This morning I found a great post on the Executive Link private Facebook group. A current EL member was looking for input on information that he should share with the landowners of various properties that he leases. There were several great suggestions ranging from wildlife population status to water infiltration rates. After weighing in myself, I went about my day.
The route this morning led me across all three of our private leases. With the Facebook conversation fresh on my mind and the leases under my feet, my mind was very preoccupied with one question: What customer value do we provide to our landowners?
Healthy lands, reducing bare ground and increasing effective rainfall.
Infrastructure maintenance and improvement.
Opportunity for family in…
“WAIT A DAMN MINUTE!!!” Suddenly it slapped me upside the head. “WE write the check to them. THEY deliver a product to us in exchange. WE ARE THE CUSTOMER.” I reframed the question. What customer values do our landowners provide to our business?
Doesn’t it seem like some people work endlessly trying to find leases? Knocking on doors, ringing phones, buying advertisements, pounding the pavement. Then when they do finally find a chunk of land available, there is an inevitable conflict. Sometimes there is a difference in perception of proper land care, infrastructure maintenance, price structure, or just plain old personality differences?
Meanwhile others are having leases seemingly fall in their lap. They are turning down leases that don’t meet their needs. They are developing relations leading to exceptionally long terms, and/or leasing at significantly reduced prices. Is this second group of people just lucky? Or do they expect to be treated as a customer? Have they done a much better job of honing their mindset and defining their own mission and vision, which allows landowners to seek THEM out?
There are obviously things that a landowner must have control over. For example we wouldn’t expect to lease an excavator, then cave in the cab or run a track off and expect to pay the same price as if we had taken exceptional care of the machine. Nor should we expect to overgraze plants, overstock land, or allow fences to fall down and not have to suffer some consequences. At the same time though, leasing that excavator (should) come with a promise of rapid service response, timely pickup/delivery, affordable rates, etc. What kind of customer values should you expect from your landowner? That all depends on your business and the expectations you have of your business.
In ranching most of us are price takers. Whether we want to admit it or not, most of us still take what the market gives us. Some have figured out how to understand market relationships in order to make the market work better for them. Others have found customers willing to allow price setting. Could there be similar opportunities with leasing land? Can we better understand relations in order to make the lease work for us? Could we become such a sought-after customer that we can set our own price? There are people doing both of those things. Fair lease price is only necessary for benchmarking and finding the deadwood in our business. Otherwise, it is another substantial overhead in an industry that is struggling with high overheads. In the words of my late uncle, “Fair is where you go to see the hogs.”
So, what did I discover when I reframed the question? We provide customer value to each other. Our mission and the mission of our landowners seem to align. Not perfect alignment, but enough so that if a wire gate needs tightened, you would be just as likely to see the landowner stretching it as me. Enough that you will find the landowner in our pens on shipping day. Enough for us to get to implement some of our “crazy” ideas on their property. Enough alignment that if somebody were to offer them more money, shorter terms, or a generally sweeter deal, that person would be shown the door.
At our Ranching for Profit Schools we spend four out of the seven days working to develop your people management skills. We help you establish clear goals for you, your family, and your business. We teach you the tools to hold people (including yourself) accountable for the results you want without damaging relationships. In addition to understanding and excelling at husbandry and ecology, you need to develop your people management skills to run a successful profitable ranch business.