Making good farm-expansion decisions

Key points

• Farm expansion can occur through the purchase or tenancy (leasing or share-farming) of additional farming area, or by generating greater levels of production from the existing area
• There is no ‘one-size-fits-all’ approach to farm expansion as success is dependent on the goals and the existing circumstances of the farm-business operators and owners
• The goals of the expansion must be understood to ensure the best decision is made
• Well-managed expansion can increase profitability, profit and wealth creation
• The extent to which wealth is created from expansion depends on the level of scale advantage, the value of the expansion opportunity, the financing costs and the ability to meet the financing costs.

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Region: Southern

• Farm business management fact sheet: Making good farm-expansion decisions (PDF 0.2 mb)