Chris Salko has the rugged look of a man who has spent most of his life outdoors. “I grew up on this farm,” he says, gesturing out the window. “My dad had cows, pigs, horses, chickens. But, gradually, everything else went and it was just the horses.”

When Andrew Salko bought his farm in the late 1940s, Southport, Conn., was still a sleepy rural community with roots deep in Colonial history. There were horses and ponies everywhere, owned by farmers and local residents who valued the pleasures of country living. The Fairfield County Hounds still sallied forth from the Fairfield Hunt Club in adjacent Westport. Riders who would become part of the first civilian U.S. Equestrian Team were schooling in local rings. A thriving bridle trails association of local landowners kept a rambling network of trails open for foxhunters and recreational riders.

All that changed fast over the next 20 to 30 years as homes replaced farmland. And by the time Chris Salko graduated from high school in 1972, commuters riding trains into the Big Apple were commonplace.

Location, Location, Location

When his father retired in 1973, Chris took over management of the farm, which had evolved into a 10-stall boarding facility. He began upgrading and expanding, plowing profits from boarding back into farm improvements while an off-farm job provided other income. The old converted dairy barn was repaired and repainted inside and out. A smaller cow barn was retrofitted with new floors, interior walls and aluminum stall bars. Chris added a shed to hold loose shavings, a concrete slab to store manure and remodeled an old chicken coop into more stalls and a machinery shed. New roofs went up on barns and outbuildings. He remodeled and refurbished until there were 19 stalls in three buildings that always gleamed with fresh red paint. “I had boarders year ‘round and always had a waiting list for many years straight,” Chris says.

Salko Farm benefitted from the demographic trends that were reshaping Southport and all of Fairfield County around it. Salko was expanding boarding capacity just as development was eliminating many available stalls throughout the area. The location was attractive to boarders not only because the farm sits at the center of the trail system south of the Merritt Parkway, but also because of its “in town” location. It was a 20-minute or longer drive to reach other stables. Boarding at Salko Farm simply meant more time with your horse and faster access to riding trails. The farm’s 10-acre turnout was another attraction for many boarders.

A New Partner

In 1994, Chris married Teddie Lok. Among the things Teddie brought to their new partnership was her background in business. With degrees in business and English from St. Michael’s College in Vermont, she had worked for the investment firm of Smith Barney and sports clothing manufacturer Le Coq Sportif.

As the area’s population continued shifting from farmers and country folk to commuters and relocated city dwellers, Chris was getting more and more calls for riding lessons. In 1995, he decided to test the waters. He bought one school horse and a Pony Club graduate became a part-time instructor. When she moved on, a full-time instructor and another lesson horse filled requests for lessons. The business arrangement was very simple. Chris provided the horses and facility while the instructor handled all scheduling, horse preparation and teaching. They split the lesson income fifty-fifty.

“I was hands off, basically,” Chris says. “We either broke even or lost money.” Teddie, meanwhile, had become a commuter herself, working in nearby Stamford. That changed when their son was born in 1995. “I wanted to be able to be at home with him,” she says. “I thought, ‘Why don’t I take over running the riding school?’ ”

A New Business Model

The riding school needed to replace Teddie’s off-farm income in order for her to justify staying home with her son. She immediately made several important decisions. First, she acknowledged that her past horse experience did not necessarily qualify her to run a horse business. Second, she knew from her past business experience that successful businesses are not run by trial and error. They have a plan.

The Salkos turned to Bob Brooks of Horse Country Real Estate in East Lyme, Conn., for help. For years he ran a high-profile Morgan horse training and breeding farm and as he saw other needs within the industry, he moved to fill them. As others approached him for advice on how to start training or breeding businesses of their own, he developed an active consulting practice. Brooks and wife Patti also started Horse Country Real Estate.

Brooks made Chris and Teddie look at Salko Farm in an entirely new way. First, he pointed out that, given their prime location and the scarcity of available stalls in the immediate area, they could ask much more for board than $400 a month. Second, he made them look at each stall as a profit center and consider how much monthly and annual income they could get from that stall if it was occupied by a lesson horse versus a boarder. Third, he made them think hard about how to maximize the farm’s lesson capacity. Fourth, he made them take a pragmatic look at the kind of lesson horses they needed in order to maximize income per stall. While Teddie acknowledges they have not followed all of Brooks’s recommendations to the letter, he opened their eyes to a new business model that could generate the income they wanted.

Sticker Shock

When the Salkos surveyed the boarding fees charged at other area stables, they saw that the Fairfield Hunt Club less than a mile down the road charged almost twice the amount they did and stables much farther north charged as much or more than Salko Farm. Though some farms had indoor arenas to justify their higher boarding fees, Brooks pointed out that the Salkos had their prime location right on one of the three remaining equestrian trail systems in Fairfield County to trade on. Further, they had not considered that the average income of Fairfield County residents had skyrocketed since their high school days. Given the simple law of supply and demand, they were not charging what the traffic would bear.

Through the years, Chris had steadily raised the board in $50 or $100 increments from the $95 his father had charged. Sure that he would lose a large percentage of them, Chris alerted boarders that he was raising the monthly board substantially. To his amazement, they stayed. As boarders eventually moved or sold horses or left for other reasons, Chris gradually filled the stalls with lesson horses. Seven boarders still remain, housed separately from the lesson horses in the smaller converted cow barn and the board is now $800.

Will Work for Food

When a stall is occupied by a boarder, $800 is the most monthly income it can produce for the farm. When a lesson horse occupies that stall, however, it can provide a much higher cash flow. “The goal,” says Teddie, “is that the horse has to, at the very least, make what the board would be.” That puts the current “break even” point for a Salko Farm lesson horse at, on average, a very modest four lessons per week.

“You really have to know your numbers,” Teddie notes. One parent offered them $5,000 for one of their better school ponies, then upped her offer to $10,000 when Teddie declined. That pony, she notes, is one of their best school horses, earning about $2,500 monthly for the farm. “Over a year’s time,” she explains, “he is worth far more than $10,000 to us.” Without knowing those numbers, she admits that the offer might have tempted her to part with the gelding.

“I have daily sheets and the instructors write down which horses they use,” Teddie says. “I go through each month and tally which horses are doing what, which horses are doing too much and see which horses aren’t working enough. If the horses aren’t doing enough, then we try to get more suitable horses.” One of the hardest things, she admits, is getting rid of the horses that don’t make the grade. But good business dictates there is no room for pet horses.

Safety is one of the primary reasons that Teddie has let some horses go. “We have 90 percent beginners,” she explains. If the horse doesn’t have the right temperament to be suitable in their program, it simply won’t work out. Other times, she notes, the instructors don’t like a horse for one reason or another. “We’ve bought a lot of horses and lost a lot of money on a lot of horses,” Chris admits, “but I’d rather lose a thousand today than spend the money to take care of the horse for another two or three months.”

More Improvements

Building a string of lesson horses also meant acquiring tack—lots of it. Again, Teddie emphasizes safety. “You have to have good tack,” she explains. If someone files a lawsuit, you want to make sure there is no reason for a lawyer to say you were at fault for anything. Everyone at Salko Farm rides with an ASTM-approved helmet and the farm provides them to riders who don’t have one of their own. The farm also requires paddock boots for safety. Teddie does note that she tries to help parents minimize their investment in riding equipment until they are sure their child is going to stick with the sport.

As the lesson program began to evolve, Chris realized that the farm needed more than the adjacent trails and a ring worn in the topsoil. He invested almost $17,000 in a new 100-foot by 160-foot outdoor arena built with a surface for year-round use.

More recently, the Salkos added a second, slightly smaller ring adjacent to the first. This newest addition allowed the farm to increase the number of weekly lessons it can offer by about a third. “We start everybody out with private lessons here,” Teddie explains. “We don’t start kids in group lessons until they can canter by themselves.”

Another large expense was building a kitchen/classroom/lounge area with bathroom facilities. Dubbed “The Tack Room” although it’s for people rather than horse equipment, it has proven an enormous asset. It gives parents a place to get a cup of coffee or to sit and read. Instructors can warm up inside during winter months. and during the summer it becomes headquarters for the farm’s camping program.

To finance these improvements, the Salkos took out short-term loans and tapped into savings, but made paying both themselves and the bank back a top priority. “It’s essentially taken us five years of putting all the money back into the business,” says Teddie. “We haven’t lost any money and I think that’s because we’ve done it slowly.”

And, while doing it slowly meant taking more time to reach their break-even point and become profitable, it also allowed them to control the amount of work required of both horses and instructors. “If we borrow,” says Teddie, “that means I’m going to have to make my horses go around twice as many times as they should and they’re going to burn out.”

Will Work for Wages

After horse-care costs, staff expenses are the farm’s biggest expenditure. Chris has one full-time employee who helps him with every aspect of horse care and farm maintenance and another part-timer to help clean stalls daily. He hires seasonal help when he cuts and bales hay, which is primarily sold to local landscapers. Three part-timers help with the lesson program. They groom and tack horses up, help clients mount and keep the tack clean.

“The hardest part of this business is finding good instructors,” Teddie says. Because the surrounding area is so affluent, many people who are qualified to teach either show or simply do not need the money. Chris also notes the importance of having teachers who are good role models. He looks for non-smokers who understand the importance of coming to work on time and keeping the lessons running on time.

“This is a service business,” Chris says. “If Susie’s mom is paying for a half hour lesson, she should get 30 minutes.” The Salkos have clocks prominently placed around the farm and keep them all synchronized.

The Salkos currently have three full-time and one part-time instructor. They work on an hourly basis as independent contractors with their pay rate reflecting their experience. “We’re pretty much hands-off managers,” Teddie says, although experience has taught her the value of having a single person doing all scheduling and bookkeeping. “I do all the scheduling and billing and I tell the instructors that if anybody has a problem, they should come and talk to me.” The result has been clear lines of accountability and smoother operations. Teddie does not use software for scheduling, just some simple charts she designed herself.

A Clear Mission

One of the best things about no longer being totally dependent on boarders, Chris says, is that he can be much more selective about who boards at the farm. He no longer has to put up with people who are forever critical, dissatisfied or unpleasant to farm employees or other boarders. The same selectivity is also true of lesson clients. “A neighbor says I’m the only guy he knows who fires his customers,” Chris grins.

People pay for five lessons in advance and Teddie has a very strict 24-hour cancellation policy. “One of the hardest parts of this business is that people look at riding lessons like a play date. They don’t see it as a business, don’t realize that if they don’t show up, we’re not making money. If they don’t show up, there is still a horse tacked up for them and we still have to pay the instructor. We could have put somebody else in there. We always have a waiting list of people who want to ride.”

Salko Farm also tries to weed out the nasty people. “We tell them we think they’d do better at some other place,” Chris says, and he offers them the names of other stables in the area. “It’s the same thing I used to tell my problem boarders,” he says.

One thing that becomes clear in talking with Teddie and Chris is that they want Salko Farm to be a place where people come to enjoy horses and have fun. If there’s one thing Teddie would change, it would be the amount of time she spends on the telephone. “I get about 20 calls a day,” she explains, as people call to inquire about, schedule or cancel lessons. Still, the constantly ringing phone is proof that the priority placed on a happy experience for themselves, their horses, their employees and their clients, is another business decision that has paid off.

Profit Center

The owners believe every business should be diversified enough that if one source of income drops off, there are others that still pay the expenses. Salko Farm produces income from six different activities:

Private lessons: Private lessons cost $50 for a half hour, $100 an hour. Teddie says she tried discounting the hour lessons at first, but concluded that the discount did not really make a difference in a student’s choice.

Group lessons: Once riders can canter comfortably on their own, they can move to group lessons, which cost $50 an hour. For safety, Teddie prefers groups of no more than four riders. The number gives riders a sense they have gotten their money’s worth and instructors do not become frustrated and burnt out.

Summer riding camp: There are nine one-week sessions offered with a different educational emphasis each week ranging from learning about breeds and color to basic dressage. Teddie schedules three weeks of camp followed by a week off to keep both instructors and horses from burning out. Each camp session is limited to 12 riders aged 6 or older and costs $550.

Leased horses: Salko Farm closes in January to give staff and horses a needed opportunity to recharge their batteries. Chris gives competent lesson clients the option of leasing a horse for their personal use during the month. A full lease costs $1,200, a half lease $600 and a quarter lease is $300.

Boarding: Boarding provides a base income that helps pay the bills during the winter months, especially in January when Salko Farm closes.

Hay sales: Chris mows and bales several local

fields but given New England’s fickle weather, no longer tries to raise the quality of hay he wants for his horses. The hay finds a ready market among local landscapers and developers who use it for mulch and silt containment.—BK

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