8 Ways to Make Your Landlord's Day
By Gil Gullickson
Andrew Fansler operates a thriving 4,600-acre grain operation near Shelbyville, Indiana. Fansler Farms grows soybean seed, conventional soybeans for export, and yellow and white food-grade corn for processors, along with commodity corn.
Just 20 years ago, though, Fansler Farms was a gleam in the eye of a young 16-year-old Fansler. Being a first-generation farmer, his first foray into farming was renting 42 acres in 1995 by trading labor for the equipment needed to plant his crop. Taken under the wing of local farmers Kenny and Cindy Kuhn, Fansler credits them for teaching him much about farming.
Building and preserving a land base is a challenge for any farmer, whether it’s first or sixth generation. With no land base to back him, Fansler had to be creative in building one with his current core of 15 landlords.
Here are eight ideas from Fansler and others to meet, attract, and retain landlords.
1. Reach out to landlords. While attending Franklin College in Franklin, Indiana, Fansler devised a then-fictional company called Fansler Farms in a business development class.
“I decided I was going to use marketing materials I made in the class to send out to people who might be able to rent me their land,” he remembers. “Back then, the Sunday Indianapolis Star would be thick with advertisements from stores trying to get people to come to their places. So if that’s what bigger businesses were doing, why should farmers do any differently?”
Over time, his outreach program has created and sustained growth. An outreach program can be something as simple as a good farm website, says Terry Kastens, a retired Kansas State University agricultural economist who farms with family near Atwood, Kansas. One that explains your farming philosophy, work ethic, equipment, and agronomic strategies can help raise landlord awareness.
2. Listen to landlords. Getting a landlord’s attention through outreach is just one tool Fansler uses. Meeting and listening closely to what they say is another key.
“It’s the Golden Rule. The person who owns the gold also makes the rules,” he says.
“Landowners hold the gold. You need the land to farm, and you have to play by those rules.
“I primarily focus on landowners who want to be in a long-term relationship,” he says. “Both parties have to make money. They really want you, as their farmer, to be successful long term while maintaining the integrity of their asset.”
3. Leave playing detective to Sherlock Holmes. Never make your landlord play detective. Ray Gaesser, who farms near Corning, Iowa, with his son, Chris, touches base with landlords once a month to update them on farm activities and crop progress. He also updates landlords about the gradual transition of his farm to his son.
“It gives landlords a sense of stability knowing there is another generation on the way,” Gaesser says.
Fansler compiles an annual report that details records on soils, chemical application, yields, and other agronomic attributes to give to landlords annually.
“It is nothing fancy, but it is something they can stick in their file and put their whole year’s activities right in there,” he says.
4. Put a plan into writing. Fansler recalls working with two nonfarmer brothers who owned a sizeable farm.
“Their farmer was retiring, and I knew the family well from my mom,” he says. “So I sent them marketing information, and they called me and I met with them. This was before PowerPoint, so I sat down in Microsoft Publisher and put together a presentation. We went through it line by line. In the process, I was really just selling myself to them. I left them with all that information, as I wanted to give them something to remember me by.”
A week passed before he received good news. “They had met with a farm manager who told them he had never seen a presentation like that,” says Fansler. “He told them, ‘I don’t know who he is, but he needs to be your farmer.’ We came up with a game plan, and 15 years later, I’m still farming their land.”
5. Offer several rental options. Flexibility is one factor that’s helped Fansler negotiate with landlords.
“I have agreements that are straight cash rent, share crop, and flexible combinations of these two,” he says.
Fansler says these tend to be popular in that a fixed value is set in the cash rent portion. If the market skyrockets, the share rent portion of the agreement allows landlords to garner a share of it while still retaining a set amount.
6. Realize that landlords differ. No two landowners are the same in goals or temperament.
“Every one of them is a unique individual,” he says. “Understanding and realizing that was huge.”
Many landowners crave frequent contact with their farmers, and that’s fine. Others don’t, and they may take offense if you do.
“I work with one landowner who is extremely wealthy and often doesn’t have time to talk to me,” says Fansler. “When we talk, she is very pleasant, but she is busy and has a lot going on in her life. If I need to reach her, I first call her staff. I know that when she calls, she really needs something, and I immediately take her call.”
Although landlords differ, they do share common interests. “They want someone who is honest and trustworthy, and someone who gives them a fair return on their investment,” says Fansler. “People think that is rocket science, but it’s not.”
7. Beat High-Rent Harrys to the punch. Fending off operators who pay sky-high cash rents is a constant farmer lament. Rather than commiserate in the coffee shop, though, you may want to apprise your landlords of the situation. They may have heard a lot more than you assume.
“The first time that happened to me, it was within 7 to 10 miles of a pretty good-size farm that I rent,” says Fansler. “As soon as I heard it, the first phone call I made was to them. I told them I didn’t know if those numbers are true, but it is higher than normal. So let’s talk about it.”
In retrospect, Fansler says contacting them directly was the right step and ensured goodwill.
“I didn’t want someone else calling them or finding out from someone else,” he says.
Granted, money solely motivates some landlords who switch renters in the same manner in which a Hollywood hunk or starlet changes spouses. The good news, though, is that money isn’t the overriding factor for some landlords, says Kastens.
“Some have a desire to help out a farmer. Some want to get their fencerows mowed, have good-looking crops, or grow different kinds of crops,” he says. “Others want a good place to hunt. So you have to understand what motivates the landlord.”
8. Don’t be a Chuck Cheapskate. Another way to nix the High-Rent Harrys is to be a competitive bidder yourself.
“There are some rural areas in Kansas where rents are 50% of where they should be,” Kastens says. “That is running a risky game. The biggest way to inoculate themselves from competing pricey rents is paying close-to-market rents.”
Still, you don’t want to pay rent that is guaranteed to lose money, either.
“I observed in the glory (grain market) years, rents were not keeping up where they should be,” says Kastens. “Now, with the market prices down from where they were a few years ago, I see some farmers who are overpaying for rent because they just have not taken time to do their homework.
“Typically, look at futures prices for three years and think of long-term average yields. That way you don’t get too up and down on the rent you pay,” says Kastens. “It is just a matter of being knowledgable about rent in the cost-price structure.
“We all struggle with this,” he adds. “This is nothing new.”