Hello, my name is Kaitlyn Davis and I’m an agricultural outreach specialist with UW Madison Division of Extension. Today we’re going to be talking about accessing land for your agricultural business. This is one in a series of videos for getting started with your food or farm business.

Some takeaways for today’s presentation include accessing land where do you begin, navigating lease agreements, negotiation for success, and resources to get you connected?

Like with many aspects of a business, the most important piece for planning purposes is to figure out what your goals and values are. Ultimately, what is your goal for land access? Are you hoping to own the land when renting is a better option for your business? Depending on what your goals are, it can shape how you approach acquiring land. If you’re planning to rent or rent to own, a written agreement can lead to a better conflict management, and provides a visual for both you and the landowners needs and expectations for the land being utilized. 

Have a business plan in place. Knowing how much land you will need to fit your goals with starting your business will help you determine if you decide to buy or rent. Business plans provide you the chance to visualize on paper what steps you need to take in order for business to be successful. As mentioned on the previous slide, it is important to have a plan in place. UW Madison Division of Extension Farm Management website offers several videos, our articles and resources to help you refine your business plans from goal setting to adding in additional enterprises. We won’t dive too deep into those in this video, but it’s worth mentioning the importance of having the plan in place. It can help save you time and money as you prepare to start your business.

This does not substitute legal advice. It is important that contracts and legal advice come from an attorney. These are tools for you to use to create a robust lease agreement. The hardest part is starting one. Having a conversation around setting up a lease, especially if there wasn’t a written one in place when you began renting, the land can feel like a huge task. You don’t want to cause conflict, when and how when in fact having a written lease agreement can help you in the landowner to feel more confident that both parties have a vested interest in what happens to the land. 

What kind of business do you have? Basically, it comes down to how much liability Do you want to have? Should something happen? Are you a sole proprietorship or partnership? Are you an LLC, maybe you’re a corporation or a cooperative? A lease agreement is also a tool of communication, it’s a lot easier a year or two after the contract starts to review something written down rather than trying to remember what each party had said. This helps to keep communication clear and open and allows you to be able to express how you plan to use the land and what will help you to reach those goals.

Determining who is responsible for what. Certain types of crops require specialized facilities and equipment. If you choose organic production, this can be built into the land leased as well. So other questions as you’re determining who is responsible for what is: What type of equipment and facilities do you need and have? who oversees the maintenance and repairs? What type of agricultural practices will you have in place to handle things such as weeds and pests? Do you have exclusive rights to the land? Or does the landowner also have rights to that land to come on whenever they wish. Who pays for utilities? These are a lot of different questions that you can ask yourself as you’re determining those different aspects of your lease.

Other things to consider as you communicate your needs in this lease agreement, include the following. If you are looking at possibly renting for more than one year, look at getting a long term rental contract on the land. Make some improvements while you’re there, maybe explore the different soil types available and see if there’s anything you can do to improve upon the soils. Have a land price agreed on when and if it becomes available for purchase down the road. So say your ultimate goal is to own the land. Having a set price can also help you to determine what direction you go in as you work through your business plan. Express your goals for the land and determine when the lease starts and ends. What that rental rate is and how to communicate issues as they arise with the landowner.

This is just going to touch on some quick basics of negotiating, I can present a whole session on negotiation alone. The next few slides come from a presentation given by Stephanie Plaster, farm management outreach specialist, and myself in 2021  on the art of negotiation, the video is currently available on the farm management website, and a link for that resource will be provided under resources. So when it comes to negotiating land rental agreements, preparation is key. Know what your goals are and how that relates back to the landowners know, your bottom line is still good enough to meet your needs, build and maintain those relationships. Relationships are so important when it comes to building up those rental agreements. 

Listen, first talk second, if you know exactly what the landowners goals are, you can see how your goals and their goals align.  Take care of you. Ultimately, this is a decision that’s going to come down to what you feel is going to be best for your business. Put it in writing. A lot of times and like I mentioned in a previous slide, you know, it’s very hard to remember what you’ve even had for breakfast two weeks ago, let alone what you agreed upon in a verbal contract from a year or two ago. 

Make it a habit. Negotiation is just like learning to ride a bike, it’s a learned skill, you just have to start somewhere and get better with practicing. Negotiations don’t work when one person wants to do all the talking and control the entire situation. Truly listen to the other side understand their key issues and hot buttons. then formulate a response. Engage with that discomfort, embrace the awkward, it’s okay to not be comfortable. acknowledgement of discomfort is key. 

You want to also focus on your goal. Being that active listener. Express your feelings without showing anxiety or anger. Sometimes when it comes to negotiation, there’s a lot of emotions involved, especially if this is your first time bringing up things such as a lease agreement, when before the lease agreement may have been verbal.

Some strategies for success: come prepared with a backup or alternative that you see fair and be open to listen to other party’s alternatives. Be sure to do your research on every area of discussion before going through with agreeing to an alternative. A fundamental tool of negotiation is to begin at the point where you have agreement. This creates a sense of common ground and helps you build trust. As the negotiation process progresses. There’ll be times when the parties start to head off in different directions. That is a cue to come back to common ground and begin exploring options again.  The best way to win a negotiation is to be crystal clear on what you want to get from the process. 

Don’t let one issue cost you a successful negotiation. Sometimes it’s best to suggest that an issue be set aside for the moment and both parties move on to make progress on other issues. A creative solution may come to you later outside the heat of the negotiation over that single issue. Bargaining is where the give and take happens. If you think success means all take and no give you won’t capture real value. You make and manage your concessions in bargaining. When you give and take that which satisfies both parties interests, you’ll build a lasting relationship and a fruitful outcome. During the bargaining stage you continue to create value and with trades finally capture that value.

Some common roadblocks to avoid: when you make an offer and the other person rejects it, do not make another offer. That’s known as negotiating against yourself. Instead, ask and wait for the other party to make a counteroffer, learn to master the discomfort of sitting in silence and waiting for the other person to speak. Buyer’s remorse, instant regret, feel comfortable with agreement. Be aware of who you are negotiating with and make sure the person sitting on the other side of the table actually has the power and authority to make a deal. You don’t want to use all your best arguments and then be told that well we need to take this to the boss for final approval. 

Your instinct exists for a reason. If a deal sounds too good to be true, or something about it feels off. Listen to your gut. It’s better to walk away than to have to live with a deal made with somebody who you don’t truly trust. Once a deal has been reached, celebrate the victory to not let yourself fall into second guessing yourself. You did the best you could at the time. So let that deal play out. If there’s a lesson to be learned for future opportunities. Make a note for the next time but don’t waste a minute on feeling badly about things once the deal is sealed. 

Don’t get sidetracked by secondary benefits very often a negotiator will try to get you distracted from recall by highlighting a secondary benefit. For example, a restaurant buyer who makes the point that your name on the menu would be great publicity for your business. While that may be true, it’s not relevant to the negotiation at hand, which involves pricing for current order.

So next, we’ll be talking about some resources that will definitely help you out as you go through. Before that though, I want to talk a little bit about taking back to the farm. So we talked about land access and where to begin, we talked a little bit about navigating lease agreements, we talked about the negotiation part, so setting yourself up for success, and now we’re going to dive into those resources to get you connected for further information. 

So some resources you may find available as you work on creating your lease agreement or navigating land access if you have land for a good toolbox, navigating lease agreements for small acreage, high value crops, and there’s also farmland Access Legal toolkit. All of these resources will be found below in a box where you can click on them and have a chance to be connected with them. 

Thank you for your time and watching this video on accessing land for your farm business. UW Madison division of Extension Farm Management website offers lots of resources, videos, podcasts and articles on business planning. You can find links to more information the box down below and some additional articles you may find beneficial on your journey to getting your business started. If you have any questions feel free to reach out to the farm management team. Thank you.