The benefit of a balanced business diet

Diversification is so important in all sorts of businesses – including banking. Creating integrated but diverse revenue streams is a high-value business model which helps companies in higher risk industries remain successful.

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One such business – or businesses – is Red Cliffs-based Taylor’s which is split into three offerings – Taylor’s Vineyard, Taylor’s Farm Supplies and Taylor’s Survey & Development.

“We always say ‘just add water’ but if you don't have that water available, you can't actually grow your commodity.”  – Dean Taylor

Managing Director Dean Taylor says running an agriculture business doesn’t always go to plan, so the family run three separate business to complement each other and lower the overall risk.

Dean’s parents first established their business with Taylor’s Vineyard in the late 1970s. What started from a modest block has since grown to 260 hectares – home to eight varieties of grapes which are then supplied to a local winery. As we drove through the property recently I was amazed by the scale of the vines stretching to the horizon and the massive dams on the property.

But vineyards are not the biggest part of Taylor’s: “The contracting business is the largest of the three,” Dean explains. “We develop irrigated agriculture across Australia - from corporate farms down to small family farms.”

“And then to complement both other businesses, we run a farm supply shop to support local industries with chemicals, fertiliser, post wires and more.”

Just add water

Dean says the changing climate is a big challenge for their business given water supply is the number one ingredient to farm successfully.

“We always say ‘just add water’ but if you don't have that water available, you can't actually grow your commodity,” he says. “We're improving soil every day by adding compost and building up that microbiology, improving the carbon, monitoring our soil in new ways, whether it's with electronic monitoring and just overall protecting our assets.

“The better we can use water, the better we'll operate.”

For operations like Taylors, capital costs are absolutely necessary for growth. Dean says ANZ supports the business seasonally with funding to grow crops.

“We have our bad years when the water prices are high, so we need additional assistance – the bank supports us and it gets us through the next couple of years.”

On my trip to the Sunraysia area these are things which really stood out for me, the real drive towards and the appreciation of the value of diversification. And coupled to that, the scale and capital investment needed to fully realise that value.

Shayne Elliott is CEO of ANZ

The views and opinions expressed in this communication are those of the author and may not necessarily state or reflect those of ANZ.

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