Computer Helps Brothers
VERNON ACHENBACrf JR.
Lancaster Farming Staff
PENRYN (Lancaster
Co.) There are perhaps few
who know the bottom line of lower
milk prices better than a pair of
brothers trying to maintain a fourth
generation dairy farm in northern
Lancaster County.
While most dairymen have an
idea of how far their milk check
will go, few have as detailed a
breakdown of farm profits and
expenses as do Steve and Dale
Hershey.
With their computer and soft
ware, the two have recently calcu
lated and number crunched in an
attempt to come up with a plan to
keep the farm income stable.
And while the computer doesn’t
necessarily print out good news, it
does show the two where they
stand.
Keeping track of expenses and
profits is nothing new for the Her
sheys; they’ve been setting annual
budgets and monthly goals for
almost a decade.
And while the most recent set of
calculations doesn’t look good
any way they examine the
numbers they have formed a
plan; make more milk, spend no
more money.
As simple as that sounds, it isn’t
simple, according to the brothers.
TTiere were many other options
that had to be sifted through and
without the speed and accuracy of
the computer, they would have
spent days, if not weeks, breaking
down operational ideas to see if
they, would fly, at least on paper.
With the computer, different
numbers can be entered and within
seconds, the new numbers are cal
culated. The brothers can see what
can work.
The use of the computer, and the
decisions that result, may just well
be what keeps these two in
dairying.
“I don’t see how I could get
along without it,” Dale said. “The
other day I looked at 10 different
possibilities (of operating the
farm). I looked at several different
milk prices.
“Once the formulas are set up, I
can say, ‘What if?’ and it can recal
culate in seconds. I have access to
information over years,” he said.
“When I look back to when 1
wrote things out in books, I know a
computer is also much more
accurate.
Dale Hershey works In his office managing the finances
of the Hershey Brothers farm near Penryn. All expenses,
household, crop and dairy production are included within
files in the computer’s memory.
“I used to stty I’d give up a trac
tor before I’d give up a computer.
But now, trying to imagine farming
without a computer is like trying to
imagine farming without some sort
of power to pull equipment”
The two milk an average of SO
all-registered Holsteins in a tie
stall bam three times a day. Most of
the equipment is about 20- to
25-years-old, but holding up well.
The farm contains 135 acres, 90
of which are tillable. They rent
additional acreage for a total of 200
acres tilled. The crops are com,
alfalfa, soybeans, barley and small
grains. All crops are used to feed
the herd. Sometimes there is some
extra com that can be sold.
Steve and Dale Hershey have
been farming together for almost
10 years. They started working
with their father and bought the
place from him.
• For a couple of years they led the
county in rolling herd average milk
production. Their operation has
been held out by county extension
agents of an example of how to do
certain things well.
But the reality of the current
milk price is that no one is doing
well some are just doing worse
than others.
The Hershey operation is
located in one of the last remaining
“isolated” areas of Lancaster
County. Several miles to the west
lies Route 72. Several miles to the
east is Route 322. Just north is the
state turnpike. Except for the con
stant rumble of turnpike traffic, the
area is relatively quiet.
A) seemingly haven of days gone
in southeastern Pennsylvania, the
atmosphere belies the modem
techniques and tools used by the
Hersheys.
Steve handles the herd while
Dale takes care of the crops and
finances. The exact split of work
has fallen into place over the years.
Every check written and every
dollar brought in is recorded on the
computer it is filed according
to budget catagory.
Every morning, for at least half
an hour, while the children arc get
ting ready for school. Dale sits
down to review items in the
computer.
With the aid of the electronic
memory, he knows what needs to
be done that day. He prioritises a
list of “must-be-done” and also
adjusts anything else that may have
happened during the last 24 hours
Find Bottom Line In Dairy Operation
From the left, Dale and Steve Hershey stand by a tree planted by their great grand
father, in front of the family farm house the two share. Dairy prices have hurt every
operation. They are hoping the use of their computer and careful control of farm
expenses will see them through difficult times.
to affect financial flow
If a piece of machinery needs
repaired, he can pull up the cost of
the piece when it was new and
compare it to the cost for a rebuilt
piece, or whatever is relevant.
The value of the computer is,
according to Dale, to make quicker
and better decisions. They are deci
sions based on accurate recollec
tions of on-lhe-farm experiences
'and past decisions. He doesn’t
have to guess, or go with a gut
feeling.
He eliminates, as much as possi
ble, waste of time and money.
Luck is always a part of success,
but the two always attempt to eli
minate their dependence-on luck,
as much as possible.
for example, every January
Dale makes an annual budget, eli
minating as many variables as pos
sible. He is not looking for a
balanced budget, he is looking for a
budget that keeps the operation in
the black.
According to Dale, with this
year’s milk price, a status quo
operation would equal an end-of
year loss. It is unacceptable.
Therefore the operation needed
to be examined harder than ever.
The two examined expanding
their herd to milking about 75, pul
ing in additional free-stall space
and continuing to milk in the tie
stall section.
The brothers said that although
expansion sounded like a good
Lancaster Farming, Saturday, February 16, 1991*A21
idea, once all the costs, interest
loans, increased milk production,
feed and overhead costs were
balanced out against the increased
income, the computer figures
showed that the two would be
working harder and still end up
almost the same amount in the red.
They said they answer seems to
lie in applying extreme caution in
spending, while managing the herd
closer for higher production and
trying to milk a few more cows.
Dale said he is figuring his
budget on a milk check based on
$11.50 per hundred pounds of
milk.
That’s about half a dollar lower
than county extension agents
recently said they expect the price
to level out at, but the Hersheys
have to err on the side of financial
safety they have two-families to
support and it is not inconceivable
that the price of milk could drop
lower.
“I suppose most dairy farmers
are in the same position a tight
budget, although there may be
some variance with debt load,”
Dale said.
Steve does his own computa
tions with (he computer.
.He said that back when they first
bought the system, “Dale got a
financial program and sat down
and learned to use it I got a spread
sheet and learned to use it”
So now. immediately after every
test by his representative of the
Dairy Herd Improvement Associa
tion (DHIA), Steve takes the infor
mation and adds it to his computer.
After keeping records for so
long, Steve can show a number of
breakdowns of his herd, and he can
make decisions as to cull or not,
feed more or not, he knows pre
cisely what is going on with his
herd. He also eliminates as much
quess work as possible.
He also keeps information on
breeding and can determine suc
cess with that, over a time.
In fact, based on his data and the
recent financial data, he said he is
planning to change some of his
breeding strategies.
The herd has been practically
closed for many years. Almost
every cow can be traced back to a
couple of good cow families and
within his greatgrandfather’s herd.
“In 11 years we bought two
cows,” Steve said.
The two have been lucky recen
tly in the breeding program. “We
always raise enough heifers to sell
a few each year. In 1989 we have
37 heifer calves out of 50 cows,”
Steve said, adding how extremely
high that replacement production
was.
Adding some of those to the
milking herd may help, but in order
to get them on board with no extra
capital expense, they have to max
imize cow space efficiency in the
SO tie stall bam.
(Turn to Pag* A3O)