# Hay contracts?



## Holte-Hoff

Hello everyone, 
I have a barn manager who wants me to make hay for her. I have a 60 acre place available to rent but need to improve it To get the type of hay she wants. I want to know what a contract should look like. I'd hate to spend all kinds of $$$ and have her back out next fall and no other market for it at the price I want. Not that I can't find buyers, but its a potential 5,000 bale sale, not a 100 bale sale here, another there. She's looking for 5,000 bales and I figured I can for sure do 3,500. She wants me to store it for her too, that is figured into the price.


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## swmnhay

To get her to sign a contract i would presume it would be to her specs.So what if the weather doesn't cooperate and it gets rain damaged or cut late?You need a plan B anyway.It would be easier to sign a contract for the hay after it was baled so you know quantity and quality.Maybe get a down payment to insure she don't back out of it.

60 acres and only producing 3500 sm sq bales???


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## somedevildawg

Holte-Hoff said:


> Hello everyone,
> I have a barn manager who wants me to make hay for her. I have a 60 acre place available to rent but need to improve it To get the type of hay she wants. I want to know what a contract should look like. I'd hate to spend all kinds of $$$ and have her back out next fall and no other market for it at the price I want. Not that I can't find buyers, but its a potential 5,000 bale sale, not a 100 bale sale here, another there. She's looking for 5,000 bales and I figured I can for sure do 3,500. She wants me to store it for her too, that is figured into the price.


I don't think a contract will do you any good......might make ya feel good but not much else. Perhaps you could have her pre buy with a deposit. Would have to be exclusions on both sides for weather problems (or any other problems) so it's gonna be hard to enforce either way.....best to be sure you know who you're talking to and find out if they have good character or not......

Good luck, touchy situation either way.....make sure to include storage and loading costs


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## Teslan

I've had various horse barnss over the years want me to do that sort of thing. I won't do it. For many of the reasons swmnhay states. But mostly it's because I need to keep hay moving all summer to have room. Because the different cuttings sell for different prices they have to be all accessable also. Plus I like to be done selling hay by November. I feel these big stable outfits should be able to afford and store their yearly supply at one time or they might not be trustworthy to be a dependable 4 bale a week buyer (I'm talking big bales) Plus I don't care to start a tractor in the cold of January just to load 4 bales.


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## rjmoses

If you want to lock the deal in, get a written contract that specifies 1) the minimum acceptable quality that she will take, and 2) partial payments as you go, i.e., so much up front (non-refundable), so much at certain dates throughout the life of the contract.

E.g., Specify the minimum RFV/RFQ/CP/DM that your hay will be. Then specify the dollar amount upfront at harvest, maybe 25% non-refundable, then, as each load is taken, the dollar amount to be paid. If structured properly, you will always be ahead of the game and working out of her pocket, not yours. If she falls through, you are ahead of the game and still have the hay to sell. If she's not willing to do this, don't bother with her--she probably will stiff you.

My dad sold his father's farm on contract-for-deed for 50% down, 10% of the balance each year over 10 years. The buyer missed his payment on the 6th year and my dad and uncles got the property back, kept the money that had been paid to date, and was able to sell the land a second time for more than they sold it for the first time.

Hope this helps.

Ralph


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## glasswrongsize

Ralph, fine ideas/thoughts. If I might add one idea... a price per bale to buy out the contract in the event that production runs short a certain number of bales.

73, Mark


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## Tim/South

I am leery of horse barn managers. The ones I have known had a short shelf life. Horse boarding facilities also seem to operate from pay check to pay check, boarders always seem to be a month behind paying.

I know there are financially sound horse operations out there. I have known a couple. I would check out the stability of the entire operation before I made any decision. Barn managers come and go. Each one has big plans.


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## OhioHay

Tim/South said:


> I am leery of horse barn managers. The ones I have known had a short shelf life. Horse boarding facilities also seem to operate from pay check to pay check, boarders always seem to be a month behind paying.
> I know there are financially sound horse operations out there. I have known a couple. I would check out the stability of the entire operation before I made ant decision. Barn managers come and go. Each one has big plans.


Couldn't agree more. I have seen the same thing in my twenty plus years of selling hay.


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## Teslan

Tim/South said:


> I am leery of horse barn managers. The ones I have known had a short shelf life. Horse boarding facilities also seem to operate from pay check to pay check, boarders always seem to be a month behind paying.
> 
> I know there are financially sound horse operations out there. I have known a couple. I would check out the stability of the entire operation before I made ant decision. Barn managers come and go. Each one has big plans.


Very good points. Try to deal with the owner not the barn manager. Unless they are one in the same of course.


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## hog987

I have heard too many stories about horse barns and the hay they buy. Usually along these lines. They buy squares from several people. Count and put any bad bale in a pile from everyone. Get a total count of all the bad bales. Than phone up all the hay suppliers and say all the bad bales were from them. Demand money back. For example a horse barn buys 5000 bales from ten different guys. They end up with 100 poor bales. They phone up each of the ten sellers and get their money back on those bales. So now they got 1000 bales for free.

I have had several people tell me these stories and one nice older guy said the moral of the story is if the barn phones you up about bad hay. Go look at it. Most of the time it wont be your hay anyways. Also no refund at all if they cant show you the hay. A lot of the time the hay was still good enough to feed so they did feed it. The excuse of why the hay is gone when you look at it is they burned it. One guy was telling me the problem was becoming so common that he started to use an odd color twine so he could pick out his bales at a distance and so there could be no arguments if it was his hay or not.


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## rjmoses

Here's a tip:

All of my hay is marked with the field ID and cutting number, e.g., K2 is field "K", cutting 2. I mark every other big round and small squares every 10 bales or so.

I do this to keep track of what hay came from what field, so I know the quality and yield. If somebody wants lesser quality grass hay, I know how much I have in inventory, where it's at, and what I can charge for it.

Now, here's the kicker: Because I can pull a quality test on the cutting, people have more confidence in my product. And they try less games!

Ralph


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## Hokelund Farm

Customers wanting refunds just sounds silly to me. This isn't Walmart, there are no returns. The customer looked at the product and bought it. Not every bale is the exact same - they don't get to buy a load and then pick through each bale after the fact and return bales they don't approve of. As long as the farmer isn't selling them certain hay and then delivering different hay...

As for the hay contract that just sounds pretty complicated for hay sales. Is there something unique about what they want in their hay that will prevent others from buying it? Only way I see it working is to get a large, non refundable deposit - which still won't stop them from backing out and trying to get their money back.


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## gearhartfarms82

Hokelund farm 
Thats were i disagree. If you put the right product on the trailer they can't discriminate. Ive learned one thing with horse people the only ones who are loyal are the ones who dont want to haul it and dont complain about the price. When we load with a grapple if we see a bale not right it doesnt hit the trailer. We offer guarantee on hay that we sell and deliver. We do not do contracts in general. Did one way back and got screwed.


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## Hokelund Farm

I think we are actually saying pretty much the same thing. If you are honest and up front about exactly what you are selling there shouldn't be issues. I'm more so saying that issues the customer came up with/manufactured after the sale to get some money back or to get away with something will not be acknowledged.

Unless what is delivered is different than what the seller represented or what the buyer looked at there are no returns.

I will not do returns because what I sold was either looked at by them or exactly what I'm representing in my sale. They either get to see with their own eyes or I tell them exactly what they are buying. After they buy it and have it at their place the deal is done.


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## glasswrongsize

This year, I used 3 different square balers and each took a little learning to get a bale with which I was happy. When I sell hay, I tell the customer to watch each bale and reject any bales that they do not like due to too heavy, too light, or just don't like it. I encourage them to reject any that they do not like, as I will feed them and want them to feel that they have received their money's worth. I have sent bales down the elevator told the buyer to reject it off to the side. They were satisfied to take it, but I wasn't satisfied to sell it.
There is a difference in my small operation&#8230;I feed plenty of bales and ugly bales feed just fine to my critters, I am not loading with a grapple and therefore can check each bale as it is loaded, and if the customer does not reject the bale as they are loading it they know it is their fault. I have had good feedback on doing it this way and believe I will have repeat customers due to my overly honest approach. I am in no way suggesting that other sellers are less than honest, just that my method puts it squarely on the shoulders of the buyer. As I sell more, my method may have to adapt.
73, Mark


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## gearhartfarms82

Hokerun farm

I see what ur saying and yes pretty much the same. Got to love the fabercated lyes for returns.


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## Holte-Hoff

Thanks everyone! The barn was a new start up and sounds like it's not happening this year. So I'll just put some pea/oat then an organic winter wheat in the field for next summer.


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## CDennyRun

Hokelund Farm said:


> I think we are actually saying pretty much the same thing. If you are honest and up front about exactly what you are selling there shouldn't be issues. I'm more so saying that issues the customer came up with/manufactured after the sale to get some money back or to get away with something will not be acknowledged.
> 
> Unless what is delivered is different than what the seller represented or what the buyer looked at there are no returns.
> 
> I will not do returns because what I sold was either looked at by them or exactly what I'm representing in my sale. They either get to see with their own eyes or I tell them exactly what they are buying. After they buy it and have it at their place the deal is done.


I agree with you in most regards. The only thing I've ran into with returning bales to my hay guy is when he was dishonest, and said he delivered 1'st cuttings from a week ago... but the hay was completely bleached, and all the bales on the bottom of the stack were moldy. We took the good ones, and left the moldy ones on his trailer to get a refund. The first wagon load we looked at was definitely fresh 1'st cuttings.

I'm sure a guy like you wouldn't do that to a customer, and most won't. I sure wish we could find a good reliably, honest farmer until I get the rest of my hay equipment.

Regards,

Chris


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## slowzuki

I'm rare for my area in that I do returns. I tell them up front I only credit what comes back so don't leave it outside or throw it in the manure pile. If you crack it open and don't like it, tie it back up and I'll take it back.

I haven't had much abuse of this and we feed all the returns here. Its usually fine but I don't get on them too bad about it.


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