I’ve been shoeing horses for money since 1966. I’ve seen the industry boom and bust to varying degrees a few times.

In the late ’80s and early ’90s, I became interested in changing careers, so I invested in furthering my education and earned a bachelor’s degree in accounting, then a master’s in taxation and a certificate in public accounting.

The accounting field wasn’t as rewarding as I had hoped. Let’s face it, the transition into an office is difficult after you’ve spent most of your career outdoors shoeing horses.

While I returned to farriery, I found the accounting and taxation fascinating and wish I had received that education much earlier in my life. Not so much because I longed for a different career, but because it gave me a whole different perspective on the business of shoeing horses.

Farriers, like many small business owners, get so wrapped up in perfecting their trade, generating more customers and cash flow, and keeping up with their changing industries that they can’t be bothered with “the books” or the real management side of being an entrepreneur.

Sure, accountants can take care of that at tax time when sifting through a bag of receipts to prepare last year’s tax return. But I hear many farriers complain that their accountants do a lousy job and cost too much because there’s just no way that they made that much money and owe that much tax. Heck, many of them are amazed because they’re still paying for the year before!

Go Beyond Hard Work

The reality is that if those farriers spent more time tending to the business of their farrier practice, they wouldn’t have to work so hard playing catch up. Many business owners want to be successful, but have no plan to get there other than “work hard.”

But what does that mean? Long hours, no time off, work for whatever the customer will pay. They don’t really know what their idea of success is, and I believe that they’ll just keep working until they stumble on it.

Some farriers are naturally good managers and conscientious about running their businesses. And others are fortunate to be in lucrative footcare markets where they can get by without paying too much attention to management.

Without a plan or an understanding of how to operate a business, struggling farriers can’t recognize whether they’re headed in the right direction because they not only lack a direction, but they have no idea where they are on the journey. They don’t run their business — the business runs them!

Other business owners invest some effort into running their businesses. They know where they’re going because they made a plan. They have a solid idea of what they have to do to get where they want to be. These business owners have an understanding of what it will cost to run their practice, and they know where they’re at because they regularly use a few simple tools to track the direction of the business.

Because of this understanding and time investment, these farriers usually “work” less and enjoy life more.

In my opinion, business management isn’t really that difficult. I also find that there is a similarity between this and shoeing horses. In this sense, no matter what type of horse you shoe, you use certain basic tools and principles every time, with some differences in application in some cases.

When you master these basic tools and principles, you generally have a better outcome. The same applies to running your farrier business.

Check The Oil

Every so often, you’ll read articles about business plans, budgets or some other aspect of business management. You may attend farrier conventions and seminars that have presentations on “practice management,” but these are generally someone offering anecdotal information on how they run their practice.

Farrier schools don’t have the time to thoroughly instruct novice horseshoers on the subject of management. Frankly, I haven’t seen too many opportunities to learn some nuts and bolts management tools, based on good principles that can be applied to a farrier business.

Again, there is a large segment of farriers who try to do better by working harder and hoping it will all work out in the end. But too often it ends before it works out. In today’s difficult marketplace, passive management just won’t work.

Just like your truck or your tools, your business will last longer, require less work and cost less money if you pay regular attention to it. Give your business “service” when necessary — it is easier and cheaper to change the oil in your truck than rebuild the engine. Pay attention to your footcare business by using the management tools to “check the oil” so you can make small adjustments before its engine blows up!

Types Of Business Owners

As a practicing certified public accountant, I had the opportunity to work with numerous small businesses. The accounting firms I worked for usually did the accounting and payroll, but primarily the client’s tax work. Sometimes they had been clients of the firm for many years, while others changed accountants every year or so. In my time with these firms, it didn’t take long to see some patterns emerge in two major classes of business owners.

One group always seemed busy, always late for everything. They worked day and night, 24/7. They always were ready to make a deal so no one else would get the job. Price didn’t matter, they could make it up with add-ons or find a deal on material. Their equipment was always falling apart because there wasn’t time or money to maintain it. When things got rough, they would try to work harder and catch up. They always worked too hard to manage their business. And they lived on their “profit,” which usually wasn’t much.

The other group had a different approach. They determined what the business needed to produce financially per year so they could have a comfortable lifestyle, including health care, retirement and savings, as a minimum — the things an employee would expect from any good job.

These business owners understand how much they could and needed to produce per year. Next, these owners recognize how much the materials and equipment would cost to produce at that level. They know to the dime the minimum amount of revenue they will need to generate to make it worthwhile to be in business.

These owners know the market factors that may affect the outcome of the plan: the geographical size of their market area, demand for their product and competition. Finally, they calculate a price that may at least produce a return on their efforts sufficient to support their desired lifestyle.

Now this business operator has a starting point to begin managing the business. And what is management? Management is using the results of operations to determine whether the business is achieving long-term expectations and making necessary changes to reach that goal.

Know Your History

Look at your history to help predict your future. “Those who don’t learn from history are destined to repeat it.” And the basis of that history is your business records. Remember, a little time spent sharpening your hoof knife rewards you with an effective tool.

The same goes with your business management — a small amount of time should be part of your daily or weekly routine. For example, a few minutes a day or week organizing receipts that you have collected both for the money you’ve received and spent is far more cost effective than the days required to catch up when your taxes are due or you need to organize when your shoeing rig breaks down for good and you have to apply for a vehicle loan.

Another benefit of management is that it becomes easier over time as you accumulate relevant information on paper and in your head. The good business managers have well-organized records of their business.

This depth of organization allows you to better manage clients. It’s similar to having a book full of established shoeing clients. Because you know what you did for them 6 weeks ago, 6 months ago and even 6 years ago, you then have an accurate idea of what you will need when you go to their barn the next time.

Business owners can quickly and easily check what the business did last month, last year or this month for the past few years. This allows for proper reviewing and forecasting. They know where they expect to be this month, next month, this year and 5 years from now.

They know whether they will need and can afford $50 worth of supplies, or can take advantage of a price break on $1,000 worth of supplies. They know whether they can afford four new tires or only two. Will they be able to go to the International Hoof-Care Summit or other farrier meetings, or just read about it?

The ability to recall details of your practice through accurate records will be invaluable when you get the letter from the IRS inviting you to have a chat about your tax returns. Good business decisions are based on good management, and good management is based in good records.

This article serves more as a pep talk to get you to change your line of thinking if you are struggling and don’t manage your business.

There are other articles in this publication that offer insight on pricing, records and other business-oriented topics. Don’t ignore these — they will help you determine and achieve your own level of success.