Monday, 31 July 2017 07:55

What’s your future in dairying aged 20-odd?

Written by  Brent Love
Brent Love. Brent Love.

Brent Love, director farm enterprise at KPMG, explains how to make it in dairy for 20-somethings.

So you've got yourself here. Well done. With a bit of luck you’ve worked hard at secondary school, and may even have advanced to tertiary study or got started on some Primary ITO development.

You may have found out, through early mornings and time in a cowshed, that dairy farming is your future. Congratulations, you will do well. Many have been before you, but to be fair to you they haven’t actually been where you stand today.

You are the new generation to whom the career pathway isn’t as clear as it was 10-15 years ago. Back then you could start where you are at now, realistically with a little luck, and by doing a tonne of hard work you could achieve the success of land ownership as the ultimate goal.

Things have changed: the capital-hungry dairy industry and the roller-coaster ride of commodity prices have changed the game-plan for many.

At times you can become disoriented, and wonder why you are perhaps doing what you are doing, and you may start to consider what success looks like.

So let’s develop a plan to span the next 2-5 years; that’s more than enough. Make the plan robust and include financial and personal plans. Your plan will need action points to help achieve short-medium term goals or achievements. Make sure the plan is heading in the general direction of what your ‘dream’ outcome looks like.

Be flexible and be realistic in your plan. If you have no capital today and you are earning a $50,000 salary, and you are paying off your car and student debt, a plan to own a 1000-cow dairy farm in Canterbury within the next 10 years may not be realistic. Understand the financial and personal demands imposed by your present commitments, and how that works with your plan.

Be committed; realise that what you’re doing today might be a reasonable outcome for you.

I have successful contract milkers who have generated significant wealth over the last few years by saving hard, investing long term in assets like property, shares or Kiwisaver schemes and using debt sensibly.

Buying cows to lease out for nothing to start a herd and maybe going 50/50 share milking at Temuka is not really a plan. This has a significant risk to it that you can’t control or mitigate.

Be successful at being counter-cyclical; sometimes that means you have to stick to your knitting, take a calculated risk with at least a B plan attached to it and don’t be greedy on entry or exit.

Understand that the management jobs in the dairy industry, compared with a lot of other jobs or careers, are relatively well paid in monetary and lifestyle terms, and while it may not allow you to purchase a farm, it does allow you to plan for a successful financial outcome for you and your family.

Value what you do today. I see a lot of people in the industry spending time day-dreaming about the future but failing to make a good job of what they are supposed to be doing. This is an extremely important point, when you have little capital and few relationships; what you offer in raw physical and mental ability become extremely important to your future success.

If you blow through jobs, especially at management and share milking level, eventually this will catch up with you; your reputation in this industry is paramount.

Be kind to those around you and remember that your solar system doesn’t control the universe. This means that you asking your employer for a pay rise isn’t a right: negotiating by ultimatum can be extremely dangerous to your future relationship and opportunities. Understand that your brand is something you establish: how good you are at building that brand is your responsibility.

The future is bright for people who are well skilled and financially secure in their own right to take up those opportunities. Remember, get a plan, take responsibility and ownership for the plan, be realistic and do what you are doing now as well as you possibly can.

• Brent Love is director farm enterprise at KPMG, based in Timaru. This is his address to the South Island Dairy Event 2017 at Lincoln University.

 

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