People are the key to farm expansion
It’s time to publish your Farm of the Future report. I am Tim Hammerich.
Kristjan Hebert is a Saskatchewan farmer who grew his operation from around 3,500 acres to nearly 30,000. To maximize his investment in fixed costs, he focused on growing in 8,000-acre chucks . But he says the key to this tremendous growth isn’t equipment or technology, it’s people.
Hebert… “Equipment is a fixed cost, people are an investment. Not a cost. But the only way to minimize your fixed costs is to actually have the most efficient investment you’ve ever had, because they’re the ones that really optimize all of your fixed costs. And so the rate at which we hire people is the rate at which we’re trying to get to the next multiple of 8,000. And we’ve realized that people are actually what allow us to minimize fixed costs, not necessarily acres.
Hebert is a former CPA and says focusing on building his team has helped him maximize his return on capital.
Hebert… “So, I mean, last year we expanded, you know, as a net expansion, about 6,000 acres and we didn’t hire anybody. He came close to the 8,000 multiple. The team was probably the best functional team we’ve ever had. And so our fixed costs have collapsed, right, from 6,000 to 24,000 acres. So, I mean, we had a significant drop in fixed costs and yet we performed as well as ever.”
In addition to farming, Hebert owns Maverick Ag, a consulting firm for other farmers.