Producers can boost agricultural income through diversification

In recent years, agricultural producers have seen a decrease in their bottom line, not due to a lack of hard work but due to issues such as higher input costs, fluctuating product prices and the development of large-scale industrial production.

According to the U.S. Department of Agriculture, “Eighty-eight percent of all farms in the U.S. are family farms, and income reported by small farmers and ranchers also includes part-time or off-farm work, but producers can increase their sources of income by diversifying operations and creating additional income.”

Recently, Faith Hamlin, manager of the Little Jennie Ranch in Bondurant, addressed the topic of agricultural diversification at the Wyoming Stock Growers Winter Roundup Convention held in Casper Dec. 4-6.

Since 2019, Hamlin has been managing the Little Jennie Ranch, a working cattle ranch about an hour south of Jackson Hole, where she oversees a crew of more than 25 employees who help her manage a variety of farm animals. However, the Angus-Hereford cross cows are the main focus, Hamlin explained.  

Generating

additional income 

Producers can incorporate additional revenue streams by taking full advantage of agritourism, direct-to-consumer marketing, byproduct sales, farm education or adding new methods to increase product value.

“Producers need to tap into revenue avenues which align with the organization’s mission,” Hamlin stated. “Right now, the Little Jennie Ranch is selling live animals to other farmers and ranchers, but I am taking more and more animals to market at local butcher shops.” 

“I believe individuals should be able to buy their food as locally as possible, and I want our meat to be accessible to folks,” she explained. “We network with local slaughterhouse owners, participate in local farmers’ markets and talk with other vendors who can help distribute our products.”

The Little Jennie Ranch is dedicated to sharing an authentic Western experience through various summer and winter activities which generate additional revenue for the ranch.

“We are a team and we work together to promote Western traditions while being stewards of the land,” she added. “No matter the time of year, we have awe-inspiring views, a professional team and the unending love for what we do.”

By offering year-round activities, the Little Jennie Ranch is able to tap into additional resources, which helps spread out operation costs and diversifies the ranch’s income.

“Managing multiple income streams for an organization can be challenging, but it’s crucial to ensuring financial success,” Hamlin continued. “Every new revenue stream brings its own set of expenditures, and organizing these costs is key to optimizing profitability.”

She reiterated, “You have to know when to say no, as not every new avenue will work, so stick to what builds your organization’s culture and promotes your authenticity.”

Increasing profit margins

Producers who maximize labor and reduce spending can increase revenue so their operation can retain as much profit as possible.

Short of simply raising prices, there are a number of strategies producers can employ to increase profit margins without sacrificing the quality of products brought to the market.

Hamlin acknowledged, “Having a seasoned and versatile staff is key. At the Little Jennie Ranch, we have guides who can lead spring bear hunts, switch roles and assist during calving season and then guide clients who come to the ranch to enjoy a winter snowmobile tour. It’s a plus, and it helps decrease payroll costs, which is our biggest expense.”

Little Jennie Ranch has been incorporating more opportunities for guests to see and participate in daily chores and jobs, which encompass raising cattle, in hopes of contributing to the understanding of Western agriculture and educating others on a tradition pivotal to the history and identity of Wyoming.

“Another tool to drive revenue is social media marketing,” she concluded. “Social media provides producers with an opportunity to connect, communicate and engage with the public in a way they may not be able to do otherwise on a daily basis.”

Additionally, utilizing social media is an excellent way for any agricultural producer to connect with individuals interested in visiting their business or buying products.

Melissa Anderson is the editor of the Wyoming Livestock Roundup. Send comments on this article to roundup@wylr.net.