Politics aside, it’s been a challenge for many equine operations focused on commerce and profitability this year. I’ve always been a big believer in attitude shaping results. Collective cries of woe can be even more dangerous than individual negative thinking for your business.
Admittedly, this year has been tougher than most for me on the optimism front. Dealing with the first broken bone (besides fingers) provided a huge awakening. The fact that this required couch potato status for three full months was major incentive for a reality check. I literally had to stop the trucks in transit with young horses loaded and destined for staring under saddle training at Halcyon Acres®.
Diversification helps in the horse industry
Diversification is critical to survival in the horse industry, or just about any business, for that matter.
The bad leg break provided a heads-up on the foolishness in depending solely on physical prowess for a considerable chunk of my income. It also alerted me to the need to be better equipped with staff that could carry out day-to-day herd management and care without my participation (something that should have been delegated a long time ago) and prompted me to start looking for an assistant trainer with the young horses.
It also prompted me to look deeper at my diversification strategy (all aspects of the business suffered during this time sans article submissions, including breeding, starting, reprogramming, training, horse sales etc.) because each required me to be present and healthy. So, I had lots of time to develop a better strategy for the future. Not only did I get determined about delegation, but also planted the seeds (including writing the first book) for the Horse Sense and Sense series to be launched in early 2010. The business will never be crippled again by an unexpected injury.
Horsemen aren’t feeling the pain
In talking to horsemen (and I do not use this term lightly) in the US and other countries, they have more business than they can handle.
Horse sales are an issue, but few depend on this for livelihood income and are more inclined to hold rather than reduce prices to silly levels. We’re offering fair prices for good horses and have seen a huge uptick in interest this fall, so believe the market is coming back here.
As far as the trainers, clinicians, instructors and handlers that we’ve spoken with, if anything, the perceived bad economy is bolstering their business. These are people with solid reputations for expertise and honesty and it seems clients are still putting money into the horse industry – but being more careful about who they choose to work with. Most of these people have a number or revenue streams associated with horses and when one is a bit soft, the others seem to be taking off. It is interesting that the rallying cry from those who are respected without the hype to make it so is “I need a vacation.”
Breeders are pulling back
I’ve seen a lot of breeders pull way back in the past two years.
We didn’t (although our efforts were not rewarded this year due to the most freakish cycling issues I’ve seen with mares in my lifetime). With the increased interest in horses this fall, it seems moving forward with future crops was a smart strategic decision. We did decide to pull out of the Thoroughbred industry (we just don’t have the mares to consistently produce allowance caliber foals with the tougher competition coming in) and put the full focus of our breeding program behind the Irish Draught Sport Horses (with different mares more suitable for this aim). These foals are proving to be standouts and although it requires a much longer time investment, the total costs are less and the rewards are much more predictable.
Being able to weather economic storms in the horse business also requires an ability to assess and redirect when necessary.
What’s the answer?
So, the answer on the horse industry economics is “it depends.”
I think those who are excellent at what they do, clear about who they are, operate with honest integrity and are devoted to those they serve do not suffer from the expressed malaise. It helps if you have a number of equine revenue streams in case one grinds to a halt due to market conditions.
We’re not quite yet at the impervious level at Halcyon Acres® and have found diversification and cost-reduction strategies to be fruitful.
We fenced in 26 acres (nine separate paddocks are enclosed in this perimeter) this spring and this has provided huge savings ono feed and bedding and an unexpected benefit of a much healthier looking herd. Surprisingly, this became a more time-intensive horse care strategy that needs reworking. We’ll have to rework this prior to spring as our plans include offering turn-out board (full care is break-even at best).
The launch of the Horse Sense and Cents™ book series this winter is an exciting initiative for us that will help market the farm services and horses, provide an additional revenue stream and offer a fun cerebral distraction during bad weather and injury healing times (and every evening and weekend :-)). Plus, it’s a great product that will help readers better enjoy their horse experience (while giving their horses better life opportunities). Of course, this is also something I can do when I’m old and decrepit, so it serves as a good component of the long-term strategic plan.
I was amazed at how quickly and enthusiastically the demand for horses for sale here rebounded. This bodes well for the future, not only for us, but others who produce and/or offer quality horses at fair prices (we did not drop the price of our stock in response to the stall in demand).
How are you weathering the global economic challenges with your horse business?