Elisabeth McMillan

Agility and control are hands down the two best attributes of owning a small business. They enable you to react very quickly to economic challenges and opportunities.

Your ability to successfully use these two attributes is essential in order for you to protect your business during this challenging economic time.

While not everything listed below is suitable for every type of horse business hopefully they will stimulate your creativity and help you devise a positive plan for taking action in your business. The ability to take action quickly and make appropriate changes in your business can provide you with substantial protection and advantages during times of economic change and uncertainty.

1. Diversify Your Income and/or Expand Your Offerings — Your financial security in life is largely dependent on how diversified your income streams are. It is the old don’t put all your eggs in one basket adage. If you have personally been wanting to reach into new areas or if you have thought about expanding what your business offers — this could be the time to:

Start teaching clinics (Don’t forget to look for undiscovered markets)

Host more clinics

Write a Book or Ebook

Make Educational Videos/DVDs

Get Your Judges Card

Become a Course Designer

Learn to Shoe

Get or Upgrade Your Instructor Certification

Start an onsite tack store

Sell tack on your website

Use affiliate programs

Camps and Summer Intensives

2. Cut Expenses — Now is the time to make sure your business is a lean mean profit generating machine. Take a hard look at your P&L’s (profit and loss statements) and cut away any fat you see.

a. Change or Renegotiate With Suppliers — are you getting the best prices/incentives to buy from your suppliers? If not see what the competition offers. WARNING: This doesn’t mean to throw away a loyal hay supplier who has always brought you the best hay, on time, for the last 10 years BUT maybe see if that hay supplier can give you a discount for buying in bulk, paying early, etc. If you have never had a consistent relationship with suppliers — it may be time to build them.

b. Reduce Employees or Employees Hours and Increase Remaining Employees Responsibilities or replace with working students

c. Eliminate any late fees or out of line interest rates — i.e. credit cards or high interest loans

d. Look for barter or work/trade opportunities to replace some of your ongoing expenses. Working Students are the most common but you can also trade your services for other skilled services and products. EXAMPLE: I traded lessons for bookkeeping & accounting for almost the entire life of my business. I also traded training fees for a really cool sports car and when I first started my business I traded board and training for an apartment. TIP: Keep it classy. Don’t ask everyone you come in contact with to trade — Do keep you eyes open for mutually beneficial opportunities that you can take advantage of.

e. Look at your personal expenses — be honest are there changes you should make in your lifestyle? These can be temporary but it is wise to take action early in an economic cycle rather than late.

f. Get a Sponsor — You don’t have to be a world beater to benefit a sponsor. Look at it from the sponsors point of view and try to find a mutually beneficial situation where they get great exposure and you get a portion of your expenses paid for.

3. Raise Prices — Don’t be last in line here, carefully watch your profit margins and raise your prices as necessary. If you are worried about losing clients when you raise prices consider offering them more choices. EXAMPLE: Make a new training program that reduces services (and your expenses) that you can offer to struggling clients — Create solutions that benefit both you and your clients. EXAMPLE: My business was near a couple colleges and the college students were always looking for horses to ride that could jump and do shows. It didn’t make financial sense to own the school horses for this myself. What worked great was leasing these students sales horses or providing them with half leases on certain client’s horses — clients who were struggling to attend enough shows etc. By setting up leases and offering a special training program a WIN /WIN situation was created that simultaneously reduced clients expenses and made the barn more money. It also created a steady stream of college referrals and increased the barn’s show group substantially.

4. Reduce Outsourcing and Increase Your Share of Wallet — Share of Wallet is a business term that means — the amount of your customers’ total spending that you are capturing in the categories you offer. Look for areas (categories) where you or your customers hire outside help or private contractors and look into whether or not it might be a smart business decision to take over the service they provide and make the money yourself. Find areas where you can increase your income by a few hundred to a couple thousand dollars a month like —

a. Body Clipping — do you out source your body clipping? If so, this year keep it in house. Do your own or teach one of your employees to body clip so you get the cash for this extra service

b. Braiding — same idea — can you train one of your current employees to do this and make the income yourself rather than outsourcing it to a private contractor?

c. Blanket Repair/Horse Laundry

d. Shipping — Do or would it be smart for you to have access to a truck and trailer? Consider doing your own hauling.

e. Tack & Equipment — If you help your clients buy much of their equipment, consider getting paid for your part in the sale either by offering exclusivity to a tack store in exchange for a percentage of sales, carrying and selling the supplies and equipment your clients use most yourself, or by joining an affiliate program and encouraging your clients to buy from your affiliate provider.

f. Other Services —are your clients paying someone outside your business for something you could provide?

5. Increase and Improve Customer Satisfaction — Increase your perceived value to current customers. Don’t underestimate the importance of this one. The economic climate that has you reading this article affects your customers too! They too will be looking to make changes and adjustments to improve their financial situations. This is the time to MAKE SURE your current customers are happy and know the VALUE of being one of your clients! Think about ways to connect with your clients. Whether it is sending them a framed photo of their last show or throwing a party — Now is the time to strengthen the bonds between you and your clients. TIP: Your barn should be thier most important refuge from stress- their horse a piece of paradise. The training they recieve should be inspiring. The barns social environment (friendships with you, your staff and other clients) should provide irreplaceable support and comradery.

6. Offer Incentives — Does your business rely heavily on Selling horses? Horse Show Attendance? A Lesson Program? Wherever your business needs a shot in the arm and/or wherever your largest profit margins are — Think about offering incentives. FOR EXAMPLE: If you have an equestrian business that is dependent on selling horses now is the time to offer a free months board and training with any purchase. Or you could run a Travelers Special! Offer to pay for the buyers airline tickets when they purchase. If you need to ensure a certain amount of horses attend a certain amount of shows offer a Volume Discount. If you want your clients to band together and encourage each other to attend — put in a discount for every show that X number of clients attend — let them sell each other on committing to the shows. If you have a Lesson Program consider selling blocks of lessons offer the 11th lesson free with block of 10 prepaid lessons or offer a free horsemanship class, clinic or gift to lesson sign ups of 12 lessons or more. If you already offer incentives for purchasing in volume try a bring a friend discount. Use your creativity — Now is the time to give your business a leg up by offering incentives.

7. Jump on Opportunities — One of the most important things people tend to miss in stressful economic times is all the opportunity! It sounds weird but economic down turns can offer huge opportunities to buy — discounted horses, equipment, and property. Find a way to keep your finger on the pulse of your country’s economic situation and take advantage of —

A. Owner financed real estate — Now and for the next year or two you may be able to buy your own facility or the investment or retirement property you were always hoping and dreaming about. Anybody who is trying to sell NOW is a prime candidate for a Creative Financing idea that could enable you to own your dream property. Economic down turns and housing crunches are prime opportunities for normally unqualified buyers to negotiate a great deal. Think about ways you and your business could take a stronger hold during this weak economy.

B. Horse buy/sell opportunities — many people will be looking to dump horses or sell good horses at reduced prices — perhaps you can twist this to your advantage

1. Do you have a brave client who may want to make a long term investment in some sales horses? Buy young horses who won’t hit their peak sales price for several years.

2. Look for bargain aged, made horses that can be leased at a profit to clients who are balking at purchasing due to the economy.

3. Build your school horse program by acquiring some top school master lesson horses that you normally would not have access to. You will likely find that many sellers of aged made horses are having trouble selling/placing them — these people often get to a point where they just want out from under the expenses.

4. Look for new strategic alliances with people who may want to consign horses for sale or develop interesting partnerships.

C. Discounted Equipment and Improvements — Now could be a good time to buy the new used Truck, trailer, tractor, barn, fencing you’ve been needing. Be sure to look for nearly new used, as it is generally the best buy. You can even find used deals on some types of fencing and barns.

You may find that for the next couple of years you have to work harder to earn a living and make ends meet, don’t lose heart! Tough it out! Economic cycles are just that — a cycle. The down will turn into an up before you know it. Use this time to improve and stabilize your business and position it for solid growth in the future.

In order to implement the 7 Steps to Recession Proof your Equestrian Business, One of the most important things you can do is, learn more about how marketing affects your business, especially how important it is to correctly and consistently market to your current customers. Remember Marketing is not limited to advertising — is everything you do to promote your business AND it doesn’t have to be expensive to be effective.

Equestrian Professional.com provides career support and business resources to horse professionals If you found this information helpful be sure to sign up for our free weekly newsletter. You’ll get great marketing & business tips just for horse professionals — plus you’ll also receive The 10 Best Ways to Increase Your Profits in The Horse Business.

Share this Article