Whenever I ask farmers or ranchers what their biggest problems are, the top two on the list are always “not enough time” and “not enough money.” It is possible to get more of both at the same time, but most people give up one in order to get the other.
Here is what I mean. A number of years ago I was asked to lead a holistic management course at Fort Francis in northwestern Ontario. I wanted to know a bit about the families before I got there, so I wrote and asked them to send me a description of their farming operations, the major problems they were facing and what they planned to do about them.
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It was a diverse group of farm enterprises, everything from cow-calf to logging to a retail berry jam operation. Of course their top two problems were “not enough time” and “not enough money” and what almost all of them planned to do to solve the problem was add another enterprise.
On the first day of the course, we talked about this situation, and I asked them how adding another enterprise was going to give them more time. Their assumption, which most people make, was that another enterprise would give them more cash flow, which would mean they wouldn’t have to work so hard “sometime down the road.”
The truth is, another enterprise, unless it is something you know well and fits nicely with your centrepiece enterprise, will eat up a lot more time and it will likely take three or more years before you get good enough at it to make a significant profit.
One of the keys to having more time and more money is to do a gross profit analysis on every enterprise on your farm or ranch. Let’s say your centrepiece enterprise is a cow-calf herd. You will likely have several enterprises attached to it, such as your bull enterprise, hay enterprise and calf enterprise.
Calculate the gross income from each enterprise – what you would get if you sold the product to someone else – and subtract only the expenses incurred by that specific enterprise. What is left over is what you have to pay your fixed costs and take your profit from.
Most people I know who do these calculations on all their enterprises end up dropping some of them. The enterprises simply aren’t worth the time, investment and worry for the amount of gross profit they generate. That gives them more time, and more money, especially if they do a better job of managing the enterprises that do make profit.
For example, about 20 years ago Don and Randee Halladay, who ranch near Rocky Mountain House, Alta., figured out if they could buy hay for $40 per tonne, which they could do nine years out of 10, it was cheaper to buy hay than put up their own. They sold their haying equipment, had more spare time and made more profit on their hay land by pasturing it.
Here’s a little exercise from a book called Finding Your Work, Loving Your Life by Nanette V. Hucknall published by Samuel Weiser Inc., York Beach, Maine, 1992. It may help you find a little more time to do what you truly want to do.
- Look at your daily routine and write down all the things you feel are essential to your life. If you are married, being at home with your mate and family might be one of those things. List everything that is important for your happiness, even if it seems mundane, such as going to the movies or renting videos.
- Look at the list and take off one item. Close your eyes and see that thing being erased from your life. For example, if you watch football on Sunday, see yourself doing that and then see yourself getting up
and turning the TV set off. Feel if it is all right. Does it make you sad or upset?
- Go through the list doing the same with every item until you have eliminated those things you feel you can do without. Remember, you
can put an item back if you find yourself missing it too much. Eliminate one activity at a time and see how it feels. Then go on to the next, increasing time for what you really want to do.
Edmonton-based Noel McNaughton is a former broadcaster and rancher who lectures on farm lifestyle issues at agriculture conventions and for corporations. He can be reached at 780-432-5492, e-mail: noel@midlife-men.com, or visit www.midlife-men.com.
