4 Management Tips to Improve the Profitability of Your Ranch

4 Management Tips to Improve the Profitability of Your Ranch
  • Opening Intro -

    Most people want to begin ranching because their passion is growing things and they love the outdoor life and they love animals.

    More than anything, they love being independent.

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However, ranching is not as simple and idyllic as those dreaming of the lifestyle expect. You also have to think about the financial side of ranching as well as marketing. You’ll also need to manage your people. Ranching is not only an idealized lifestyle, but a business.

Here are four tips to help you make your ranch profitable.

Treat Your Land Right

If you already have a ranch, your soil is perhaps the most important thing. The bottom line is depleted soil cannot support the grass your cattle need for grazing.

You need to rotate your cattle to different pastures; give each pasture a short grazing season followed by a long recovery.

If you don’t already own land, look at ranch properties for sale that have good soil, and have been practicing pasture rotation.

If you purchase land that hasn’t been practicing pasture rotation, you’ll have to give it more time to recover before you can use it for grazing.

Once you do start using land for grazing, you need to be careful to avoid overgrazing. If your cattle eats the grass too short, the grass will take longer to grow enough to be useful again. Often grass growth is divided into three stages.

Cattle tend to like the first stage best because the grass is softer. However, if the grass is continually eaten down to this stage, it will have trouble growing.

Most ranchers want to keep their grass at stage two, where it has grown enough to be able to support maintenance but not so much that it stops growing. When the grass is getting to the lower end of stage two, it’s time to rotate pastures.

Plant Native Cover Crops

No-till cover crops contribute to the overall health of your soil. Plant a mix of many plants, heavy on native species. This will provide your cattle with year-round grazing, as well as fertilize the ground with plenty of manure.

Propagating native plants is not only good for your soil and cattle, but it will also encourage native species of animals. The added benefit to this is you can engage in agritourism and fee hunting as a side business.

Match Your Costs with Profits

Don’t treat your costs and profits separately. Look ahead several months, and try to manage the margin between your costs and your profits.

For example, cattle ranchers can lock in the price of things like feed, and then leverage the cattle futures market to shield the risk of their sale. Don’t wait to get a better deal, try to lock in your profit ahead of time.

other valuable tips from our business blog (new win):

Every month, check your current cash flow against your projections. If a month is worse than your projection, you will need to realign your expenditures.

Even if your ranch isn’t your main source of income, you need to treat your ranch like any other business. This includes proper budgeting and careful management.

Pray for the Best, Plan for the Worst

A lot of things can happen out on the range, such as wildfires, tornadoes, blizzards, and floods. One natural disaster can wipe a ranch out.

This is where getting the right type of insurance can help. For example, if your land is prone to drought, you might need Pasture, Rangeland, and Forage Insurance.

To put it simply, managing a profitable ranch is a balancing act between the love of the land and knowing your business. Take the time to do your research and manage your ranch carefully.

If the ranch is not your main source of income, you may want to hire a manager who can take care of the day-to-day duties on the ranch.

Image Credit: ranching by Pixabay

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