The rest of the title line is “Desperate Measures.” However, I disagree with that concept. Realizing that there may be desperate times coming in the future (and that’s always a possibility…), we need to be proactive in our approach to business. I like to call it “Thinking for a Change.”
Now, I am not suggesting that you haven’t been thinking. It’s just that the amount of thinking required and the speed at which you must act on things has sped up dramatically. You may recall that two months ago, I referred to a song by Huey Lewis & the News entitled, “I’m taking what they’re giving, because I’m working for a living!” I want you to approach your business from an entirely new angle.
I’d like you to start thinking that, assuming you want to survive (and of course you do), “what do I need to change?”
- Can I develop a new niche for my business? There may be some opportunities that you have overlooked. Don’t discount the various possibilities.
- How does your business measure up on various efficiency items? Here are some key measures for dairy operations (and every business has some like these):
- Feed Efficiency – Pounds of Energy Corrected Milk/Pounds of Dry Matter Intake. Can you hit a level of 1.50-1.60?
- Labor Efficiency – Are you maximizing your worker outputs? I understand that the demand for employees has increased, but if they go to Amazon or Walmart, these same employees won’t be standing around idly either! You may even want to ask for current employees’ input for ways to boost their efficiency. The best ones (i.e. the ones you really want to keep…) will want to help you on this issue.
- Farming – Are you making the best use of your current land or just doing what you’ve always done? Some new thinking may even offer up an opportunity to diversify your operation.
- Debt Structure – Are your loans structured to maximize your Cash Flows, or, as I sometimes observe, are they set up to suit the current appetite of the bank, or, worse yet, to provide them with a potentially “quick exit?” I’d be glad to discuss this with you if you so desire.
- Considering the “facility constraints” you are facing, can you boost the productivity of your operation by milking 3X? How about milking fresh cows 4X for 21 days or 3X for up to 120 days into their lactations? The benefits of this have been outstanding for some of my Clients.
- As I mentioned earlier, do you have opportunities to diversify your business? If so, what does the return on your investment look like? Is it time for a change?
This entire thinking process is absolutely critical today, and if you need assistance, please contact me or check our website for many useful tools for your ongoing business evaluation. I’m always available for a follow-up call and wish you the best of success! We invite you to check out this video… https://youtu.be/foBuf4a34Dk.
John Ellsworth of Success Strategies offers financial consulting to dairy and farming enterprises across the U.S. He may be contacted by email at [email protected] or by phone 209.988.8960. More information is available at www.success-strategies.com