Business Idea, what do you all think- Collapse retreat contract

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Wayne Grow's picture
Wayne Grow
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Joined: Sep 18 2008
Posts: 21
Business Idea, what do you all think- Collapse retreat contract

I propose a service contract model which might help a lot of us stay in our gardens more(I vastly prefer to be there over the office these days).  I live on a rural property where we have invested copious time, cash, energy and love to fashion a living arrangement very much in line with the Peak Prosperity philosophies.  My thought is that there must be many families who are aware of the PP resiliency steps but due to limitations of time/location of work/personal physical abilities etc, simply are not able to establish and manage their own farms(the classic trouble a lot us run into with one foot in the new world but one still necessarily stuck in the old one).  My thought is a sort of business arrangement in which the client pays a fee to have turn key access to a retreat ready property.  Of course the specifics of each arrangement would be highly individualized per the needs of the client and facilities of the homesteader. This would allow someone to continue their lucrative city oriented career and basically have an insurance policy that would allow them to immediately flee to a property with a host family who has already bread the sheep, built up the soil, planted the gardens, stacked the wood and maintains community/neighborly relationships.  I think this might be particularly attractive to retirees as well.  Perhaps we establish a running list here or where clients could "shop" for retreats that fit their geographic and other needs. Cheers All.  I am ever greatful to CM and this community.  Cheers all!  (I'm in the Seattle area BTW.)

jrf29's picture
jrf29
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Joined: Apr 18 2008
Posts: 453
Retreat contract

Of course, the very idea of a "contract" (as a form of agreement) relies on the existence of a well-functioning legal system.  And even in the best of times, whether a contract is performed is a matter of business risk; contracts are often "re-negotiated" under duress after the bargaining position of the parties has suddenly changed.

Setting aside for a moment whether it is even possible to be truly prepared with any kind of "turnkey" system, I think that whether this idea would work depends greatly on who owns the land, and who offers the services.  If the land is owned by the host family, and the right to retreat to it is the service provided, I see several weaknesses from the perspective of the buyer:

  1. Any person with the wherewithal to purchase a retreat would want to own the land themselves.  Even then, legal ownership may not be enough.  As Dmitry Orlov says, after the collapse of the Soviet Union, the people who profited were the ones in actual physical possession of real things: buildings, land, and equipment.  Not the theoretical legal "owner," but the man who actually had keys to the building.  With this in mind, even allowing a caretaker to live on land that you own is a big risk;
     
  2. From the perspective of the buyer, a service contract is even weaker than a lease.  If the host family were to turn the buyer away, even assuming a fully functioning legal system the buyer would be entitled only to money damages.  In other words nothing;
     
  3. There is nothing to prevent a host family from "overbooking" their farm.  For all the buyer knows, the host family might sell contracts to 100 other people;
     
  4. When the chips are down, the refugee would be entirely dependent upon the host.  They might wind up little better than a serf on the land of their host family.

So, the person with the lucrative city-oriented career would obviously prefer to have the service contract work the other way 'round: they own the land, and the caretaker occupies the legal position of merely a hired gardener.  Now this is less than ideal for the caretaker.  What caretaker would accept this arrangement?  Who is to say that the caretaker won't be slowly pushed out into the cold after the host family arrives?

That is the inherent problem with one-sided service agreements. The very best arrangements are those where both parties need each other, and both have something to offer.  For example, let's say you have an entomologist with a brown thumb whose personal hobby happens to be the collection of a wide variety of modern and antique insecticides (don't laugh: I know one), and he grew up on an animal farm.  Let's say his old college friend knows nothing about animal farming per se, but is a veterinary technician who is an avid gardener with a natural green thumb.  It's obvious they can help one another.  In fact, they might even agree ahead of time to have each others' backs, within their respective areas of expertise.  That is an agreement that has an excellent chance of working after things go pear-shaped. Why?  Because both parties have something to gain from the agreement, and neither one is at the mercy of the other.

All of this is a long way of saying that I doubt an arrangement like the one you propose could work where the only thing that one party has to offer is money.  The mutual benefit must go beyond money.

TechGuy's picture
TechGuy
Status: Gold Member (Offline)
Joined: Oct 13 2008
Posts: 366
Re: Collapse retreat Business Model

"My thought is that there must be many families who are aware of the PP resiliency steps but due to limitations of time/location of work/personal physical abilities etc, simply are not able to establish and manage their own farms"

FWIW: That market would be extremely limited. I very much doubt it would be a profitable business model.

I think over the next ten years (if we avoid collapse), The trend will be more automation and a transition away from the home office model into a cloud model. This shift will permit workers to perform most if not all of there job duty at home or at a remote office. Those that want to persue a rural lifestyle will not necessarily be tied to a urban location for employment. This assessment is based upon a trend I see happening in corporate america. Business are shifting to cloud systems to ditch internal IT systems for back office systems (eMail, accounting, sales, marketing, etc). I also see companies shifting away from full time employees into an outsourced model, where they hire firms to perform tasks instead of full time employees. Since IT systems are shifting to the cloud and cloud based  system are accessible anywhere it seems likely that the need for the daily communte into the office will become unnecessary. Companies will also see savings by not having to own/lease a large home office space, and will no longer need to limit there labor pool of available workers to a narrow region (ie with in commuting distance of the home office). With cloud bases systems, workers can be located anywhere there is a reliable internet connection.

That said, I also see companies reducing the size of their labor force as computing automation begins to replace white collar jobs. Just as automation has reduced the need for labor in manufacturing. I think will see corporate america reduce its laborforce at a rate of 2% every year. Although a major recession would speed up the rate of jobs losses. This will put a long term cap on wage increases, and will most likely force white collar workers to endure pay cuts to retain their jobs. 

I believe the biggest hurdle for those wanting to adopt a self-reliant, rural lifestyle will be the capital needed to set up a homestead, not neccessary training or location. The majority of people simple don't have sufficient capital, and the majority will be forced into remaining in suburbia with a small back yard garden. With a weak economy and a major shift the the structure of the labor force (see above) its very unlike that many remaining on the sidelines will ever be able to move. In fact most of the blogs, vblogs, etc are about people prepping on a tiny lot in suburbia (and that's trend began well before the economy started going down hill)

Ideally, the best business model advice I can offer is to avoid any consumer services. The easiest business model is to provide business to business services. Businesses are a heck of a lot easier to deal with, and your profit margins will be higher for the amount of work you needed. Its easier to sell and provide $5K of services to a single business, than it is to find 100 consumers selling then $50 of services. If you must rely on consumers for your income, I would recommend investing in a trades education (HVAC, plumber, home-improvement). Demand for these services will never go away (until there is a collapse). These trades are mostly dominated by aging boomers, and its likely there will be a shortage of skill trade workers as boomer retire or are unable to perform job functions due to age related health issues. Of the trade skills I think will be in the most demand is HVAC, simply because Heating and cooling for most homeowners & renters is probably second only to food, and a place to live. When there is a problem with the Heating or hot water, you can bet a call for service is only minutes away. Since HVAC systems are more complex, they need more frequent maintainence and repair. Usually HVAC services costs are higher than other trade services. But as a HVAC guy, you need to be a little of different trades, since typically HVAC repair involves a bit of an electrician, a plumber, and sometimes, a carpenter. Disclosure: I am not a HVAC guy, nore am I occupied in an trades career. 

Those that have the capital to acquire rural land often just lease their land out to a farmer. Rural land that is in "farm land use" has a considerably lower property tax rate. For instance a rural property might have a yearly property tax of $1500/yr, but under farm land use it would be reduced to about $50/yr. Also the farmer pays them rent for use of the land.

Another hurdle for those wishing to go rural/self reliant is the investment in equipment and tools. Typically a homestead farm will need at least a small tractor, equipped with farming attachments, seed drill, fertilizer spreader, harrow, mower, etc). A small tractor will run about $8K to $15K (used), plus another $5K to $10K on attachments. The tractor will also need tools for maintenance, for greasing joints, changing Oil, filter replacement (Oil, hydraulic, air, etc) as well as tools to replace & sharpen blades/knifes on the attachments. Thats just the very basic. If you want to harvest a sizeable crop, you'll need harvesting equipment which can cost tens of thousands for the smallest versions.

I would guess that a homesteader that wishes to be self-reliance, and sustainable, would need a minium of 40 to 60 acres (rain, soil, weather, length of growing season), with at least a 20 acre wood lot to provide winter heating and lumber. 10 to 20 arches of land for agraculture (fruit& nut trees, perennials - blueberries, grapes, strawberries, and seasonal crops - grains, beans, vegetables - tubers, grazing land for some livestock). As well as a barn or utility building for equipment storage/maintenance. The homestead home will also need to be well insulated to get by on a 20 acre wood lot that is sustainable (accept if the property is located in the tropics where there is no need for heating) 

I believe this would require at least a $500K investment in a low cost region where you can acquire land below $2k/acre and this is probably a low-ball estimate. I imagine some people will try with much less capital but at some point realize that they won't will not be able to achieve self-reliance or sustain self-reliance and be force to abandon their model. Over the years I read blogs/vblogs of people buy 10 to 20 rural acres, using a camper or tent to live in. I cannot recall seeing this mimiumal arrangement lasting more than a few years before they are forced to throw in the towel. Is a minimalist arrangement possible? perhaps, but it would involve an incredible amount of labor to turn it into something sustainable. I think very few people would be able or willing to put in the labor investment to make it work over the long term.

 

 

Tbil2's picture
Tbil2
Status: Member (Offline)
Joined: Jul 13 2011
Posts: 4
Retreat contract

Hi All,

I agree with the comments about capital investment in a farmstead.  I have attached links to  some community projects that are based on a learning model for folks that want to learn skills and build community ties (cooperative home steading).  It is not an answer for everyone but does address some of the how to concepts of preparing and learning to be more self sufficient and sustainable in the coming years. 

Enjoy the possibilities,

Todd

http://dachaproject.com/

http://ithacan.ning.com/

 

brushhog's picture
brushhog
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Joined: Oct 6 2015
Posts: 24
Wayne, I agree with your

Wayne, I agree with your overall points but your numbers are way off. I'm a farmer by trade and a self reliant homesteader by hobby. Ive been doing this for many years now, and I own and work about 200 acres. When asked this question I find most people grossly over estimate the amount of land needed to be self reliant. Your estimates of 10-20 acres of land for agriculture, 20 for wood lot, and a total of 40-60 acres is way, WAY too high.

A family of 4 would have a tough time consuming everything they can get from a 1 acre garden. I know this from personal experience. The pilgrims fed the whole village from 20 acres. A 20 acre agricultural plot isd a business, no way on earth a single family can make use of it all. 20 acre wood lot?? No way. I live in the northeast, where we get some pretty cold winters. Estimating tree growth rates in this area say you need about 1/2 a cord per acre to sustainably provide for your heating requirements. That means 6 cords for about 12 acres. I heat only with wood and I have yet to blow through 4 cords, though an older less insulated house certainly could...but 20 acres?? No, thats too high.

I'm sure many people who buy 10 acres 'throw in the towel' but the issue there is that they either have the wrong type of acreage, or much more likely they simply were not prepared for the rigors of self reliance. More acreage would not change that. Over the years Ive had alot of people quit on me. Its always surprising to me to find that most people are just not cut out for this life. They start out very gung-ho, and then the daily grind and the tedium wear them down after the novelty of cutting and dragging wood, hauling water, hoeing the garden, and feeding the livestock wears off. Its always been the opposite for me, heading in to a job everyday, with a boss and co-workers, pressures, etc has always worn me down fast. Swinging a hoe, or an ax and doing the long list of daily chores is something that I find alot easier. I am yet to find a kindred in that.

I would say, if you had the RIGHT type of land, that 10 acres in a southern climate with lower heating requirements would be enough...a 5 acre woodlot, 1 acre garden, and a few acres to raise a couple goats/sheep and cut a bit of hay. Chickens can free range or you can set up a little fenced in pen for them on a 20x20 square of marginal land.

In the north, requirements for wood and hay are higher so I would say 20 would be the right number. 1 acre garden, 10 acre woodlot, 4 acres pasture, and 4 acres hay  and youve still got an acre for the house and barn.

brushhog's picture
brushhog
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Joined: Oct 6 2015
Posts: 24
I give you great credit for

I give you great credit for thinking outside the box. I think it could be successful from your point of view, but not from the buyers. Ive been farming for years, and practicing self reliance. It's not something that you can jump into coming from outside without a long list of failures. It takes years to learn. Even with a turnkey type situation you dont just go from commuting to a desk job to being a self reliant homesteader. It requires a massive level of dedication and commitment, and if somebody has that level then they are probably already homesteading. This life has demanded 100% from me for years in order to become somewhat successful at it. A long trail of failures, and alot of starting over, and over, and over, and over...each time putting in blood sweat and tears. Each time learning a little bit more, becoming a little bit wiser. I did all that WITH the advantages of an intact supply chain, internet, and functioning currency.

I think alot of people living urban and suburban lives think that they can go to the country, put some seeds in the ground and become self sufficient. In that regard, I think you can be successful selling some units, but 90% of these people are going to fail and quit.

Over the years Ive tried a few urban people and they all quit on me after the novelty of it wears off. They start out strong and gung-ho and then after the newness and excitement wears off and the tedium of the daily routine starts to grind them down they get quiet, then they start making excuses, and then they take off. Its a life of self sacrifice, delayed satisfaction, and grinding work 7 days per week. The average modern person is just not wired for it. I'm somewhat of an oddball apparently, because I found modern employment, the schedules, deadlines, bosses, co-workers, etc to be the thing to grind me down, and I can tolerate the highly physical, boring, nonstop string of farm chores more easily. But I am yet to find a kindred. Most people who live this life successfully were born to it, with a small smattering of oddballs like me....not enough to base a business on.

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