Category Archives: Home-Based Business

Tradition vs Innovation Paradox

Another great blog from Ranch Management Consultants (Ranching for Profit).  If what you are doing regularly is only a tradition – start questioning why you continue and if the practice is still effective for today’s economy, whether for your home or business.

sunset cowboyAgriculture is steeped in tradition. These traditions serve as a source of pride and continuity which help make us who we are in agriculture. However, these same traditions create a paradox of sorts when it comes to managing the business of ranching. Balancing respect for traditions and fostering innovation can be tricky to navigate. Another complicating factor in ranching is that business leadership is often slower to transition than most. Generally this is because the decision making is in the hands of a generation that would have retired 10-20 years ago in any other industry. This generation is often making decisions from a place of risk minimization … rightly so from their perspective. However, when Junior is wanting to expand the business to support a growing family this can pit two very different business strategies against each other which often creates conflict on the family ranch.

I think there are some traditions on a ranch that need to be challenged to position the ranch to be successful in the coming decades. Each operation will need to find its own balance between tradition and innovation. Having clear goals will help determine the appropriate balance of risk management and growth strategy for the business.

Below is a short list of common ranch traditions that I suggest you look at and examine why you are doing what you are doing, then put some numbers to what it might look like if you did things differently. I’m certainly not suggesting everyone must change these traditions but have a discussion with your team about the pros and cons of staying the same or changing.

  • Grazing management
    I see far too many ranches where tradition determines the grazing plan rather than good planning. Effective grazing management is one of the most powerful economic levers you can pull. Does each pasture get adequate rest for plant recovery after every grazing? Are your animals in a pasture long enough to allow a second bite? I have never visited a ranch that couldn’t improve their grazing which would allow the ranch to increase carrying capacity, often as much as doubling historic stocking rates, while still improving the condition of the land. Often the driving force for not improving grazing practices involve hanging on to old traditions. Many equate better grazing with more fences or more work. Neither of these must be true.
  • Needing lots of stuff to ranch
    Here is an interesting thought experiment. Make a list of every piece of equipment on the ranch and what it would be worth if sold today. Total up the dollars and now pretend you have that money as cash in your hand and you have no equipment. Paint a picture in your mind of the type of business you want to build. Now, ask the question, “How would we best deploy the capital we now have to create the business we want?” Would you spend it all or save some for a cushion? When times are good on the ranch, we often fall into the trap of upgrading tools that make our lives easier. It is very difficult to go backwards in creature comforts once we step forward. However, from the numbers I’ve seen it is the rare piece of equipment that creates more cash flow than it costs in depreciation and repairs. Tradition might lead us to believe that we need all this stuff to ranch, but economics might be telling us that all this stuff is part of what makes ranching so financially difficult.
  • We should be running cows
    But we have always run cows! What is the purpose of your ranch? Is it to create opportunities for owners to do the things they enjoy or is it to create cash flow and profit to support the owners and provide opportunities for others? Might these two things be in contrast? I’m not saying you can’t run cows and be profitable, but often I observe ranchers who see no other alternative to the current enterprise structure on the ranch. I also don’t believe it is a problem if ownership sees the ranch as a place to allow them to do the things they enjoy – such as running cows. I do see a conflict when the ranch isn’t creating the outcomes required and people are unwilling to look beyond traditional enterprises. Might it be that the ranch could be an even more enjoyable place if it were highly profitable?

Following that line of thought, what other traditions should be challenged on your ranch? Which traditions must be held on to? There are some traditions that are core to who we are, let’s be sure we don’t jeopardize those in pursuit of profit. Balancing the paradox of tradition and innovation is part of what makes this business so interesting.

Tyner Pond Farm, Indiana

Congratulations to my friend, Amy Baggott, on successfully navigating the hoops to obtain organic certification for their family farm, Tyner Pond Farm, near Greenfield, Indiana!  Great interview with local tv station at this link.  Layers, Broilers, pigs, and cattle.

Inside Indiana Business – Tyner Pond Farms land officially organic.

 

 

Wool – Regenerative Fiber

The impact of plastic pollution – why wool is the sustainable choice

‘British shoppers’ addiction to new clothes is putting the future of the planet at risk.’

As a nation, British shoppers buy more new clothes than any nation in Europe, with people buying twice as many items of clothing as they did a decade ago.

‘Fast Fashion’ – the reproduction of highly fashionable clothes at high speed and low cost – has far-reaching effects in terms of plastic pollution.  Discarded clothes are piling up in landfill sites (government figures indicate that three in five garments end in landfill or incinerators within a year) and wildlife in our rivers and seas is eating synthetic fibres dislodged in the wash.

The Government Environmental Audit Committee recently announced plans to work closely with major fashion chains to reduce plastic waste and encourage recycling, and could call on the fashion industry to create a demand for longer life garments, along with a ban on dumping clothes in landfill. These are two key actions where increasing usage of natural fibres (such as wool) can make a real difference.

So why is wool a better choice?

Wool is recyclable

Products made out of synthetic fibres can take up to 40 years to degrade, while wool – a natural fibre – degrades in a fraction of that time. This is because wool is made of keratin, a natural protein similar to the protein that makes up human hair, which can be broken down naturally without causing an environmental hazard.

Wool will also reduce waste to landfill as it decomposes in soil in a matter of months or years, slowly releasing valuable nutrients back into the earth.

Wool lasts longer

Wool is an incredibly complex natural fibre, providing many attributes that plastic fibres just can’t match. Its natural crimp and elasticity endures constant wear and compression, and its bulk resists crushing and matting, helping it withstand continuous wear.

Wool needs less washing

Wool naturally absorbs moisture when the atmosphere is damp, and releases it when the atmosphere is dry, supporting less frequent, lower impact washing, which in turn prolongs the lifetime of garments. A simple airing is often enough to refresh woollen garments – simply hang them outside on a dry day for a couple of hours.

Read more about the benefits of British wool at https://www.britishwool.org.uk/benefits-of-wool

References

https://www.politicshome.com/news/uk/environment/environmental-protection/news/98810/british-shoppers-love-fast-fashion-putting

https://www.bbc.co.uk/news/science-environment-45745242

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The impact of plastic pollution – why wool is the sustainable choiceWool can help combat plastic pollution

Wool can help reduce plastic waste and plastic pollutionWool is recyclable, lasts longer, and needs less washing

What Is the Greatest Challenge to Being A Grass Farmer?

This article is printed in the most recent issue of The Stockman Grassfarmer and written by our good friend, Jim Gerrish.  For more great articles like this, subscribe to The Stockman Grassfarmer.  If you are interested in an upcoming speaking engagement or prefer private consultation, contact Jim.

What Is the Greatest Challenge to Being A Grass Farmer? By Jim Gerrish

MAY, Idaho,

Allan Nation used the term “grass farmer” to describe a new type of agricultural producer who was something beyond the conventional mold of a farmer or a rancher.

The true grass farmer is someone who understands the foundation of our business is harvesting solar energy and converting it into a salable product.

A grass farmer strives to create a healthy landscape where water infiltrates and does not escape the boundaries of the farm as runoff; someone who understands that life in the soil is as critical to farm production as the life above the soil.

A grass farmer understands the fewer steps you put between your livestock and the direct harvest of solar energy, the more likely it is that you will be profitable.

The true grass farmer is someone who becomes one with their landscape and the life within it.  Grass farming has been described as farming in harmony with nature.  This is contrary to many of the basic tenets of conventional or industrial farming where nature is viewed more as an enemy to be vanquished.  Droughts and floods.  Weeds and bugs, Scorching summer and bitter winter.  All of these are aspects of nature conventional farmers and ranchers do daily battle to overcome.

It is very hard for most conventional farmers to understand grass farmers.  For this lack of understanding grass farmers are often ridiculed, ostracized, and sometimes, sadly, beaten into submission to the gods of iron and oil.  Sometimes that conflict is fought in the local coffee shop, sometimes across the neighbor’s fence line, and sometimes across the kitchen table.

That brings me to the consideration of what is the grass farmer’s greatest challenge.

Four years ago, I received an anonymous letter from a frustrated grass farmer.  It was five pages long and it outlines a 30-year long struggle to convert the family farming operation to an entirely pasture-based grass farming business.  The letter writer asked me to somehow tell this story and try to help other farm families struggling with the same issues find some resolution.

I thought about that letter quite a bit at the time and tried to find something to pull out of it for a monthly column.  I came up empty.

Earlier this year, I spent a day with a farm family and when I left, one of the family members put an envelope in my hand and suggested I read the contents some time later,. I did and, lo and behold, it was the same letter I had received anonymously four years earlier.

Now I had a face and a person to attach the story to.  The victim-less crime now had a victim.  How many times do we experience that in life?  Some issue that never mattered an iota to us becomes a cause when it becomes personal.

I think the greatest challenge to becoming a true grass farmer are those family members who cannot see the farm with the same vision.

If your brother is a crop farmer who sees only gross income, how is he going to switch from growing corn bringing in $1000/acre to a cow-calf operation with a revenue of only $300/acre?  That is a very hard sell.  But, why does he have a job in town?  He says he can’t make it just farming.  When the breakeven cost of growing a bushel of corn is $3.85/bushel and the price is $3.46/bushel, a gross income of $1000 doesn’t pay the bills.

If you have a gross margin of $240/calf and it takes you three acres to run a pair year around, the gross margin per acre is $80.  Which enterprise is actually better for the farm?

As long as your brother looks at gross income rather than gross margin per acre, he will never understand grass farming as a viable business.

When you have been taught all your life to till ground, kill weeds, spray bugs, and take whatever price the elevator offers you, it is hard to understand there is another way to use the farm.

If your culture says land must be divided with a 5-strand barbwire fence on the quarter section line, how can you accept weird shaped pastures created with single polywire?  The whole cultural construct must first change.

As long as the mentality is that is it OK to spend $100,000 for a new tractor but you must buy the cheapest electric fence energizer at the farm and home store, grass farming will not move ahead.  As long as the thought process i that the land rental rate is too high to run cattle on that field so we better plow it up, grass farming will never advance.

When farmers can wrap their heads around the idea that Mother Nature is our friend, then grass farming will move forward.  When we truly believe our mission as stewards of the land is to create a living landscape on every acre of ground we manage, then we will become true grass farmers.

Sadly, that is why we still say we advance only one funeral at a time.

Hate to start the New Year with such a downer thought.  Let’s see what February brings.

 

Jim Gerrish is an independent grazing lands consultant provide service to farmers and ranchers on both private and public lands across the USA and internationally.  He can be contacted through www.americangrazinglands.com.  His books are available from the SGF Bookshelf page 26.  He will present a Stockman Grass Farmer Grassroots of Grazing Schooland a Stockman Grass Farmer Management-Intensive Grazing School in February.  

 

 

Fundo Panguilemu, Coyhaique, Chili

I cannot do justice to the sweet hospitality of this young family.  Our Savory Institute journey group is here to learn about the improvements they have experienced using the holistic management techniques.  The grass is thick, lush, and tender – rested paddocks are ready for consuming.

 

 

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Regenerative farm owner and operator, Jose,  (who is also a holistic management instructor) gave us an excellent overview on how they’ve managed their farm and improved the sward and healed the soil substantially in only 6 years using managed grazing of cattle and sheep.
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No bare soil in this thick sward.
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Thick stand of grass after 45 days rest.
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Elizabeth, also owner of the farm and a holistic management instructor keeps all the balls in the air on this stunning cattle and sheep farm/pastured egg laying/horse trekking/firewood gathering/wildlife viewing/fly fishing/mountain biking/yurt accommodation/HMI training site.  Oh, did i mention she also is raising 2 wonderful little children as well as training interns who show up from around the world to help on the farm?
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How about a unique stay on a working farm?! And talk about a view!  Excellent fly fishing available here on the edge of the Simpson River.  Contact Elizabeth at Fundo Panguilemu.
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Lookout Paddock provides excellent overview of paddock layout.  Note cattle and sheep grazing in lower left paddock.
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For my Missouri friends, you will be surprised to know that many of the grasses and forbes are the same as what we graze.  This is a photo of the rose bush that we also have growing, but no multiflora rose here.

Knife Making

Near the end of our homeschooling stint, we discovered a wonderful family who have for 35 years pulled together a spectacular array of historical and educational speakers.  Formerly called CHEF  (Christian Home Education Fellowship), now called Family Covenant Ministries.  

In February 2012, they organised a small group of young men to meet at one of the nation’s premier knife making operations near Ozark, Missouri.  Definitely a highlight of our home education career.  Ozark Knife Makers at Ozark Forge.

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RMC’S Sustainable Management

You  may not agree with every precept promoted by Ranch Management Consultants (Ranching for Profit) or those of any expert in the ranch/farm management or sustainable/regenerative camp, but fundamental thoughts work for nearly any endeavor.

RMC’s Ten Fundamental Truths of Sustainable Ranching

  1. TRANSFORMING your business BEGINS WITH TRANSFORMING yourself

    Transforming your ranch into an effective business involves changes in land management, animal husbandry, money management and in the way you interact with the people in your business. But the biggest change isn’t to the land or the animals. The biggest change is in you.

     

  2. IT ISN’T SUSTAINABLE if it isn’t  PROFITABLE

    Profit is to business as breathing is to life. A ranch that doesn’t produce an economic profit isn’t a business. It’s a hobby … an expensive hobby.

     

  3. FOCUS ON effectiveness NOT EFFICIENCY

    Efficiency and effectiveness are not the same thing. It doesn’t do any good to do things right if you are doing the wrong things! If something is efficient, but not effective, stop it immediately!

     

  4. GET IN SYNCH with nature

    Most ranch businesses are structured to fight nature. That’s expensive and exhausting. Businesses that match enterprises and production schedules to nature’s cycles are more profitable, less work and more fun!

     

  5. YOU DON’T GET harmony WHEN EVERYONE SINGS THE SAME NOTE

    In any business, especially family businesses, there are bound to be differences of opinion. Our decisions are improved when we bring different perspectives and ideas to the table and engage in constructive debate, as long as we agree that, at the end of the day, we all ride for the brand.

     

  6. WORK LESS and  make more

    Unsustainable effort is unsustainable. Period! Planning is the key to simplifying enterprises, increasing profit and reducing labor.

     

  7. RANCHING is a business

    We often act as though we have a choice between ranching as a lifestyle or a business. The lifestyle of ranching improves when the ranch is a successful business first.

     

  8. WORK ON YOUR BUSINESS two mornings a week

    It’s not enough to work IN your business, you must work ON your business.

     

  9. WEALTHY on the balance sheet & BROKE AT THE BANK

    The misallocation of capital is the biggest financial problem in ranching. At the Ranching For Profit School you’ll learn how to capitalize and concessionize assets to increase profit and improve the financial health of your business.

     

  10. RANCHING FOR PROFIT is NOT an oxymoron

    Many ranchers seem to think that profit is dictated by prices and weather…two things beyond our direct control. Ranching for Profit graduates prove every year that the key to profit is management.

    Blessing!

    tauna