The Role of a Ranch Management Company

By: Justin Bryan

Historically, the most reliable predictor of a successful farm, ranch, or recreational operation is a competent, honest, and qualified management team. This team should have the owner’s interests at heart and possess the attributes necessary to effectively manage the property. In the end, their oversight of the property and relationship with the owner will have profound long-term implications toward the success of the property and ultimately influence those who may desire to purchase it in the future.

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The real pleasure a landowner receives from ownership is obtained when he/she is confident that the property is being properly supervised.  When this occurs, the owner, family, and friends will be able to enjoy it as intended both from the operational and the recreational point of view. The enjoyment of ownership is what we term the “psychic return” and is a significant part of the “return on investment” derived by the landowner. Each landowner has his or her own unique needs – large and small – and matching those with the correct management system is the key to successful property management.

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For the on-site landowner who is consistently present and knowledgeable regarding rural property management, the ability to guide the daily tasks and develop valuable relationships with the staff creates a healthy environment to thrive upon.

In contrast, many rural properties are owned by on-site individuals who lack a real understanding of the unique aspects of rural property management. This can often result in poor overall performance of staff at which point ownership ceases to be enjoyable. A common example of this would be a situation in which the principal managing family member passes away and an inexperienced family member is required to fulfill the duties. Then there are the true absentee landowners. This inherently creates the most challenging situation for staff and owners to communicate clearly. Often the managing director of an absentee-owned property is an estate executor or a successful business person who, although accomplished in their chosen field, lacks knowledge in real-world rural property management. Procuring the right people in place who “ride for the brand” and perform their job as expected can come in a variety of forms to meet the requirements of each type of landowner.

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In terms of management, each type of landowner is afforded a few options regarding administration and on-the-ground labor. Their requirements might involve simply livestock and/or agriculture, or they might involve a mix of livestock, wildlife/fisheries and the maintenance/restoration of buildings. These choices include traditional staffing, farm and ranch team consultants, or a hybrid mix of traditional on-site staff with consultant oversite. Each of these staff options have pros and cons and must be evaluated by landowners whose needs are unique unto themselves. The selection of the system that best fits the owner provides the opportunity for the “return on investment” – either psychic or financial – that is desired.

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Traditional Staffing

It is a unique individual who chooses to be a beneficial source of labor and knowledge on a rural property. Ranch employment is not your average everyday eight-to-five job and, therefore, necessitates a high-level of personal commitment.  Be it a livestock guy or gal, wildlife biologist, or all-around ranch hand, reliable and competent employees are a must. To alleviate poor hiring choices, those individuals who are well-vetted by someone who truly understands what is required on the property and knows the owner’s expectations often have the best opportunity to succeed. These individuals provide a stable platform upon which a property can thrive. The relationships that can be built between an owner and long-term staff are rewarding as both entities work in conjunction to develop the property and see it flourish over time. Staff turnover, when it occurs, can, unfortunately, be the most expensive, stressful, and time-consuming issue in farm and/or ranch ownership causing the enjoyment of ownership to begin to wane.  If and when employees leave, they take with them the comprehension of what is actually required to permit a property to operate efficiently and effectively – from water systems to haying, livestock to bill paying, to hunting operations. Their knowledge of the property derived from a long tenure can be challenging to replace.

Farm and Ranch Team Consultants

Acquiring the services of a rural property management firm is an option available to landowners, especially absentee landowners or estate executors who desire to immediately have in place a proven team focused exclusively on their needs. This independent focus allows the firm to work with and typically mentor the on-site staff, and it allows them to always be part of the solution for the landowner and never part of the problem. A firm such as this can effectively manage the increasingly complex federal and state environmental regulations, changing national and world markets for livestock, crops and timber, critical water and mineral rights issues, and tax considerations on any given property. The firm’s experience with multiple successful operations gives them a high level of current knowledge and practical expertise for these details to be dealt with correctly and in a timely and professional manner. In this situation, the owner/executor is assured that the property is being taken care of properly. In addition, a history of professional management is, without a doubt, a major advantage if and when the decision is made to sell a property.

Hybrid Management

A hybrid management scenario occurs when a landowner desires to have competent staff on-site in combination with supervision expertise from a management firm. This allows for the management company, which has extensive exposure to a diverse array of operations, to provide operational oversight on a broad spectrum of ranching enterprises while the boots on the ground fulfill the daily tasks. A hybrid system is commonly utilized by all three types of landowners who desire to maximize profits and minimize potential headaches.

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Desirable Management Services

  • Budgeting, accounting and bill paying
  • Creation and execution of natural resource development and business plans
  • Asset evaluation including land, equipment, structures, herds, crops, fish, wildlife, and other tangibles such as the human resources available
  • Product sales and marketing services
  • Recruitment and hiring of management level personnel
  • Direct management and/or consultant services to staff
  • Periodic oversight of operations
  • Direct management of deeded properties, leases, and grazing allotments

Such services are most often chosen a la carte per the landowner’s needs. These can be as complex as the cost-benefit analysis of financing farm equipment, restoration of wetlands and/or native grasslands, or habitat mitigation credits. Or as simple as periodic oversight, bill paying and monthly reports or consultation with or mentoring of staff.

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Managing quality rural real estate properties, be it commercial farms or ranches or prime recreational retreats, can be a daunting challenge. This is particularly true for absentee owners, but even full-time resident owners can often benefit from the outside perspective of an experienced farm/ranch management firm. Ultimately such services should ensure that details of the property are being properly taken care of to allow the landowner to fully enjoy his/her property with family, friends, and business associates.

Hall and Hall is one of the few companies that provide management services and the recruitment of management level employees on behalf of landowners across a broad geography and property type. Please feel free to contact one of our offices if we can be of help. It is the stated purpose of our management group to make the ownership of rural land a positive and worry-free experience for our clients.