbol shown on the left.

As with any electronic transaction, pay attention to security issues. According to Jeff Kopchik, a Senior Policy Analyst at the FDIC, “Many security experts believe that mobile payments are more secure than swiping your magnetic stripe credit card because the mobile service keeps your credit number in encrypted form and does not transmit it to the merchant. But you still should make sure your phone is protected, such as with a password, so it cannot be accessed by a thief. Some of the newest smartphones use fingerprint readers to control access, which can be secure and convenient.”

Also make sure your phone “times out” and re-locks itself after it isn’t used for a short period of time. If you lose your smartphone, notify the bank or other issuer of any credit or debit cards that may be loaded on the phone.

“Remember that if there is a problem with a transaction, you will receive the same federal protections that otherwise apply to the underlying payment source,” noted FDIC Senior Policy Analyst Elizabeth Khalil. “For example, if the transaction drew on a credit card for payment, you will be protected by the same laws and regulations that cover credit cards.”

To learn more, start by contacting your smartphone service provider or credit card issuer.

Article courtesy of FDIC Consumer News

Four Ways for Your Business to Survive and Thrive in a Down Economy

As a business owner, bad news on the economic front causes worry—worry about you and your family, about your business, and about your employees.  Question is, what can you do about it? 

Four Ways to Survive and Thrive in a Downturn

The biggest mistake that business owners make in a downturn is to be overly optimistic and do nothing—to simply wait for things to improve.  Oh, you might think that your business is “recession-proof”, or that you are better-prepared than your competitors to weather a downturn.  But are there signs of trouble?  Are incoming orders declining, or are customers lagging behind on payments, or are inventory levels slowly creeping up?  Rather than ignoring these signs, now is the time to really put your ear to the ground and find out what your vendors, suppliers, and customers are saying.  Listen to your front-line employees.  Then:

1.  Begin by building contingency-planning into your business plan.  What if your customer can’t pay that large account receivable on time?  What if your sales staff doesn’t reach established sales goals?  What if that new line of inventory doesn’t sell before you have to make your vendor payment?  Can you stay in compliance with your loan covenants at the bank?  Now is the time to pro-actively enlist the help of your banker and your other advisers–knowing that you are looking ahead and positioning your business for a downturn will give them confidence in you, and they will be more able to help you during difficult times. 

2.  Keep in mind that cash is king, and anything you can do to maximize cash will put your business in a position of strength.  Get rid of slow-moving or obsolete inventory through special sales.  Think of other uses for inventory that might create sales in non-traditional markets.  Monitor your accounts receivable and demand payment on time.  Don’t become your customers’ banker—expanded terms mean expanded risk.  Be prepared to cut off, go COD, or file a mechanic’s lien if necessary, as a customer who is solvent today may be in bankruptcy tomorrow.  And finally, look at your fixed assets with an eye to selling anything that is non-productive.

3.  On the expense side, use a critical eye in determining your cost structure.  Do you have the right people in the right spots?  Are your employees performing at their maximum?  Are you organized properly? Ask your employees to look at their job descriptions and duties—are they doing something because “it’s always been done”, or are there some duties that can be dropped or done more effectively?  Is there duplication of efforts anywhere?  Have your expenses been creeping up?  Find out why.  From this analysis, identify 5-7 expense-reducing opportunities and make them happen.

4.  Identify your most profitable product and service lines, and those with the most potential to grow. Contrary to what many believe, those who thrive in a downturn avoid diversification and, instead, focus intensely on those products and services that make up their core business.  If possible, sell off—for cash—those lines that you don’t feel contribute to your core value as a business.  Save the cash, or use the proceeds to invest in assets that will further what really makes you money.  And for goodness sakes, don’t cut the advertising budget for those revenue lines that will keep you in the industry forefront.

Move Forward Enthusiastically

At this point, make sure your entire workforce is engaged and moving in the same direction—develop a mission and vision to sell the profitable products and services upon which you have built a solid reputation.  Generate enthusiasm for the task at hand—after all, being part of a company that is moving ahead in a downturn vs. simply digging its head in the sand is exciting!  And be sure to celebrate small successes and milestones along the way. 

If you’ve done these things, be assured that you are doing everything you can to survive and thrive in a tough environment.

By: Julie Baumgartner, Vice President

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