Knowing that there is no such thing as a free lunch, ranchers continually ask “How much will this cost me? and… Is it worth it?” Putting together a figure for the cost of an improvement to the ranch is fairly simple. The more difficult thing to figure is the value of the return the improvement brings to the ranch. The time that it takes the ranch to recover the cost of the change should also be figured into the equation. The shorter the recovery time for the money spent, the more likely the success of the expenditure. This article addresses the value in planning for additions or changes to the operation. As the saying goes, “No one plans to fail, but many fail to plan.” This article and economic analysis activity places an economic reality to ranch additions and teaches how to figure costs and creates a value to the ranch for the additional improvement.

How Do I Know It Will Pay?
Jim Gerrish
American GrazingLands Services LLC, Patterson ID USA
August 2014
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