Having the next generation show interest in and want to be a part of the future of the dairy farm is very exciting. However, transitioning the farm can be daunting. Many avoid planning because discussions can be stressful and emotional. Yet, the sooner conversations and plans start, the smoother the transition can be. No one wants to be caught unprepared if the farm has to be transitioned suddenly. A full understanding of the operation, constant communication, and flexibility are great ways to help the succession process.
Understanding the Dairy
All parties need to understand how the farm and business is performing. Farm performance is probably much easier to understand than business performance. Most of the next generation will come back to the farm because they enjoy the day-to-day tasks of working with the herd. So, they probably have a good understanding of herd performance.
However, financial understanding is just as important, if not more important. As the next generation returns, the farm needs to be able to support the income for them and their family. Lenders, financial advisors, and accountants should all be a part of the team to help ensure profit and prepare for financial risks.
Communicate, Communicate, Communicate
Communication is often the most limiting factor in preparing for farm succession. Early identification and addressing of communication barriers is vital to a successful transition plan. Individual meetings with all parties before coming together will give a better understanding of each partner’s goals and desires for the dairy. Individual meetings should also include the partner’s family as the transition also impacts them.
Scheduled group meetings should occur regularly. Meetings should be dedicated to developing plans for the transition, and obtainable goals should be set for each meeting. Agendas should be created and distributed to all attendees before each meeting. Designate someone to take notes to track what has been accomplished and what needs revisiting.
Flexibility is Important
Transitioning the farm can become very emotional for many reasons. All parties should be expected to compromise some to complete a plan that everyone can agree with. Also, understand that the process takes time. Years may pass before the farm fully transitions from one generation or party to the next. Family and herd dynamics may change, so timelines and goals need to be flexible to meet the overall goals and ensure the success of the transition plan and dairy.
For more on ‘Next Gen,’ read:
- Farm Succession: Don’t Neglect The Value Of Planning
- How To Translate Generational Misunderstandings
- How One Next-Gen Tennessee Farmer is Using Her Strong Voice to Advocate for the Ag
- 5 Conversations Every Family Should Have Before A Farm Transition
- 6 Lessons Learned About Legacy and Community After Losing A Farmer
- Time To Transition: How to Get Out of The Way, Without Going Away
