Article 7 focused on the importance of determining production costs and profit margins per cwt of milk
shipped in an effort to make smart business decisions You can also use this same mlomiation to compaie
your business with other businesses, we refer to this as benchmarking
I here are a variety of data bases that can be used as benchmarks Some of them arc
Other dany farms that arc similar to yours The ag service people you deal with (accountants,
velcrmai urns, feed industry reps and other consultants) may have summary information for farms they
work with that arc similar to yours How do you compare with similar type operations in your area 9
Dairy producers in the top 25% bracket - brackets such as profit per cwl milk, total farm profit,
return on investment, output per worker or per cow, etc This can help you see what it might take for
you to get to that level - and to determine if you want to be at that level It also gives vmi ilic
opportunity to compare your business with your sliffcst competition Tins kind of information might he
available from the same sources listed above Some is available on the internet for example, an email
source of U S Top Dairies Benchmarks is available at blip //www cpdmp Cornell cdu 81/
Dairy producers in your own slate. In Penna this information is found in the AnnuakPennsyh ama
Dairy Farm Business Analysis Summary This iniormalion is made available through the cooperative
cffoils of the Pennsylvania Farm Bureau and The Pennsylvania Stale Umvcisity Table I shows three
years of data abstracted from these summaries by Dennis Gmder, F.xtcnsion Farm Management Agent
for Lancaster and Chester counties and (Jlcnn Shirk, Extension Dairy Agent for Lancaster County
Keeping similar data for your farm enables you to compare your business to other fauns m the stale
With several years of data you can also monitor trends m your business Aic you making progress >
Dairy producers elsewhere in the countiy Dairy farms and situations other states and regions may he
quite different from your farm or local situations Never Ihc-lcss, these comparisons still help you see
how you slack up with your eoni|XMilion m other pans of the country One email source of tegional Milk
Costs and Returns is http //www ccon ag gov/Uncfing/fhc/cai/milki htm Some Wisconsin Faun
Financial Benchmarks can be found at http //www wise cdu/dairv-profil/
When you compare your farm business with averages of other farms, keep in mind that you should since to
he belter than average if you intend to slay ahead of the pack Also, the average farm may bcai little
icsemhlancc lo your la m Thus, you may want to focus on data for farms that arc similar to youis. and hums
that arc m the lop 25% performance category What makes other ndn agricultural businesses succc .sfiiP Can
we learn something from them, and should we be benchmarking with some of them as well ’
I aimers vary in the way they allocate production costs, and (he style of dairying can affect how costs arc
allocated For example, a farm with limited acreage will have higher purchased feed costs and lower ciopping
costs Thus, it may he difficult for you to compare flcmi/cd costs of production wilh any degree of accur.u v
ll might be moic accuialc to compare categories of costs For example, lump purchased feeds and crop tclalcd
costs into one bioad category of feed-related costs
LEGA
Y OF PRIDE
From a proud neighborhood dairy in the 1910’s to a modern
manufacturing company of the 1990’5, the Dietrich family-owned business
continues to move forware. With the dedication of three generations and
a heritage rich In experience and Innovation, Dietrich’s Milk Products
faces the future with confidence.
As In the past, our future success depends upon fine quality products
made from quality milk.
need more good dairy farm families from your area to assure a
continued bright future together.
OUR
JEFITS
• Strong Market Premiums
• Extra Pay For High Solids
Milk
• A Field Staff That Knows The
“Cow Business” And Is Here
To Help You!
SERVING LANCASTER, CHESTER, BERKS COUNTIES
AND THE SURROUNDING AREA
fa DIETRICH S
T* MILKfRODUCTS, INC.
• 100 McKinley Avenue
Reading, PA 19605-2117
READING OFFICE:
800-526-6455
DANIEL VOSBURG;
717-354-5562
JEFF JOHNS:
610-323-4630 '
• High Quality Milk Premiums
• Sensible Hauling Rates
• A Local, Family-owned Dairy -
Large enough to Serve your
Milk 1 Marketing Needs - Small
enough to Know You!
Tabic I Pennsylvania Dairy Farm Income and Expense Averages
Year
No of farms
Averages
No of tows
No of ci op at res
No of workers
Cwl milk sold
Milk per cow
Milk per worker
Income:
Milk sales
Cattic sates
Patronage refunds
Dividends, interest
Crop sales
Custom work
Mist income
Accts rcc change
Inventory mu
Livestock
Fred
Supplies
Total Income
Expenses:
Breeding, testing, re]
Vet, medicine
Livestock supplies
Purchased livestock
Utilities
Purchased feed
Crop seed, supplies
Fertilizer, lime
Fuel, oil
Repairs - mach, equi|
111 rd labor
Custom work
Truck, auto
Hauling
Marketing
Rent, leases
Repairs - buildings
Taxes
Insurance
Misc expense
Acets payable change
Inventory decreases
Livestock
F ccd
Production suppl
Total Expenses
(before mi & prj
Net Farm Income !
(before ml & pnne )
Adjustments:
+ Non I,u m imomc
I aimiy living exp
Avail, for Debt Pay
interest payments 2
pi me tp.il payments 2
ICstimateil b'xecss
footnote #1 Dcprcci.ilion was excluded because » may not accurately reflect cash How
I ootnote 112 Net farm income reflects profit before debt payments Interest and pnnup il p tyments an
shou n later and compared to funds available for debt payment
footnote #1 Principal payment data was not available for 1991 and 19'Vi. Ihcrcfoie, they "in csliapol Heel
fiom actual mtciest payments by keeping the ratio ol pimcipal to mlciesi the same is loi 1 *<■ > I
Agricultural Generators
Automatic \
L.P. Gas, Diesel, Natural
Gas Generators
5 to 2,000 KW
Service - Rental - New - Used
rM.MwwwmsySTJE/MS
Power Generation Systems Specialists
Call Leonard Martin 717-866-6404
Lancaster Farming, Saturday, July 2!
1994
219
2 22
2 23
13,012
17.121
583,498
12,248
17.011
551,712
172,595 13 20
12,411 0 95
0 0
0 0
168,468 H 74
14,977 1 22
0 0
0 0
5.273 0 41
1,523 0 12
8,107 0 03
3,788 0 31
1,520 0 12
7,597 0 62
-0 03
-423
600 0 05
2.908 0 22
7,507 0 58
87 0 01
1,261 0 10
112 001
65 0 01
197,365 16 11
211,131
3,762
4,705
6,649
4,956
5.470
0 30
0 36
0 50
0 37
0 44
3,625
4,433
6,173
4,566
5,431
44,897
8,970
6.386
4,625
9,835
3 60
0 70
0 47
0 38
0 82
44,142
8,616
5,718
4,695
10,079
13,293
3,423
1.354
I 09
0 27
0 11
13,290
3,288
1,307
1 1,951
0 93
11.356
9,679
2,694
2,785
4,085
0 60
0 23
0 25
0 34
7,380
2,801
3,028
4,151
3,666
570
0 27
0 02
3,255
297
153,755
147,631 12 05
57,376 4 41
49,734 4 06
11.056 0 85
32,721 2 5 1
I I 469 0 94
24,911 2 01
16 711
2 96
36,262
10,702 OS 1
lI,SO/ ' 275
10,112 RS
34,811 2 81
10 792
071
8,981
iiud.Dairy.Lii
1995
1990
1325
1288
2 23
13,293
17,042
'0,099
Tol.il Pci C\vl
202,910 15 ->0
10,051 0 80
0 0
0 0
6,100 0 40
1,031 012
8,346 0 63
482 0 04
3.'1l 021
I. ’S3 010
407 0 04
17 69
235,177
1623
3,908
4,980
7,414
5,118
5,866
0 29
0 36
0 51
0 38
0 42
60,647
11,434
6,844
5,608
11,211
3 45
0 69
0 49
0 36
0 76
14,121
3,960
1,395
I 02
0 26
0 10
10,800
0 92
11,256
3,166
3,055
4,208
0 74
0 21
021
0 31
4,344
-223
0 28
0 04
179,1 12
11 82
56,065 4 2 I
12.772 0 06
37,155 2 80
II 682
2 74
1 1.622
M.S79' 29?
18X19 I 42
OSi
Generators
25 to 100 KW
h
301.il Pci Cm
Total PcrCwl
0 29
0 37
0 56
0 39
0 44
4 56
0 86
0 51
0 42
0 84
I 06
0 30
0 10
0 81
0 85
0 24
0 23
0 32
0 33
0 02
13 38
2 18
os;