“I'd say to farmers that it's really hard to start improving without starting to measure something,” Justin says.
“We get a lot out of our analysis – it’s a way of looking at areas where we are doing well and also where we can improve on.”
Justin says it's easy to get bogged down in the day-to-day operation of a dairy farm.
“There's a lot of things happening every day,” he says.
“But the plan is to have a system that is profitable or most profitable in as many years as possible. While that's not always possible every year, you've got to have the resolve that that you're on the right track.
“That where’s monitoring performance comes into it – to make sure you are actually on the right track and that that system that you're trying to run is suitable.”
Business comparison
Justin has been using DairyBase to track his financial figures. DairyBase is an online financial analysis tool to help dairy farmers and advisors measure and compare farm business performance over time.
“The best thing to do is look at the areas where you're underperforming relative to average or the best farms in that specific comparison group,” Justin says.
“You can then can hone in on those areas either with a consultant or other like-minded farmers, and it gives you an opportunity to then make changes to your business.”
Through benchmarking against high performing farms, Justin realised that his operation could milk an extra 100 cows.
“We now have a 340-cow milking herd – that is a significant difference to our business.”
Justin says that his business has really improved its performance overall.
“As things change and the external factors move around us, it's really helping us track how that's affecting our business to make sure we're continually looking forward,” he says.
“If we can stay ahead of the game, that'll help us maintain our profitability long term – as opposed to waiting for those changes to happen to us. The ongoing monitoring of performance really helps us not fall into the trap of complacency.”
Help is available
Justin acknowledges that becoming familiar with farm business performance tools can be a daunting.
“For those who might find it a bit overwhelming, there's the Farm Business Snapshot tool, which is a simplified version of DairyBase,” he says.
“It’s a good starting point.”
Farm Business Snapshot is also a free online analysis tool where you can create a quick snapshot of your dairy farm income and costs. There is also support available for farmers who are wanting to access these tools and other resources.
“If you're not a numbers person, I'd reach out to someone who will assist you in trying to collect this information to make it meaningful,” Justin says.
“Because it will definitely be worth the effort to try and get across all those things in your business.”
For support with your farm business management needs, contact your regional office today or visit Enhancing Farm Business Management | Dairy Australia
