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  1. #1
    Join Date
    Jul. 10, 2003
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    Virginia bred, Carolina transplant
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    Default Can you really make a profit???

    Another thread has me wondering if breeding can actually be profitable. One of the posters exclaimed that they were done breeding - too much risk and not enough money in it. I have bred some of my own mares and it was not profitable (wasn't targeted to be as they weren't planned as resale)... I also worked for a huge breeding farm (5+ stallions and lots of babies every year) - but they also boarded a good number of horses so I'm not sure if the boarding actually funded the place more than the babies. So my question for you would be:

    1. Do you make a profit?
    2. If so, what do you breed?

    I think it would be interesting to see if a certain type or breed is in more demand/profitable...



  2. #2
    Join Date
    Apr. 2, 2009
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    285

    Default

    For some people it is and others it's not. I don't think boarding is big money maker.



  3. #3
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    Jun. 23, 2004
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    Fauquier County, VA
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    Default

    Boarding is not a moneymaker. Training, showing, and giving lessons and clinics can be. Breeding can be, but if you have bad luck one year you can take a really big hit. My advice would be to not get into breeding expecting to get rich, unless you breed racehorses and are awesome at it.



  4. #4
    Join Date
    Dec. 9, 2005
    Location
    Australia
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    725

    Default

    It's weird - I've got a broodmare (she is now 7 years old). She has cost approximately $3000 to produce herself to a 7yo (trouble free in every sense). The studfees for her two foals have added up to $4000 inclusive and her progeny have sold for $6,500 each prior to weaning. So on an individual basis this mare has made me a profit.

    It's all the other sh*t that happens that costs a fortune. I'm not going to make a general profit until I sell another FEI horse.

    Edited to add - I breed Holsteiners for dressage and jumping - this mare was bred to an outside, imported Oldenburg stallion for dressage prospects. She gave me two colts, I might have kept a filly in which case she wouldn't have been "in profit" either.



  5. #5
    Join Date
    Mar. 1, 2007
    Location
    Canada
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    4,215

    Default

    Hmm, I don't know to be honest. We have never really ended up trying to sell the offspring yet but I can say that it does seem that whenever a person has "good luck" in the breeding, it is not likely to hold out for long.

    Last year we got all three of our mares pregnant first try with frozen semen..everyone thought we were so lucky. We also had three healthy fillies born from these mares. Yup, definately lucky. But this last winter one of our mares aborted her Quaterback foal at around 5 months and things just went downhill from there. We lost one of the fillies we had last year, a beautiful black keeper filly to a shattered cannon bone a few weeks ago (she was also from the dam who aborted the foal). Then to top this season off, we have only one mare pregnant out of three. We went through over 11k worth of semen and 8 frozen semen attempts between the three mares each at around 1000 - 1500 bucks a cycle. So you can do the math. It's painful lol.

    In all honesty though, we have had good enough offers on a few that if things went well, a person could certainly make a profit. But, things have to go well and that just doesn't usually happen on a regular basis lol. I think it is much more profitable to keep them and start them and get them going, if you have the resources.

    ps..we breed Hanoverians.
    www.svhanoverians.com

    "Simple: Breeding,Training, Riding". Wolfram Wittig.



  6. #6
    Join Date
    Mar. 17, 2006
    Location
    Sunbury, NC
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    1,789

    Default

    We breed Hanoverians/Oldenburgs, etc for the hunter ring mostly, and I agree with Donella, "if things go well" you stand to make a profit.

    For last year (foaling year 2008) we had 5 mares in foal. One aborted at 8 months, one had placentitis and we lost the foal at NC State after 24 hours and a lovely vet bill, then we had a dummy foal that spent 2 weeks at NC State with an even lovelier bill but luckily survived to be healthy.

    This year (09) we had a mare abort undetected twins in January and almost die from a retained placenta for 6 days (in ICU for a week, nice), a baby with a patent urachus spend 5 days at the emergency clinic, and had another with an umbilical abcess which luckily rectified without surgery but $ in antibiotics and vet bills at home. And we're in August and only have 4 out of 8 mares confirmed in foal right now (checking 2 tonight, fingers crossed)... so not looking good as far as profit for next year.

    Thinking back, it's always kind of been bad. For foaling year 2007 we had two mares die in foal, one of cancer and one of a heart attack, about 2 months apart in the winter before foaling... so that was a fine how do you do...

    For foaling year 2006, I think all went reasonably well. I think that was probably our best year, 4 mares in foal on the first try and all healthy foals born. BUT, then one 10 day old foal shattered his knee running in the field.

    For foaling year 2005, there were no foals born because we had a mare abort twins in November (04), a mare that lost her pregnancy due to a wound that required strong antibiotic which killed the baby (had no choice, had to get the mare well), and a mare that didn't resolve twins - too bad we didn't have the vet we have now - and pregnancy had to be ended. So all was lost that year.

    We do investment horses as the other "half" of our business and that is where the profit is. If we didn't breed we'd actually be way better off, as the sales float the breeding part. We'd be miserably in the hole probably without that - not sure how people afford to breed without something like that honestly!! Our day jobs definitely couldn't swing the bills in addition to household expenses.

    If we just had a year where everyone got in foal quickly and the foals were all healthy and there were no incidents, we would be well off, if they were sold as weanlings. So far we've not had that happen. Keeping them long term is not profitable if you look at the true cost from breeding and keeping the pregnant mare up until they are 3 and broke, unless they are selling for $50k or something, but still return on investment is not near as good as if you sell as a weanling.
    Signature Sporthorses
    www.signaturesporthorses.com



  7. #7
    Join Date
    Dec. 7, 2006
    Posts
    867

    Default It depends on your business model

    Breeding is just like any other business, you have to do everything you can to maximize your revenues, be very diligent about cost control, and be prepared to cut your losses.

    Where breeding differs is that most breeders (at least of sporthorses) tend to get emotionally attached to their "product" and have a hard time making tough business decisions.

    I have a friend who is a very successful breeder of racehorses. His horses sell for a lot more than what sporthorses typically do, but to me that just means he has more to loose.

    He has a band of about 30 broodmares, so he can spread out his fixed costs and risk. His success or failure does not hinge on any one foal. Most sporthorse breeders do not have that many mares, and therefore assume much more risk.

    If a mare is not producing or stops producing, he will sell her.

    He will NEVER put more into a foal than he can get out of it. This is a common mistake I see sporthorse breeders make.

    In short, whether or not you can make a profit at breeding depends on the choices and decisions you make.



  8. #8
    Join Date
    Mar. 17, 2006
    Location
    Sunbury, NC
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    1,789

    Default

    Ravencrest has a good point - most people don't run horse business as a business, but it's just the same as selling shoes, or houses, or cars. Same principles apply.

    That's not to say your heart shouldn't be involved, but if you look at those who are most successful, they do treat it as what it is, a business, and don't let their heart get in "the way"... of course we love our horses to death but do consider the business aspects very strongly.

    For example, if our broodmares are aged and can no longer produce, they have a retirement home for life with us. We love them as family. Some who are strictly business-minded would get rid of them and we see that happen all the time, sending them through auctions and so forth at 18, 19, 20 years old.

    If you're not looking to make money (or try) , then you can do whatever you feel!
    Signature Sporthorses
    www.signaturesporthorses.com



  9. #9
    Join Date
    Jun. 9, 2003
    Location
    Alabama
    Posts
    5,578

    Default

    I think the only way to possibly make a profit with horses is if you offer a service and don't own the horses or the facility. If you teach or train or maybe offer another service, it's more realistic to make some $. Too much can go wrong with living creatures or a facility that depends on them.
    PennyG



  10. #10
    Join Date
    Jun. 23, 2004
    Location
    Fauquier County, VA
    Posts
    10,467

    Default

    Quote Originally Posted by Signature View Post

    For example, if our broodmares are aged and can no longer produce, they have a retirement home for life with us. We love them as family. Some who are strictly business-minded would get rid of them and we see that happen all the time, sending them through auctions and so forth at 18, 19, 20 years old.
    This issue has been raised here before but culling mares, sending them to auction, etc does NOT fly with a lot of US clients, so to the extent a business values its reputation, it may not make much business sense at all to try to save a few bucks that way and risk alienating clients.

    Someone else mentioned not putting more into the foal than you could possibly ever get out - that is important, I think, to the extent one can control that. We breed top quality mares (they are my competition mares, not typical broodies) to the best stallions available. The idea is to produce horses at the top of the market for their particular age and level. Obviously, some will turn out that way and some won't. But the good ones need to be very, very good.

    Also, there is profit and then there is profit. Saying you paid 2K on a stud fee and made a profit because the foal sold at birth at 4K or the like is not a profit unless somehow that foal had no mother, no costs for breeding and maintaining the mare through pregnancy, and was incubated on land owned by someone else with free utilities and was born unassisted.



  11. #11
    Join Date
    Dec. 14, 2007
    Location
    Wilsonville, Ontario, CANADA
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    4,647

    Default

    We breed dilute TB's and TB crosses and we do well every year with the foals that we produce

    While the stud fee revenues from my stallion fund the overall running of the farm and maintenance / upkeep, and also foot the bill for any open mares that dont have a foal to sell, the foals that are produced pay the upkeep on themselves and their dams plus a nice profit as well

    Where breeding differs is that most breeders (at least of sporthorses) tend to get emotionally attached to their "product" and have a hard time making tough business decisions.
    Agree 1000%

    If that mare (or stallion) isnt producing a stellar foal that consistently allows the breeder to turn a profit and make a decent living, I simply cannot understand WHY they continue breeding him/her. There are quite enough cheap foals out there that cannot find a home and/or do not sell for prices that allow a profit to be made - why continue to produce something that will be an uphill struggle to even sell at ANY price???

    That's not to say your heart shouldn't be involved, but if you look at those who are most successful, they do treat it as what it is, a business, and don't let their heart get in "the way"... of course we love our horses to death but do consider the business aspects very strongly.
    Again - agree 1000%. Profit does NOT have to be a dirty word. I purchase all of my mares because they are excellent examples of what my breeding program is all about and they are all mares that I view as excellent broodmares or broodmare prospects. BUT ... mine is also a very narrowly focused, niche market breeding program, and there is every possibility that fabulous mare will NOT niche well with my stallion. Doesnt mean she cannot be a stellar producer in someone else's program, but if she doesnt fit in mine - she goes, and its that simple and that straightforward. Ive said it before - I have to look at that foal standing there and want to mortgage my heart, my soul and my home to buy it and if it doesnt evoke that strong an emotion in me, it sure as heck wont in any buyer I am asking to fork over money to buy it either ... and if that mare isnt capable of producing that level of foal, the decision is made to cut her from the broodmare band

    For example, if our broodmares are aged and can no longer produce, they have a retirement home for life with us. We love them as family.
    My one mare that I owe a lot to, is 13 this year. My intention with her is to hang onto her once she reaches the end of her reproductive life and I really hope I am in a position to do so. But I do know I would never in a million years send her through any auction trying to squeeze the last few hundred dollars out of her. If it came down to a situation where I was not able to look after her well and properly and I had no one that I trusted enough to send her to, she would be stuffed full of her favorite foods and the vet would come and put her to sleep in my presence and then I would never wonder what happened to her and if she was okay. My other mares are all younger and I know would have useful and productive lives for many many years yet to come ...



  12. #12

    Default

    Quote Originally Posted by TrueColours View Post
    We breed dilute TB's and TB crosses and we do well every year with the foals that we produce...
    WE KNOW!!!
    ~ Bill Rube ~
    http://www.bydesignfarm.com
    Check us out on Facebook



  13. #13
    Join Date
    Sep. 26, 2008
    Location
    Vancouver, BC
    Posts
    435

    Default

    I'm going to agree with many breeders on here who have said that there is a possibility to make a profit, pending that everything goes well. In my experience, we haven't ever had a year when everything went 100%, that just seems to be the horse business. This year has been especially bad, we lost a mare and her in-utero foal 30 days before she was due (to a freak foal colic), 1 foal just had umblical surgery to remove her stump, 1 mare needed an array of stitches after cutting her chest open in our post and rail paddock (on godness knows what??) and several mares that have needed to be bred more than one cycle. So, this year....not going to be profitable and probably going to eat any profit we might have next year...LOL. Thankfully, we put up our own hay so we don't have to contend with the almost 50% increase in feed we have here this year :-)
    Having said all this, on a more positive note we've had some great foals over the years that have done well at their inspections and gone onto awesome homes. That is what we are in the business for....
    Proud Momma:

    Imax - Fresstyle x Juventus x Rubinstein
    2014 - Sister to IMAX (hopefully)



  14. #14
    Join Date
    Sep. 3, 2005
    Location
    Northern California
    Posts
    433

    Default

    I'd love to make a profit. However, just this week I've been to the vet twice with my yearling (that I would like to take to the IHF in 2 and 1/2 weeks). Tuesday night she jumped out of her field, minor damage in the grand scheme of things, 2 stitches in the stifle; hair patches on the fence indicate she caught the stifle on the sight rail on the way over (said sight rail is hung at 5'). Today I get on her mother for a quick hack in the arena, come back 1/2 an hour later and the filly's cute little white face is bright red all down the middle. 10 staples later it looks pretty good and should have the staples out on Aug 18th. IHF? Profit? Neither seem very likely this year. In fact, I think I'm going to print out this thread and keep it for when the IRS sends me that "you're being audited" notice - the posts above indicate the many reasons why it's difficult to make a profit breeding horses.



  15. #15
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    Mar. 15, 2007
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    (throw dart at map) NC!
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    6,296

    Default

    I think another important factor in the breeding "bottom line" is the services you, as a breeder, provide to your own operation and the vet that you use.

    I have a friend who breeds warmbloods for dressage who used a local (high end) repro vet for breeding. This vet charged (alot) for *everything* separately (visits, ultrasound, etc.) - he made money whether the mare took or not. It cost her a LOT to put a foal on the ground. She has to sell for a high amount to make a profit. I have another friend who also breeds warmbloods for dressage (exact same bloodlines as friend #1). It costs her only hundreds (minus stud fees) to get a foal on the ground because her repro vet charges a flat fee for the season - all ultrasounds and visits included. Thus, it is in the vet's best financial interest to get the mare in foal fast. And they are very good and very experienced. It costs her only 3-6K with stud fees to produce a sellable 3-4 year old on average (injuries and unforseen craziness excluded!!). She has a large profit margin (if she ever decided to sell, that is!).

    Just something to ponder.



  16. #16
    Join Date
    Jun. 23, 2004
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    Fauquier County, VA
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    Default

    Quote Originally Posted by J-Lu View Post
    IAnd they are very good and very experienced. It costs her only 3-6K with stud fees to produce a sellable 3-4 year old on average (injuries and unforseen craziness excluded!!). She has a large profit margin (if she ever decided to sell, that is!).

    Just something to ponder.
    This I do not believe. I really don't. I would be very curious to see the accounting on that, because I can bet you that person is leaving out a number of expenses that a breeding business is supposed to attribute to each horse produced. What about feed? Vaccines? Farrier care? Teeth floating? Dewormer? Supplements for proper bone growth? And a sellable 3 to 4 year old should be going under saddle. Even assuming she starts them herself, her time is not free.

    Also, given that these are youngsters, it is fairly meaningless to quote an average that excludes injuries and other extraordinary expenses. Based on that approach, I could have retired already.



  17. #17
    Join Date
    Jun. 2, 2009
    Posts
    1,258

    Default

    Just following on from Yankee Lawyer's comments. I own my farm, we make our own hay and have loads of good grazing pastures. A couple of years ago I did the math for each horse we own and the average price to keep a horse per year worked out at around $1k per annum. That included farrier trims (no shoes), wormers, vaccinations, feed, hay (at discounted price to myself since we make it) etc. It did not include any injuries requiring vet attention or entry fees for shows, all my time training these horses and as we do not have a mortgage or payments for anything then this was a pretty true figure *for us*. However, from a business perspective, all of my horses take up space on my farm. The more horses I own here, the less "paying" horses I can take; the hay my own horses eat, the less I can sell for a non-discounted price; the training I put into my own horses means less training for paying horses; therefore these cost really should come into the equation. For anyone holding a mortgage or paying for trucks, trailers, paying for training etc. To do this costing effectively you need to include these figures to give a clearer price.



  18. #18
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    Mar. 15, 2007
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    (throw dart at map) NC!
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    Default

    Quote Originally Posted by YankeeLawyer View Post
    This I do not believe. I really don't. I would be very curious to see the accounting on that, because I can bet you that person is leaving out a number of expenses that a breeding business is supposed to attribute to each horse produced. What about feed? Vaccines? Farrier care? Teeth floating? Dewormer? Supplements for proper bone growth? And a sellable 3 to 4 year old should be going under saddle. Even assuming she starts them herself, her time is not free.

    Also, given that these are youngsters, it is fairly meaningless to quote an average that excludes injuries and other extraordinary expenses. Based on that approach, I could have retired already.
    Well, you can believe it. Maybe $3K is too low but certainly $4-6K. Her husband is a professional accountant-they keep detailed records of her business. They live in west Texas - everything is a whooole lot cheaper than what you'll find in VA. I know this because a) I used to live in the general area and b) she has my horse. She does train and start them herself (she is an accomplished dressage rider/trainer).

    Obviously, it does not account for injuries or extraordinary expenses, but your long term profit margin will depend on how you handle these situations as well as how you handle your whole business. Thus, it is meaningless to include such numbers. And it most definitely depends on where in the US you are. I'm pretty sure that horse care services in northern VA aren't exactly cheap. The point of my email is that while *you* may not realize much of a profit (I am guessing you are more like Friend #1 in my previous post), some people have the potential to because of the way they set their business up (including *where* they set it up).
    Last edited by J-Lu; Aug. 8, 2009 at 02:03 PM.



  19. #19
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    Jun. 17, 2000
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    Durham/Chapel Hill nc
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    Default

    Quote Originally Posted by TKR View Post
    I think the only way to possibly make a profit with horses is if you offer a service and don't own the horses or the facility. If you teach or train or maybe offer another service, it's more realistic to make some $. Too much can go wrong with living creatures or a facility that depends on them.
    PennyG
    Interesting - not directly related to "profit," but a wise elder advisor of mine has commented that the only way horsepeople manage to retire with $ (or at all) is to have put money into land over the years. Then at least they can sell the hopefully appreciated land, or live rent free in elder years.

    IF I were going to try to breed for "profit" I think I would factor in whether the business was giving me the tax breaks which helped fund my land. I certainly can't imagine paying board and trying to make profit on breeding....



  20. #20
    Join Date
    Jun. 23, 2004
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    Fauquier County, VA
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    Default

    Quote Originally Posted by J-Lu View Post
    Well, you can believe it. Maybe $3K is too low but certainly $4-6K. Her husband is a professional accountant-they keep detailed records of her business. They live in west Texas - everything is a whooole lot cheaper than what you'll find in VA. I know this because a) I used to live in the general area and b) she has my horse. She does train and start them herself (she is an accomplished dressage rider/trainer).

    Obviously, it does not account for injuries or extraordinary expenses, but your long term profit margin will depend on how you handle these situations as well as how you handle your whole business. Thus, it is meaningless to include such numbers. And it most definitely depends on where in the US you are. I'm pretty sure that horse care services in northern VA aren't exactly cheap. The point of my email is that while *you* may not realize much of a profit (I am guessing you are more like Friend #1 in my previous post), some people have the potential to because of the way they set their business up (including *where* they set it up).
    I still do not believe it. Usually when I hear claims like this a little more probing will reveal that the breeder is not allocating utility costs, taxes, farm mortgage costs, etc as they are supposed to. In addition, your friend's training time is not free. If she is counting it as free, that is inaccurate.



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