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Can we have an honest chat about the business of boarding?

Off Course
#1

Lots of threads as of late about barns, money, and the profit margins (or lack thereof) for equine boarding facilities, the costs involved, what boarders don’t really know about how stables operate, etc.

I’ve seen barns who fare beautifully, and the owners live comfortably. I’ve seen barns that fail miserably, and the owners scrape by or eventually go bankrupt. The biggest factor seems to be how well-versed in business practices the owners are.

So, BO’s of CoTH, many have spoken up here and there, but anyone care to get into the knitty-gritty? Most of what we hear is “there is no money in boarding”…but those who run barns have to make it work somehow. Willing to share?

Questions to consider:
Do you work FT or PT? Does your spouse/partner?
Do you train?
Do you have some other outside source of income?
Did you have help starting the farm, investment from a parent, spouse or business partner?
Did you buy an existing farm?
How many horses do you house? Did you take on boarders just to offset the cost of having your own horses at home?
What kind of board do you provide (full-care, rough care, pasture only?)
Do you offset costs by bartering services?

#2

Questions to consider:
Do you work FT or PT? Does your spouse/partner?

  • I work full time with the barn: about 40 hours total per week, but all seven days a week.
    Do you train?
  • Rarely. I used to train and had an assistant, but with my health issues it isn’t as safe for me to ride strange horses. Training was a good money maker and allowed be to afford staff…which was awesome! Now I only do some occasional training on clients horses, or for people I know/trust.

Do you have some other outside source of income?

  • DH works full time. I recently got a VERY part time job off the farm…only 4-5 hours per week. Mostly just to update my resume in case my health gets to the point I can’t do the horse thing anymore.

Did you have help starting the farm, investment from a parent, spouse or business partner?

  • Spouse and I got an investment from his parents so we didn’t have to take out a bank loan. It helped pay for the building.

Did you buy an existing farm?

  • It had previously been a cattle farm, so a few useful outbuildings, but the main structures and all the fencing had to be done, as well as considerable land work (it was way too hilly…we had to flatten for the arena and paddocks).

How many horses do you house?

  • There are about 20 now. We had up to 30 in the past though.

Did you take on boarders just to offset the cost of having your own horses at home?

  • Mostly…yes.

What kind of board do you provide (full-care, rough care, pasture only?)

  • Full care, indoor and outdoor. Mostly outdoor, particularly in the summer.

Do you offset costs by bartering services?

  • I occasionally barter help for lessons, but that is about it.
#3

Not going to give out a ton of personal information, or what I consider proprietary knowledge. :lol:

However, I will say that I’m full-time, don’t train, inherited the place and make a comfortable living. :winkgrin:

#4

I’m sure I’m not a representative sample, but I do have boarders, so I’ll answer.

Do you work FT or PT? Does your spouse/partner? Spouse works full time aside from the farm and I work part time at home, aside from the farm. The barn work takes up about 2 hours a day.

Do you train?
No.

Do you have some other outside source of income?
Yes.

Did you have help starting the farm, investment from a parent, spouse or business partner?
Um… no?

Did you buy an existing farm?
No… we bought a house with land and we built stalls in an existing structure and did all the fencing etc. Still planning to build a new, larger barn in the future as we only have 4 stalls and I’d like to expand.

How many horses do you house?
4

Did you take on boarders just to offset the cost of having your own horses at home?
Pretty much! LOL. According to my calculations, having paying boarders pays for the grain, hay, and shavings for my own two horses. Plus I have riding buddies, and one of my boarders likes to clean stalls and will feed for me when she can.

What kind of board do you provide (full-care, rough care, pasture only?)
Full care, with 24/7 turnout if weather allows, but they all have a stall. They’ve all been coming in at night for about a month now because of the temperatures.

Do you offset costs by bartering services?
I’m not quite sure what this question means. What services? Like stall cleaning/barn worker services? No, because I’m not big enough to have a worker. One of my boarders gets a slight reduction in board due to her willingness to lend a hand.

#5

Please tell me you’re not just trolling for ammunition to beat folks about boarding costs. :frowning:

#6

[QUOTE=ESG;7963426]
Please tell me you’re not just trolling for ammunition to beat folks about boarding costs. :([/QUOTE]

Uh, no. I’m in the process of closing on land and am planning on building a small barn and having a few boarders. All I’ve been told since I can remember is that there’s no money in boarding, but the existence of successful establishments seems to indicate otherwise. I’m curious if there’s a trend amongst successful barns other than business savvy.

But thanks for making a fairly miserable assumption about my intentions. :no:

#7

I hear there’s no money in boarding, too. Many of the successful boarding operations that I know of have:

  • No mortgage, or a job that helps offset those costs
  • Successful manure management: they know how much manure they get in a day/week/month, the local regulations on disposal, and the layout of the facility is such that it’s not onerous to clean stalls (i.e. passive encouragement for staff to do a good job)
  • A draw: good arena? Great trainer? Great footing?
  • Steady, reliable source of hay and shavings. Stuff happens, yeah, but there’s no excuse for ending up with 6 bales of hay and 40 horses to feed before the hay guy comes.
  • Good pasture management (sometimes goes hand-in-hand with manure management)
  • A limit on how many horses come on the property. Don’t build more than your property can support
  • published, well-communicated rules and minimal drama.

At the end of the day, it’s a business. Understand your overhead (mortgage, taxes, etc.), your cost structure (should you get shavings and hay in bulk, or does the convenience of square bales/shavings in bags trump the cost increase?), and the cost of your labor and price accordingly. Limiting your personal horses makes more opportunities for paying boarders.

#8

If all you are doing is having a few boarders along with your own horses, no, you will not make money. However, you may offset some of your fixed costs.

In other words, if you do it right, you may be able to take in enough cash to cover the additional costs of the boarders (extra feed, insurance, for example) plus cover the property taxes, for instance. In this case, you’d have to pay the property taxes anyway, so you are ahead of the game. However, you won’t be able to cover the cost of the land (mortgage, taxes), all the other costs AND pay yourself for your time.

If you have a bigger barn, and offer other services (training, clinics, shows) I think there’s a better chance of paying yourself.

Edited to add: don’t get upset with ESG, it is what I thought as well, and I suspect is why there haven’t been many replies from BO’s. No big deal, but unless you state your intentions/why you are asking a particular question, people will fill in the blank themselves.

#9

[QUOTE=Abbie.S;7963825]
Uh, no. I’m in the process of closing on land and am planning on building a small barn and having a few boarders. All I’ve been told since I can remember is that there’s no money in boarding, [/QUOTE]

Its the good old depends answer.

We had boarders, but the primary boarder was my personal business’s horses that were used for advertising the company and the other boarder was our own horses.

The boarding operation was an incorporated farm. The Farm leased the land from us, the buildings that The Farm built were an asset that were depreciated as were all other assets of The Farm.

We personally had horses that we then had to pay board to The Farm because The Farm was an on-going business

The Farm operated for about ten years, was always profitable paid its taxes and never audited.

Record keeping is about as equal to the labor itself as everything was separated off as would any independent operation would be.

Sold my business when I went to work for the manufacturers, gave the horses away for token payment, terminated the lease, officially closed The Farm as a business with the state and the IRS.

suggest even on a small scale to have a good tax attorney to assist in setting up the operation and a CPA versed to Farm/Ranch tax law to prepare documents.

#10

I think you are missing a key factor in evaluating this, which is the area you are located in, and the market dynamics. While all of the things you have listed contribute to profitability, if you build a fancy full service facility but are a two hour commute from the nearest city with potential clients, or if you build it in an area where the demand is mostly for pasture boarders and people like to trail ride, you are unlikely to succeed.

#11

[QUOTE=Pookah;7964022]
I think you are missing a key factor in evaluating this, which is the area you are located in, and the market dynamics. While all of the things you have listed contribute to profitability, if you build a fancy full service facility but are a two hour commute from the nearest city with potential clients, or if you build it in an area where the demand is mostly for pasture boarders and people like to trail ride, you are unlikely to succeed.[/QUOTE]

Very true, and things I have already considered, given that the land is being closed on :slight_smile: I’m just outside a suburban-ish area (for my state, anyway) area, but away from developments, in a very well horse-populated area that caters to a fairly large group of competitive riders in multiple disciplines.

I appreciate the responses thus far, I was just a bit taken aback that someone would so quickly assume ill will, perhaps because my mind hadn’t gone anywhere close to what some of you seem to have assumed.

I should probably clarify: the preliminaries I have laid out so far is a farm set up for full care, with a ballpark of 15-18 horses (I only keep one horse at a time, so almost entirely boarders) between a main barn and a handful of nicely set up run-in sheds. That’s considered “small” for my area. Most of the boarding barns around here that offer what I am setting up to offer have 30+ horses, but I find the issue at those places tend to be not enough staff to properly oversee the needs of all the horses and a serious lack of pasture/space. Good pasture in general is a serious problem in my area, but the land we’re closing on is absolutely perfect, has near-perfect attributes based on topo assessments and soil tests.

It is obvious that the better someone is versed in business, the better the business is run. So that’s a given. I have a pretty in-depth business background, and own a small business currently. My curiosity was what other factors consistently come up for successful barns (or make it that much easier to be successful over time).

#12

Lots of good input here (though I understand peoples’ reluctance to give out personal information.)

In every boarding barn I’ve been in and liked, there has been outside money from investments and/or wealthy family, and usually no mortgage. I’m in a very expensive area, though. I’ve ended up at what is considered “mid range” around here for places with an indoor and a good reputation, which costs about $700-$900 a month. The more expensive barns tend to be very serious show barns with a wealthy clientele and often a “program” required for the horse. They are often much more beautiful but the care isn’t necessarily good, especially WRT turnout.

#13

a ballpark of 15-18 horses

To me that would mean 2 to 4 employees … I worked in the saddlehorse industry while in college, each groom was pretty much maxed out with six horses to care for. Admittedly, all the horses were in full training…nevertheless 18 head is too many for one person. And weekends … that would be another story staff wise.

What are the competitors offering/doing?

I am still pretty amazed that boards rates are still the same as 1990.

#14

Why are you doing this? I ask in all seriousness, because you are talking about a huge amount of cash (unless you are in a very cheap area of the Northeast – northern Maine e.g.). After all is said and done, you may be better off with a few of your own horses, fewer facilities (that is, fenced pastures, run-ins etc) no hired workers (and all the headaches that entails) etc etc.

For example, I’ve found that a max. of 10 horses is best for me. My farm has a LOT of extra land, but in order to add, say, another 10 horses I would then have to have very large capital costs to fence, add run-ins, run water etc plus with 20 horses I’d have to hire someone to help . . . and absolute best case scenario I would be breaking even. I’d have to be doing a ton more work but I would not be making more money. Hence, no plans to expand any time soon.

I think it would be cheaper for you to just have a few horses at home and forego the headache and expense of that many boarders.

Having written all this out, obviously if you are buying the land with the idea of putting an 18 stall full service boarding barn on it, I’m pretty sure I’m not going to talk you out of that!

The one amenity in the north east (at least in populated areas) that is rare is large fields for turnout (like, 10 acres a field, for 4 - 5 horses).

Have you run the numbers? You must have but I have an even harder time seeing how a full service place that is built from scratch can make any money – in other words, I think it is even less likely than other boarding barn scenarios to make $$.

However, I do say good luck to you, and also would be happy to try and answer questions you might have. My set up is very different – 10 horses on about 20 acres (of a 200 acre farm); horses out 24/7 (lower labor and materials costs!), no indoor, no wash stall, all but one of my boarded horses are retirees. So, I can’t help with every area, but would be happy to help where I can.

#15

I don’t board horses, but I’ve watched a couple of places go belly up and have some opinions. :slight_smile:

It seems to me that places that fail share three issues, although each had other problems, as well.

  1. Lack of business knowledge and planning, under which I would include lack of sufficient start up capital. And by start up capital I mean real money that is yours, not money you borrowed from someone that expects you to pay it back.

  2. Delusions of grandeur, i.e. hiring people to do all the dirty work because owners don’t clean stalls, even though the owner has time and is capable of doing so.

  3. Failure to understand community dynamics, by which I mean things like offering full board in an area where people want pasture board, trying to be an A rated show barn in an area where most people don’t have the income to engage in that activity, and being too far away from where potential clientele live.

#16

This is very accurate. Any “salary” we earn from boarding (ie. $ for our time after all expenses are paid) goes right back into the property in terms of improvements. Both myself and my husband have jobs outside of the farm that provide our real income (the $ we use for the mortgage, food, clothes, etc.). The boarding allows us certain tax benefits and helps us maintain the facility for our own horses. And major improvements, like the indoor arena, still come out of our personal savings.

What kills us the most is the liability insurance we have to carry to even have one boarder…not sure where you are located, but in NYS the price tag to go from private homeowner to just boarding is staggering - if we did training/lessons it would be even more.

#17

[QUOTE=clanter;7964064]
To me that would mean 2 to 4 employees … I worked in the saddlehorse industry while in college, each groom was pretty much maxed out with six horses to care for. Admittedly, all the horses were in full training…nevertheless 18 head is too many for one person. And weekends … that would be another story staff wise.

What are the competitors offering/doing?

I am still pretty amazed that boards rates are still the same as 1990.[/QUOTE]

Competitors are understaffed. Most of the barns in the area have an owner who isn’t so much involved in the day-to-day, and an on-site trainer who acts as the BO. The chores are done by the trainer or whoever they can get the do them, usually boarders looking to decrease their board. The biggest issue I’ve seen is that the care is really inconsistent: one day everything is done as it should be done, the next day bell boots get forgotten, the blankets don’t get changed, meds get left out…that’s personally my worst nightmare as a boarder.

Other than that, most of the major ones are varying degrees of “full care”, which could mean anything from just the basics to they take the reins right out of your hand and your horse goes on their program.

#18

The 18 horse versus 30 horse is going to have some disadvantages due to economies of scale. If you want to know more about that, find some barns that size, maybe outside your region, and see what they have to say. Keep in mind how you will support a riding arena, training opportunities, etc. Note that it is hard to always have exactly the right amount of stalls, so it’s good to have some slop area - extra paddocks that can be empty or have multiple horses of yours - because otherwise you’ll probably end up with a couple of empty stalls for months at a time, here and there. That business plan that is comfortably profitable at 18 might break even at 16, and then when you’re at 15 you’re losing money.

If you’re running a full barn, and suddenly you want to buy yourself another horse, where will he go?

My experience (here in California) is that boarding makes money when the land was bought inexpensively and many years ago. It is much harder to make money when you are paying the market price for land and brand new facilities, because your costs are just way higher than your competition.

#19

[QUOTE=SMF11;7964139]
Why are you doing this? I ask in all seriousness, because you are talking about a huge amount of cash (unless you are in a very cheap area of the Northeast – northern Maine e.g.). After all is said and done, you may be better off with a few of your own horses, fewer facilities (that is, fenced pastures, run-ins etc) no hired workers (and all the headaches that entails) etc etc.

For example, I’ve found that a max. of 10 horses is best for me. My farm has a LOT of extra land, but in order to add, say, another 10 horses I would then have to have very large capital costs to fence, add run-ins, run water etc plus with 20 horses I’d have to hire someone to help . . . and absolute best case scenario I would be breaking even. I’d have to be doing a ton more work but I would not be making more money. Hence, no plans to expand any time soon.

I think it would be cheaper for you to just have a few horses at home and forego the headache and expense of that many boarders.

Having written all this out, obviously if you are buying the land with the idea of putting an 18 stall full service boarding barn on it, I’m pretty sure I’m not going to talk you out of that!

The one amenity in the north east (at least in populated areas) that is rare is large fields for turnout (like, 10 acres a field, for 4 - 5 horses).

Have you run the numbers? You must have but I have an even harder time seeing how a full service place that is built from scratch can make any money – in other words, I think it is even less likely than other boarding barn scenarios to make $$.

However, I do say good luck to you, and also would be happy to try and answer questions you might have. My set up is very different – 10 horses on about 20 acres (of a 200 acre farm); horses out 24/7 (lower labor and materials costs!), no indoor, no wash stall, all but one of my boarded horses are retirees. So, I can’t help with every area, but would be happy to help where I can.[/QUOTE]

I really appreciate this, SMF. All of it.

Do you want the short or long version to the “why” question? :slight_smile:

The short version: I’ve wanted a farm since I could walk. I have never wavered on my desire to have a horse farm, to run an equine boarding business, yada yada yada. I’m at a point in my life right now where I could seriously make a go of this, and so we’re moving forward.

The long(er) version: I have worked in several barns, as a stable hand and BM, from trail barn to expensive show barn, and understand what goes into the business. I have seen where so many barns fall short. I understand what boarders in our area want, what the economy supports in terms of pricing, what is necessary in terms of infrastructure to be attractive to clients, and what is necessary in terms of care set up to keep the horses happiest and healthiest. I have been running numbers for the better part of two years, looked at dozens of properties, some with no infrastructure and some with fully operating barns. At first we were looking at buying something existing or a fixer of sorts, but found that the property was A) not set up for the type of business I want to run, B) needed too much cleaning up/repair to make it worth the investment, or C) was not in an area conducive to the type of clients I’d be attracting.

So we started looking at building from scratch. My dad has spent the last 30 years in real estate and residential development. I have his decades of expertise and all of the contacts he’s made in the lumber and building industry at my disposal. I also have the backing of his company in terms of equipment: they own all their own machinery, so I would not have to hire out in order to do a lot of the major groundbreaking and construction. Were it not for this, I would not be attempting to building something from ground up. I am essentially very, very lucky and in a much better position than most.

The there’s the financial help from a deceased family member in the form of a lump sum of money left to me in her will. This will pay for a large chunk of the infrastructure and make a pretty big dent in mortgage payments. Again, would not be going this route if I didn’t have this at my disposal.

I’m more than fortunate in so many ways, as you can see none of this would be even close to possible for me without all the aforementioned points.

#20

OP, your plan definitely has many components that will help it become successful. Here are a few things that will help you run the numbers:

(1) Hay, grain and shavings. Talked to suppliers yet? You NEED a hay dealer who can supply you good quality in bulk. That means cash flow. Will you be taking in enough to pop a check for $4,000. to $7,500.00 say, every 60 days JUST FOR HAY? You’ll need to. Your feed/shavings dealer will expect a check each month if he’s nice enough to run a house account for you; many won’t. For that number of horses, that’s going to be ANOTHER $3,000.00 per month. What if both hit at the same time? Add in your mortgage, fuel, car payments, and help. Still with me?

(2) You NEED an excellent veterinary firm with 24/7 emergency coverage you KNOW you can get. Bonus points if this is a vet already popular with your client base. Ditto farrier. Going to use one or everyone’s? The chaos factor there rises exponentially when you let clients use anyone they want. Who’s going to hold horses for them, you, the client, or the help? Add in people who also want woo-woo (chiro, acupuncture, thermography, massage) and it’s a LOT of time!

(3) As others have said, manure management, pasture management, drainage.
Is your new place WORKABLE? If you have to walk a horse through three other paddocks to get to his turnout, some changes need to be made. Trucks and tractors have to be able to get in and out. Bonus points for own backhoe! Fortunately, equipment dealers have SUPER terms and will practically pay you to take one.

(4) I’m surprised that only one person above mentioned one HUGE factor that makes this all work–TAXES. Find yourself an equine-knowledgeable CPA and attorney and have him/her set things up to maximize what you can write off.
If you have other income, lots of times there are advantages BUT you can’t run at a loss forever and need to show sincerity in attempting to make a profit. In the short term, however, this is a factor that helps you pick up enough speed to take off.

(4) Where are you going to get help? DO NOT go the “work off the board” route unless you want to be doing all the mucking yourself while going broke. :lol: Are you prepared for the paperwork burden of actual employees, or do you know someone who “does barns” as an independent contractor? Make SURE you know the difference or you can find yourself in a deep dumpster of doo-doo indeed!

(5) Who will your clients be? Are you a “name” known locally to horse people? What is your experience level and what will you be offering to induce people to leave where they are and take a chance on a brand-new place? At the very least, you need to have a CLEAR list of services and prices to present. Have a plan to FIND these clients and get your name out there so THEY can find you!

(6) What’s your niche? Just general boarding covers too much ground, it can be anything from AA-circuit to trail riders and you’ll find a lot of those “groups” don’t mesh well. Pick a specialty you know best and seek that kind of boarder.

(7) CLEAR BOUNDARIES of professional distance–while you like your clients very much, they are not BFF’s. Have posted hours, rules, and enforce them equally which can be more difficult than you think! Be sure to reserve your private space and time, you’re going to need it in a business in which you ARE NEVER OFF DUTY.

The Northeast is probably the BEST place to start a full-service barn, because at least the cash-flow potential is there with a lot of wealth in the area. Best of luck, and I wish you well! One thing the nay-sayers sometimes miss is that, if no one wanted to run a boarding barn, there wouldn’t BE any for them. :winkgrin:

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