Ron Torell with his wife, Jackie.
Cow Camp Chatter
Budgeting for stewardship
It is often said that there are no better stewards of the land than agriculturists. With stewardship comes the responsibility of managing your property in the interest of long-term sustainability. At the end of your ranching career, when you turn your operation over to the next generation, will your ranch and land be in better shape than when you took over management and/or ownership? Have you always had good stewardship of the land in mind when it comes to the management of your ranch? Do you treat and manage the land, your neighbors and employees, both two- and four-legged, with integrity, respect and dignity? In this edition of “Cow Camp Chatter,” let's talk about how we might budget for the infrastructure maintenance of our ranches in order to become better long-term stewards of the land.
Many of us in agriculture receive a ranch paycheck once a year. Stretching this paycheck to last over a 12-month period requires good budgeting skills, discipline and sacrifice. There never seems to be enough money to cover both the prioritized needs that are necessary to keep our operation running along with the short-term wish-list items that we desire. Often when we go without for a period of time we confuse wants with needs. During the good times we spend as if there is never going to be another bad day in agriculture. History tells us that every time the highs go higher, the lows eventually do go lower. Following a financial plan and spending money on infrastructure maintenance while putting a little cash away for a rainy day may ultimately be wiser than splurging on those instant-gratification, short-term wants.
Good money management suggests you make a written long- and short-term prioritized purchase list. Give a lot of thought to your wants and needs and their importance to the functionality of your operation. Since you only have so much money to work with, it will be necessary to make some compromises. For example, a want might be a $50,000, 1-ton, four-door, diesel flatbed pickup with an aluminum fifth-wheel trailer behind it. A need, on the other hand, would be a reliable, low-cost form of ranch transportation capable of pulling a functional stock trailer. Take into account what items will give you the best return on your investment and, at the same time, make you a long-term steward of the land.
Stewardship is a necessary budgetary line item. We need to seriously consider the upkeep of irrigation ditches, rangeland restoration and water development, along with the maintenance of fences, corrals, gates, trucks, trailers, tractors, haying equipment and outbuildings. Without a functional infrastructure in place we cannot effectively heed good stewardship practices.
Take weed control, for example. We have all seen ranches that have deferred these costs to the point where the weeds have literally taken over the ranch. What once could have been taken care of with minimal cost and little effort when the weed patches were small is now a huge budgetary expense. Controlling willows, wild rose bushes and other pesky noxious weeds is unattainable given current resources. Over time this leads to the inability to apply sound management practices, resulting in reduced production, lower profits, and additional loss of infrastructure. It is a spiraling situation.
Ranch infrastructure is the underlining foundation and basic framework of any operation. The visual appearance of the entire ranch — including its house, yard, shop and corrals — shows pride of ownership and is a reflection of not only the financial standing of the ranch but also its management style. Maintenance of a ranch's infrastructure saves thousands of dollars compared to putting off these costs until another time. Postponing these expenses for too long results in an overwhelming task in order to catch up. Some managers who continually defer these costs and allow them to get out of hand have a tendency to give up. The condition and appearance of their poorly maintained ranch and property is a reflection of their apathy to the situation. The long-term cost of not maintaining ranch infrastructure on an annual basis is too great not to budget for.
When all is said and done, the ability to stay focused on the big picture is paramount. Making short-term financial sacrifices while adhering to sound budgeting practices will result in long-term success. In doing so you will be able to answer "yes" to the questions posed at the beginning of this article.
That's enough for this month. As always, if you would like to discuss this article or simply want to talk cows, do not hesitate to contact me at 775-385-7665 or by e-mail.
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