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Somerset Sam
09 Apr 11 22:07
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Date Joined: 11 Mar 02
| Topic/replies: 1,275 | Blogger: Somerset Sam's blog
Can anyone give an idea how much it costs to get and keep a mare in foal before the yearling / foal goes through the ring and hopefully a profitable payback?

Would be interested what the break even figure would be?

Info much appreciated..
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Report potentialmillionaire April 9, 2011 10:31 PM BST
I would think the figure varies pretty massively Somerset Sam.

Right now we're in the middle of the stud season fielding pretty grim bills from the vet's (unavoidable) and if you board your mare with the stallion keep fees, perhaps phenomenal (Coolmore, say) or as part of an all in deal merged with the stud fee.

Mare depreciation is another big aspect you need to consider and ofcourse the day to day running of a premisies or a year round boarding rate.

Someone like me with a few converted pigstys (but good winner producing land I might add!) is hoping, and needing, to keep things a lot more modest than the Aga Khan Laugh

The phrase 'piece of string' springs to mind!
Report RipVanWinkle April 10, 2011 1:37 AM BST
The cost of staying up all night waiting for foals is pricelessPlain
Report RipVanWinkle April 10, 2011 3:34 AM BST
.
Report Prima Donna April 10, 2011 6:07 AM BST
RipVanWinkle     Joined: 18 Nov 08
Replies: 527 10 Apr 11 01:37 
The cost of staying up all night waiting for foals is priceless.

LaughLaughI do know the feeling!I've done it a few times but thank god no longer.Perhaps try drinking Vodka, if like I did last night then you feel like you will never sleep again!CryWent to bed at 1am woke at 2.45AM wide awake lay there for what seemed hours only to find it was just six mins from when I last looked at the time,at that time in the morning feeling like I did you start thinking of how hot and uncomfortable your bed is along with a strong desire to tip any Vodka left down the sink PlainI did think about having my breakfast but at 3.30 lunch seems a hell of a long way offGrinmy sympathies Rip Van hope all went well and you managed to get some sleep.
Report Somerset Sam April 10, 2011 4:33 PM BST
On average guys what are the nuts and bolts figures??

I thought it was just agents who didnt give straight answers.....[;)]
Report potentialmillionaire April 10, 2011 9:01 PM BST
Absolute minimum 7k Somerset Sam. And that would include buying a mare for tuppence who then becomes worth doing the job with. You've got to know what you are doing and be doing it all yourself too.

If you've got a 500k mare who's looking disappointing, then don't be forgetting just how quick she's depreciating.Cry

There really is no such thing as a ballpark, it's a massive range.
Report Somerset Sam April 10, 2011 10:04 PM BST
I suppose depreciation only really comes into play if you're thinking at any stage of a resale value?

The cost of buying a mare is surely, to all intents and purposes, a sunken cost?
Report potentialmillionaire April 10, 2011 10:20 PM BST
The mare is treated as stock and valued and written down accordingly.

If she doesn't perform we're still looking to get out in time for some salvage value or if you are at my level when the value is frequently modest at the outset then they quickly become valueless.

So practically the mare is treated in much the same way as accounting practice views her so it's definitely part of your ongoing costs.
Report RipVanWinkle April 10, 2011 11:39 PM BST
SS, it depends what you have, if you have a good mare then your going to be going to more expensive stallions to improve sales results, stallions fees will be higher but so should the return after sales. You have to prep them before sales, vet them have the farrier at them alot. There is no way in putting a cost on it because every mare is different which leads to different costs. The feed,farrier,vet and sales prep will be the same reagrdless of what quality stock you have but you have foal levys and sales entries and transport if you want to go to tatts or doncaster
Report Somerset Sam April 11, 2011 7:40 AM BST
Shouldnt the mare be treated as the equine equivalent of plant and machinery and the produce as stock? Though depreciated all the same!!

Cheers RVW.

I suppose as has been mentioned earlier do you try and do as much yourself? Keeping costs as low as possible seems to be the name of the game, especially with the market like it is.
Report Equimine.co.uk April 11, 2011 8:39 AM BST
Sam,

Whenever I am looking at equine investments, the Broodmare is always treated as the equivalent of “Plant & Machinery”; she is a fixed asset in the balance sheet and depreciated as such. The depreciation schedule is age related, to a maximum of fifteen years of age, with a factor for the probability of barren years. For example, a nine year old mare would be depreciated over 5 years if purchased in the operations current accounting year. If the mare was underperforming and sold at a book loss, then you would take any additional hit on sale.

There would also be an annual interest charge for the mare capital costs, the cost via a bank overdraft if that is the method of financing, or an acceptable rate based upon the cost of the capital within the company. The minimum rate to use in the UK would be 3.5% per annum. This is the rate you can get on a “risk free” investment such as UK Gilts over fifteen years. Every business purchase is effectively made using borrowed money; it is borrowed from either the company itself or a third party such as a bank.

We assume an annual keep cost of £6000 per annum for a typical broodmare. An increase made for mares of above average value. As has been said before, every mare is different these are just the guide methods I use.

These are just the mare costs, and take no account of infrastructure, property, labour costs et al.

The progeny should be treated as stock if you plan to sell as a yearling, you could argue it was “Work in Progress” as others costs would apply to each individual foal, it would be a “Current Asset” not a fixed asset therefore no depreciation. Again, by way of example, I would have a foal at birth having a business cost of £51,575 if it was the progeny of a £100,000 value eight year old mare, covered by a stallion with a fee of £25,000.
Report potentialmillionaire April 11, 2011 6:15 PM BST
Stick with me Somerset Sam - I think Equimine is way too smart!

I believe the UK Inland Revenue values consistency in an organisation's Accounting methods above all else and the fact is that writing down a mare looks like it's the same in Equimine's world as it is in mine in all reality!

Technically mares and indeed Stallions should be treated as stock in trade and valued individually at the beginning and end of each year on the usual basis of cost or net realisable value whichever is the lower.
Report Equimine.co.uk April 12, 2011 9:34 AM BST
I am pleased you like my dress sense, potm. [;)]
Report potentialmillionaire April 12, 2011 6:05 PM BST
Best dressed on here, Equimine Laugh
Report Prima Donna April 12, 2011 6:27 PM BST
No Pot M I hold that title,[;)]
Report potentialmillionaire April 12, 2011 7:05 PM BST
B=gg=r. I'd never have presumed to get away with that statement, but I thought you weren't following this thread Laugh
Report Prima Donna April 12, 2011 7:24 PM BST
Yes I'm looking in,personally if I like a mare and I want her I get her,if it goes wrong and she ends up costing me then so what that's how they go........that's horses,trick is in getting the right one in the first place.That does sound very big-headed mind.ALL horses cost you once the hammer drops,fact of life I'm afraid.
Report potentialmillionaire April 12, 2011 7:49 PM BST
I never seem to get to move mine on I'm afraid! By the time I've realised they're no good it's mighty obvious to everyone else as well!

So I might as well write them off in year 1 really. I suspect we come at it from the same direction just at slightly different ends of the market Laugh
Report Prima Donna April 12, 2011 8:05 PM BST
We do Pot M,yes we have top class mares but also mares in the same or very similar markets to yours,its a great feeling when those sorts come up trumps esp' if you use a 'cheap' stallion.I've said lots of times top mares to top sires really there is no skill in getting a good sale its easy( a sweeping statement I know)the other sort is much more rewarding to me.So you see as breeders we are very similar and operate at the same level sometimes anyway.Happy
Report potentialmillionaire April 12, 2011 9:32 PM BST
I remember an interview with Egon Weinfield many moons ago after they'd had a particularly good sales season. He said that his highlight of the year had been a particularly good sale from a cheapie, not the mega sale of a Bella Colora or some such.

I presume though that the opposite is true and the mega investments have the biggest potential to disappoint. Cry
Report Prima Donna April 14, 2011 10:57 AM BST
They do Pot M,a few times you have a very silent ride home in the car!Still like all of us in the game we always are eternal optimists and the only thing you can do is take it on the chin and look forward.Cool
Report potentialmillionaire April 14, 2011 8:03 PM BST
Aah, the drive home from the sales Laugh

That little comment really got me thinking!

So much can be learned from that single journey, I reckon there's a fly on the wall documentary in there somewhere - probably a whole bl00dy series in fact.
1, Non-stop chatter  (rare), a successful sale.
2, Studied conversation, no money made but no threat to survival.
3, Silence (common) juggling ideas to try and stay in business.

It's always preceeded by a trip to the tea room and my comfort blanket of choice, cake not booze, and that seems to be downed in the same industrial quantities whether as celebration or solace Laugh
Report Prima Donna April 15, 2011 11:09 AM BST
If your horses don't make what's hoped for on your return does Mrs Millionaire greet you with a large chocolate cake?LaughMe I go straight for the bottle..........and NOT Vodka!!!!All the time dreaming of walking around the place taking out mares with a machine gun.Shocked
Report potentialmillionaire April 15, 2011 5:18 PM BST
Ramblings . . .

I steer clear of the bottle as I don't like waking in the morning with a business in ruins AND a sore head!

The original thread. We all need to factor into our production costs £25k which Fiona Marner coughed up today as she had a smouldering muck heap. Serious bad luck Fiona. . .

D day tomorrow for all ours new wonder horse. T'would help if Cecil's were anything like fit Sad
Report Equimine.co.uk April 15, 2011 7:28 PM BST
If you fancy a little flutter Potm, Shropshire at 11/2 to come second is good value.
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