Entrepreneurship in New Zealand Farming - Roles and decision making

Division of labour in the farm and household
Enterprise business structures and integration with the farms
Division of labour in the enterprise
The enterprises are important for women
Operation and decision making
Decision making on the farms
Reasons for establishment
The decision to establish

Roles and decision making

Division of labour in the farm and household

A ‘traditional’ division of labour was evident for farm and household, with men performing the major role on the farm and women the major household role. The women interviewed usually shared ownership of the farm with their husbands, but seldom shared (or acknowledged sharing) responsibility for the management of the farm. There was only a minority of households (14%) where males and females accepted joint responsibility for domestic tasks. Men reported performing a range of household tasks that included washing the dishes, cooking and child care. For women their secondary roles on the farm included the farm accounts, cooking for shearers, feeding out, docking and lambing.

Enterprise business structures and integration with the farms

The majority of the enterprises were financially and structurally independent of the farm business, being ‘stand alone’ business structures. Forty-four per cent were integrated with the farm business operation in full or part. Most of those working with an integrated structure described it as an ‘accounting mechanism’. Others cited the use of farm land, buildings or equipment by the enterprise, or reported that initially their enterprise had been set up with farm finance. Those who ran an integrated structure noted that separating the activities out, especially if they had more than one enterprise, was just too complex. Independence was the strong incentive for those who chose a stand alone structure. One noted, for example, that the use of separate accounts was crucially important as it enabled her to watch the financial progress of her enterprises.

Financial integration was usually due to the need to simplify accounts. This meant that the farmers only needed to run one GST and tax account, and the farm account held the business assets and liabilities. This type of integration was found in particular with smaller, new businesses. In many instances the enterprise operator did keep separate figures for management purposes, and sometimes these were identified within the total farm account.

The second dimension of integration was in the use of farm resources, from land to buildings to equipment. This could include the use of otherwise under utilised or redundant resources, such as a farm shed or extra bedrooms. In other cases it can involve the use of a well-used facility, such as a shearing shed, but one that could easily be adapted to the enterprise and its different seasonal activity.

The interrelationship of farm and enterprise can confuse the question of the value of farm assets used by the enterprise. With a farmstay the dual use of the farm house is inseparable, as it is with those entrepreneurs who work from home in a consulting capacity and use ‘space in the kitchen’. They use the farm computer but the intellectual property on which the enterprise was based belongs to the entrepreneur. In some cases land and buildings were bought for the enterprise that were not primarily farm assets. Nevertheless, many of the enterprises benefited greatly, or would not have existed, without the use of farm buildings in particular. For at least half the entrepreneurs the proportion of the farm assets used by the enterprise were ‘significant’, ‘essential’, and ‘interdependent’. It was a crucial dimension in the competitive advantage held by the farm enterprises, and one that the respondents readily acknowledged when they considered the possibility of relocating to a site off the farm. In an urban setting they would be facing high building and land overheads. The immense benefit of having premises close at hand was also identified: ‘access is immediate, time saved is huge’.

Division of labour in the enterprise

In comparison, just under 40% of the women have the major role in the on-farm enterprise, 29% were operated by males and a further 27% were operated jointly. Women therefore are involved in over two-thirds of the enterprises in the study. Males (26%) provided a secondary support role to many enterprises. Twelve per cent of the enterprises employed labour, however, 26% of the enterprises had nobody supporting the major operator.

The enterprises are important for women

Women have high involvement in the enterprises, in many cases as major operator or as joint operator with their male partner. This high involvement in alternative enterprises may explain their low involvement with the core farm operation. It was evident that women operating enterprises had a high degree of motivation and considerable satisfaction from their work. This motivation and satisfaction was based on their ability to utilise personal creativity and skills, and formal training. It also demonstrated an enjoyment of operating in the business ‘world’, as distinct from the farm. In effect a number of women were developing careers through their businesses, in a similar way to a set of women in the off-farm employment study².

Operation and decision making

The majority of enterprise operators were women (23); 15 men were identified as the major operators and nine couples reported sharing this role. Six women reported being the major operators of one enterprise while their partner ran another. There was little difference in enterprise decision making — financial, production, marketing — between males and females. Around a third of the women and a third of the men made decisions. A further third of all decisions were made jointly by men and women. In at least one example the decision making role changed as the enterprise developed. A further finding is that there was no single preferred manner of business operation. Completely different business and decision making methods could be in operation for each of one or more enterprises on a farm. It does appear that women were more likely to have a direct decision making role than a direct (non-partnership) stake in ownership. Overall women have more say in the enterprises than in farm decisions.

Decision making on the farms

Men were the major decision makers on the farms, exercising this responsibility across finances, production and marketing. The majority made their decisions on their own. Only a fifth of the women participated in the farm’s management by shared responsibility with the men. While men dominated the farm decision making process women were more involved in household decisions having sole responsibility over the daily/weekly budget in two thirds of the households. In a further fifth of the households this responsibility was shared jointly between the men and the women. Just under a third of the women had responsibility for major household purchases with two thirds of the couples making joint decisions on household purchases. The greater involvement of men in this aspect of household decision making could reflect the relationship between household purchases and farm drawings. Child health and education were mainly joint decisions but women have exclusive control in this area in just under a third of the households.

Reasons for establishment

There were two broad reasons for establishing the enterprise, personal and pragmatic. Personal reasons were based on philosophies of self fulfilment, challenge and the need ‘to achieve on my own’. In several instances dis-satisfaction or disillusionment in farming were cited, as was the need to ‘stop the boredom’ after developing the farm to it’s full potential. Pragmatic reasons were firmly grounded in financial concern. At least one male who enjoyed the hobby which became his enterprise found that he no longer enjoyed farming because farming was no longer successful financially, so he decided to ‘do something commercially’ about his enjoyment.

The decision to establish

The decision to start the enterprise was made by marginally more men (14) than women (12) on their own. For a further seventeen couples the decision was made jointly. The remaining couples made the decision in discussion with their families and in one instance with friends who ultimately became partners in the enterprise. For several respondents the decision appears to have been like a non-decision — they spoke of just ‘drifting into it’ or noted that a ‘hobby evolved into an enterprise’. Marginally more men (15) than women (13) had the initial enterprise concept. Nine couples shared development of the idea jointly, a further 12 couples developed the idea with their family and others developed the idea with friends and colleagues. Six of the couples identified either previous work experience stimulating their eventual enterprise or an interest in a hobby that they developed into their enterprise. For several, the move into farm tourism was a commercial extension of everyday farm hospitality. Almost without exception the entrepreneurs were aware of their product’s market niche. Because of the slow and deliberate evolution of the enterprises many, especially in the tourist market, were already involved in the activity that they were to turn into an enterprise, for example, the ‘market’ was already visiting the garden.