Don’t look back: Something might be gaining on you
- Know your current and future forage needs. This is the basis for feed program planning.
- Don’t get locked into any one ingredient; keep the options open.
- Prices are important, but margins are critical. It’s not what you spend; it’s what you have left afterward.
- Understand the top three drivers of your cost of production and look at them on a current and projected basis.
- Can you reduce the risk on your major inputs and outputs? What does that cost?
- Decreasing production makes economic sense in very few situations. However, chasing the last pound of production regardless of cost is generally a loser as well. Do you know why certain items or production practices are part of your program? Do they pay? Were they needed at one time, but now times have changed?
- Are you spending time on $50 decisions or $5,000 decisions? Who is “running the numbers” and planning for changes that could radically affect your profits? Do the cows run your operation or do you?
- When was the last time you scheduled a meeting with your lender? If your answer is “not for a while,” you might be expecting an invitation to answer many of the questions listed above.
- While talking to others to gather ideas is a good practice, don’t just run with the crowd. Your set of circumstances may dictate a different path.
I hope the results of the fall harvest are all bigger and better than we fear they might be. In fact, fear and uncertainty might be one of the biggest risks we have to overcome. This article was originally written for Progressive Dairyman. About the author: Al Gunderson is the Vita Plus vice president of sales and marketing. He has served as the general sales manager since 1987 and added purchasing to his responsibilities in 1999. Gunderson first came to Vita Plus in 1979 as the swine product manager after he earned a bachelor’s degree in meat and animal sciences and master’s degree in ag business management from the University of Wisconsin-Madison. He is a member of the American Registry of Professional Animal Sciences (ARPAS) and the American Society of Animal Sciences (ASAS). Gunderson is the chair-elect of the board of directors of the American Feed Industry Association and chairman of the board of trustees for the Institute for Feed Education and Research (IFEEDER).
Business and economics