I understand where economists are coming from when they warn against owning too much iron and keeping a lid on costs. It’s sound advice in a high margin business, let alone a low margin, highly competitive enterprise like we are involved in.
When I got out of school, I had the low cost mentality firmly imprinted on my brain. I’ll never forget my neighbors pulling into the yard and asking me, “Is that all the hay you have?” and shaking their head in disbelief when they realized that I didn’t own a tractor. Admittedly, they were impressed when I finally got a tractor after seeing my lovely wife feeding cows in -20 degree weather without a cab. I don’t know this for a fact, but I think some of them thought I was so cheap that I would end up with a new wife before I ended up with a new truck.
Time and experience, though, have a way of changing one’s perspective. I have a cab on the tractor now, I love our hydraulic chute, and while I’m not sure my wife would say I need to be mounted as well as I am, you’re going to be hard pressed to find me riding out on some jug-headed old plug.
Here is what I’ve come to discover: incentive and motivation are two critical ingredients to success, and by living on the economic edge ,it provides a certain urgency that can be a big help from time to time. There is nothing that will get you up at 3:00 in the morning to check heifers in cold weather like realizing that the budget you created to pay for those new kitchen cabinets not only requires a 100% calf crop but at least two sets of twins.
While I’d never advocate spending money like our politicians, you have to admire their creativity. They can spend money they don’t have and call it a cost saving. They way I look at it, that new aluminum trailer is merely a push to help one think out of the box. As they say, necessity is the mother of invention, and my changing perspective on iron, if nothing else, forces me to look at things in a new way.
Disclaimer -- If my banker happens to read this, I want to say in advance that this article was sent to me by a reader who wishes to remain anonymous.