by Winston Hansma
Winston Hansma – one of North America’s top cutting horse trainers – was one of the renowned speakers to attend the Horse Breeders and Owners Conference that took place January 13 to 15 in Red Deer, AB.
Hansma grew up on a mixed farm at Granum, AB. He managed some of the top Quarter Horse farms in Western Canada before moving to Texas in 1987 where he was manager and trainer of Bar H Ranch for 14 years. Hansma won the NCHA Futurity in 1994 and has won the Maturity three times. He was also responsible for establishing the Hans Hansma Memorial Scholarship to encourage young riders to further their education.
The following is an excerpt from Hansma’s conference speech on the performance horse and profit potential:
There is not a specific formula on how to make horses profitable, but I will give you some basic guidelines to use in your program. These guidelines will help put you in a position to work towards reaching your goal.
For those of you that are not in the horse business, the main reasons you should have horses are a) pride of ownership, and b) to take advantage of some of the tax write-offs that are available to you.
Most of my comments will be directed to the performance horse industry, although they probably will cross over to other areas in the equine industry.
For those of you who are involved in the training aspect of the horse business, you are probably aware of the fact of the small profit line involved.
Therefore, it is necessary to control your costs and maximize your labour production. This must be accomplished without sacrificing the quality of feed or care and maintenance of the animals.
Feed costs can be controlled by buying in bulk form, contracting and locking in the price of your feed, both grain and hay. Adding your feed company label to your advertising will sometimes get you a discount on your grain prices.
A good equine health program also involves consistent worming, vaccinations, and teeth floating. These preventive health measures pay big dividends in the long run.
Running a successful horse program requires good labour management. Not only is it necessary to have competent employees, but you also must keep them.
Maximum productivity from your help is a must, but this has to be accomplished while still providing an enjoyable workplace. This, along with providing them with opportunities to advance their skills and further their careers, will also motivate them to continue working hard.
Good employess will pay for themselves many times over. For example, you give your young, qualified assistant a project horse, one that displays some potential, but who clearly needs the extra time spent with it. The young assistant is able to put in that extra time. The result may very well be that the horse will be sold at the end of the year for several times what the young trainer’s wages would be.
If cattle are required in your training program, there are ways to keep them from being a major expense. Working with local producers and studying trends in the cattle market can be helpful.
Constant supervision of your cattle program is necessary or it is an expense that can quickly get away from you. There are some alternatives available that can stretch your cattle supply. Buffalo and several of the mechanical training devices available are proven alternatives and, when used properly, are very effective.
A properly run training facility will still rely on horse sales and winnings to make it profitable. Controlling your expenses will determine how profitable your year will be.
Whether you are trying to promote a young stallion, raising foals to be sold the following year, or showing horses, your odds for success will be increased if you start with a group of well bred, proven performance brood mares.
Over the past 15 years, the performance horse aspect of our industry has gotten very similar to the racehorse industry. Bloodlines are playing more of a factor in producing championship calibre individuals.
Not only do we see the first dam being a successful performer, but the second dam as well. We still see top performers out of mares with no record, but performing brood mares with black type bloodlines will increase the odds of raising quality performers with increased marketability.
With the rapid appreciation of the value of brood mares over the past few years, assembling a group of quality mares has become nearly impossible. One of the reasons brood mare values have increased is the approval of multiple foal registration.
Being able to market multiple foals per year has made paying high prices for mares feasible. Because of that, mares began bringing up to double their show earnings.
Between the sheer numbers of mares being bred each year and people flushing multiple embryos out of top mares, we are now seeing an excessive number of yearlings being offered for sale. Since the market is a supply and demand situation, we are seeing that the supply is exceeding the demand. With the exception of the top end of yearlings, prices are down.
This has resulted in reduced brood mare values, and average purchase prices are back to being equal to earnings. Over the next few years, there could be more of a buyer’s market, creating a good time to assemble a group of quality mares.
Keep in mind you will be further ahead raising fewer, but better quality individuals due to less overhead and increased marketability.
If your horses need to make a profit, remember potential brings a premium. Yearlings almost always average more than two-year-olds, and they will have significantly less time and money invested in them. Eye-appealing fillies always bring a premium as yearlings.
The yearling stud colt market is somewhat softer unless they have a very good conformation and are extremely well bred. The reining horse and snaffle bit industries have stronger stallion markets than the cutting horse industry. Look at all aspects of the horse industry and use that information when marketing your horses.
If you are unable to market your horses directly off the ranch, there needs to be some thought as to which sale would be best. An individual who is only just above average could be overlooked in a sale that offers the top end of the industry.
Put that same horse in a slightly lower quality sale, and it will most likely be a stand out. With a lower consignment fee, the horse will end up netting more profit.
If you are trying to promote a stallion, you have to take a different approach. If you sell all your offspring as young horses, you are leaving promoting your stallion in someone else’s hands.
This, as a rule, generally doesn’t work out. You can sell a few prospects to help generate some cash flow, but you need to ensure that those prospects get into the right hands and will get every opportunity to reach their full potential.
You need to maintain some level of hands-on involvement in the development of your stallion’s offspring in order to develop a better feel of the type of mares that are the best cross with him.
Development of a breeding program requires you to be patient, stay focused on the big picture and what the future holds instead of getting caught up in short-term momentary gains.
If you are a trainer, you should be riding or showing your stallion’s offspring. If those colts are not good enough for you, why expect that someone else would want to own or ride one?
Promoting a young stallion involves a lot of work, but can be an investment of time and energy that may pay large dividends down the road.
General Guidelines
1. Use sound business principles when making horse purchases and decisions. As a businessman, apply the same principles that made you successful in your profession, to your horse business.
2. Ask for and pay sufficient attention to the advice of a professional.
3. If you goal is to make a profit, don’t turn one down.
4. When you sell a horse, don’t be afraid to leave a little profit potential for the buyer. If you do, they will likely be back to buy another from you.
5. Don’t get caught in the trap of buying full brothers or sisters to the champions.
6. The cheapest part of the horse business is the original investment, if it is done wisely.
7. If you buy or raise quality, you will probably always have a marketable product, and they cost the same to feed and train.
