Abstract: There is little direct evidence about the business model used by the legendary cattle king, Sir Sidney Kidman. Kidman’s properties were invariably stocked at less than full capacity, and were generally contiguous, forming chains that straddled stock routes and watercourses in the most arid zone of central Australia. Railheads at the ends of the chains provided access to the main capital city markets, and Kidman’s drovers supplied a wealth of information on competing cattle movements. This combination of features effectively afforded strategic transport flexibility in the form of so-called ‘real options’, especially during severe region-wide droughts. Alternative perspectives, such as the vertical integration of Kidman’s operations, or spatial diversification of land holdings, offer only partial insights. Faced with a highly variable and unpredictable climate, combined with the onset of erosion and the spread of rabbits, Kidman exemplifies human ability to adapt creatively to exogenous environmental shocks such as climate change.