Farm Succession Planning 101
Kendall and Rebecca discuss succession planning in agriculture with Seth Wilner, an Extension specialist with 26 years of experience. Seth defines succession planning as the strategic transfer of farm management and ownership to the next generation, emphasizing its importance in minimizing taxes, reducing family conflict, and ensuring business sustainability. He highlights the need for farmers to start planning early, maintain basic records, and assemble a trusted team of advisors. Seth also stresses the emotional and logistical challenges, particularly when dealing with family dynamics and remote stakeholders. He advocates for patience, grace, and the support of experienced mentors to navigate this complex process.
Show notes:
Seth Wilner – seth.wilner@unh.edu
Farm Credit East – www.farmcrediteast.com
Environmental Mediation Center – www.emcenter.org/nhamp/
Natural Resources Conservation Service (NRCS) - https://www.nrcs.usda.gov/
UNH Cooperative Extension: www.extension.unh.edu
Women in Ag Newsletter signup - https://unhoutreach.tfaforms.net/217751?CID=701G0000001AiKCIA0
Kendall Kunelius – kendall.kunelius@unh.edu
Rebecca Dube – rebecca.dube@unh.edu
Transcript:
Kendall Kunelius 0:00
Welcome to this episode of Shared Soil, a podcast dedicated to creating community, honoring challenges and encouraging personal and professional growth for all people in agriculture. My name is Kendall Kunelius, and I'm a field specialist in the area of agricultural business management.
Rebecca Dube 0:24
And I'm Rebecca Dube, providing administrative and technology support to the specialists of Extension.
Kendall Kunelius 0:30
So today, Rebecca, we've got a topic that's been a long time coming. And I say that a little bit facetiously, because this is succession planning. So I will tell you the first time that I went to an Extension event about succession planning was 2016. And at the time I was on - the town we lived in I was on like a town farm committee. And the town owned a piece of farm property. We were trying to decide what to do with it. And I was just trying to get some information. Our program team leader Kelly McAdam had hosted this day-long, seminar workshop thing about succession planning. And we heard from different farmers; we heard from Farm Credit East. We heard from a whole bunch of speakers who helped us wrap our heads around the idea of what does it look like when somebody is ready to exit farming, or there's a generational gap, or all the above, right? There's a hundred-million scenarios we could be going through about why succession planning is applicable, and that really stuck the term in my brain. So I then have heard recently from a farmer about the importance of succession planning. And this was, of course, only underlined heavily by our guest, Seth Wilner, and many other people that I've chatted with at Extension about succession planning. And of course, we heard from our young farmers on the previous episode about how important it was for them because they're both generational farmers. Lindsay was a generational dairy farmer. Gracie inherited an orchard and works on an orchard now. So they have this succession planning mindset of their own that's really important. We also heard from Andy Fast back in our timber episode about how important a forest management plan was, because that forest management plan is supposed to cover like, 100 years, right? Forests are such a long-growing crop. All this to say we have Seth Wilner with us today to help us get a good grip on this concept of succession planning and why it's so important. So Seth, we've actually already heard from you on the podcast briefly in our Thank You Farmers episode, but now you get a chance to give us a little bit of a longer introduction to you. So I yield the floor.
Seth Wilner 2:37
Yield the floor. Well, thanks for having me here. This is a fun topic that I really enjoy talking about. I have the pleasure of being here after 26 years in Extension and farm business management. I do succession planning under the umbrella of whole farm planning. It is a subset of farm planning in my mind. I have many thoughts on it. So 26 years in Extension, a lot in whole farm, holistic management-type of planning, working with farms of all commodities in the state, in the region, and just loving that aspect of my job. With that said, we can jump on into succession planning, unless you want more about my life and times. We could go back to my childhood if you want. But I don't think people need to hear that!
Kendall Kunelius 3:23
Well, no, but I was gonna say, Seth is also the number-one food and ag agent I'm going to call if I'm somewhere and I need a good restaurant recommendation. The cool thing about Seth is that - I'm kind of exposing you. You're such a foodie, but it's great because you know where all those best spots are. So I think that's introduction-worthy material to share.
Seth Wilner 3:28
I thank you. And if you're traveling with me as my wife, you may not fully appreciate that, since I - and my dad gets a kick out of that. I do wake up and think about where are we going to eat today, and why waste a meal that we can have some unique food. So yep.
Kendall Kunelius 3:58
Love it! All right. So we've kind of dived into this a little bit, but just give us a brief overview of this term succession planning. Tell us about it, help us kind of get a grasp on what that term actually means. What do we care about succession planning, from all angles.
Seth Wilner 4:14
All right, so the Google machine will tell us that farm succession planning is the "strategic long term process of transferring a farm's, management, ownership, income and operational control from the current generation to the next". It goes on to say, "It combines retirement planning for owners with estate planning to ensure their business's sustainability, minimize taxes and reduce family conflict." So I was like, okay, that's an interesting place to start. And there's so many definitions, and there's so many different webinars and podcasts and fact sheets on succession planning. So in my mind, in short, it's a way of passing on a farm and its assets, and it's all of its properties, equipments, incomes and whatnot. And I'll add, and/or, so it's an and, making room for a new set of owners and managers to have a business interest of their own. And so sometimes it is just simply making room. And making room can be really yielding an entire enterprise, but allowing decision making, allowing success, allowing people, as Kendall, I like to say, fail forward. It's not our term, but it resonates with us. To go and learn and learn on a specific - you're in charge of the hay enterprise, you're in charge of whatever. But it could be bringing on the next generation while the current owners and managers still are existing there. So that would be how I would define it. I love it myself, because it's a puzzle. It's a puzzle in different areas. It's not one area that's a puzzle. It is thinking in different areas and piecing things together. There's always the people piece. So there always will be family dynamics in personal inter-relationships, often conflict, which we can get into a touch later. Then there, of course, is the tax and property transfer puzzle and strategies based on business structure, based on all kinds of different aspects. Then there, of course, is the finances and the analysis, all the what-if scenarios. How many families can the farm afford to support? Things to that effect. And then how do we actually capitalize the next generation or new owners or managers? Where's the money, when I say capitalize, to actually help them start off? Buy new equipment, buy new cattle, buy new perennial plants: blueberry bushes, apple trees, whatever. So I love that that is always a puzzle, and it's a puzzle that lasts from; if you're darn lucky and have the best team lined up and the phenomenal records, then you could do it in a year. But that is almost magic if you could do that. So it's a puzzle that lasts for two to three years.
Rebecca Dube 6:54
Oh. So who needs to think about succession planning?
Seth Wilner 6:59
It's a good question. I'm going to say everyone, the longer your runway for thinking about it, the more flexibility and options you have. So it might be, well, we're a decade out, and we, you know, want to at least start thinking about, how are we going to retire? Ideally, you're in your 20s and 30s, and you are looking at retirement planning - again, a part of succession planning - what are you going to retire off of? And so you're taking advantage of compound interest. Maybe you're thinking about it as parents and your kids are going to college, and they are expressing some desire to come back to the farm. How is that going to work? But oftentimes, because succession planning is complex, intimidating and involves people dynamics, it gets just kicked down the road and last minute-ed, we need to do something. Here's the most recent experience over the last seven to 10 years: We start a succession plan. It gets messy. We avoid it and stop doing it. And then my phone rings and says, Hey, can we pick this up again? You know, we got this health issue, or we have this issue, or whatever, whatever, whatever, and we need to do it like yesterday. And we're like, you know, okay. As you know, an ag service provider, [which is] a fancy word for a person that helps farmers, you just go at their pace. But who needs to do it? I'd say everybody. Because at some point that farm is going to be your retirement, either the sale of the farm, or the bringing on other people to farm it as you slowly back away from it.
Rebecca Dube 8:35
Well, keeping that in mind, then, you talk about people maybe starting in their 20s with retirement planning. What kind of information or records would a person need to start keeping now so that they have information when the time comes to exit the business? Is there something they should start really early on?
Seth Wilner 8:53
The good news is they need to keep just basic, common records that we ask all farms to keep. The bad news is they have to keep the common, basic records we ask all farms to keep. And so on a minimum, one would want to at least keep what is the money they're putting in their own capital investing in the farm, but ideally, it is all the common records that I could throw out there. You'd want balance sheets, at least for the last five years. You'd want profit and loss statements for the last five years. If I'm a new farmer coming on, I'd like to see cash flow statements, meaning when does money come in? When does money go out? Specifically, are there gaps when I have to pay my bills and I don't have revenue to do it? Here's where I'm going to potentially differ, but maybe not. I could tell you all the records, and I can use those neat, fancy words of balance sheet and profit and loss statement and whatnot, and that adds to the problem of what we do. It overwhelms people. And so instead, I'll pivot, and I'll say succession planning is complex. It is intimidating. It ought to be intimidating. And you as the farmer, you not need to be an expert on any of this. Kendall and I were talking about this yesterday and the thing we stumbled onto, because my dad is a veterinarian, is when you bring your dog to the vet and they're going to have a surgery, you really don't need to have to learn how to do that surgery. You don't need to know the organs that are going to be taken out, what anesthesia is going to be used, why it's going to be used. You just really need to know why your animal needs this surgery, what you need to do to prepare the animal, (don't feed it after midnight, whatever, whatever) and what you need to do to help the animal recover. And you let the vet take care of the surgery. And any information they gave you specifically you would likely well forget. And why wouldn't you? You're not a veterinarian. So we don't have to sit you in a room and tell you all the in and outs of how to dissolve a partnership and what capital accounts are. We don't have to tell you about how long you're - all your assets that need to be valued and what needs to be valued within a one-year period or two-year period. And so instead, all you need to really know is, okay, this is the team you're going to need to help you internally. This is a team you're going to need to help you externally. So internally, you're going to need somebody that's gonna be able to pull up the numbers and pull up the taxes; has a relationship with the accountant that can ask for records if you don't have them. Hopefully you do have them, but if not, at least be able to ask for those things. You're going to need somebody that's going to be able to organize and schedule meetings, maybe lead meetings. You're going to probably want to reach out to other farmers and get their experience, their advice, things of that effect. And then your external team, on a minimum, you're gonna need a lawyer. You're gonna need an accountant. You're going to need, I would argue, potentially if you can, a financial planner. And I'll say the most important person, you're gonna need someone you trust in the ag industry that understands succession planning, and that can hold your hand over the course of years and give you advice. Or say, boy, you know, Kendall, that didn't really sound that all that great to me. Or Rebecca, why don't you ask this question and see what they say? Or, as I did this morning before this podcast, jump on the phone call with the accountant and be like, can you explain why you did this and add clarity? And then be able to ask follow-up questions while the farmers are present, so that they can get a better understanding as well. So that would be how I would simplify succession planning and feel like, you don't need to really know all that and have expertise.
Kendall Kunelius 12:37
Yeah. And if I could just jump in there too and say, I think also just having good people around you is so key for any kind of situation, right? I think doing a resource inventory, a community and people resource inventory, might be a good first step, because sometimes you don't know who you know until you know who you know. And it's through that process of being like, Oh, I didn't realize you were an accountant, or, Oh, I didn't know you did XYZ, or you have expertise in this. Sometimes I think taking time to talk through that process is helpful with the people around you that you know and trust and have and do actually have legitimate expertise. The other thing I think is tricky about doing a succession plan, especially for farm - I want to go back to what you were saying, Seth about all these assets, right? Not only is it land and it's buildings, but it's equipment and machinery and animals, and being able to really understand what you have is great too. My husband and I recently took a trip, and we felt like, since we were both going, we really needed to have some sort of directive document in place. And as I was writing this, I was like, wow, we have a lot of stuff! Wow. I didn't realize, my chickens, my dog! So I think the other, the point I'm trying to get at is to say, yeah, I can see where this absolutely takes years. I can also see how this is a tricky situation to go through mentally, because you really are thinking through a lot of heavy topics, a lot of stuff. And so, you know, maybe my question for you, Seth, is, who could you have on your team that's going to help you encounter those really heavy questions of, what do I do when I come to a difficult situation and I'm not sure what to do about something maybe I feel sentimental about, or feel deeply about, or I have family stuff, what would you say there?
Seth Wilner 14:22
I would say that for sure, on my team, I'm going to have somebody that I trust, like deeply trust, that has expertise, but beyond that, that I deeply trust. So there are farmers at one farm I was dealing with this past week, doing succession plans. (Again, four just landed on my desk.) Deeply trust, long-term relationship with their lawyer. So that is a person that knows their family, watched their kids grow up, and understands all the dynamics. And they can go and say, Okay, here's our partnership agreement. What do we do about this? Or here's our, here's the S Corp. These are the members of it. What do I do about that? Others are with an accountant. Others might be with a long-term financial advisor. Others might be an existing Extension or a retired Extension agent that might help them, or educator. Maybe it's folks that work for these other ag service providers, vital communities, Farm Credit East, Land for Good, the list goes on. So trust is a key thing that you could have honest conversations with. And that will bring us back to, at least, I'm going to force it back in, to - The one thing that you cannot export is goal-setting and that planning. The only way you can help people help you is knowing what you want. And so that is not always the easiest thing for the farm community with whom I worked for the last quarter century - really defining what it is you want to happen. But that is going to help us in the inevitable conflicts. It's going to help us to what you just asked, the really difficult choices. And the answer is going to be, it depends. And the answer to it depends is, what are we managing towards? What is our goal with this succession plan? There's going to be one thing about transferring assets to the new owner management group, whether they're related or not. There's going to be - another thing, of course, bringing people on. But there's of course, going to be providing for the other folks that are in your life: other kids, other relatives, whatever it might be. So really defining, truly, what you want out of this succession plan is going to be key. Most recently, I said the people aspect is rich. So I am going to be retiring in a year plus from now, so I can relate when I sit next to a farmer that is like, what is life going to be like after I'm done milking cows, or after I'm done plowing fields? And I'm like, yeah, what is life going to be like after 30 years of Extension? And so really trying to get with that emotionality and having someone there that you trust to talk about with that. Because that is going to be baked into the cake, whether we want to admit it or not. So that is something. What are you going to do when you're not super-actively farming? And there is that many times farmers say, I'm going to die in the field. They're going to pick me up off the tractor. And that's all well and good, assuming you don't get in the way of the next folks that are there. My dad and I were talking, and he said, Well, he was siding with the farmer and not the farmer's kids in the conversation. I said, Dad, I was going to be a veterinarian, and likely we would have been in that same situation. You would have been like, kind of pinch hitting for me, working for me. I was like, Do you think you could have kept your mouth shut and said, No, Seth, I wouldn't do it that way. Or no, I don't. I don't I don't think you want to do that. I was like, if I said, Thanks for your advice, you know, I just want to handle this on my own. Do you think you can bite your tongue and he goes, hell no. I was like, Yep, no way. I was like, I don't know. There's always a benefit to have folks around like that. So you might need to find something else off-farm.
Kendall Kunelius 17:55
Yeah. Speaking of, so I love where you were just going with the conversation of giving some examples. Are you willing to talk through, you know, without names, farms, et cetera, et cetera, just some case studies that you've seen that have either gone really, really well, like successes, or maybe like lessons learned?
Seth Wilner 18:10
I think one of my biggest lessons-learned was planning for conflict. I ran into some cases where the things that kids said to their parents, and parents said to their kids, simply blew me away. And I've had farm meetings where I simply had to be like, Okay, this one's over. I'm calling an end to this. Let's not do any more harm. And I called one of my mentors, Cara Cargill, who's a mediator with ag mediation services, which every state has. And she's like, you can actually set yourself up to avoid conflict, or you can set yourself up to be able to manage it. And so I went and I got certified in two different mediation techniques based on her tutelage. And Mediation and Conflict Management is a skill. She is amazing. She is available in at least New Hampshire, if not other states. Every state, I believe, has it. It's a free service. I think that was my biggest lesson. Conflict will happen. It's not if, it's simply when and how severe it will be. And maybe you're nipping things in the bud, and so it's not so severe. But that was a big lesson learned. The other lesson learned is you don't need to know everything. You just need to know you have to have a network, and you need to know people to call. There's not a succession plan I've done where I do not get off the farm and get in my car and call Carol Starkey from Farm Credit east, who's my buddy; call Mike Chevarassi, who is my mentor, who was our extension farm business management specialist for near forever; somebody on a production perspective; and say, Is this shield good? Or what do you get for? You know, how much is a - can I sell the herd for? You know, could this farmer sell the herd for? So it's having that network, which is just key, even for the ag service provider, let alone for the farmer. So case study examples, that's the beauty. It's just so so specific. Today I learned and everything is just this learning thing. And so you always leave yourself open. And I think if you get an ag service provider that has an ego, then that might be a red flag. I always approach it with like, I'm going to learn with you. And so that's why I really enjoy these. Today's case study experience was learning that guaranteed payments in a partnership are actually expensed, and so your net profit actually has that money taken out. So the net profit is - the profitability of that farm is actually what the net profit says, plus the guaranteed payments that came on right before. And so Mike Chabarossi called me randomly. I was like, hey, I'll call you back after this podcast. I got a question. I don't know why that is, but I will find that out. But that's like the fun of just going through all of these things, and it is your network. So the accountant I'm looking at the taxes, I'm like, why do we pull that out in this farm? Accountant explained why, and I'm going to ask a bunch more questions on it. So the case studies have so many different stories, doing so many different things, but I'd say it really comes down to being there and constantly drilling down, what does the farm want, and how do we get to it? And what's the best approach from a tax perspective? What's the best approach from the next generation, or whomever the new owners/managers are coming on? And thanks to that effect. I will tell you that there is a gap that I noticed that turned out to be a nationally noticed gap, and that is that the owner generation lacks retirement plans. So if you don't know what you need to retire, then that really can add a wrench in the works of knowing: are we going to sell this equipment? Are we going to gift this equipment? Or are we going to will it to you? And how you gain ownership of equipment has a tax impact, a fancy word called stepped up basis or lack thereof. And so one of the things in a grant that I have is I'm now paying for retirement plans for farmers so that we can determine what it is they need to live off of. And so usually you can say, at least, well, how much do you think you lived off of? Like, well, I think we lived off of $40,000, and in your head you're thinking no couple lives off of $40,000 all in. And so then you only come out to find what housing is, you know, paid for by the farm, and gas is paid for by the farm, and the vehicle is farm-owned, and all these other things. And so you're like, all right, what is it going to cost you to live if those are not included? Because how many farms can afford to support multiple families? Not many is what I'm finding in my experience. So now we're trying to figure out what really is that number. And so we have to start with boring things like a family budget, which making up a family budget, or watching paint dry, often the farmer is going to choose to watch the paint dry.
Rebecca Dube 23:08
So you're really like an advocate for the farmer, and kind of holding their hand through this whole process and seeing maybe the things that they don't see that need to be asked or delved into. And what a bonus that is for a farmer to have that help - a guide through the process to know what to do.
Seth Wilner 23:27
I love that word, advocate! So I was supposed to describe what my services are to farms in this and I was like conductor of an orchestra? Like I didn't - I like the word advocate. Okay, thank you. You helped me in another project that I'm on. Woohoo!
Rebecca Dube 23:44
You're welcome.
Seth Wilner 23:45
And a guide. Yeah, that's what I feel like. When you know you're going to go on some tour; maybe that's a hike through the woods. Maybe you're going to go on, you know, my wife recently went on the Civil War tour of New Orleans. And so you have this guide, and that guide is telling you all these different things, but it's based on what do you want to get out of that tour? Are you interested in seeing architecture, are you interested in learning history, are you interested in the people part of this that or the other thing, are you interested in seeing natural sites? And that guide can then choose the path, help you choose the path accordingly.
Kendall Kunelius 24:15
I think one of the other things that comes to mind for succession planning, it's just the idea of land, like land being such a finite resource, especially farm land that's already open and in agricultural use, current productive use for crops, pasture, hay, land, whatever, whatever. Do you feel like you want to speak at all to something in terms of understanding how succession planning can impact the actual, I wanna say, landscape of agriculture in New Hampshire? But I do really mean landscape too, kind of like in both senses.
Seth Wilner 24:50
So land is really an interesting resource, right? It usually increases in value, appreciates over time, and it's a really wonderful resource, for lack of a better word, to hold on to. And so, one, it could be rented to the new owners, whether they're your relatives or not, and that could serve as a income source in retirement. Two, it could be gifted. Three, it could be leased, and you could put a lease agreement attached to the deed that allows use of it. You can also sell development rights. And there's some form of capital, some form of revenue that can help either the next generation or whatnot. It could be sold outright. So there's so many different ways that land could be used. Land also has, of course, great sentimentality, depending on how long it's been in the family. And so maybe that's also something that is going to be divided up amongst kids that are not getting the farm proper itself. Or maybe that's something that access to other siblings and their kids and whatnot can also be written into the- baked into the cake. So land is a super rich resource that has emotionality and economic value to it. And then there's, of course, ecological functionality, the land that people might care of and want to preserve that and want to see how much that they can bake that into the cake. So land is, it's a super rich conversation, and it really goes back to, well, what's the goal? Is it simply we're getting out and we're maximizing the money we can get out with (which is almost rarely or never the case), or is it, how do we really pass this farm on based on our values and whatnot? And then, as our lawyer who made our trusts and wills up also advised us, you can't manage from the grave, so how much control do you actually want to have? But yeah, a rich resource laden with opportunity and also has its own emotional landmines to it as a family has to deal sometimes with giving it up.
Kendall Kunelius 26:54
Yeah, for sure, and I think too maybe on a personal note that's very resonant with me. You know, we have our family farm in Connecticut, and same kind of thing, right? I spent so much time there as a child, and I totally see where that you would be coming from. You know, helping a farmer navigate that with lots of family members in play. I'll also say, like, out of state too. How do you work with those family members or key players who may not be in location, like right there with you who are accessible. It's another consideration that comes up to my brain is to think like the logistics of just getting everyone together too, and having the conversations.
Seth Wilner 27:30
For sure, made easier with technology. I will say that it is not uncommon for the situation to be, at least in my experiences, I don't want to farm, but I don't want you to sell the farm. That's where we grew up; that's where grandma, grandpa grew up and farmed and whatever have you. But I don't seek to farm it, and I can't really afford to just buy it and hold it. And so that is, that emotionality is quite something in terms of people all being in the same place. A process I like to do, or I like to use, is to meet with the farm owners. They are the owners. They are the ones that control and have decision making. They can yield it and they can share it, but at least they have it; and understand what their goals are and help them with that. And then I like to meet with all the other people that are impacted. I was gonna say, all the other players, but maybe they're not players. Maybe it's simply like kids that want nothing to do with the farms and live out of state even right? But I like to at least interview each of those families. What are you hoping to gain? What are your fears in the process? It's great to get fears out. Fears are an underlying source of conflict. Holy mackerel. I like to interview them. I like to interview their families. You can ask only the blood relatives to be in the room, but if you think that their spouses are not in that room with them, that is not reality, and so that is going to be a source of conflict. And no matter what, if Kendall and I are married, and she's the only one in the room, when she comes back I'm peppering her with questions. And I'm like, what do you mean you're getting $50,000? You're getting totally hosed in that situation! And Kendall is gonna go back into that room with a whole different perspective after we talk about it alone in our house. And that happens, so understand that. So I like to go and I like to speak with that couple or that family, and understand, what are their wants? What are their fears? What are their personalities like? What are we dealing with here? And then, with permission with a farmer, often, what I do is I write up notes. And so if I interviewed Kendall and her husband, I'm sending the notes to her and Billy and saying, did I get this correct? And then once I understand that it's correct, I'm asking, What do I have permission to share with your parents, who are the farm owners? And so it's only by permission of which I share. I at least have the full picture in my mind. But then, to the extent that we can, we get everyone together via the Zoom machine, via the phone, or whatever it allows, and we kind of proceed. As a succession plan takes shape, more decisions become solidified. That's an approach I at least take. So yeah, not being in the same state can be an obstacle, but I love the phone, or we can use a zoom machine to overcome that.
Rebecca Dube 30:12
Interesting.
Kendall Kunelius 30:13
One thing that's kind of like coming up in my brain is this idea of how a farm fits into the community that it's around, right? And how farms that simply: they retire, they sell their cows, whatever, whatever the situation is, they cease to keep producing food and products. And I don't know what the data necessarily says in terms of food access and the impact on the community that way, but I do think there's a perception from the community or the state at large, maybe when they see a farm closed that it's because they went out of business. And I'm just kind of curious if you have any insight on is that always the case, or sometimes, is it really just people are retiring and there wasn't anyone who's taking that on?
Seth Wilner 30:56
It's definitely both. I mean, farm failure is is an issue. Lack of farm profitability is an issue. Lack of farm profitability coupled with the amount of the hard work it takes to farm does add a deterrence to the next generation wanting to go into it. But of course, there's a whole slew of folks that want to go into it. I would say that there is this new understanding that a bunch of us older folks are having that if we could take people who are soon or freshly retired and have these skills in agriculture - my focus is on business management, but it's also on production as well - and we can help them to mentor the next generation, the incoming generation, that would be huge. Mentor for free, mentor for a fee for service, whatever have you. But could we get an organization to help organize and be the contact in that? And so that's this idea that's kind of running around in some of our heads. Maybe that's the conservation districts, particular counties that might do it. Or maybe it's a statewide organization. Maybe it's a NOFA or Farm Bureau. I don't think it's come to Extension. I don't think like that's on our radar much now, because I don't think we have the time or capacity right now as we are- Our phone rings off the hook as it is. But how do we take these retiring farmers for whatever reason: because the the economics didn't support them staying in it, or because they aged out, or because of health reasons. How do we take retiring ag service providers? How do we take retiring lawyers and accountants and really help them to help this next generation? It's a fun puzzle that that I believe is going to get traction, and it's going to be a snowball rolling downhill hopefully and find a landing and get some resonance.
Kendall Kunelius 32:44
And I asked that question, I guess, with the personal opinion that succession planning is a key contributing factor to farm viability in New Hampshire, too. Because I think it really - From all the components that you were mentioning in terms of knowing those: the good and the bad news of having to know your farm, your basic farm records, as well as knowing who's on your roster, who's on your team. What are your plans? What variable are you solving for in terms of making a succession plan? I just think those are all things, those are important components of running a farm business as it is. So I don't know, what's your thought in terms of farm viability in New Hampshire? How does succession planning play into that and that definition for you?
Seth Wilner 33:24
Boy, that is a rich question. Off the top of my head: It always perplexed me; why one, if the failure rate of farms is high, if the profitability of farms is somewhat low, and if the percentage of New Hampshire farms and New England farms in the Northeast farms, for that matter, is not high in those that can afford a farm, of those that can be supporting their family through farming; if all that is the landscape, which the data certainly says it is. And if I can make mistakes while getting paid on somebody else's farm, and farm labor is in such high demand, why do so few people go and work on other farms, and why do they need to start their own farm? So that is a question. That is one spoke in the wheel. The next spoke in the wheel is: if I'm working on someone else's farm and I have been there for a while, then maybe that is a vehicle into farm ownership and succession planning, because maybe they can trust they could see. And if there are not the next, you know, family members that really want to step up and farm, maybe I become the next best thing, because I've been there learning it and whatnot. The other interesting thought that came to mind when you asked that is, why do I see existing farms having trouble selling and transferring to the network? Why wouldn't I just as a new desiring farm owner, just go and buy a turnkey operation that has market share, brand all these different things? But for whatever reason, they don't. They want to start from scratch on their own. So yes, succession planning absolutely is a component in farm viability. But the only thing that I can conclude is that people are really highly complex beings, and so they don't always make the most logical decisions. At least that's how my brain works. But anyone who knows me will also say, well, Seth's brain works in its own unique way in and of itself. So there it is. But yeah, succession planning certainly has that Farm viability. If you are working as a daughter, son, cousin, niece, nephew, grandkid and/or just a strict, like a non-relation, with the current, existing generation, the owner generation, and they are introducing you to their customers. They're slowly giving you access to their books. You can see which market channels or sales outlets, for lack of a fancy word, are profitable or not profitable. You can see how they do business, what works and doesn't work. That, to me, would give you a leg up on having a viable farm operation. Particularly if you plow in the wrong crop because you misunderstood your directions that day, but you still get paid, and you don't have to worry that that is no longer a saleable commodity anymore. Whoops, that wasn't the one you asked for!
Kendall Kunelius 36:12
Sorry. Well, somebody's gonna worry about it, but if it's not you, well, okay. And last question, anything else we didn't talk about that you wanted to mention?
Seth Wilner 36:26
We spoke about the people aspect of it, and don't underestimate that. I think the last thing I would mention that I'm not sure I gave full due diligence to, is that rarely is it the case, in my experience, that you start and continue straight through to a succession plan. You often start, stop, begin again, maybe stop again. It doesn't go linear, and thus it's years in the making. And so that is something to understand and have patience for. And then I am often encouraged, and I thus encourage others to have grace with yourself and have grace with those around you. Having grace is going to be huge. It is imperfect. It brings out a lot of old scars and old wounds. Mom always loved you best. Can't say I haven't heard that a thousand times. It's going to bring out a lot of different aspects of people's past as it is in the present, and fears about the future. So have grace with yourself, have grace with those around you, and then take the intimidating burden off yourself. You do not need to know how to spay a dog to bring your dog in to get spayed. You need a vet you trust, and you need people that will support you. And so that would be, I guess, the metaphor that we came up with yesterday that just has resonance. And then, Rebecca, what did you say? A guide? Advocate!
Rebecca Dube 37:48
Advocate.
Seth Wilner 37:49
Get yourself an advocate.
Kendall Kunelius 37:52
Well, thank you, Seth, so very much for talking with us today. This is a lot of great information. Honestly, I think this is one of these episodes I'm going to listen to two or three times to digest and take notes and just like go through everything again and again. But if anyone has any questions, where can they contact you? Or who can they reach out to?
Seth Wilner 38:09
You could email me at seth.wilner@unh.edu of which has a maybe a 15% probability that I'll actually respond to it. You can call me which has like an 85% probability, 603-543-7169, and/or text me, which has equal probability. And so, peace out people, as they like to say in French. Have a fine day.
Rebecca Dube 38:34
Well, thank you very much. Seth, we really appreciate hearing from you, and we'll be talking with all of you again soon on the next episode of Shared Soil.
Kendall Kunelius 38:48
Shared Soil is a production of University of New Hampshire Cooperative Extension, an equal opportunity educator and employer. Views expressed on this podcast are not necessarily those of the university, its trustees or its volunteers. Inclusion or exclusion of commercial products in this podcast does not imply endorsement. The University of New Hampshire, US Department of Agriculture and New Hampshire counties cooperate to provide extension programming in the Granite State. Learn more@extension.unh.edu.
Seth Wilner 39:28
That was fun. That was super fun!
Transcribed by https://otter.ai
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