Family farming creates a lasting legacy

March 2025

KARINA MULLER, PULA CONTRIBUTOR

A FAMILY FARM IS MORE THAN A BUSINESS, AS IT’S A LIFESTYLE AND AN IDEAL WORTH PRESERVING. PRESERVING FAMILY FARMING REQUIRES MORE THAN LUCK – IT DEMANDS CAREFUL PLANNING, DISCUSSIONS AND SOMETIMES EVEN CONFLICT RESOLUTION.

Family farms are vital to South Africa’s agricultural industry, contributing significantly to the economy. They are key to managing natural resources, protecting the environment and enhancing community life. The United Nations has dedicated the decade from 2019 to 2028 to family farming, recognising their role in global food security and sustainable development. The generational transfer of family farms is a solid foundation for economic growth in rural communities.

However, challenges such as market uncertainty, farm attacks, climate change and the lack or hesitance of succession planning have made the environment unstable, prompting many young people to leave rural life for urban careers.

FAMILY FARMS IN SOUTH AFRICA
Dr Theo de Jager, former president of the World Farmers’ Organisation, asserts that family farms are the world’s largest single employer and often serve as the economic and cultural centre of rural communities. In South Africa, up to 90% of family farms generate less than R5 million annually. Despite this, smaller farms are often more resilient to market fluctuations.

Dr Andries Radley of Radley Business Solutions notes that over 80% of South Africa’s agricultural producers are family farms, which account for more than 50% of the country’s agricultural output and highlight the importance of succession planning.

Unfortunately, family farming businesses often last only 24 years on average. According to Yolandi Kruger, director and agricultural advisor at Dunamus Agri, the success rate drops to 30% when passed from the first to the second generation and falls to just 10% from the second to the third generation. ‘This failure often arises from a lack of succession planning – a business strategy that ensures leadership transitions smoothly when the initial leader steps down.’

Father and son team, Thomas and Simphiwe Sibiya, who are mentored by Timon Filter from the Louwsburg regional office.

SUCCESSION PLANNING IN FAMILY FARMS
Succession planning is the process of identifying critical positions within the business and developing action plans for individuals to take over. It strengthens the enterprise by ensuring the right people are in the right roles today and in the future. For family farms, it’s crucial that leadership is passed to the next generation to sustain operations. Effective succession planning involves:

• Identifying critical roles and potential vacancies.
• Selecting key skills necessary for continuity.
• Developing individuals for future needs.

Succession planning ensures that family farms are prepared for transitions, allowing all involved members to grow – not just those in management roles.

Planning in advance
The initial leader plays a crucial role in succession planning. It’s vital that the patriarch begins preparing for retirement or scaling down long before stepping down, allowing for proper provision. Family farming plays a significant role in feeding the world, but without succession planning, many farms fail when the patriarch leaves.

Without proper preparation, a family-run farm can grind to a halt. Setting clear guidelines before the next generation takes over reduces preventable conflicts.

Dr Johan Beukes from Authentic Living Learning emphasises the importance of clear boundaries to protect family relationships. ‘In family farming, there can only be one leader – someone who has enough knowledge to manage the farm and ensure its long-term benefit.’

Communication
Theo Vorster of Galileo Capital stresses that family farming issues arise when communication breaks down between the generations involved. He emphasises the need for ongoing communication between the father, children and grandchildren to discuss their needs and aspirations for the farm.

‘Ineffective communication is one of the largest obstacles and sources of conflict in family farming businesses. Regular meetings should be held to discuss the farm’s financial status, business risks and succession plans, with minutes taken for reference.’

FAMILY STRUCTURE AND SUCCESSION
Many families use a family structure document to guide successful succession planning. This document provides the foundation for transitioning the farm across generations and should be updated regularly. If disagreements arise, professionals can assist in the process.

The family structure should include the following elements:

1. Succession plan: This plan should detail the personal and business aspects of the transition. The more precise this plan, the greater the chances of success.
2. Management succession: The management philosophy should be clearly described, including decision-making processes and identifying the successor.
3. Ownership and asset transfer: The transfer of assets – land, livestock and implements – should be well understood. Questions like asset rights and how to divide assets should be addressed.
4. Estate planning: Estate planning should account for taxes and expenses when the patriarch passes away. It is important to calculate the farm’s liquidity to avoid cash shortages affecting operations.
5. Jobs for family: Clear criteria should be set for appointing family members and addressing disciplinary issues.
6. Shareholding: Clarify who can own shares and the terms for selling them.
7. Advisory council: Define the board of directors and voting procedures.  

STRATEGIES TO ENGAGE YOUNG PEOPLE
The 20-year-old son of a North West farmer shared with Pula Imvula that he would never take over the family farm, citing its small size and lack of profitability. This young man, like many other young people, prefers an urban career to farming.

To encourage the youth to stay in farming, the industry should present agriculture as a modern and viable career.

Here are some strategies to engage young people:

1.    Showcase farming as a profitable career:

• Diversify the income through value-added ventures such as farm-to-table products or eco-tourism.
• Use smart technologies such as drones and automated systems to increase efficiency.
• Provide entrepreneurial training to help young farmers view the farm as a growing business.

2.    Modernise rural life:

• Improve infrastructure, such as roads and healthcare, to make rural life more convenient.
• Foster community hubs, sports leagues and events to keep young people engaged.

3.    Provide education and mentorship:

• Offer agricultural scholarships and mentorship programmes.
• Organise internships and exchanges to expose young farmers to innovative practices.

4.    Offer financial support:

• Provide start-up grants for young people to launch their own farming ventures.
• Ensure clear succession plans to offer stability for future generations.

5.    Foster a sense of purpose:

• Show how sustainable farming practices benefit the planet and communities.
• Involve young farmers in local leadership roles to build pride and responsibility.

6.    Celebrate farming success:

• Share success stories of young farmers thriving in the industry.
• Recognise innovation and sustainability through awards.

7.    Create fun and fulfilment:

• Offer flexible schedules to provide work-life balance.
• Integrate hobbies such as photography or camping into the rural lifestyle.

8.    Build stronger family ties:

• Embrace the innovative ideas that younger generations propose for the farm.

Farming can become a fulfilling and attractive career when aligning rural life with young people’s aspirations for growth, purpose and connection.

Publication: March 2025

Section: Pula/Imvula