Performance review pays for finishing enterprise
REVIEWING BUSINESS performance may be an unappealing prospect, but taking the time to do so can reveal where enterprises can be fine-tuned to improve profits, as one young South Yorks producer discovered.
A brief experiment with the Red Meat Industry Forum (RMIF) benchmarking program, to compare his own business performance with the others, has convinced Doncaster-based Robert Haigh to take a fresh look at store cattle finishing.
Mr Haigh has already altered his feeding regime in the hope of lifting cattle weights. He is now looking at new markets to try to reduce transport costs and increase returns.
His main disappointment was finding that his beef sales of 185p/kg deadweight were lower than the average 197p/kg, when his financial performance figures were added to the RMIF”s online benchmarking website this January.
The results prompted him to re-examine target weights for the 65 heifers he bought for Grange Farm. Cattle arrive at about 11 months old and take an average eight months to finish at between 230kg and 270kg deadweight.
Feeding additional protein was seen as a way to increase cattle weights. and 18-year-old Mr Haigh decided to introduce home-grown spring beans at about 25% protein. Beans are milled by a mobile contractor and fed at a rate of 0.75kg a head a day – 11% of the total ration.
The diet has been adjusted to accommodate the new ingredient.
“I used to feed sugar beet and wheat pellets ad-lib, but I now use 2kg a head a day of sugar beet pellets and 3.5kg a head a day of wheat feed pellets, plus straw over the finishing period,” he explains.
“The slight decrease in the other ingredients will make up for the cost of the beans. Restricting the diet, and adding more protein in the early stages, should build up extra muscle.”
However, growing feed wheat on the 485ha (1200-acre) arable farm was not an option. “We specialise in milling wheats, so it would be uneconomical to grow feed varieties.”
feeding system
“I have a feeding system which is simple and basically works well, so I would rather not alter it too much.”
As well as lifting average cattle weights, he hopes the changes will bring more consistent results.
“I would like to narrow the gap between the lighter and heavier cattle, by bringing those at the bottom end up to 250kg,” says Mr Haigh. “One animal might make 75 profit, but another can sometimes lose 50.
“It is hard to say why results are so variable, because when stores arrive, they are fairly uniform. There is an average seven-month gap between the first sale and the last, which leaves room for improvement. The extra protein should help the stragglers catch up.”
Despite highlighting several areas where Mr Haigh felt he could do better, the benchmarking exercise also producing some pleasing results. “My vet and medicine costs were only 1.6p/kg dw, compared with an average 4p. I put that down to having a run-out area next to the building. It is light and airy and I hardly ever get a case of pneumonia.”
More attention is also being paid to marketing, as a direct result of trying the RMIF system. The business is also looking at reducing transport costs, and exploring potential new outlets. “The abattoir I normally use is 20 miles away, but there is another even closer, which could make haulage cheaper.
“I am planning to get much more involved in marketing in the future, and perhaps spend time identifying the outlet offering the best price. Direct sales to butchers are another possible opportunity, but I don”t want to sell to the public. There is already a lot of competition in this area.
“Benchmarking was informative and confidential and the program was easy to use. It was well worth taking advantage of – particularly as it is free of charge. It”s made me realise I need to do more costings and take better control of the business.
“It has opened up my mind to new ideas and I am even considering buffalo meat production, although I will need to carry out a lot more research,” he adds.