December 1995
Diversifying Need Not Mean Farming
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Prairie Grains is the
official publication of
the Minnesota
Association of
Wheat Growers,
North Dakota Grain
Growers Association,
South Dakota Wheat,
Inc., and the
Minnesota Barley
Growers Association.
To maintain the viability of their farming operation near Fosston, Minn., the Affeldts would need to take on more acreage, and that’s something they didn’t want to do.
Partly because Warren’s dad Leland, a partner in the farming operation, wanted to retire. Also, as a past president of the Minnesota Association of Wheat Growers, Warren has been a close follower of farm policies. He speculated that expansion may not be wise when significant policy changes in a new farm bill might be on the horizon.
The Affeldts were admittedly fed up with farm policy the way it is now. Already disenchanted by having to deal with scab in wheat two years in a row, the decision to set sail in a new direction clicked last December when Warren returned home from visiting the local FSA (ASCS) office, sick of the ties to farm program paperwork.
"With the assets we acquired through farming, we decided to look for something else," says Warren.
Soon after, the Affeldts found out that owners of Hillview Homes, a local modular housing dealership, were planning to retire from the business.
Not wanting to move away from Fosston, and cognizant of a strong housing market in northwest Minnesota - particularly for more affordable manufactured homes - the Affeldts were quick to inquire about a transaction. By March 1, 1995, the Affeldts were new owners of a business in a market sector they knew virtually nothing about.
It’s been a flurry of venturesomeness since. Deb quit her job as a registered orthodontist assistant to work full-time in their housing business. Warren rented out two-thirds of his cropland, or about 2,000 acres, but still farms the rest with the assistance of his dad and hired help.
"I didn’t want to close the door on farming completely. We want to see where this new business leads us and where the trend in agriculture goes, and we’re positioned to get more involved in farming again if we choose," says Warren.
Some of the people involved with the past ownership are still employed by the Affeldts’ housing business. "The help from the previous owners and their family has been a key in our learning process and making this work," Deb says. "We couldn’t have done this without them."
In the housing business, the Affeldts haven’t entirely escaped some of the headaches associated with farming. They still have paperwork to contend with, but are quick to point out that "it’s not government paperwork."
And so far, the time they put into selling, transporting, and placing houses has rivaled the hours commonly invested in farming. "Warren comes home more worn out some days now than in the heat of seeding or harvesting," says Deb.
However, cash flow planning is easier, and a definite advantage is being able to set a reasonable price for their products, they say.
But like most farmers, Warren still has a yearning for topsoil under his fingernails that needs to be met. "Deb let’s me run to the farm when I want to. Farming is an outlet that helps me keep my sanity," he says.
Warren admits to a little nervousness in his first house sale. However, he says that skills gained by serving for almost nine years on the MAWG board have carried over to what he’s doing now. "It was an invaluable leadership experience that has helped in dealing with people. It helped create confidence to manage tough choices."
The Affeldts have been pleased with how their housing business has been going so far. They say that through the new venture, they diversified; only outside of the farming sector.
"It’s value-added through a different route," says Warren. "When we talk about diversification, we often relate it to production agriculture. But don’t rule out the outside possibilities."