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How do you decide your Board Rate?

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  • #21
    Originally posted by Jaideux View Post
    And I will never, never open a boarding operation if I can't afford to run the whole place without boarders. Their income is the icing on my (hypothetical) cake. That way I would never have to agonize over kicking out an awful boarder out versus having the income. And I can afford to absorb a boarder moving 3 horses out all at once.
    I find this is a VERY useful way to think about boarding. While I would be pinched if ALL my boarders left, one or two won't sink me. And I agree, it gives me the ability to decide if someone will fit in here vs. only seeing the dollar signs when a potential boarder expresses interest in the farm. I think the ability to say "no" helps keep this a happy, smooth running place.

    However, the boarded horses pay their share of the farm taxes and maintenance.
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    • #22
      Nobody does anybody any favors in the long run unless boarded horses pay their fair share. If you want to keep 10 horses and board someone else's two, then the costs should be divvied up 12 ways. I had a particularly financially inept family member that rented out rooms to friends at oh $25 a week, when the rent was $600 and the other roomie paid half that, without a discount. God knows how they managed to split the utilities, but you need transparency in your charges, or at least something understandable or people get upset. And then they leave.
      Courageous Weenie Eventer Wannabe
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      • #23
        Boading costs

        Originally posted by RTF View Post
        Would love some ideas as to how you came up with a reasonable Boarding rate. I have never raised my rates, and I have done many improvements. Do you consider being small and private, an advantage or disadvantage?
        A basic formula is that you need to make 10% on your investment. In NJ land is expensive, a quick Google search showed me acres of undeveloped land going for 20,000 per acre. Since a horse in NJ requires one acre per horse your base cost at a CHEAP rate 200.00 for the land/pasture the horse requires. Then add facilities an indoor could add another 75-100.00 per month , then insurance, feed, hay, bedding, care and maintenance. Forget labor, there is no pay, you do however now have a steady income that helps at least pay for the property which is your "pay". I also have a basic board fee which covers the normal care of a normal horse. If the horse doesn't fit into basic board not a problem, I'll do anything to an extent, just be willing to pay for it, those "extras" are my pay.

        I can't say I find a small private place an advantage or disadvantage, it all depended on my goals at that time. I will say a trying to fit in to a small private place when you really want/should be at a full service fancy Hunter Jumper barn with all the trimmings is a disadvantage to all involved.

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        • #24
          The only thing that matters is can you be priced competively with other barns in the area? No matter what your costs are, or what the numbers work out to, you can't charge signifigantly more for a similar product than others are.
          This is true and is so often missed in these discussions especially by people who have never done this but have lots of advice for those who have done this :-).

          I cannot charge what I should be charging.

          And for those who say, well don't board horses, then-

          that is also true -but some expenses are there whether you have boarders or not so for me it helps with the bills so I choose to do it. As I get older it makes less sense, though.

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          • #25
            Our board rate(s) will factor not only insurance costs, building costs, maintenance costs, other local boarding facility rates of the same size, but also our relative proximity to local horse attractions. (ie. we are less than a half mile from a local hunt club, and we are very, very close to trails). Also, I'd like to factor in our relative proximity to interstate travel. From our house, you can literally head any direction in this country within minutes. As a mom with children playing hide n seek, this is a nightmare...but for a horse owner...

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            • #26
              Originally posted by ReSomething View Post
              Yes, but we've all heard the stories of the disgruntled boarders tired of paying for the BO's horse hobby. And cash poor usually translates to skimping on the business end, NOT the BO eating Ramen and doing without Direct TV.
              I don't mean to make this into a BO/HO conflict. Some HO's eat Ramen too. I'm a cable-less HO.

              It used to be that the farm was also a decent real estate investment. Many trainers I knew in the SF Bay Area regarded their farm as a golden parachute of sorts. So whether anyone is forgoing TV or healthy food or whatever in order to have a farm or a boarding business, perhaps they need to think of that as supporting an investment strategy. Dang, regular old home owners could do the same thing-- pay a huge mortgage and have the sucker unfurnished on the inside. I have seen that, too.

              I don't know if anyone can treat their house or farm this way anymore.
              The armchair saddler
              Politically Pro-Cat

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              • #27
                Originally posted by casper324 View Post
                A basic formula is that you need to make 10% on your investment. In NJ land is expensive, a quick Google search showed me acres of undeveloped land going for 20,000 per acre. Since a horse in NJ requires one acre per horse your base cost at a CHEAP rate 200.00 for the land/pasture the horse requires. Then add facilities an indoor could add another 75-100.00 per month , then insurance, feed, hay, bedding, care and maintenance. Forget labor, there is no pay, you do however now have a steady income that helps at least pay for the property which is your "pay". I also have a basic board fee which covers the normal care of a normal horse. If the horse doesn't fit into basic board not a problem, I'll do anything to an extent, just be willing to pay for it, those "extras" are my pay.

                I can't say I find a small private place an advantage or disadvantage, it all depended on my goals at that time. I will say a trying to fit in to a small private place when you really want/should be at a full service fancy Hunter Jumper barn with all the trimmings is a disadvantage to all involved.
                If you are making 10% per annum on your investment, you are doing very, very well. You can't do that in the stock market at present. Most people aren't doing that with real estate just now. So it would surprise me if our presently week economy would supply you with boarders who could pay at those rates. After all, those payers are losing purchasing power, too because they ain't makin' no stinking 10%.

                The very sad fact that folks have pointed out here is that it's often local competition that has the greatest effect on what a BO can charge. That must be painful and frustrating for someone who, say, doesn't own the farm outright or runs a training business as nearby farms do.

                The other truth to be derived from all this is that boarding is a great deal for most of us because the profit margin is so slim. So even if board seems like a big check to write every month, we'd be hard pressed to do it better for cheaper ourselves.

                I for one couldn't afford to own the farm and ring I'd like to ride in, you know? I'm happy to help someone else by paying one-horse-worth of their investment in all that infrastructure.
                The armchair saddler
                Politically Pro-Cat

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                • #28
                  MVP

                  "The very sad fact that folks have pointed out here is that it's often local competition that has the greatest effect on what a BO can charge. That must be painful and frustrating for someone who, say, doesn't own the farm outright or runs a training business as nearby farms do."

                  EXACTLY and why many of the reputable H/J barns in the area are what I consider a bargin for board considering what you get for the money, but they make it up on training/lessons. We all have our must haves regarding boarding if its direct access to trails for the trail rider to a full Cross Country/Dressage Ring and Jumping ring course for the Eventer and usually know those must haves come with a price.

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                  • #29
                    You can only charge what the market will bear!! In the end you have to have some one willing to pay what you are charging.! Some times that will be enough to cover expenses some times not!

                    Dalemma

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                    • #30
                      The following are the average basic fixed costs for a stalled horse. Higher in some areas a bit lower in others.

                      Feed $3
                      Hay $3
                      Straw $3 (+- for shavings)
                      Labor, mucking, turn out and in, watering, etc, higher if grooming is involved
                      $10 +-
                      Total per day $19 per month $570+-
                      Don’t see how people can do it much cheaper using quality product and employees
                      This does not include property insurance, liability insurance, workman’s comp and a minutiae of other things that all add up.
                      Cost and up keep of property. Costs for borrowed money, utilities, costs of equipment etc.
                      In the end you always get what you pay for. Fixed costs are fixed costs no way of getting around that. Unless you cut corners.
                      All of this has to be factored in. I don’t do it for the money.
                      Our 501K is our property. We paid through the nose to buy into the “right” area and have not over built. We also diversify our profit centers. There is very little gravy if any in just boarding for most operations.

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                      • #31
                        gumtree- I recently put together a very detailed business plan for a facility my husband and I have an offer on in the San Diego area, and came up with similar numbers as you. If I calculate the absolute barest miniumum of bedding and hay costs (I called around and got an average price of $0.17/lb), I come out to $193.38/ horse. That's no grain/ feed (it's common in CA that owners provide all non-hay feed at their cost), labor, insurance, facility maintenance, ring/ arena maintenance, improvements (new jumps, putting a real bathroom in the barn, etc) or small profit for myself.

                        As per the other comments, I couldn't charge enough for the area to make it even close to worth my while. I'm certainly not going to enter in to the business of subsidizing someone else's horse habit and then listen to them complain about how much board costs (please feel free to go buy your own place then, and run/ maintain it exactly how you see fit)

                        I have decided to keep it private, play with my kids on their own ponies, breed some beautiful babies, do some OTTB retrain projects, and have one or two private boarders (people I like and with whom I see exactly eye-to-eye on horse care) to help me with stuff when I travel for work.

                        I wish every boarder out there would run their own facility for awhile and then they would have a very visceral appreciation of exactly what they are paying for when they write that board check every month. And would probably write it gladly with no complaints for ever after!
                        ~Living the life I imagined~

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                        • #32
                          Detailed spreadsheets are wonderful for determining boarding prices. It's also important to consider what other comparable barns in the area are charging, but in doing this I would only compare with barns that have been in business over the long term. There are many fly-by-night operations where people charge less than what it really costs them per horse and these people usually end up getting out of the business very quickly.

                          The last factor to consider is what price makes boarding "worth it" to you, the BO. For example, you may have calculated all of your facility, labor, insurance, feed and bedding costs, but what would someone have to pay you to spend an entire Saturday (when you had other plans) dealing with getting a problem boarder moved out? Or what it is it worth to you to be stuck dealing with someone else's sick horse Christmas day when the owner is out of town (or just "too busy with family") and the rest of your family is sitting down to dinner without you? How much do you need to charge so that you aren't upset every time you go out to the barn and find other people's messes waiting for you? There are a lot of minor (and sometimes major) hassles and inconvenience associated with having boarders, and I think it is important to charge enough that you don't end up resentful.

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                          • #33
                            Man I'm glad BeeHoney showed up

                            Here are my points, to add:

                            Originally posted by mvp View Post
                            Now if you want to "grandfather" in long-time boarders such that different people are paying different prices for the same services, you are on your own. This is another practice to be found in our industry and I think its a recipe for disaster.
                            I agree it CAN be a no-no, but I've also found that since it's no one else's beeswax what others are paying, it can also be a non-issue. What I always did in the past was offer a multiple horse discount. Encourages people to stay and/or board more critters.

                            Originally posted by Jaideux View Post
                            And I will never, never open a boarding operation if I can't afford to run the whole place without boarders. Their income is the icing on my (hypothetical) cake. That way I would never have to agonize over kicking out an awful boarder out versus having the income. And I can afford to absorb a boarder moving 3 horses out all at once.
                            Pretty good idea...except, who buys a Starbucks without planning on customers? Someone who says "I will only own a coffee shop so I can afford to be the only person there, drinking coffee, customers would be a bonus." A boarding facility is still a business. Unless you are bringing in a couple people for company, each horse is going to cost money, more than the facility just being used by you with empty stalls. Just playing devil's advocate .
                            COTH's official mini-donk enabler

                            "I am all for reaching out, but in some situations it needs to be done with a rolled up news paper." Alagirl

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                            • #34
                              In terms of the "profit that makes boarding worth your while," one way to look at this is to ask if running a boarding business allows you to buy more land or a better facility *that you enjoy* than you could have otherwise.

                              I know more than one family that has built an indoor with this strategy in mind.

                              I personally wouldn't. I don't think there's enough money in boarding for me to make that addition pay for itself. And.... this is one of the reasons I'll never run a regular boarding stable. I wouldn't want to ride on the POS farm I could afford.
                              The armchair saddler
                              Politically Pro-Cat

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                              • #35
                                As a small BO with a private barn and two boarders I don't expect the boarders to cover all of my fixed costs. What I do expect is that the board that I'm charging covers all of my per horse variable costs (hay, grain, bedding) plus an amount over the variable costs to cover my time and perhaps some fixed costs. I calculated recently that it costs me roughly $300 a month for hay, feed and shavings per horse. I charge $475 for stall board and $350 month for pasture board (same amount of feed and hay, no bedding costs).

                                It's crazy to compare my board at a small private facility to the cost of boarding at a professional's barn with a full-time trainer and grooms available. While I offer very good care and quite good facilities including an arena and access to trails, I am not a professional trainer and don't offer lessons or training rides or full care board including grooming and tack up service.

                                To suggest that small private boarding facilities are under cutting prices is like comparing spending a night at a Motel 6 to the Four Seasons. Both offer hotel/motel services including a private room, bed and shower. Try calling room service at the Motel 6! The cost of spending a night at Motel 6 is most likely well under $100 vs. maybe $300 to $400 a night at the Four Seasons. Is Motel 6 undercutting the Four Seasons? I don't think so, since customers are willing to pay considerably more to rent a room at the Four Seasons for the service and ambiance that the Four Seasons offers. Conversely, if you pay $60 to spend the night at a Motel 6 you don't expect much more than a clean room (hopefully) and a working shower.

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                                • #36
                                  Originally posted by BeeHoney View Post
                                  The last factor to consider is what price makes boarding "worth it" to you, the BO. For example, you may have calculated all of your facility, labor, insurance, feed and bedding costs, but what would someone have to pay you to spend an entire Saturday (when you had other plans) dealing with getting a problem boarder moved out? Or what it is it worth to you to be stuck dealing with someone else's sick horse Christmas day when the owner is out of town (or just "too busy with family") and the rest of your family is sitting down to dinner without you? How much do you need to charge so that you aren't upset every time you go out to the barn and find other people's messes waiting for you? There are a lot of minor (and sometimes major) hassles and inconvenience associated with having boarders, and I think it is important to charge enough that you don't end up resentful.
                                  Absolutely agree with the above. Once I put my own detailed spreadsheet together, it very quickly became evident that I would not even make close to enough money to make boarding "worth" it, let alone save a cushion to repair extra damage done by extra horses, replace arena footing, fencing, and other capital more quickly due to extra wear-and-tear.

                                  What I AM still considering is a straight rental of a portion of the property (10 stalls with full access to all amenities). I already had a ballpark number in my head of what would be "worth" it to me to do this, and I just went back and pulled out all the fixed costs that having all those extra horses and having to establish an LLC or corporation would entail (liability insurance, equipment maintenance, LLC fees & taxes, capital depreciation). I added a proportional cost of the utilities (water, electric, manure removal). I put on a 10% profit, and came up with $1232.56/month. Surprisingly, that just about dovetails perfectly with the $1250/mo I had in mind! It's also pretty in tune with other similar facilities I've seen for rent in the area. Doesn't leave me much cushion though for any major damage or upgrades.

                                  However, what that means to a trainer coming in is that before she makes a single dollar, she's looking at $193.38+$123.26 = $316.64/ horse in direct costs- and I still haven't factored in her labor or any profit for herself, and that means she has to have all 10 stalls full. I would also absolutely require her to have her own liability insurance, so that is an additional cost off the top. For a decent trainer I think it's doable, if she charged ~$500 board and then had her own training fees on top of that. Still, it's a hard way to make a living. IMO.

                                  The benefit to me is that I get a regular monthly income that accounts for most of my fixed costs, and I don't have to deal with the hassles and minutiae of boarding- the trainer has the joy of managing all that. I'll still have to have oversight over the whole facility, but will have one point of contact (the trainer) to work out conflicts.
                                  ~Living the life I imagined~

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                                  • #37
                                    Originally posted by BeeHoney View Post

                                    The last factor to consider is what price makes boarding "worth it" to you, the BO. For example, you may have calculated all of your facility, labor, insurance, feed and bedding costs, but what would someone have to pay you to spend an entire Saturday (when you had other plans) dealing with getting a problem boarder moved out? Or what it is it worth to you to be stuck dealing with someone else's sick horse Christmas day when the owner is out of town (or just "too busy with family") and the rest of your family is sitting down to dinner without you? How much do you need to charge so that you aren't upset every time you go out to the barn and find other people's messes waiting for you? There are a lot of minor (and sometimes major) hassles and inconvenience associated with having boarders, and I think it is important to charge enough that you don't end up resentful.
                                    This is so important. I never considered this when deciding to allow some friends to board their horses at my place. I thought it would be different becasue they were friends. I charged going market rate for my area, because you certainly can't charge more. This covers cost of feed and bedding and labour but is less than my monthly cost per horse because utilities are so high and I have so few stalls. So basically I run the operation for free and subsidize other people's horse habit. I hate how little gratitude I get for the effort I put in for other people's horses at the expense of my own enjoyment of my own facility. I basically have no time to do my own horses and feel like all I do is listen to people to complain. Initially I thought having the boarders would help defray the cost of utilties and help support my own horses. The reality is that people are not considerate about turning lights off since they don't pay the bills so utilities are signifigantly more and the insurance required to have other people's horses makes it more expensive than just having my own.

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                                    • #38
                                      Originally posted by TheJenners View Post
                                      Man I'm glad BeeHoney showed up
                                      Yes!!

                                      I think one of the farriers says "charge 'em till you like 'em", a succinct way of putting it!
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                                      • #39
                                        Originally posted by TheJenners View Post
                                        Man I'm glad BeeHoney showed up

                                        Here are my points, to add:



                                        I agree it CAN be a no-no, but I've also found that since it's no one else's beeswax what others are paying, it can also be a non-issue. What I always did in the past was offer a multiple horse discount. Encourages people to stay and/or board more critters.
                                        In my book there is a fallacy in this thinking. That second or third horse costs as much to feed, hay and bed. It does not make less manure. It does not turn itself out or in, and they don't straighten each others blankets. It is covered under care, custody and control insurance. If it gets a laceration, it will be just as much trouble to care for. Takes just as much time to hold for vet, farrier, etc.

                                        It is just as much wear and tear on your fences your arena,pastures and your tack room.
                                        Some riders change their horse, they change their saddle, they change their teacher; they never change themselves.

                                        Remember the horse does all the work, we just sit there and look pretty.

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                                        • #40
                                          Originally posted by RTF View Post
                                          Would love some ideas as to how you came up with a reasonable Boarding rate. I have never raised my rates, and I have done many improvements. Do you consider being small and private, an advantage or disadvantage?
                                          I based my board rate firstly by factoring in what my rent on the barn was going to be and dividing that by the number of stalls. Added in costs for shavings, hay, grain, etc..., and built into my contract that board only covered x lbs of hay/day, ditto grain... Then you are not loosing your butt when you get a crazy hard keeper (or 10...)

                                          Also factored in what other barns were charging, what they offered, what the facility had, and -important- how full they were.

                                          I was able to save where some larger barns could not, for example, my first place was 8 stalls. I was able to get shavings from my uncles cow farm for next to nothing, my dad was a trucker so he brought me hay from a family friend in OH, for next to nothing, things like that.

                                          I am now in a 20 stall barn and have raised board 3 times in 7 years, $25 per increase. Private can be an advantage or disadvantage depending on market needs.

                                          Improvements you should consider raising board for would be a new ring, new footing, lights in ring, things boarders use and appreciate on a daily basis. Even though fences need fixing, or you upgrade the wiring, those things most people will not like paying extra for.
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