Questions for Equine Business Owners

[Guilherme]

@EquiFinale

This has been incredibly helpful - thank you for the insight - definitely agree on looking for business courses, unfortunately there does not appear to be an abundance of them dedicated specifically to the horse industry. I think a deep dive into HR related topics for staffing issues that have been referenced would be a good bet for myself as well.

Thanks!

You don’t need “horse related business courses” you need “business courses.” Basic stuff. Then, when you have at least a functional understanding of running a business, then you add the equine related issues.

Put another way, “horse business” is a subset of “business,” not the other way 'round!!!

One of the things you will learn is “business planning” and maybe the first question should be “why does my relevant market need my services?” To answer this question you must first define your “relevant market” and then determine the most common demands for service within that market and then show how you will provide services to meet the demands. This is not done the back of an envelope. This will take several sheets on a yellow pad and you may wear out a pencil or two. That’s OK. Pencils are cheaper than erroneous business decisions.

This does not mean you have to go find a combination MBA/Equine Business Degree from an Ivy League university. It does mean that you might want to see what kind of “survey” courses are available from you local community college or even on-line.

The hard reality of the equine business world is that it’s a place where you can lose a lot of money fast but you can’t make a lot of money fast. Take you time, educate yourself, train yourself, and then if you have the capital then take the plunge.

G.

[Redlei44]

@Palm Beach

Would it be worthwhile to purchase a large commercial washing machine and offer blanket/laundry service? What should you charge? Should you pay cash for the washer, or finance it?

What about getting some vending machines so clients can purchase drinks and snacks? You can buy them and stock them yourself and keep all the money, or there are businesses that drop them off, stock them, and give you a percent of the sales.

This is fascinating. What other peripheral services are potential revenue streams? I’m going to search old threads and maybe start a spinoff thread.

[Palm_Beach]

@Redlei44

This is fascinating. What other peripheral services are potential revenue streams? I’m going to search old threads and maybe start a spinoff thread.

Coffee machine, do a pizza/movie night @$X per person, trailer loading, despooking clinic, braiding/show prep, etc.

[clanter]

@Palm Beach

Coffee machine, do a pizza/movie night @$X per person, trailer loading, despooking clinic, braiding/show prep, etc.

charging for the parking spot for the trailer if the area was secure would have wider interest

First thing OP needs to research is What can legally be done on the land they own. Here I could board a fiend’s horse but I could not open a commercial boarding operation as my land is zoned residential.

Next would be as others have said… figure out just what form of business would in their best interest. For me it was set the farm up as a C-corp which allowed us to do some very specific things that we wanted to do for our kids. The Farm leased all the ground/buildings from us. The Farm was its own individual, it was the responsible party who owned the operation which was a firewall to limit but not eliminate personal liability

But actually before I ever did this I would use the Yellow Pad test to see if there was any chance of the business being viable… please exclude personal expected satisfaction of working with horses as your view will be clouded with only the perfect days beings envisioned … be honest with yourself now rather looking bad and wonder why did you do this in the first place

Starting a horse business sounds nice, comforting and pleasant, but starting any business is hard …but horses… even the feed manufacturers who specialize in equine feeds are wondering just what they are going to need to do to remain profitable

[HungarianHippo]

@EquiFinale

This has been incredibly helpful - thank you for the insight - definitely agree on looking for business courses, unfortunately there does not appear to be an abundance of them dedicated specifically to the horse industry. I think a deep dive into HR related topics for staffing issues that have been referenced would be a good bet for myself as well.

Thanks!

The coursework doesn’t need to be specific to the horse industry at all. Accounting, marketing, vendor and client management, budgeting, taxes, insurance and legal advice-- these are common necessities across all types of business.

Final bit of advice: look up templates for Business Plans (www.sba.gov has good resources for this!) and write a very thorough biz plan. A good one takes a lot of time, don’t half-ass it. The parts of it that are really hard for you to complete will reveal any weaknesses and flaws in your plan that need to be corrected before you dive in and invest. And if you find you can’t muster the willpower to complete a business plan, then that’s a huge red flag about how you’ll run the business. This isn’t a judgment, it’s simply a way to understand if you are ready to be a business owner. A lot of people aren’t – they’re driven by passion but don’t have the management skills yet to sustain the enterprise. When that happens, much stress and heartache will follow. Another good way to test your plan is to take it to your banker and ask if they’d lend money to this new business.

The more you operate this as a business rather than a passion, the better off you will be.

Good luck!!

[HungarianHippo]

@clanter

… First thing OP needs to research is What can legally be done on the land they own. Here I could board a fiend’s horse but I could not open a commercial boarding operation as my land is zoned residential. …

And here @clanter has accidentally but accurately described some of the boarders you’ll eventually need to confront :lol :lol:

[clanter]

@HungarianHippo

And here @clanter has accidentally but accurately described some of the boarders you’ll eventually need to confront :lol :lol:

now I believe I was more correct than I thought. my subconscious must have OKed the posted

[rhymeswithfizz]

@EquiFinale

Thanks everyone, you’ve all given me solid food for thought. Really like the approach to managing boarders & expectations carefully.

To be more specific, I have existing land and fortunately a partner with a non-horse paycheck. I’ve priced out a small-medium facility ~15 horse barn where I’d like to offer lessons and boarding. Yes, there was definitely sticker shock over the cost to do this - but I am mostly concerned about the actual financial/managerial side of the operation. I’m trying to make sure I’m being completely objective and looking for any & all issues that could hurt financially so that I’m not wondering into this missing all the facts.

Building new with the intent to make a profit off of that investment with only 10-15 potential clients (and that’s assuming you don’t have any horses of your own to pay for) is a terrible, terrible idea. Unless your partner doesn’t mind flushing a couple hundred thousand bucks (or more) down the toilet, or you happen to come into a large sum of money that doesn’t require a loan payment, I can’t see how the numbers will work out for you. Especially considering that you are starting from scratch and currently have zero clients, and it will take at least a year to build. There will be no income, only money flowing out, for a long, long time.

I don’t mean to be a downer, but please be realistic – this could ruin you and your partner financially, and maybe ruin your relationship too. Hope for the best but prepare for the worst – that’s my best advice for anyone considering starting a new business.

My advice would be to go work for a pro, the type of pro you really respect and eventually want to be, and see what it’s like. Learn the business side. Not the riding part – I mean the hay-ordering part, invoicing and paying taxes part, the clients who don’t pay their bills part, the injury that prevents you from working part, the finding-insurance part, the tractor maintenance, the working 60 hours a week for barely minimum wage and having to get another part time job so you can afford to show once a month, etc, etc, etc. Make sure you really, really understand what you are getting into. You may love it, or you may change your mind.

[Palm_Beach]

@rhymeswithfizz

Building new with the intent to make a profit off of that investment with only 10-15 potential clients (and that’s assuming you don’t have any horses of your own to pay for) is a terrible, terrible idea. Unless your partner doesn’t mind flushing a couple hundred thousand bucks (or more) down the toilet, or you happen to come into a large sum of money that doesn’t require a loan payment, I can’t see how the numbers will work out for you. Especially considering that you are starting from scratch and currently have zero clients, and it will take at least a year to build. There will be no income, only money flowing out, for a long, long time.

That depends on where the OP is located. I am acquainted with a trainer who purchased modular shedrow style barns, 4 stalls each, and put them in a U-shaped formation with a “courtyard” inside that had a few large sheds to serve as tack and feed rooms. Once she was up and running, she moved the sheds and built a large pavilion where people could tack up under cover instead of in the stalls if it was raining. A few years later she was able to build a small indoor, and put an overhang on one side, and moves the sheds close to the indoor, so now people can tack up under the overhang and go right into the indoor during inclement weather. Not the most scenic, fancy place, but it works for her and her students and boarders.

[Redlei44]

@Palm Beach

That depends on where the OP is located. I am acquainted with a trainer who purchased modular shedrow style barns, 4 stalls each, and put them in a U-shaped formation with a “courtyard” inside that had a few large sheds to serve as tack and feed rooms. Once she was up and running, she moved the sheds and built a large pavilion where people could tack up under cover instead of in the stalls if it was raining. A few years later she was able to build a small indoor, and put an overhang on one side, and moves the sheds close to the indoor, so now people can tack up under the overhang and go right into the indoor during inclement weather. Not the most scenic, fancy place, but it works for her and her students and boarders.

Great point. I am familiar with a small startup training/lesson/show program that failed within a year due in part to the proprietor’s unwillingness to consider any options for running the business other than those one would find at a long-established, highest-end, well-funded program. Quickly ran into cash flow issues related to staffing levels, facility expenses, etc. OP, don’t ever lose sight of high standards for horse care and professionalism, but do be willing to make trade-offs where it makes sense as you establish your business.

[anicolle]

OP do you live in a super horse oriented area? Would you be able to build barn with x amount of stalls and arena and then maybe lease part out to a reputable trainer who has established clients already? Does your spouse support this totally if it flops? What services do you offer etc?

[EventingMaff]

@rhymeswithfizz

My advice would be to go work for a pro, the type of pro you really respect and eventually want to be, and see what it’s like. Learn the business side. Not the riding part – I mean the hay-ordering part, invoicing and paying taxes part, the clients who don’t pay their bills part, the injury that prevents you from working part, the finding-insurance part, the tractor maintenance, the working 60 hours a week for barely minimum wage and having to get another part time job so you can afford to show once a month, etc, etc, etc. Make sure you really, really understand what you are getting into. You may love it, or you may change your mind.

I would second the above. Spend a few years working as the business-side barn manager for an existing program to learn the ins and outs. If you’re lucky and can get a spot at a well run barn (even as an assistant manager) you’ll benefit from learning systems and processes that work. And I don’t just mean for the daily barn operations - I mean more for the behind-the-scenes business operations and decisions.

The two most successful barns I know have non-horsey people running the business side. They oversee the financials, billing and payment collection, ordering, insurance, HR, taxes, etc. Their horsey partners manage the barn’s day to day operations (turn in, mucking, deciding who to hire, training and lessons, boarder relations, etc). Unless you’re one of those very rare people that have both the horsey talent and the business sense/interest - decide which you’re stronger at and then find a partner to complement where you’re lacking.

Also totally agree with PP that you don’t need a horse focused business course you need a business course. If you feel you need more on horse management and care - then you’re probably not in a position to start a boarding & training barn. You need to bring either the business sense or the horse management knowledge to the table - ideally both but that’s a rare breed