Tips for Managing Ranches Part 1
If you are among the many investors interested in owning Florida cattle ranches for sale, you should know that owning a ranch can be a rewarding experience. Ranch buyers who dream of rural living should also be aware of the challenges of owning this type of property. The financial success of owning a ranch depends on many variables and factors, which is why it is essential to develop a good strategy for managing your property.
In this two-part series, our land experts will share some tips for effective ranch management. In part one, we will focus on essentials such as the five keys to success, profit over convenience, profit per cow, and reducing overhead costs.
Five Keys to Success
It takes hard work and land expertise to operate a ranch. To develop long-term success for your ranch. Consider the following:
- Employ an integrative and holistic approach to managing your ranch
- Always strive to improve your most precious resources (i.e., livestock)
- Keep your eyes on costs and manage them well
- Invest in marketing for your business
- Use professional analysis and decision-making tools to determine the future of your business
Think Profit First
When it comes to running a ranch, you have to choose profit over convenience. It is easy to make decisions based on personal preference or what is convenient for you, but a common pitfall is to assume that things will take care of themselves. However, ranching requires significant care and much of your time will be devoted to managing the property in order to produce a satisfactory profit.
Reduce Overhead Costs
It is important to always keep costs at the forefront of your operations. You should always be thinking of ways to run your ranch while reducing labor, facilities and equipment costs. While some overhead is necessary, excess overhead can be detrimental to your profit. Take the time to see where you can restructure your operations and cut these costs.
Focus on Return Per Acre
You may be wondering if your focus should be on return per acre or return per cow? While it is true that you need to consider cows per person, fed vs. grazed feed, and acres per cow, you also need to think about revenue per acre. Focusing on production or profit per cow instead of profit per acre or whole ranch profit can result in fewer cows and poorer performance, which also leads to less production per acre or an increased supplementation bill. A greater focus on profit per acre leads to economic efficiency and profitability.