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Looking at the business
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<blockquote data-quote="Rogerwilco" data-source="post: 244813" data-attributes="member: 4347"><p>I have been looking to get into the cattle business for a while and I was wanting to ask for impressions from a more experienced group of people. I have been around cattle because my family has cattle, but I am not in line to inherit land or money, and nobody has invited me to join them in a cattle venture, but that's fine. </p><p>I am looking at the business in it's simplest form with a minimal outlay in cash. From what I can tell that might be buying a bunch of steers after they are weaned and feeding them to a higher weight and selling them. That sounds simple enough. Without having to own any land it looks like this, to me. </p><p>Initial cost of livestick: about $650</p><p>Sale price of livestock: about $1000</p><p>Expenses necessary for this kind of weight gain would include transportation, pasture lease and feeding if necessary, veterinary care and interest on the loan at about $120-150 per head. So, in an average year, without catastrophic conditions, what it seems we are talking about is a Net profit of about $200 per animal. That is a 20% profit on our $800 investment. i am not including the value of your time, depreciation on vehicles and genteral cost of running a business. </p><p></p><p>I understand that this is a simplified model, but does this sound like an accurate description of this business? If not, what kind of margins can an average producer with minimal overhead expect?</p></blockquote><p></p>
[QUOTE="Rogerwilco, post: 244813, member: 4347"] I have been looking to get into the cattle business for a while and I was wanting to ask for impressions from a more experienced group of people. I have been around cattle because my family has cattle, but I am not in line to inherit land or money, and nobody has invited me to join them in a cattle venture, but that's fine. I am looking at the business in it's simplest form with a minimal outlay in cash. From what I can tell that might be buying a bunch of steers after they are weaned and feeding them to a higher weight and selling them. That sounds simple enough. Without having to own any land it looks like this, to me. Initial cost of livestick: about $650 Sale price of livestock: about $1000 Expenses necessary for this kind of weight gain would include transportation, pasture lease and feeding if necessary, veterinary care and interest on the loan at about $120-150 per head. So, in an average year, without catastrophic conditions, what it seems we are talking about is a Net profit of about $200 per animal. That is a 20% profit on our $800 investment. i am not including the value of your time, depreciation on vehicles and genteral cost of running a business. I understand that this is a simplified model, but does this sound like an accurate description of this business? If not, what kind of margins can an average producer with minimal overhead expect? [/QUOTE]
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