Owning a ranching operation can be a fulfilling experience. There are, however, common mistakes that many not-so-informed buyers make, which can really put a dark cloud over the rural living experience. So, before you commit to buying a ranch, be sure you know the following:
- Determine how many animals the property will support. To determine this, consult your local Natural Resources Conservation Service (USDA) office. Here, you will find information regarding the soil type, precipitation, vegetation and forage condition of your land – all factors that determine production potential.
- Assess the time required to run your operation. If you cannot dedicate yourself completely, you may have to hire someone. Before you purchase the ranch, develop a plan that factors in the time required for the care of animals and ranch maintenance (fences, water, etc.). Hire additional staff if necessary.
- Figure out where to purchase your livestock. Don’t make the mistake of paying too much for livestock or purchasing low quality livestock. Do your research. Tap into your agricultural network. Consult other ranchers for guidance. Call your local livestock extension agent.
- Be aware of technical difficulties. Don’t enter the ranching industry without knowledge of common challenges. You must know about growing forages (fertilization, grazing management), managing cattle (nutrition, health, genetics), marketing, and general business management (accounting, financing, taxes).
- Discover reliable sources of information. You need to form a network of experienced ranchers and professionals that give the right advice. Attend educational meetings (such as Cooperative Extension programs) before your ranch property is purchased. Form connections with trusted professionals who can help answer your questions and ease your concerns.
- Create a realistic budget. Estimate your yearly costs. Estimate your gross annual income. If you need financial assistance, be sure you research ranch loans and your farmland financing options. Contact knowledgeable professionals to help you budget and finance wisely.
Need help financing agricultural land? Contact Bankers South, an ag lending company, for ranch financing assistance.