Getting started as first generational producers takes a self-drive for success, persistence, and looking for opportunity. In many cases, when you sign up for a project, you sign up for the entirety of the project. There’s no one else to complete the labor. There’s no one else to tend to the animals. It’s you. You’re the group leader for every aspect. If you’re 22 and have little to no life experience, you’re still the group leader. You signed up. You also don’t have the luxury of working an 8-5 job and going home to supper, your recliner or work-out, and the TV. Speaking from experience, we have a TV that rarely gets used.
That sounds really harsh. I know, I know.
But the truth is, the real world is harsh. And there’s no harsher world than that of agriculture. Don’t believe me? In one year, you can easily go thousands or more in debt if you aren’t careful. This is why so many generational farms are what’s left in agriculture.They made it through the 80’s farm crisis and for many, even the dirty 30’s. The resilience, determination, and eye for opportunity is what’s kept them going. The start-ups are few and far between if we’re talking more than a simple hobby farm.
If you’re a new start up with zero financial standing other than a little of what you have in the bank and just the knowledge and smarts in your mind, you likely are going to have to strategically fight for everything you acquire, whether it’s a piece of ground, a tractor, or livestock. You will have to be creative, open to new ideas, and very, very, very good with numbers and marketing. Unless you are sitting on a pile of cash, you will likely have to have a good working relationship with your loan officer as well.
The Next Step
So how do you achieve “the next step”? The step that gets your foot in the door, your start, or the next step in developing your operation. Whether the next step is a piece of equipment, pasture, well-priced but quality livestock, farm ground, or heck… even a farmstead, you need to look for the right opportunity. You need to talk with area producers. You need to prove yourself to yourself and others. You need to be financially focused with a drive for long-term sustainability. You will need a practical mindset and have a good relationship with your loan officer. And last, patience. You need a whole lot of patience… Rome wasn’t built in a day, friends.
The Right Opportunity
The right opportunity isn’t always a stand out opportunity. What I mean is, many people would consider a stand out opportunity as high quality and young 2-3 year old cows for $800 apiece. This would be an opportunity to jump on if you had interest in a cow/calf operation. But this kind of opportunity is rare if not non-existent. The right opportunity might look more like fairly priced, high quality cows that you can afford to purchase whether through cash or on loan.
A stand out opportunity might be decent pasture or cropland at a rent price less than half the county average. The right opportunity might be good land at a justifiable price that you can still make a profit from based on your current financial standing.
The lesson? Quality costs money. That’s just the way it is. Sometimes, you might have to give on quality just for something to fit in your budget if it’s a necessity. The important thing is to prioritize what you need and go for quality when you can.
Talk to Area Producers
Sometimes the only way to find the right opportunity is to talk with your local producers. You can’t rely on them, no. Absolutely not. But the more you chat, the more knowledgeable you become about the markets, smart decisions, poor decisions, and how to best serve your operation. You also build lasting relationships with these people and when you’re in an absolute pinch, your neighbors can help drag you out of a hole. Been there, done that.
Believe it or not, a lot of established producers want to see young people in agriculture. And they know the start up of an operation takes, well, a lot of determination and grit. If you prove yourself to them, they are going to be a lot more willing to work with you and help you achieve success.
Prove Yourself to Yourself
Not only do you have to prove yourself to others, but the most important thing is to prove yourself to yourself. You obviously can’t be all talk. You need to do the dang thing. Where are your priorities? Are you inadequately spending your time by focusing on things not oriented towards your goal? Or what about the dollars you’ve earned? How are you spending them? The only way to prove to yourself that you can be successful as a young producer is to put your heart and soul into it, all or nothing. That means you might have to make some sacrifices, and they might be hard. But just like so many small business owners know, the only way to make progress is to truly work your butt off to prove that your idea is achievable.
Be Financially Focused
This is a make or break one. If you don’t have a bottom line and a general idea of what kind of profit you’re going to make on whatever ventures you’re pursuing, you can’t control your spending accurately. And you can’t have a bottom line unless you are able to understand your input costs and likely income you’ll bring in based on market prices.
If you don’t know how your money is being spent, you can’t control where it’s going and whether you’re spending your dollars accurately. And to top it all off, we aren’t usually talking a couple thousand dollars. Many times, purchases and incomes are in the thousands. Side note: this is why a lot of people think farmers are rich. They’re not… they just see a lot of money change hands and then get their yearly income for the most part all at one time or over a handful of months. So if having money burns a whole in your pocket… this is a time for precaution.
Have a Practical Mindset
Practicality. Not everyone has this quality. I’m not saying you can’t be a dreamer. In fact, dreaming big is part of what leads to success. However, you need to be a practical dreamer. Find the dream or the goal and then find a practical way to achieve it. If the path to success isn’t logical, not only is the chance of it flopping greatly increased, but if you need a loan to achieve the goal you will likely be shot down. Because the real world runs on practicality and logic.
Have a Good Relationship With Your Loan Officer
A loan officer can’t magically make your dreams happen no matter how much they like you. However, they can create the opportunity for you to make your dreams happen if you are practical and strategic about how to achieve them.
Let’s get to the point. If your plan doesn’t make sense or your loan officer sees you as flighty or your goal as unlikely, you probably are going to have a hard time getting the funding. They are, in fact, just people. People that have to protect themselves and the business they work for as well. They can’t take an overly risky client on because at the end of the day, they need to be paid too.
I’m not saying that everything can’t fall into place quickly… What I am saying is that this often is far from reality. Building something great takes time and patience. Continued effort. In today’s get rich quick society, agriculture is the last type of business that most people want to get into. Getting income from what you are producing takes months to year at a time. Building your operation through acquiring key pieces takes time and money… and often it takes time to acquire the money…
If you aren’t walking into an operation that already has a lot of the key start-up pieces, it’s often a slow game of acquiring them if your start-up cash is next to nothing (I’m talking to my 20-somethings…it might be a different story if you have a larger sum of start-up cash on hand for your business).
Pursue the Hard
If starting an operation is on your heart, I encourage you to pursue it. Don’t wait for “the right time” or “when you have the money”. Because if you don’t make something a priority, it will never happen. I encourage you to look for the right opportunity, and start. Start small, and build slow and steady. Progress will come. Be open-minded. Think strategically.
But remember, this road can be a long and hard one. You have to really want it. You have to prioritize it. Afterall, if it was easy, everyone would be doing it. But at the end of the day, when you look back on what you’ve built, it will be so rewarding.
Pursue the hard things, friends. Achieve “the next step”. Build something to be proud of.