Three Pillars Shape Illinois Farm

July 31, 2018 07:13 PM
 
Bailey Family Farm Leaders

One phone call can be a waterfall moment for a business. In the fall of 2012, Darren Bailey and his two sons, Zach and Cole, received a call from an area farmer. He asked to meet that weekend to talk—providing no other details. As one does, the Baileys expected the worst. He must be unhappy over how they were farming neighboring land.

At the meeting, the farmer walked in and immediately flopped down a bunch of papers. He looked the three Baileys in the eyes and said, “Darren, I like the way you’re farming with your boys. Here’s all my farm ground, and I’ve already secured all my landowners, you’re going to farm their ground, too.”

 “That was 1,200 acres,” recalls Zach, 30.

Just months before that pivotal meeting, Zach and Cole, 28, had returned to the Louisville, Ill., row-crop operation. At the time, the farm included 4,000 acres. That additional 1,200 acres was the first step of a major growth spurt that would stabilize and evolve the family operation. Fast-forward to today, and the Baileys produce corn, soybeans and wheat across 12,000 acres of the flat land in south-central Illinois.

Growth of this speed and scale is not easy—it takes calculated strategies, persistent financial analysis, a focused vision and, above all, constant and compassionate communication. These best management practices, combined with the Baileys’ commitment to their family and community earned them recognition as finalists for the 2018 Top Producer of the Year Award.

Bailey Family Farm

Growing Pains. Business growth always comes with a price tag. Darren knows that well. In the early ’80s, he joined his father, Bill, on the family farm. Soon after, Darren’s brother-in-law joined the team. The three were focused on expansion.

“We grew the farm to about 30,000 acres in the mid-’90s,” Darren says. “By 2006, things were very hectic, and we were having trouble getting along. So, I ultimately stepped out and spent six years as an independent business.”

Zach and Cole had a front-row seat to the misery and stress of running a large operation with family members.

“We knew what dad went through,” Cole says. “Dad asked us if we thought we’d come back to the farm. The answer was always: Nope.”

The boys, who are the oldest of Darren’s four children, moved away for college. Cole studied physical education and Zach, aviation management. They each married and before long, babies were on the way.

“I called dad and said, ‘I don’t necessarily want a job on the farm, but if there’s a position for me, I’d love it,’” Zach says. “Either way, we’re moving back because we want to raise our kids around family.”

Cole had just returned, so the brothers (and best friends) joined the farm as hourly employees. They were honored to become the third generation of farmers in the family. But before they would put down roots and make the farm their career, crucial conversations had to happen.

The Baileys, and their wives, discussed everything from farm responsibilities to how to deal with conflict to personal and farm goals. No one wanted the farm to bruise family relationships. They also set up regular family and farm meetings, to keep these issues front-and-center.

On a monthly basis, the family meets—Darren and his wife, Cindy; Zach, and his wife, Kelsey; Cole and his wife, Marcy; and Mason, the youngest Bailey son who is in college and plans to join the operation soon. (The brothers’ sister and her family aren’t part of the operation.)

“It’s all about communication and being transparent with each other,” Zach says. “We go home and share our frustrations with our wives. At the family meeting, we bring that stuff up. We ask our wives, what have the guys complained about?”

By the time the monthly meetings roll around, a lot of conflicts aren’t important any more. But, if they are still bothering someone, they need to be brought up and addressed. Their goal: don’t let any frustrations fester.

As the family patriarch, Darren says these meetings can be uncomfortable, but they are vital. “I’ve learned to be humble, patient and listen with open ears and an open mind to resolve the situation and not take it personally,” he says.

 

Bailey Family Farm

All-Inclusive Name. When the sons joined the farm, its name was Darren Bailey Ag. To achieve the level of growth the operation needed to support the three families, they took a hard look at branding the farm. After visiting with the marketing team of their seed supplier, Beck’s, they decided on Bailey Family Farm. Their logo includes a cross to emphasize the business’ three pillars: Faith, Family, Farm.

The logo is on their trucks, field signs, buildings, website and employee uniforms. “Our goal when someone sees a Bailey Family Farm sign is that it is synonymous with quality,” Zach says.

Putting their name out there can be a double-edged sword. “If something good happens, hopefully somebody will see that and call us,” Zach says. “But if one of our tractors pulls out in front of somebody, we’ll have a phone call within an hour. It may put a target on us, but it also holds us accountable.”

The Baileys’ branding efforts have paid dividends in their landlord relationships. Leased ground is critical to their operation, so they strive to have every relationship go beyond being a simple transaction. Landowners now regularly approach them about renting their ground.

“We’ve never knocked on a single door for acres,” Zach says. “We have 40 different landlords, everyone from recently retired farmers to those who are three or four generations removed and now live in Los Angeles and on the East Coast.”

To strengthen and maintain those connections, the Baileys mail out a quarterly farm newsletter to their landlords and all of their landlords’ children. Currently, 60% of the farm’s leases are on shares, with the remaining being cash rental agreements. The Baileys are open with their landlords about low commodity prices, and the advantages and disadvantages of each type of lease.

“We’ve had conversations the past two years with every single landowner,” Zach says. “We’ve told them that prices are tight, and yields weren’t where we wanted them to be. We decided to keep rents the same. But, we asked them that if we come to you a year from now, please hear us out about negotiating rents.” 

In light of tight profit margins, the Baileys have zeroed in on their expenses so they could understand them at a micro level.

“The Baileys keep the income statement and balance sheet at the forefront in making daily operating decisions,” says Frank Dhom, a relationship manager with Rabo AgriFinance and one of the family’s lenders. “The operation understands risk and are always looking for how to improve their operation.”

Crop rotation is driven by profitability and opportunity for the farm. “The Baileys have gone against the grain on the standard corn-and-soybean rotation and planted all soybeans for two years,” says Michael LaPlant, the vice president of agribusiness banking at UMB Bank.

This was a well-calculated move, LaPlant says, as a detailed fertility program and intensive production practices produced high yields and strong earnings for the operation.

For 2018, corn is back in the mix, but they have switched to 100% non-GMO corn and soybeans, in addition to their wheat acres. The Baileys contract their grain through specific buyers to capture premiums.

Transition Test Run. Zach and Cole’s return to the farm has allowed Darren to envision a bright future for the farm. “You’ve got say, ‘What do you want this place to look like in 10 years or 30 years when you are gone?’” Darren says, “It means a lot to me to know my family—with or without my last name—will be carrying it on.”

Darren is running for the 109th House District seat in Illinois. He beat out a seven-term Republican incumbent to win the party’s nomination this past spring, and the election will be in November.

Zach and Cole are increasing their responsibilities and gaining confidence as leaders of the 50-year-old operation. For the Baileys, size, money or acres aren’t their priorities. Instead their focus is quality of life. “I pray daily that I never become complacent with the opportunity that I’ve been granted,” Zach says.  

 

A Snapshot of Bailey Family Farm

Operation:

Bailey Family Farms produces corn, soybeans and wheat on 1,800 owned and 10,200 rented acres in southern Illinois. For 2018, all the corn and soybeans are non-GMO. Due to lower corn profitability, the Baileys grew 100% soybeans in 2016 and 2017.

Grain Storage: To capitalize on producing non-GMO varieties, the Baileys have heavily invested in grain storage. They can store 440,000 bu. in a large shed, and four years ago they bought the grain elevator in their hometown, which added 1 million bushels of capacity.

Bailey Family Farm

Family and Team: The farm is a partnership between brothers Zach, Cole and Mason Bailey, and their father, Darren. The team also includes 15 full-time and five part-time employees. To ensure everyone works well together, every family member and employee has completed a personality assessment. By knowing what makes each person “tick,” the team can work through conflict quickly.

Community: The Baileys hold leadership roles in their church and several commodity associations. One of the family’s proudest achievements was establishing a faith-based school in their community. Two years ago, they bought a church camp property and created the Full Armor Christian Academy, which today welcomes 200 students.

 

Recipe for a Five-Star Team

Potential new employees at Bailey Family Farm must answer one key question in the application process: Explain your skills and experiences that would make you a valuable asset to this company. They adopted this screening process from Mel Kleinman, president of Humetrics, a human resource consulting firm. He provides this advice on building a stellar team.

Know your special sauce.  Every employer needs to create a unique employee proposition, Kleinman says. This is why you are a good boss and your farm is an outstanding place to work. Compile a bullet list of reasons. “If you don’t have a unique employee proposition, you are just like everybody else,” he says. “Plus it holds you as an employer accountable.”

Build a shopping list. If you go grocery shopping without a list, you spend more money and end up having to go back because you forgot something. For every position you plan to fill, detail the CAPS required—Capacity (mental and physical), Attitude, Personality, Skills.

Select quality ingredients. Create a thoughtful and insightful interview process. “People come to interviews to tell you what you want to hear,” Kleinman says. To make candidates tell you the truth, create a thoughtful question list. “Farmers work hard,” he says, “but how many of you ask hard-work questions?” Ask: What’s the hardest job you ever had? You’ll learn so much about your candidates.

 

2019 Top Producer of the Year

The award honors three producers whose operations are at the forefront of agriculture and crowns one winner. Entrants are judged on entrepreneurial originality (50%), financial and business progress (30%) and industry or community leadership (20%). All three finalists receive trips to the Summit, CEO coaching sessions and other prizes. The winner also receives a lease of a Case IH tractor. Download the application and apply by Aug. 30. Sponsored by Bayer and Case IH

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