Tag Archives: business management

Big is a disease

Several years ago, I was in Emporia, Kansas working with Ron McDaniel doing cattle handling seminars and horsemanship demonstrations for what was then Intervet. Before we got started I was visiting with folks and had a conversation with a lady that really stuck with me.

Emporia is near the Flint Hills of Kansas where there are many grazing operations. Because of the rocks much of it has not been farmed and is still native prairie. When you drive off the main road and get out in the country, you wonder if you have gone back in time and if a huge herd of buffalo are just over the hill.

Many grazers in the area “double stock” the pastures. This means they put twice as many cattle¬†on the land for a short period of time. This is the same pattern that Mother Nature has used for as long as predators influenced large herds of grazing animals to bunch and keep moving. Fire is also still used as a tool to keep grazing lands productive, just as nature has for millions of years.

Stocker cattle are shipped in by the semi-load. Many of the operations run large numbers of cattle. This need to move and care for cattle has created a big demand for skilled livestock handlers. This is where I met Charlie Trayer and his Hangin Tree Cowdogs. He custom gathered stockers for owners with his dogs. Many of these operations ran lots of cattle and everyone talked about them being “big outfits.”

Well, back to the lady…I asked her if they had a big operation. She got real serious, kind of shook her head, and said to me, “Oh no, “big” is a disease.” The way she said it really stuck with me.

I have thought about it and watched many people and operations. I believe this lady was right. From my observation, most operations focus on getting big rather than getting better. This can cause lots of problems like to much debt, loss of production, employee or family dissatisfaction, increase in accidents and a general lower quality of life. None of these are the real things we were trying to accomplish by getting big.

When I was young working with my grandfather he was always trying to slow me down.
He did not like debt and always believed in saving first then buying. He was never a “big operator” but liked to make a little money all the time. When he died he had accumulated a large estate, people that he had done business with thought well of him, and he had helped many (including me) get started.

Gordon Hazard is a author and lecturer of cattle business ideas. The thing I think he promotes is to improve knowledge and skill and grow the business with it. He grazes large numbers of cattle, but works it in such a way he has confidence in, fits his environment, does not require huge labor inputs, and is very low risk because of a system of sell/buy marketing that works well for him. I recommend his book Thoughts and Advice from an Old Cattleman.

I have seen so many examples of the opposite of this style of management with one being my own. I was a partner in a large grazing operation. We had to graze a certain amount of cattle for a certain amount of money to make our payment. We went in to an environment we were not familiar with, ended up in a terrible drought, had way to many animals for the conditions, and everyone involved in the business side we unsatisfied. I saw first hand how people act when they are in over their head and I will never be in that situation again.

Many of the livestock operations that I have visited from feedlots, large ranches, dairies, bucking bull operations and horse outfits have so much to do they simply can’t get around it all. When you are in catch up mode, you make mistakes by compromising quality workmanship for hurry up and get it done. This creates more work, fatigue, frustration, accidents, and lack of proper care of machinery and livestock, which in the end only creates more work and financial drain. This is also when family’s fall apart and employees quit or lose moral. Please, if you are in this situation you must change something. Don’t let ego get in the way.

Steve Barrett, an accountant friend of mine in Wisconsin does accounting for several dairies in the area. I asked him who was the most profitable – small or big. He said the size did not determine profit or loss, but the management of the dairy. If I remember correctly, he said debt load was the main challenge to the dairy business.

This is off topic but there is a great story about a man fishing. He was fishing with one pole and enjoying it very much. Someone asked him what he was doing and he told them he was catching a fish to feed his family. The person suggested he get two poles, catch enough fish to feed his family, sell the others, and use the money for other things the family needs. He did and then he ended up buying a boat to make more money. To make a long story short, he ended up with a fleet of fishing boats, processing factories, huge debt, employees, and all the troubles of someone with way to much on their plate. An old friend asked why he was doing all this and his reply was so he could retire and just go fishing.

I spend quite a bit of time with a gentleman named Tim Trabon. He and his wife Patty are people that know how to live. They own a large printing business in the Kansas City area which Tim started in his basement when he was very young. He also has a ranch partnership and is part of many other organizations.

When I first met him it was at a horse event, and he was real interested in improving his horsemanship skills. He is a big operator, but you would never know it. He has good help that he trusts to do the job the are paid to do. It seems to me he has the perfect balance of business and pleasure. It would be interesting to see if his competitors have the same quality of life as he and his family do. This is a good example of being good at something and using this to create a business with a life of its own which grows to the size that still works for all those involved. With all that going on, he has improved his horsemanship (not his bronc riding skills) as much as any one I have ever dseen.

I don’t remember the lady’s name, or even what she looked like, but the words she said that evening in Emporia sure made sense to me and the more I get around and learn the more I believe…”BIG” is a disease, but “BETTER” is the cure.

~ Curt Pate