Running an equine business is unpredictable. It’s important to take a step back and evaluate what is or isn’t working for long-term success.
Here are three tips for assessing where your business is now so you can better plan for the future.
Review Financial Statements
Money is the most visible measure of success. The total cash on hand or in a bank account means you can pay the bills, cover payroll and have enough left to pay yourself. However, the amount of cash you have available doesn’t provide a full picture. Reviewing your income statement, balance sheet and cash flow statement illustrate how money is moving into and out of the business.
“You have to look at the costs, income and profitability of each of your horses if you are a lesson barn and of your business sectors if you run a hybrid business of boarding/training/lessons/etc.,” said Barbara Lindberg, the equine business management director of Cazenovia College. “This requires breaking expenses and income down and attributing them to their various areas or horses that are incurring or earning them.”
If you discover that you have a horse that actually doesn’t pay his way, you might have to admit that he is actually a pet and the business shouldn’t be supporting him. That doesn’t mean you can’t keep him and support him personally, Lindberg said.
Ask for Feedback
Your stable can’t survive without clients. Find out what is working, or not, for your clients. A one-on-one conversation is a good place to start. A suggestion box or an online survey are other options for gathering insight on what customers appreciate or what they would like to see changed.
Barns that have staff should check in with employees, too. Check to find out how staff feel about your business, according to Kimberly LaComba, PhD, an assistant professor of equine business management at the University of Findlay. This can be done daily, weekly, monthly, and/or yearly.
“It allows for the team to be reminded that they are working toward common goals and to know if they need to make adjustments, which is common and okay, or if the goals have been attained,” she said.
“Equine businesses will benefit from having specific goals that include steps on how they will reach those goals,” LaComba concluded.
Quantify New Customers
It’s important to know how many new customers join your barn every year and what attracts them. Review the total number of first-time clients and strive to understand which services are attracting the most new business. Is your lesson program driving growth or is it training or hauling services?
Once you understand what attracts customers, determine how you can better use that as a competitive advantage and gain even more clients to your business.