E22-Lancaster Farming, Saturday, January 4, 2003
Monitor Dairy Business Performance
UNIVERSITY PARK (Centre Co.) With the
turn of the new year, dairy producers are looking
forward to better times ahead.
Yet the challenging times most producers faced
in 2002 can represent an opportunity to evaluate
how the business performed in less than desirable
economic conditions. Milk prices in four of the past
six years have been at or near record high levels.
Managing a dairy business when prices are in the
range of $l5-$l6 per hundredweight milk is certain
ly less challenging than in the current price environ
ment. Conducting a business analysis in good eco
nomic conditions can mask possible weaknesses of
the business and distort the owner’s perception of
the need to take corrective action.
Participating in a dairy business analysis and
benchmarking program can help producers de
termine opportunities to improve business perform
ance. In recent years, Penn State University has
formed an alliance with Cornell University to bring
the Dairy Farm Business Analysis program to
Pennsylvania producers. This program has pro
vided feedback to New York’s dairy producers for
many decades. The program provides producers
with a comprehensive view of how their business is
performing. By examining key benchmarks, ■
such as return on assets, operating expense ratio, I
asset turnover ratio, percent equity and term I
debt and lease coverage ratio, the Dairy Farm I
Business Analysis can help producers answer I
five key questions they must answer in conduct- I
ing an annual business analysis. Those questions I
are: I
• Is the business profitable? (Is it generating
acceptable returns to the resources allocated to
it?)
• Is the business financially efficient? (Is it ef
ficient in spending money to produce a prod
uct?)
• Is the business capital efficient? (Is the busi
ness utilizing capital assets efficiently?)
• Is the business on sound financial footing?
and
• Is the business able to meet its financial obli
gations?
If the answers to any of these questions is
“no”, the Dairy Farm Business Analysis can
provide insight as to why by examining more de
tail-oriented benchmarks such a labor efficiency,
production efficiency, and cost control indica
tors. Producers can compare their indicators to
benchmarks developed from all the farms that
Cornell Releases
Community-Based
Ag Guide
ITHACA, N.Y. The Community, Food and
Agriculture Program (CFAP) in the Department
of Rural Sociology at Cornell University has an
nounced the publication of “Growing Home: A
Guide to Reconnecting Agriculture, Food, and
Communities.”
Written by Joanna Green and Duncan Hil
chey, “Growing Home” is grounded in the belief
that community-based food and agriculture sys
tems initiatives are an effective means for
achieving lasting community development. Rec
ognizing the economic, ecological, and social
benefits of food and agriculture systems initia
tives, this publication is designed to provide agri
culture development specialists, economic devel
opers, planners, extension educators, community
development advocates, and others interested in
strengthening communities with the tools they
will need to turn visions into realities.
“Growing Home” includes a discussion of
contemporary food and agriculture systems in a
globalizing context; an overview of how locally
based agriculture and food systems benefit com
munities; a section full of ready-to-implement
strategies; a step-by-step guide to the commu
nity-based food and agriculture development
process; and six planning worksheets.
Contents include:
• Understanding the Global Food and Agri
culture System;
• Reconnecting Agriculture, Food, and Com
munities;
• 'Engaging the Community in Creating a
New Vision;
• Examples of “Growing Home” Develop
ment Projects and Strategies, and
• Making It Happen in Your Community; De
velopment with a Vision.
To order a copy, contact Gretchen Gilbert at
the Community, Food, and Agriculture Pro
gram: phone (607) 255-9832 or email
gcg4@cornell.edu. Cost is $25.
To learn more about the Community, Food
and Agriculture Program (CFAP) visit CFAP on
line at: http://www.CFAP.org, or contact Heidi
Mouillesseaux-Kunzman, CFAP Program Coor
dSnator, at (607) 255-0417 or
ft I ft*** % llfttftl i ft
participate in the program to see how they rate in
key performance areas.
The Dairy Farm Business Analysis program is an
essential component of the Businessense program
offered by Penn State’s Dairy Alliance team. Pro
ducers who participate in the Businessense pro
gram have the opportunity to leant best manage
ment practices in business and information
management in a hands-on and interactive learning
environment. The group discussion sessions provide
producers with an opportunity to leant from each
other as well as the instructors.
Conducting a dairy farm business analysis and
discussing management practices that enhance
business performance with fellow producers are two
important best management practices that can help
dairy producers operate competitively, even in a
tight economic environment.
Businessense sessions have been scheduled for
numerous locations around the state this winter. To
leam more about this program, producers can email
Brad Hilty, Information Management Specialist
with the Dairy Alliance program at HYPERLINK
“mailto:bhilty@psu.edu” bhilty@psu.edu or call the
Dairy Alliance office at (888) 373-PADA.
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Lancaster Fanning Editorial Staff:
Your Source For Ag News
Our time and talents are invest
ed heavily in bringing news from
the region's ag events to your
home and we've been doing so
a long time. The Lancaster
Farming editorial staff has been
recognized by various organiza
tions;
• 2 Keystone Awards.
• Ag Journalist of the Year.
• Dairy Council and NEAFCS
Honors.
Andy Andrews, editor, 13 years
of service to Lancaster Fanning,
21 years in the journalism field.
Winner of the 1992 PennAg Ag
Journalism of Year honors; win
ner of 1993 Keystone Press
Award; honorable mention, 1995,
Keystone Press.
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Lou Ann Good, food and fami
ly features editor, 15 years of
service to Lancaster Farming, 18
years in the journalism field, win
ner of the Dairy Council Inc.
Friend of Nutrition Education
and National Extension
Association of Family and
Consumer Sciences honors.
Michelle Kunjappu, staff
writer, two years of service to
Lancaster Farming, three years
in the journalism field.
Dave Lefever, staff writer,
about two years of service to
Lancaster Farming, four years in
the journalism field.
Ag & Industrial
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