Turning that ranching dream into reality: Tough talk from someone who has been thereTurning that ranching dream into reality: Tough talk from someone who has been there
Burke Teichert offers some timely advice for those who want to get into the beef production business.
November 7, 2018
I think there are many who would love to be ranchers. This piece is for those who seriously want to turn the dream into reality. It could fit old or young, but I will address it to the young men and women who would like a career on the farm or ranch. You will come from various backgrounds and have different views of what your future should look like.
To be successful in production agriculture, the future will demand several personal traits: a good intellect, strong work ethic, honesty and integrity, a passion for the work and being a life-long learner. If you have these traits imbedded in your character, you can be successful. If you miss one, it could be much more difficult.
Some of you will be ranch raised and want to return to the home operation. Several questions should be asked:
Is the ranch big enough to support the people involved? If not, can I bring a new enterprise to the ranch that will create more profitability?
What is the debt load that I will someday assume? Being over-levered with debt is one of the main causes of ranch failure and personal dissatisfaction. Will additional debt be required to fund the retirement of the older generation as they retire? Don’t return to a ship that cannot sail.
Do Mom and Dad have a transition plan for management and ownership? If not, go work somewhere else for a while, get some experience and give the family at home time to get something in place that will provide you a secure and enjoyable future. This is even more important when siblings are involved.
While working away, stay involved and show continued interest. Find a comfortable way to be involved in planning for the future of the home ranch. I have seen grandparents, even great-grandparents in their 80s, who have not yet turned management or ownership to their children. That should be planned out and written out before the next generation commits their lives to the ranch. There are way too many unhappy endings.
If you don’t have an inherited place to return to, don’t despair. Some young people are good at finding partnership or leasing opportunities that can work out well. Others find very good off-ranch day jobs that enable them to acquire capital to get started.
You might follow the path that I chose—to manage ranches for companies or non-resident landlords. I didn’t need to own what I managed to have a lot of autonomy and opportunity to establish the ranch vision which included grazing management, cattle breeding programs, manpower development, marketing, etc. It was a wonderful career with good retirement and benefits. It also paved the way to post-retirement opportunities that have been very satisfying. Naturally, when you can’t or shouldn’t return home to be a rancher, you should carefully study other options. You may need a stepping stone job or two. A few years in the AI industry were very helpful to me—better than my two university degrees. (By saying that, I don’t mean to diminish the importance of the university education.)
Having studied ag business and ag economics, the AI industry provided many opportunities to use the ag business while meeting and learning from some of the best animal scientists in the U.S., which was great preparation for my ranch management career.
Most of you will want a situation where you will have some level of management input. Determining what level you want will be important to your happiness. I once had a foreman or unit manager who told me he didn’t want to move one level higher because he wanted to enjoy his work and his life. That’s important personal insight.
My years as a general manager were more enjoyable than my years as a vice president. While I am appreciative of, and glad that I had, the opportunity of being a vice president in a fairly large farming/ranching company and the numerous opportunities it gave me, it was more fun to be closer to the ranching action as a general manager.
If you simply want to be a cowboy, get a cowboy job and recognize that the pay will never be great. If you want to become a manager at some level and make big picture decisions, consider the following:
Don’t get the idea that the parents and grandparents were the perfect ranchers. Also, don’t get the idea that they are outdated and not doing things right. Learn from them, but also learn from many other sources and be ready to change and improve. There will always be better ways—no matter how good we get.
Develop a management approach that is highly dependent on soil, sunlight, rainfall, your intellectual capacity combined with your ability to observe and the ingenuity of the people in your management group. Minimize dependence on fossil fuel and iron.
Keep overheads (people, equipment and facilities) minimal. If you need a little more of something, considering contracting machine work or day labor.
Be a cost control fanatic. Remember you are controlling cost per unit of output. If you spend a dollar and get $.50 back, quit spending that dollar. However, if you can spend a dollar and get $2.00 back, hurry up and spend it.
Don’t even start to ranch without beginning to learn principles of soil health and good grazing management. Then proceed to get good at it. If you grasp and use the simple principles of “minimal overheads” and cost control, then attention to soil health and grazing management will add more to profit, over time, than anything else you will do—except perhaps better marketing.
Acquire and/or develop cattle that are adapted to your management and environment and that are adaptable to the year to year changes in weather and feed.
Develop good livestock handling skills. Don’t assume that quiet and slow is all there is to it. There is much more, and it doesn’t always have to be slow. Don’t assume that, just because you’re good, you can’t get a lot better.
Remember, just because you can, doesn’t mean you should. Be very careful with the technologies you chose to use. The added revenue must be greater than the added cost.
Develop leadership and management skills. Your management team should extend well beyond the people on your payroll. This could include family members not working on the ranch, feed dealers, equipment dealers, buyers of your livestock, bankers, accountants, neighboring ranchers, etc.
I think that about half of my management team didn’t even know that they were on my team. But, they were trusted and willing advice givers. I like to think of managing relationships rather than managing people.
Teichert, a consultant on strategic planning for ranches, retired in 2010 as vice president and general manager of AgReserves, Inc. He resides in Orem, Utah. Contact him at [email protected].
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