Colorado Springs Gazette
Ranches return to roots by DEBBIE KELLEY THE GAZETTE
July 21, 2006
Great-great-grandfather was right, some ranchers are now convinced.
"A lot of what we're trying to do goes back to the first settlers," said Dave Pratt, chief executive officer of Ranching for Profit Schools, a northern California-based company.
Returning to the roots of the industry is helping ranchers build lucrative businesses, said Pratt, who is speaking today and Saturday at the annual conference of the American Grassfed Association at the Antlers Hilton in downtown Colorado Springs. The 260-member organization, based in Denver, supports producers who grass-feed animals of various species.
Using the methods of their forefathers makes good business sense, Pratt said.
"Most ranches are built to fight the environment, and as long as we're fighting nature, we'll never be profitable," he said.
He challenges ranchers to consider changing calving and weaning times to be in accordance with nature, and to use pasture grazing as opposed to grain feeding.
"A cow is a wonderful factory that can take low-quality energy and turn it into a high-quality product. It doesn't make sense to use high-quality energy."
Settlers also didn't put up hay, and Pratt recommends today's ranchers follow suit, as well as reducing the amount of equipment they own.
"We've built infrastructure that requires us to be part of the business, and we need to look at what enterprises we should have," he said. "There are only three ways to increase profitability in any business: improve the margin per unit, increase the number of units or reduce overhead costs."
Having a management succession plan, a labor policy, ideas for expansion and contracting know-how also are necessary, Pratt said.
"Most ranchers are good technicians and know about seeding a pasture, branding and vaccinating, but they either don't know a lick about business or have forgotten business principles," he said.
Those in the agriculture industry who learn sustainable business management are reporting an average return of 11.3 percent on assets for the past three years, Pratt said.
"So when somebody tells you ranching is not profitable, it just means they're not profitable," he said.
Some new rural enterprises don't look like the conventional ranches of recent generations. Rancher Russ Maytag created an "eco-ranch" near Westcliffe, about 70 miles southwest of Colorado Springs, that integrates agriculture and a residential development.
Maytag, who grew up in the Springs and has ranched the 3,000-acre spread since buying it in 1978, has in the past few years sold 12 of 27 sites, each 100 acres, on his Maytag Mountain Ranch. Instead of selling out to land developers, Maytag decided to sell sections but keep them part of a working ranch.
Homeowners can take part in running the operation, and homeowners association fees are offset by about $40,000 in annual revenue from the sale of organic fruits and vegetables, farm eggs and 250 grassfed and organic cattle.
Feeding cow herds grass instead of grain results in beef that is healthier and tastes better, Maytag said.
"This industry is really going to grow, because baby boomers are starting to be more health-conscious about their food and where it comes from," he said.
It's also more profitable; grass-fed cattle net a $200 to $300 premium per animal for producers, Maytag said.
Lakewood residents Stephanie and Brett Martin always wanted to own a ranch, and they have purchased land and built a house, about a $1 million proposition, on Maytag's ranch.
"I'm crazy about cattle, and here, we don't have to run the ranch by ourselves," Stephanie Martin said. "The marketplace is moving more toward grass-fed beef, and we like that the land is being preserved for raising cattle instead of just development."
