Do any of you have experience

[RazorbackRed]

raising cattle on shares? So for example, we got our hands on a new lease place. A friend of mine wants to give me $15K to buy a few pairs, and then split the profit. I raise them and send him a check for his half, if there is any. It would be a way to fill up the lease without any financial commitment from my end. Obviosuly, I have shared with him all of the 1,000 variables and let him know he might lose money.

Anyone ever done this, and if so, any heads up?

 

[plbcattle]

$15,000 to buy cattle won't give either of you much of a profit. If you have land leased you would make more off of it of you sold hay off of it rather than run a coupel head of cattle.

 

[Bez>]

I have run cows on shares - both ways - one as the owner and one as the person who holds the animals.

It is risky for both parties.

However, as the person who does all the work I used to take 75% of the calf price and send the owner the remainder. I ate all the costs.

As the owner who did nothing, I received 25% of the money received for the calves.

50 - 50 split? If the person holding the cattle can raise enough of them to weaning - well, I would buy some cattle for him as well. 50 - 50 is a good deal for the owner and a lousy deal for the person who holds the cattle.

Bez>

 

[msscamp]

raising cattle on shares? So for example, we got our hands on a new lease place. A friend of mine wants to give me $15K to buy a few pairs, and then split the profit. I raise them and send him a check for his half, if there is any. It would be a way to fill up the lease without any financial commitment from my end. Obviosuly, I have shared with him all of the 1,000 variables and let him know he might lose money.

Anyone ever done this, and if so, any heads up?

I don't believe I would go this way - with anyone - but especially not with a friend. I learned a long time ago to not mix friendship and business (particulary when the business in question is agriculture) - there is just too much opportunity for not seeing 'eye to eye', second guessing, hard feelings, ruining a perfectly good friendship, problems, etc. Letting him know he 'might lose money' is a whole lot different than laying it out in cold, hard facts with the bank statement to back it up. If you want to get into cattle, do it on your own - that way you don't have to answer to anyone but yourself, and maybe your banker. Yes, it will take you longer, but the satisfaction will just be that much greater! ;-)

 

[Hawk]

I don't believe I would go this way - with anyone - but especially not with a friend.

MSSCAMP is giving you excellent advise and I hope you consider it seriously. Speaking from experience, the only thing worse than going into the cattle business with a good friend is going in with family. Good luck.

 

[RazorbackRed]

We are already going to be running a bunch of our own cows on this place. The 10 pairs that we split with this guy would only be filling up the lease, or maxamizing the land. We are already going to be there taking care of ours. His money will buy his cows, feed his cows, and cover all expenses on his cows. They will be on our lease and be serviced by our bulls. So, I am not carrying the lease just to raise his 10 pairs.

Make more sense?

i agree with the friendship deal. This guy is a casual work associate who won't live nearby.

Thanks for all the info.