Landlords and tenant-farmer relations can be like a junior high school dance or like an elegant waltz. The outcome is largely dependent on you, the producer, taking the lead in a few key areas of your farming operation.
The key is running your farm like a professional business. There are three main keys to success:
- Do the right things and be proactive
- Keep comprehensive records
- Be warm and transparent
The first two are what we might call hard business habits. You should be doing these things, anyway, but we’ll see how they can be especially helpful in optimizing the relationship with your landlord. The third is a set of soft skills and cultivating a deeper understanding of the cost and risk associated with farming.
Do the right things
Does a perfectly good barn need a wall repaired? Is that a good place for a watershed? Be proactive in pointing it out to your landlord(s) or just go ahead and do it. These might not be expectations spelled out in your lease, but that’s ok. The overwhelming majority of the landlords we deal with would rather you take the initiative.
Here’s a partial list:
- Clearing ditches
- Improving existing structures
- Improving drainage
- Creating and improving water resources
- Soil quality management
- Helping to increase habitat and revenue for hunting or fishing
- Plans for future
Some of these items might seem inconsequential, but they, along with Conservation Reserve Program participation and NRCS projects are improving the landlord’s property.
Keep comprehensive records—of everything
It’s impossible to keep records that are “too good.” Almost every facet of the farm operation should be recorded and reported. If you’re doing a great job now, great; keep up the good work. If not, yields and costs, by parcel are critical. Here are the five key areas we emphasize to give you an idea of what’s important:
- Financial performance
- Farm management best practices
- Land resource optimization
- Enterprise‐level management
If you could be doing a better job of record keeping and reporting, reach out to me and we’ll help you get set up with the right software and practices. We help clients every day to establish baselines and benchmarks, generating reports that are valuable to producers and landlords.
Also, keep a written and photographic record of the improvements and events noted above. When negotiating—which we’ll cover in detail in another post, start the conversation with these things you’ve done. It gives you the opportunity to ask, “Can we renegotiate the rate for one year?” Then you can lean on things you’ve done as reasons for lower rates.
Be warm and transparent
If you have really good records, be especially transparent with your landlord(s) on seed, chemical and fertilizer, transportation, fuel, crop consultants, application costs—what we call direct costs.
It’s understandable if you don’t talk to your landlord more than a few times each year. But at minimum, if you have lease that is up Dec 31, you should be talking to the landlord(s) in April.
The best case is that you talk to your local or absentee landlord(s) often. There are some very effective ways to reach out to your landlord(s). Think you don’t have anything to say or a place to say it? Well, in addition to reporting on the things mentioned above, what about the following items?
- Planting intentions
- Family news
- Association and community involvement
- Current projects on the farm
- New technology or software
- New equipment or methods
- Employee update
Here are just a few places to distribute the information. Remember, you have a new generation of landlords coming on board, and they crave information.
- Appreciation dinners or tours
On a related note, a lot of producers ask me, “Thomas, I have multiple landlords. What do I do about the fact that one makes more than another?” My advice is to tackle that issue head on. If you have good records and reports, you should be able to show a landlord who complains the very real, tangible reasons why another landlord receives a higher rate.
The bottom line is to do the right thing, document it and be nice to your landlord.