Jordain Beattie
NZAB - Client Director

Louise Gibson
The Sharefarming Consultants

Sharefarming success doesn’t happen by chance. It’s built on clear communication, shared goals, and solid planning from day one. That’s why NZAB and the Sharefarming Consultants have teamed up to share insights from both the financial and practical sides of the equation. Together, we’ve seen that when farmers treat sharefarming as a true business partnership, not just a contract, it creates better outcomes for everyone involved - more trust, stronger performance, and a clearer path to long-term success.

The following insights are shared by Jordain Beattie from NZAB and Louise Gibson from the Sharefarming Consultants, highlighting key areas to focus on when setting yourself up for success in a sharefarming arrangement.

JORDAIN: Knowing your numbers before you sign

Before entering a sharefarming arrangement, it’s essential to take a thorough, numbers-based approach to planning. Start by stress testing your budgets, allowing a buffer in production and understanding how changes in payout could affect your bottom line (if applicable and not on a fixed contract). Look closely at the farm’s historical production and whether any changes to the system are expected that might influence performance. Work through a clear, line-by-line breakdown of who is responsible for each expense, so everyone understands who is responsible for what. Finally, engage financial professionals early to understand your borrowing capacity, servicing costs, and any potential gaps so you can enter the arrangement with confidence and clarity.

LOUISE: Costs and Labour Costs

Ideally, you will be provided current costs from the farm owner. If you cannot access this, work with an accountant who can access DairyBase to look at similar farms. The largest cost for a sharefarmer will be labour. Map out what a realistic labour budget will be, this will vary depending on the duties expected to be completed each day. Farm systems that have k-line irrigation and a feed pad will use a lot more labour than a pivot irrigated farm with in-shed feed for supplement. As farm owners, it can be tempting to declare a contract milker a catch all but remember that they are not responsible for all labour required on farm, only what is stipulated in the contract milking agreement.

JORDAIN: Ensure you are building wealth, not just getting through

Think beyond the current season and set goals that support your long-term growth. Consider how your equity position is progressing and how each step moves you closer to your next opportunity. Understand what surplus cash might be available after meeting all obligations, including tax and debt servicing, and plan to use it intentionally for reinvestment or debt reduction. Make the most of your professional team by seeking advice, asking questions, and staying challenged. Keep regular communication with your accountant, legal, and farm advisors to ensure your decisions are well-informed and aligned with your goals.

LOUISE: What to look for in a sharefarming agreement and who’s the correct expert to review your agreement?

Not all sharefarming agreements are created equal and even when you think you have a “standard” template, there is no such thing as “standard” in sharefarming. When looking at a template, ensure all required fields are completed and you have all the required evidence (i.e. fertiliser and milk production records). Check for additional clauses, some may be a breach of contract law which should be checked over by your lawyer. For non-template agreements, ensure that they do not contain any provision for withholding money and any penalties are fair and reasonable.

Unlike other contracting agreements, a sharefarming agreement needs to be based on farm systems science, not just the legal wording. I have met with many sharefarmers who went to a lawyer to have their agreement checked only to be told that its “just a standard agreement” and to sign it. The lawyer did not consider that the items in the front were not completed correctly, that the feed and nitrogen inputs would not achieve the expected milk production and the costs stated were unrealistic. I recommend seeking a sharefarming expert or consultant to review your agreement first and foremost and follow this up with a lawyer for agreements that deviate from the standard template.

Setting yourself up for success in sharefarming takes more than a handshake. It requires the right structure, financial clarity, and communication from the start. NZAB and the Sharefarming Consultants work alongside farmers to get those foundations right, helping both parties build trust, profitability, and a pathway for growth.

If you want to chat more with either NZAB or the Sharefarming consultants on getting your sharefarming arrangement set up for success, get in touch today.

 

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