3 changes to increase cash and cut costs for dairy farmers
What is a dairy farmer to do when they haven’t made money in several years and the bank does not want to renew their loan? That was a problem Pauly Paul with Complete Management Consulting faced when called out to a 1,500-cow dairy a few years back.
As a dairy management consultant specialising in operational efficiencies, increasing dairy farm profitability and finding unconventional ways to cut costs and increase immediate cashflow, Pauly quickly identified 3 key management areas to get this dairy making money and on track to be back in the black, and in good graces with their lender.
On the Uplevel Dairy Podcast, Pauly shares these 3 management areas he changed to increase income and reduce expenses quickly:
The Milking Parlour
Through Pauly’s evaluation, he wanted to find out how he could add more cows running through the parlour without adding labour costs. By making some tweaks and changes to the workflow, he was able to add another rotation of cows and help the workers become more efficient with their time.
Feed
When times are tough, sometimes you don’t always need the best of the best. In the feed department, Pauly worked with the nutritionist to reduce feed costs and increase the amount of forage being fed. This helped lower costs and provide a bit more cushion on expenses.
The breeding and replacement heifer programme
One of the most impactful areas Pauly was able to help cut costs was the breeding programme. For this dairy, it made the most sense to breed everything to beef and eliminate replacement heifer expenses. The dairy could then buy replacements back before freshening with the income from black calf sales.
