Bulk buying machinery can have huge cost savings, but if it means working with another operation, it can also come with a price. Whose land is priority, should all of it be ready at once? Who’s operating what? How do you manage fuel? Time? And how do you prevent conflict, in a transaction that’s all too often nothing more than a handshake?
Read more on farm management: What will your farm management structure look like in 5 years?
Some farmers are managing all of it through a business endeavour to join farm operations. Land is kept in the name of the individuals, with machinery and inputs shared between the corporation. The benefits go beyond the purchase price difference for bulk buying, to include: labour, a diverse knowledge base, and team support. Challenges, though significant, are largely considered and communicated in meetings throughout the transition period.
RealAgriculture’s video guy, Jason Stroeve, caught up with Dean Gallimore, a chartered accountant and business evaluator, at the recent Alberta Canola Producers’ Association meeting to talk large-scale joint ventures like these. In this video, Gallimore describes how creating a joint business venture is possible for farmers, citing one example in particular where four farms came together to share income, assets and knowledge.