We all individually own some essential implements and machinery that we only use for few days each year which is crazy so I am wanting to start a North East Vic machinery co-op. Does anyone know of any others in existence either here or overseas where I can steal some ideas around governance/systems etc for managing such a thing?
Hey Charlie, there were a few in NZ back in the late nineties I had researched. The one I researched was were they employed a mechanic / manager to keep everything in tip top condition.
I’m pretty sure if was a NFP so they could go for grants and have the separation between membership and $ control sorted out. When a member contributed their tractor say, it was written up as a loan at an agreed current price and a repayment plan was written up. I’ll see if they still exist.
They are such a good idea
Tool libraries are the closest thing I’ve come across - might be a good source of info if you haven’t looked into them already. Great idea, by the way!
Hi @Charlie_Showers, it sounds like an awesome idea! I’ll chip in some thoughts that come from my experience being embedded in an agricultural contracting family business (haymaking, seeding, fencing, spreading, etc) where my partner is one of the main workers and also the mechanic, and from running our own Farm Excavation earth works operation within that family business. These are probably a few of the things I’d think about when setting something like this up:
Making the most of depreciation for someone in the business has made an epic difference to our set-up. Our excavator was able to be fully depreciated in the first year (as it just squeaked under the $20k mark), which was a huge boost to the business.
Getting insurance to dry-hire out our machine was too expensive to justify unless we were trying to keep it working all the time. Instead we just have insurance that covers hiring it to the family business, and their insurance then covers much more of the liability stuff that we couldn’t justify.
Depending on how similar your area is in terms of what’s growing, there’s likely to be a lot of competing demand for the machinery at exactly the same time (e.g. in our case hay season). It’s really challenging to keep on top of who gets priority, and certainly around here to fit everyone in for hay season there are jobs that start at 1 in the morning, that get shifted around at last minute’s notice because of rain in one valley, etc. which is possible because it’s being overseen by a manager, I wonder how to manage this in a more distributed set-up.
One person can easily cause a good few thousand dollars damage to equipment in just a couple of hours if they’re not on the ball or not experienced. For a lot of ag machinery, there are also now very few parts suppliers, so there can be a reasonable delay in getting that fixed - how do you balance those types of user error costs alongside just maintenance/use costs of things wearing out quickly (which they do)? How do you manage that someone wanted to use that machinery next, but it’s now out of action for a week, and that was the week to get the hay in/seed in the ground/etc?
Our trucking cost for shifting the excavator is around $2-3 a kilometre (I can’t remember off the top of my head!), which can add up pretty quickly, it’d be interesting to figure out what the optimal range for this sort of set-up is!
Sorry if any of that is telling you stuff you already know, isn’t quite what you want to know, or comes across as nay-saying - I certainly don’t think it’s an unachievable idea, just those are some of the elements I’d consider! While we don’t have a co-op set-up by any means, I would say that locally there would be quite a few of us who are all aware of what each other has for machinery and find ways to hire it to each other and not duplicate purchases. Hope something within that was helpful!
We have a small one in our local biodynamic group and use LETS to keep track of equipment and help get it back home as soon as possible to avoid building up cost of hire. LETS - Local Exchange Trading.
Not sure if you saw this on Landline last week Charlie: http://www.abc.net.au/news/2018-04-29/collaborative-farming:-redefining-family-farming/9708978
Thanks everyone for your input, very cool info there and some great examples to build on. We’ll probably start super local and simple and see how it goes. I love the application of LETS and utilising the existing tool library knowledge too. Bravo all!
BRILLIANT!! I suggest you also get in touch with Demeter Biodynamics, as they have some great programs and people who may be doing something like this. Cheers, Madeleine
this is cool. Reading @Jen’s post makes me wonder if actually having a coop that owns and manages the things, including skilled operators, might be a good way to run it. Then if there are people in the coop who are particularly skilled it might be a source of income for them to also do some of the work for others. I guess that’s where the LETS might come in. Anyway, I suspect we’re outside the useful area for a Beechworth centred thing but will be ‘staying tuned’ with interest. Also Charlie - I haven’t looked but it may be worth checking farmhack and greenhorns for info - seems like something people there may have looked into?
Hey everyone! Absolutely LOVE the idea of a machinery co-op. We own a small farm in WA and have been finding it really difficult to either afford to buy the machinery we need or hire it. These is nothing around us where we can do so. So in response to our own frustrations we have started a business where farmers can hire their machinery for Wet or Dry hire.
We are almost ready to launch as the legal and insurance stuff is complicated. Basically farmers will be able to list their machinery on our website and when someone wants to hire it the hirer will need to pay for the insurance for the time they hire the machinery out. That’s the very basic explanation but it means the machinery owner will have no outlay. As Jen mentioned, it’s too expensive for all farmers to take out dry-hire insurance if the machine is not hired out constantly so hopefully this will solve that problem.
We are open to suggestions from everyone so please let me know what you think! We are just really really trying to help out farmer’s like ourselves who can’t justify owning everything they need! Plus we want to keep the money in farmer’s pockets where it should be
I don’t want to be spammy but this is our website if you want to see what we are up to www.yourmachineryshed.com
So many brilliant points raised Jen! We are trying to solve these problems for everyone so watch this space…any ideas would be great though
This is super cool Amy, I really hope this takes off for you guys, well done for dreaming this up and following through!
Let us all know here when you’re fully launched
I just came across this model in Canada that looks interesting, in part because they’re addressing some of the implementation challenges mentioned above: https://www.resilience.org/stories/2018-02-23/how-farmers-benefit-from-ag-equipment-co-ops/
And only because it’s a bit buried in that article but is more detailed, the PDF of a report from a Canadian university on setting them up, how they function, etc.
Also includes sample by-laws, membership contracts, costings - some good stuff in there!