Women Owned Horse Farms: A Formula for Success Sandy Hamm, Research Associate University of Arkansas, Division of Agriculture Owner/Manager, Sandy Hamm Horses

Economic Impact $102 Billion Industry $32 Billion Recreation 9.2 Million Horses 9.2 Million Horses 1.4 Million Jobs 1.4 Million Jobs Source: American Horse Council, June 2005 Source: American Horse Council, June 2005

Why Horse Farming? Agritourism - Horse Recreation industry generates $32 billion annually Small Farm Advantage – acreage requirements are minimal Urban Sprawl – Agritourism prospers with city growth

Horse Farming Growth

Agritourism Impact

Agritourism – Horse Recreation

Why Women Owned? Women run farms increased 58% from1978 to 1997 (2002 census of Agriculture) Historically women have operated small acreage livestock farms (ERS/USDA) The overall increase in equine competition sports encourages women owned farms

Women are Operating a Larger Share of U. S. Farms

U.S. Farms with Women as Primary Operators

Horse Farming What You Need to Know

Initial Investment Farmland Quicken Books Website Equipment

Financing Business Plan ◦ ‘A Must Have’ to secure financing ◦ Strategic planning for horse business ◦ Business goals Lending entity

Getting Started – Financing (Blue Ribbon Business) Borrowing PhaseRisk LevelFunding Source Start-up StageExtremely HighFour F’s Angel Investors Early StageExtremely High to Very High Four F’s Angel Investors Venture Capitalists Expansion StageModerate to HighVenture Capitalists Go Public Banks Later StageModerate to LowBanks Venture Capitalists Stock Sales Bond Sales

Farm Income – Deciding How to Specialize

Boarding

Boarding ◦ Flourishes with urbanization ◦ Small farm advantage ◦ Who is your target customer?  Performance horse owner  Large initial investment  Stabling and limited turn-out, labor intense  Trail and pleasure horse owner  Content with paddocks and turn-out sheds  Happy to ride in meadows and on trails

Boarding – What is Important ◦ Contracts  Used to secure agreements ◦ Nutrition  Know how to feed the different types of horses ◦ Specialize in grouping horses  3-4 in a pasture  All eat similar ration  Personalities ◦ On sight caretaker

Boarding – Average Monthly Costs TargetPerformancePleasure Stall (shavings $5/day)$190/month$0 Pasture$6.50/month Grain (6-10 lbs/day)$39.60-$66.00/month$.88/$1.32/month Hay (22lbs/day)$97.50/month$66-$86/month for 7 months Labor ($11/hour)8 hours per day/total horses 2 hours per day/total horses Other (insurance, fuel)$31/day/total horses

Boarding - Rates TargetPerformancePleasure Total Monthly Costs$ $479.00$ $ Total Boarding Fee$ $600.00$ $ Profit$97.40-$121.00$ $164.18

Feed Rations – Performance Horse Ration #1PelletsAlfalfaGrass HayTotal #2Sweet FeedAlfalfaGrass HayTotal #3Rice BranAlfalfaGrass HayTotal

Hay Calculator

Sales – Renewable Horses

Sales & Marketing – Renewable Horses Specialty Niche Market - Giving retired thoroughbred race horses a second career Reaching Your Target Customer  Riding Lessons, Trail Rides  Club participation  Working Students

Sales & Marketing – Renewable Horses Advertising ◦ Word of mouth ◦ Website ◦ U-tube (video) ◦ Horse rental ◦ Horse shows

Breeding vs. Buying to Sell Avg. Yearly ExpensesBreeding to Sell Operation Buying to Sell Operation Purchase Price Grain (2-8 lbs. per day) Hay (20-30 lbs. per day)1170 Veterinary (annual)150 Blacksmith Breeding Expenses23200 Foal4240 Sale5000

Breeding vs. Buying to Sell Avg. Yearly ExpensesBreeding to Sell Operation Buying to Sell Operation Total Invested 1 st Year$8,386$3,929 Total Costs each additional year $5,386$2,429 Break-even Year two $13,772$6,358

Riding Lessons

Useful Marketing Tool Lessons Buy Board

Riding Lessons ◦ Low-cost supplement to farm income  One lesson horse & schooling tack required  Your time  $25/one hour  $35/half hour ◦ Tax deductions can apply  Equipment, feed, hay ◦ Certifications available  Teaching and Training

Summary ◦ “Business success is based on 2 main criteria: Fair Prices and Good Service” (Horse Economics)

Summary ◦ Track daily costs ◦ Monitor grain and hay prices closely  Adjust feeding rations when needed ◦ If selling horses, watch break-even point  Be ready to drop price and sell ◦ Stay on top of current farming practices and trends by attending classes and reading ◦ Consult a tax accountant for savings tips

References & Suggested Readings 1.O’Brien, Catherine E., “Horse Economics” 2.Olsen, Lisa Derby, “Blue Ribbon Business” 3.ERS/USDA “Amber Waves”, issues Sept & Dec. 2007

Women + Horses = Success!