Succession Planning – The Importance of Preparation
A day in the life of an agricultural producer is almost never the same but it is always busy. Moving/feeding livestock, fixing fence, cleaning irrigation ditches, spraying weeds, coordinating transportation or sales, there is never a shortage of jobs that need to be done on a ranch or farm in Wyoming. One of those tasks that is easy to forget is planning for the future. Succession planning is vital to maintaining agricultural businesses and keeping working lands working in our industry. According to USDA-NASS, 95% of the farms/ranches in Wyoming are family owned. Research from the consulting firm AgriLegacy also tells us that while 80% of producers want to pass their operation down to the next generation, only 12% of second-generation farms make it past the third generation.
Unfortunately, succession planning is not usually a pressing issue to most families, until a crisis like a death or injury occurs. Almost no one enjoys thinking about death or change and having the hard conversations with family members about the future of the ag operation. Succession planning does take time and waiting for a crisis, often means that it may be too late. Having a plan can make all the difference.
Succession planning can be overwhelming. Depending on the operation, it may require work with attorneys, tax specialists, financial planners, lenders and more. A farm or ranch is more likely to be passed from generation to generation than a non-farm business and it’s critical to the business, family, and industry to be ready. A successful transition plan should include business planning for the ag operation , retirement planning for the retiring generation, succession planning to transfer management to the next generation and estate planning to transfer ownership.
Thankfully, there are resources available to Wyoming producers who want to start the process. A simple google search will find a wide variety of informational resources from organizations like the University of Wyoming Extension, the Wyoming Business Council, Wyoming Farm Bureau Federation, Wyoming Stock Growers Land Trust, the Wyoming Department of Agriculture, and more. These resources include online videos, courses, publications, and workshops to name a few. The resources are there. The only thing required is to take the important steps of recognizing it’s value, and beginning to move forward.
The steps you take now can make all of the difference when it’s needed. This is especially important in the agriculture industry in Wyoming because it not only helps cement a legacy for your family, it also helps ensure the continued operation of your business and that the agriculture industry remains strong. Effective succession planning is not easy. It can require a lot of time, some investment in the future, possibly some tough conversations, and a willingness to look beyond yourself. While it can be a tough process, it is a vital one for you, your business, your family, and the agriculture industry as a whole. Keep working lands in production also helps provide the secondary benefits like open spaces, wildlife habitat, support for our rural communities, and more.
