View all past Braintrust Ag newsletters here.

Edition #38

May 18, 2024

Good morning and welcome to the Braintrust Ag newsletter. That feeling you get when the email notification says “Braintrust Ag.”

A note to begin:

• A couple people have asked about hosting their own topic-specific meet ups for members. YES! That is what I hope this peer group community grows into. The community platform ⬇ has all those capabilities. Just reach out and I’ll get you started.

www.braintrustag.com/community

Alright, let’s get to the topics that will help you build a strong, sustainable ag operation.

-Clint

Here’s what we have this week:

• 🤠 Hired Help

• 🌱 Seeds

• 👨‍👩‍👧‍👦 Business Succession

• 📅 Happenings

• 🤝 Lease + ROFR

• and more…

THE BIG IDEA

BA Pro Manager Series

#6: Hiring & Managing Employees

Finding and retaining quality help is a real challenge. In this installment of the Pro Manager series, we'll explore key strategies and best practices for hiring, compensating, and managing employees on your farm.

1) Hiring Strategies

When it comes to hiring employees for your farm business, it's essential to have a clear strategy in place. Consider your farm's specific needs and objectives and develop a hiring plan accordingly. This may involve searching for employees in a handful of different ways.

Local recruitment efforts, such as ads and word-of-mouth, can tap into the talent pool within your community, potentially finding candidates who already have a passion for agriculture. Online job boards offer a broader reach, allowing you to attract candidates from a wider geographic area and potentially access specialized skill sets. Additionally, platforms like the H-2A visa program can provide a solution for seasonal labor needs, offering opportunities to bring in temporary workers from other countries legally.

By diversifying your hiring strategies and considering the unique aspects of each approach, you can maximize your chances of finding the right candidates to support your farm's success.

2) Job Descriptions

Job descriptions are vital for effective employee management on your farm. They offer clarity and structure by defining roles, responsibilities, and expectations. Here's why they're crucial and how to craft them effectively:

Why Job Descriptions Matter

• Clarity and Expectations: They spell out duties clearly, reducing confusion and improving job satisfaction.

• Recruitment and Hiring: Detailed descriptions help attract candidates with the right skills, saving time and resources in the hiring process.

• Legal Compliance: They ensure adherence to labor laws and safety regulations, minimizing legal risks.

Key Components

• Job Title: Clearly states the role's title and level of responsibility.

• Summary of Responsibilities: Provides an overview of primary duties.

• Qualifications and Requirements: Outlines necessary skills, experience, and education.

• Physical Demands and Working Conditions: Describes any physical requirements or environmental factors.

• Reporting Structure: Indicates reporting relationships within the farm.

Creating Effective Job Descriptions

• Be Specific: Use clear language to avoid misunderstandings.

• Tailor to Your Farm: Customize descriptions to fit your farm's needs.

• Include Feedback: Seek input from current employees to ensure accuracy.

Investing in detailed job descriptions sets clear expectations, attracts the right talent, and facilitates effective management on your farm.

Use this sample to base your job descriptions off of.

3) Compensation

Compensation is a key factor in attracting and retaining top talent on your farm. In addition to offering competitive wages, consider implementing incentive-based pay structures to motivate and reward employees for their performance and productivity. Here’s some potential incentive based pay strategies:

Performance-based Bonus Structure

• Task-based Incentives: Bonuses for completing tasks above a set threshold, like rolling up a certain number of hay bales or harvesting a specific number of acres.

• Quality Metrics Bonus: Bonuses tied to quality metrics, such as reducing crop damage or achieving higher-than-average milk production.

Profit Sharing Schemes

• Transparent Profit Sharing: Share a portion of overall net profits based on length of service and role, distributed quarterly or annually.

• Enterprise-based Profit Sharing: Allocate a percentage of profits linked to specific enterprises like bull sale results or farmers market sales.

Efficiency and Cost Reduction Incentives

• Resource-saving Bonus: Bonuses for practices that yield verifiable cost savings, like reducing feed costs or water usage or spray $ per acre.

Skill Development and Leadership Bonuses

• Certification Achievements: Bonuses for achieving certifications in pesticide handling, animal care, or organic farming.

• Mentorship Roles: Additional pay for experienced workers who train new employees.

Seasonal and Longevity Rewards

• End-of-Season Bonuses: Bonuses for employees who commit to an entire season, increasing with each successive return.

• Anniversary Bonuses: Annual bonuses growing incrementally for each year of service.

A Total Compensation Statement is a tool to help keep good employees by visually reminding them they’re earning more than just a cash wage. When employees see their total compensation, it helps them realize the true value of their job.

I put together a Template you can download to help with annual reviews and/or hiring.

4) Employee Handbooks

An employee handbook serves as a valuable resource for both you and your employees, outlining important policies, procedures, and expectations for behavior and conduct on the farm. Cover topics such as safety protocols, time-off policies, and disciplinary procedures to ensure a smooth and well-managed work environment.

Michigan State University has an Agriculture Employee Handbook Template available for download. 

5) Ongoing Employee Management

Once you've hired employees, it's essential to invest in ongoing management and support to ensure their success and satisfaction in their roles. This may involve regular check-ins, performance reviews, and opportunities for professional development and training. By fostering a positive and supportive work environment, you can cultivate a dedicated and motivated team that contributes to the overall success of your farm business.

In conclusion, effective hiring and employee management are critical components of being a pro manager. By implementing strategies such as clear job descriptions, competitive compensation, and ongoing support and development, you can attract and retain top talent and position your farm for long-term success.

SEEDS

• 🧓 Age: This article makes the case that the age of US farmers is not an issue, and that in fact, US farmers are becoming younger, not older, relative to the US population.

• 🍅 Organic: A new record for organic sales was hit. Nearly $70 billion of organic products were sold in 2023 (up 3.4%) with produce claiming the top spot at 29.4% of consumer sales.

• ⚖️ Entities: Protecting farm assets through an entity is often a good choice, but what are considerations we ought to think about when choosing what type? This article summarizes various structures.

• 📱 Accounting: I found this guide to the basic principles of farm accounting that could be handy for those looking to improve on their grasp of farm income & expenses.

• 👨‍👩‍👧‍👦 Succession: Yours truly had a blurb on farm transitions, properly treating ag operations as businesses, and general succession planning thoughts.

• 🐂 For Fun: #88 still hasn’t had her calf… but we’re all getting some great explanations on her care and status updates.

BUSINESS SUCCESSION PLAN

An independent seed dealer, who also farms a bit on the side, asked about transitioning his ag retail business to his son.

An ag business succession plan follows pretty much the same steps as a farm succession plan.

Here's the 3 general steps:

These general phases keep the process moving forward. Also, this is how a non-family transition can happen as well.

I'd end with stressing this key point: a realistic timeline with two willing parties is crucial.

So best not to wait until the 11th hour.

Become a member today for lifetime access to everything. It’s a small one-time cost with NO recurring subscription.

PEER GROUP HAPPENINGS

A couple mentions on what Braintrust Ag members are up to:

1) Upcoming Zoom member meet-up; Topic - Mental Fitness

Click the image above for the link.

2) Considering starting a regular, early morning Zoom small-group…

Basically a personal development meets Bible study meets mental fitness small group.

Let me know if that’s something you’d be interested in. Also, I will need recommendations for books/guides to follow.

[email protected]

OPPORTUNITY

A member posted this opportunity in the forum. For those who haven’t had a chance to see it, I figured I’d also mention it here ⤵

If you get value from these newsletters, consider joining 250+ other ag people and become a member of Braintrust Ag. Your support makes this content possible.

Lease/Will/ROFR Scenario

Young guy forged a solid relationship with an aging landowner.

Older gent's last will & testament gives the young farmer the option to buy the rented 160 acres. Very favorable terms.

No written lease agreement in place - just a handshake deal.

The farmer is working on getting a written crop share lease in place. And he ought to be negotiating for a "right of first refusal" provision.

Why, if the option is in the will?

2 reasons.

--> The will doesn't go into effect until landowner passes. He (or his POA) could sell the land prior to death.

--> Landowner could unilaterally change his will & remove the option. The lease can't be changed without the young guy's consent during the term.

Just some added protection & assurances for the young farmer.

MEME OF THE WEEK

That’s a wrap, folks.

Until next week, thank you to everyone involved in ag.

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DISCLAIMER: All content, communications, and resources provided by Braintrust Ag, its principals, operators, or members is intended to merely be educational and entertaining. Nothing published by Braintrust Ag should be relied on as legal, financial, investment, or other professional advice. Investments and legal matters involve substantial risk and are not suitable for all individuals. It is recommended to enter into a client relationship with an ESP for obtaining professional advice.