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The right partner

In today’s farming, partnerships make more sense than ever… as long as you know how to find the right partner

Partnerships and agriculture are so closely entwined that even the smallest children know from singing about the farmer in the dell that the farmer’s first job is “to take a wife.”

If only farm partnerships were so easy.

With the farm community shrinking so fast, and now accounting for a mere 1.5 per cent of all Canadians according to the 2011 Census of Agriculture, the odds are stacking up against your bumping into your ideal future business partner anywhere in your neighbourhood or even in the ordinary run of life.

Actually, it’s even harder than that because for the first time ever in this country, there are more farmers aged 55 and over than any other age group. Since older farmers may be less interested in building new partnerships, the available pool is even smaller than our already meagre numbers suggest.

Not to be too sexist, but this may mean the equivalent of a wave of “city girls” is about to enter into the industry, providing the extra operational vigour that is being chased by the farmers who are looking for new partnerships.

Or, it might inspire more creative solutions.

One question Grant Robinson, a business transition specialist with BDO Canada in Guelph, Ont., has been known to ask first is: “Do you even really need a partner?”

“Don’t just bring someone on because you want their money,” Robinson warns, although he suspects this strategy is still popular enough.

Instead, with a bit of a play on words, he encourages partnership seekers to weigh their decisions according to three different types of capital. “The capital you’re trying to deal with in a partnership is social, intellectual and physical capital, and you have to try to bring all those things together,” Robinson says.

Robinson says physical capital can be thought of as asset which you manage in a transactional way. For these, he says, you’ll have a partnership agreement that outlines how things of monetary value will be handled jointly.

Intellectual capital, however, is about the knowledge of the business and how you plan to run the place, including who makes decisions about what. This is an especially important consideration in inter-generational partnerships.

Finally, Robinson says, social capital is where the personal interactions and even a kind of corporate culture come in.

Robinson sums it up succinctly: “If you don’t like an individual on a social level, if you don’t like to socialize together, if you’re not connected in the community together, that’s pretty good evidence that you shouldn’t be business partners.”

Jolene Brown, a family business consultant who covers North America from her base in West Branch, Iowa, talks about social capital as a critical element in forming a good business partnership. But she’s more apt to call it goodwill.

“If you have goodwill, you will have a heart-felt desire to work together toward the common goals of the business, help each other succeed, and work though challenges to get along,” Brown says. 

Part of your commitment to the partnership, Brown advises, is to get things clarified and in writing, such as a communications contract, a code of conduct, a buy-sell agreement and even a conflict management plan.“When goodwill is gone, it is really tough,” Brown says. “That, more than anything in my opinion, breaks up partnerships.”

Whether farmers choose to partner with a spouse, family, or some external friend, she says goodwill must be evident not just when everyone is happy or when prices are high, but also when people are tired and conflict emerges in the partnership.

Brown says goodwill is one of the first things she goes looking for when she takes on new clients, and she measures it based on three characteristics. The first, she says, is a willingness to work towards that defined common goal of the business, whatever it is. The second thing is if partners want to see each other succeed as much as they want to succeed themselves, and that they work to help one another in this way. The third and final component she looks for is a willingness to work through conflict and problems. 

“Don’t invest in joint assets until you really know you can be good partners,” Brown warns. “Make sure you have the right mix of experience, education, personality and character.” She strongly believes in a year’s probationary agreement before locking into a formal structure with family or non-family members.

“When you’re talking partnerships, in all the many structures,” Brown says, “it’s important you discuss termination early, so that if you feel ‘we’re not a good fit,’ pending certain notice, there’s no hard feelings, ‘we can still be family or friends,’ but not working together.”

Brown believes there are a number of other elements that make a good partnership work. First and foremost, she says, common business goals need to be defined. She even likes to see them outlined in a one-page overview that includes clear job descriptions and expressed standards for responsibilities.

Brown also feels every farm partnership needs a leader who understands the “people business” aspect of farming, not just production.

Other important elements are a defined communication process that centres around purposeful meetings, conflict management protocols, and compensation that befits worthy partners doing worthy work.

Brown also cautions that every partnership agreement needs a defined exit strategy for one or both partners.

Brown tells me that if you’re thinking about business partners being married partners, it’s important to remember that, “If you want to honour the marriage, and the family, you’d better do the business right. If not,” she warns, “at the end of the day you may have neither family nor business.”

It’s advice that Dan Ohler, an independent relationship and communication specialist from Sangudo, Alta., is quick to echo. Having been there himself, farming with his wife Carol and his parents once upon a time, he personally understands how miserable life can get when partnerships go bad.

“When we left the farm, we were so close to going our separate ways,” Ohler says. “People need to know they can’t afford not to work on their relationship.”

But far more commonly, he says couples wait until things have gone sour. Ohler says most people struggling with their farm marriage confess to him that they’re thinking about their problems anywhere from 50 to 90 per cent of the time. Not only does this mean a serious loss of productivity, but it can be downright dangerous, considering all the hazards of farm work.

If you’re tempted to consider divorce, be forewarned, Ohler says. “There can be a huge financial cost, expecially if it means selling off farm assets. And it can get really ugly.”

Start by recognizing what your happiness is actually worth, Ohler says.

“People are busy, absolutely, but there’s always time to do the important things,” Ohler says. “If people can realize the importance of the relationship with their spouse, especially in a farm operation, then the farm can be incredibly productive and effective.”

Ohler says a simple strategy is thinking about your partner as much as or more than you think about yourself. Looking for ways to improve is usually not rocket science but something almost everyone can stand to do more often.

Ideas can include reading a book together about relationships, taking some kind of course, or starting on some coaching, Ohler says. Even a weekend away from the farm, just to be together to work on their relationship, away from regular routines, can work wonders.

“The tough thing is having the courage to really sit down and have a structured meeting, with an agenda, and break into pieces the business piece and the family piece,” Ohler says.

Strong farm partnerships ensure fulfillment and prosperity, Robinson and Brown agree. So whether you’re “taking a wife” or a partner of any other kind, make sure it’s the right one, for the business’s sake as well as your own.

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Amy Petherick

Amy Petherick is a Contributing Editor for Country Guide.

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