Many equine businesses are part-time or side enterprises to help support a rider’s own horse habit. Nothing wrong with that, except not running it as a true business! Here are ten ideas to help you run even the smallest equine enterprise as a Fortune 100 company.
Five Ideas That Any MBA Will Tell You
Have a business plan. Without a plan, how do you know where you are going? A business plan doesn’t have to be elaborate or be developed from a complicated template. Define your organizational structure (sole proprietor, LLC, partnership, S or C corporation), your principle players, your product or services, provide a competitive analysis, and where you would like to be in 5 years.
Set up a separate checking account for the business. It is very important to not co-mingle personal and business expenses and income. Keep detailed records of these important finances.
If you have employees, do not treat them as servants. They are your teammates, so communicate expectations, provide constructive criticism and flood them with praise (when deserved). The cost of a vacancy, hiring and training their replacement is huge.
Have adequate insurance: property, liability, medical. Don’t forget Workman’s Compensation insurance, if you have 4 or more employees.
Document everything. If it isn’t written down it didn’t happen. Keep a notebook by the phone and in the tack room. Another in your vehicle and your kitchen. Date every entry. Even trivial entries might help resolve a problem in the future.
Five Ideas You Probably Have Not Considered
I recently began teaching a new course titled “Logistics for the Horse Industry”. This bachelor’s level course sources information from Microeconomics, as well as the new field of Logistics and Supply Chain Management. We are looking at transferring innovative and new business topics to the equine industry. Here are some of those new concepts:
Target your sales audience. Instead of placing internet ads on broad based websites, direct market your sales horse to the specific audience he/she is best suited. Selling young, home-bred stock? Direct mail an information packet to riders who specialize in starting horses in your discipline. What about a great amateur show horse? Direct mail video to trainers who specialize in competitive amateurs.
Survey customers post-purchase. Was their experience exceptional? Was your staff helpful and well-informed? Did their purchase exceed their expectations? Use this information to improve customer service.
Utilize an “app” or online program for lesson sign-up. Most trainers spend way too much time contacting students to set up lesson times. I know I do! Set aside blocks of time for lessons and let students sign up. Client Manager Billing & CRM app is not free but will email clients the day before their appointment and allow you to track income. Also, set aside time each day (just like a lesson) to return calls and keep your business organized.
Know your capacity and break-even points. What is your horse capacity? Lesson capacity? Horses in training capacity? How many weekends are spent at shows? Clinics? Is your break-even point at 90% capacity or 60% capacity? If it is closer to 90% capacity, you don’t have much room for profitability. Our industry is always at risk of economic downsides. Having better understanding of your capacity and break-even points can prepare you for those downsides.
Outsource anything that takes away from your profitability. We all take pride in that flowerbed at the front of the farm, or the ability to fix fence ourselves, but business profitability might be better served by spending time in lessons, or on the phone selling a horse. If you can’t afford hiring outside help, perhaps you can barter services with a boarder or student.
Our industry faces many challenges today. Customers rarely have grown up in a rural environment with horses. Instead they watched horses on TV or attended a summer camp that sparked their passion. Our industry faces challenges from the animal rights groups, who would like nothing better than to end animal ownership. As population of this planet grows, land is in demand for human housing or human food production. If we are to have a horse industry in 50 years, we need better business skills and be prepared to adapt to customer needs and expectations. After all, do you need a drill bit or a hole drilled?
Judy Downer, Ph.D. is the former director and professor of Equine Studies at the College of Central Florida in Ocala. She taught courses in Equine Business Management, Equine Sales and Marketing, as well as the new Logistics for the Horse Industry. In addition, she is a USEF S Dressage Judge, and an active competitor and coach for adult amateurs in dressage. Her formal training is in science (nutrition to be exact), she worked 20 years in the animal health industry, where she had the good fortune to perform technical service, product development, test markets, customer focus groups, management of customer complaints, and employee management.
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