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About ILLFF
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To be the leading competitor and operation of choice
for Central Illinois. This will be achieved through
innovative and bold new management concepts and
processes. Our affiliation with an Interdependent
Participatory System will allow for
the realization of the growth and profitability
goals through top agronomic,
marketing, technological and stewardship practices |
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To provide landowners a profitable return while increasing
the scope and
profitability of Illinois Family Farms through top
agronomic, marketing,
technological and stewardship practices.
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Illinois Family Farms is in position to be the leading
competitor and operation of choice for central
Illinois.
It is a goal of Illinois Family Farms to proudly
continue to grow a highly
successful profitable business built on a foundation
of bold innovative thinking, technology and superior
management. Utilizing the latest technology, such as
yield monitors, VRT, GPS, GIS, Auto-Trac and a
comprehensive information management system, we are
able to realize higher than average yields and
returns of our major revenue center corn. With the
resulting higher profits, the
farm has invested in better infrastructure such as
grain handling and storage to increase the marketing
opportunities and efficiencies.
Every bushel of grain is marketed at least twice, with
some being sold four times.
We effectively use innovative marketing tools and
concepts such as HTA, Basis, Bull and/or Bear
spreads and options on mostly Corn on Corn rotation
to have far greater revenue per acre.
Another benefit is the economies of scale that have been
realized. The larger
base of operations allows us to justify cost reducing
assets such as Dry Fertilizer and Anhydrous Ammonia
facilities, seed dealerships, custom application, a
trucking company as well as the technologies
listed above. These assets prove
to be a major competitive advantage
over our competition.
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Illinois Family Farms is a growth and profit oriented
family farm that seeks to
provide a positive place of employment for family and
non-family employees.
We pursue the adaptation of top agronomic, marketing,
technological and
stewardship practices that allow all individuals involved
with the farm to prosper
and grow. Another benefit for new operations
is that we can allow other
operations to be merged in and compete on a
scale that would otherwise not be available to them.
The prosperous relationship benefits landowners by
providing a fair return for
their assets. Employees benefit by having an employer that
respects and
rewards good employee behavior appropriately.
Good stewardship protects landowner interest by asset
protection and increased return on asset. |
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Grain crops, specifically corn, are the primary source of
revenue for Illinois Family Farms. We grow continuous corn because of the
increased profit
potential, which is not provided by other grain crops.
Superior marketing, along with our storage facilities,
provides significant returns
over competitors. For example, in 2005 the basis
appreciated $0.66 per bushel
for December delivery when compared with fall. This
equated to an $825,000 additional revenue source due
to utilization of the grain storage facility.
We use GPS derived soil samples. Fertilizer is then
applied based on prescription derived from the GPS
samples to achieve optimum yield.
We utilize our own 30,000-gallon anhydrous, 1,200
ton dry fertilizer and chemical facilities. Through
the use of these facilities, we are able to source
these products at a substantially lower price than
other operations in the area. We also have our own
application equipment
for fertilizer and chemicals.
In 2006, we implemented John Deere Auto Steer to avoid
overlaps and skips with application of inputs. This
initial investment allowed us to reduce fuel usage
by 10,000 gallons during the season. All
operational aspects of
the farm are tracked by computer utilizing John Deere,
Easi-Suite and Microsoft Excel
spreadsheets. These numbers are then interfaced with
farm accounting software. Other John Deere site
specific technologies utilized are variable rate
planting based on soil type as well as VRT planting
system will with the extra cost of
traited seed, pay for 1 VRT drive every 1,800 acres.
The trucking company provides a year-round opportunity
for employment, as well
as more timely and profitable delivery of grain. We will
also be delivering seed
corn
for AgriGold Hybrids as well as Dekalb. |
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The agriculture industry is rapidly changing and
consolidating.
The past several years have yielded enormous technological advances in
equipment, seed, information gathering and
marketing. Most of these advances were not available
to our predecessors. We are utilizing these new
technologies and running them over additional
acreage, which reduces the cost per acre. The
additional expansion of acreage will require
additional capital and more efficient utilization of
current assets. For example, we use auto-trac
technology, GPS,VRT,GIS and triple-stack
hybrid.
I feel that one of the most important components as it
relates to growth is Working Capital. Working
Capital measures how many dollars are left if
current liabilities are subtracted from current
assets. Conceptually when all current debt is paid,
the amount left over is available for you to work
with, hence the title
working capital. Most of the businesses
that failed in the 80's, failed because they ran out
of working capital. The importance of working
capital cannot be
over emphasized as a strong capital
position allows us to take advantage of the
opportunities and growth. This is evidence by the
fact that we maintain a minimum of $100 per acre
in working capital reserves. |
Our goal is to create a cycle of generating money to pay
down debt in order to build equity so that we
can make more money.
Growth, debt & equity are all related to the
balance sheet, with Growth appearing on the left
side and Debit & Equity on the right. Growth equates to
assets. All assets are
financed by either debt or equity.
In our organization, we equate this philosophy to our
management process
which is as follows:
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The purpose of assets is to generate revenue.
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We convert revenue into profit.
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The profit is used to reduce debt and generate additional
equity.
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We then use the equity for asset purchases. Over the last
5 years only 37% of assets purchased were
derived from debt.
The new assets generated more
revenue to create additional profit which is
used to pay down more debt and
create more equity.
This process is
then
repeated.
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Copyright © 2008 Illinois Family Farms -- All Rights Reserved
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