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Is more cattle always better?
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<blockquote data-quote="Brute 23" data-source="post: 1163541" data-attributes="member: 6291"><p>The cheaper in volume applies to equipment in a lot of cases, which, is probably one of the top 3 expenses for most operation. </p><p></p><p>In many cases the same tractor, trailer, or truck can service 30 head and 150 head. Its a lot easier to justify these items with the 150 head revenue. There are sweet spots if you graph number of head vs expenses.</p><p></p><p>You have to be careful with the hay deal. There is such thing as too much hay. I've seen people with $20K worth of hay stacked for $10K worth of cattle. Hay is a necessary evil but its a bad investment. You don't want your margin for the year invested in hay... the depreciation is horrible. You have to have a good budget based on real numbers you have kept on YOUR operation. That budget has to consist of a line in the sand with a good evacuation plan. Each head is a unit of cash production. Its very easy to calculate the breaking point where they can not earn more than you have spent.</p></blockquote><p></p>
[QUOTE="Brute 23, post: 1163541, member: 6291"] The cheaper in volume applies to equipment in a lot of cases, which, is probably one of the top 3 expenses for most operation. In many cases the same tractor, trailer, or truck can service 30 head and 150 head. Its a lot easier to justify these items with the 150 head revenue. There are sweet spots if you graph number of head vs expenses. You have to be careful with the hay deal. There is such thing as too much hay. I've seen people with $20K worth of hay stacked for $10K worth of cattle. Hay is a necessary evil but its a bad investment. You don't want your margin for the year invested in hay... the depreciation is horrible. You have to have a good budget based on real numbers you have kept on YOUR operation. That budget has to consist of a line in the sand with a good evacuation plan. Each head is a unit of cash production. Its very easy to calculate the breaking point where they can not earn more than you have spent. [/QUOTE]
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