Opportunities for Success on Small Dairy Farms Revisited

Abstract

This paper offers advice to veterinarians that service small dairy producers in the United States (US). There are opportunities in today’s market place for dairy producers that want to remain small, but only if they follow a few basic business practices. These may include getting to an optimum size that will generate adequate income for family living while avoiding the problems associated with a “large farm,” limiting investments and debt, focusing on just milk and heifer production, achieving high levels of productivity per cow, and avoiding some of the “philosophical issues” that prevent small farms from achieving profitability. In fact, these rules apply not only to small dairy farms, but any business. Small dairy farms can take advantage of strategies used by their larger competitors in order to prosper in the years ahead.
A central theme in this paper is that not all farms in the US have the same goals for profitability family income and size of operation (number of cows). For example, some farms want to limit farm size in order to avoid hiring labor beyond what the family can provide. Others want to build equity before retirement. For others, a family may want to significantly expand in order to create opportunities for a son or daughter that wants to participate in the business. Thus it is important to recognize that people have different goals and objectives. That said, these goals must make sense in today’s competitive market environment.