Agricultural businesses do not always get the luxury of finishing one season before spending money on the next.
Around Devonport and the wider North-West Coast, vegetable production, cereals, dairy and agricultural processing are all important parts of the local economy. Devonport City Council describes the surrounding district as a major producer of vegetables including beans, onions, peas and potatoes, alongside cereals and other crops.
For growers and agricultural businesses, that can create a familiar finance problem.
The next production cycle may already need funding while cash from the previous one is still tied up elsewhere.
Seed needs ordering.
Fertiliser and crop inputs may need to be secured.
Contractors may need to be booked.
Fuel, irrigation, labour, freight and packaging costs can start building again.
The issue is not necessarily that the business is unprofitable.
It may simply be that agricultural cashflow does not reset neatly between seasons.
The Next Crop Can Start Costing Money Early
One of the traps in seasonal agriculture is looking only at the income expected from the crop already in production.
A business may know that money is coming.
But the next round of expenditure can begin before all of that income has been received.
That is particularly relevant in intensive agricultural regions where production cycles can overlap.
A vegetable grower may be paying for the next planting while still carrying receivables or other costs from the previous crop.
A contractor may already be preparing for the next run of work.
A supplier may offer better terms for placing orders earlier.
This is where seasonal working capital can become a planning tool rather than an emergency response.
After around 30 years in finance, one thing we have learned at Thrive Broking is that timing often matters just as much as total profitability.
A business can have a sound season ahead and still need finance because the cash arrives after the expenditure.
Start With the Production Budget
Before discussing a loan amount, we want to understand what the next cycle actually needs.
That can include:
Seed and planting material
Fertiliser and chemicals
Fuel
Irrigation costs
Wages and seasonal labour
Contractors
Freight
Packaging
Repairs and maintenance
Insurance
Supplier accounts
Existing finance repayments
ATO commitments
The purpose of putting those costs together is not to make the budget complicated.
It is to identify the likely peak cash requirement.
A business that says “we might need $150,000” gives us less useful information than a business that can show that $95,000 is needed over the next ten weeks for specific production costs before expected income begins arriving.
That makes the finance requirement much easier to understand and present properly.
Seasonal Finance Should Match the Cycle
A seasonal finance facility should ideally follow the business cycle.
The business draws on funding when expenditure is high.
Then, as crop or business income arrives, the facility should begin reducing.
That is very different from taking a short-term loan that remains outstanding long after the season has finished.
When we review a seasonal request at Thrive Broking, one of the questions we ask is what is expected to repay the facility.
Is it crop income?
Customer payments?
A contracted sale?
Regular business cashflow?
And when is that money expected?
A clear repayment source matters.
Seasonal finance should bridge timing, not create debt that the business has no realistic way of reducing.
When Supplier Timing Becomes the Opportunity
Agricultural businesses may also have opportunities to secure inputs earlier.
A supplier may offer better pricing for committing sooner.
The business may want to secure product availability before demand rises.
Or purchasing in a larger quantity may create an operational advantage.
That can be worth looking at, but the finance cost still needs to make sense.
If borrowing $80,000 allows the business to secure a meaningful commercial benefit, compare the actual saving with the cost of carrying the finance.
If the benefit is small and the finance cost is high, the opportunity may disappear.
At Thrive Broking, we do not want the existence of finance to become the reason for making the purchase.
The underlying commercial decision should stand up on its own.
What If the Previous Season’s Money Is Still Tied Up?
Some agricultural businesses are not waiting on crop proceeds directly.
They are waiting on customers.
A contractor may have completed work but still have invoices outstanding.
A produce supplier may have commercial customers on agreed payment terms.
A transport operator may have already delivered loads but still be waiting for payment.
In those situations, the business may have a debtor-finance issue rather than a general seasonal-finance issue.
The aged debtor ledger becomes important.
How much is outstanding?
Who owes the money?
How old are the invoices?
Are the customers commercial businesses?
How concentrated is the ledger?
Where eligible invoices are the reason cash is tied up, invoice or debtor finance may be worth considering.
That is a different conversation from borrowing a fixed amount simply to cover the next production cycle.
Do Not Fund Every Season With a New Emergency Loan
A business that experiences the same cashflow gap every year should not necessarily treat it as a surprise every year.
If the seasonal requirement is predictable, it may be worth reviewing whether a revolving or ongoing working-capital facility would better match the business.
That can be preferable to repeatedly waiting until the account is tight and arranging another short-term loan.
The difference is planning.
A planned facility is based on the known business cycle.
An emergency facility is often arranged after suppliers are already due, tax commitments are pressing and the business has fewer options.
With nearly three decades of finance experience, we have seen how much difference it can make when a business reviews the requirement early rather than when the funding becomes urgent.
Existing Debt Can Distort the Seasonal Requirement
Sometimes the business believes it needs more seasonal working capital, but part of the pressure is actually being created by older debt.
There may be:
ATO debt
Short-term business loans
Several equipment facilities
Property-secured business debt
An overdraft already close to its limit
Repayments from a previous difficult season
Those commitments continue regardless of what the current production cycle is doing.
Before adding another seasonal facility, it can be worth separating current operating costs from older debt repayments.
If too much cash is being consumed by existing commitments, the business may need a broader finance review.
That does not mean every existing facility should be refinanced.
Some may be perfectly appropriate.
The purpose is to understand the whole position before adding another repayment.
Growth Can Make the Seasonal Gap Larger
Agricultural businesses around Devonport may also need more finance because the operation is growing.
More hectares.
More production.
More customers.
More contract work.
More volume through packing or processing.
Growth can be positive, but it often needs extra cash before it creates extra cash.
A larger crop may mean more inputs.
A bigger contract may mean more labour.
Higher production may mean more freight and packaging.
The business may therefore need a larger working-capital facility even though its profitability is improving.
This is where lender presentation matters.
A strong finance application should explain what has changed, what the additional funding will support and where the increased income is expected to come from.
“Sales are up” is useful.
“Sales are up because the business has added another 40 hectares of production and needs an extra $85,000 for inputs and labour before the first additional receipts arrive” tells a much stronger lending story.
Leave Enough Cash for the Unexpected
Agriculture rarely follows the budget perfectly.
Weather changes.
Repairs happen.
Labour costs move.
Freight can increase.
A supplier may need payment earlier than expected.
That is why we also look at the cash buffer.
A business may be able to fund every planned expense from its own bank account.
But if doing so leaves almost nothing in reserve, one unexpected event can create another urgent finance requirement.
The right structure may involve using some business cash and financing part of the seasonal need.
Another business may prefer to preserve more liquidity.
There is no single answer.
What matters is that the decision is deliberate.
Devonport Sits at the Centre of a Diverse Agricultural Economy
Devonport City Council identifies the surrounding district as a significant producer of vegetables including beans, onions, peas and potatoes, along with cereals and other crops, with dairy production and agricultural processing also important to the region.
That diversity means seasonal finance needs around Devonport will not all look the same.
A vegetable grower may have one cash cycle.
A dairy business may have another.
A contractor, freight operator or agricultural supplier may have another again.
That is why the finance needs to be built around the business rather than around a generic “farm loan”.
Bring Us the Timing, Not Just the Borrowing Amount
If you operate an agricultural business around Devonport and the next production cycle needs funding before the last one has fully converted into cash, speak with Thrive Broking before the gap becomes urgent.
Bring us:
The major costs coming up
When those costs are due
Current working-capital limits
Existing business and equipment repayments
Any ATO commitments
Expected incoming business funds
How much cash you want to retain as a buffer
With around 30 years of finance experience, Thrive Broking can look at whether the requirement is truly seasonal, whether supplier funding or debtor finance is more relevant, or whether existing debt needs attention first.
The goal is not simply to obtain more money.
It is to make sure the business has the right type of funding available at the point in the production cycle when it is actually needed.