No headlines proclaimed “35 cows missing,” but they were, and some heifers, too. What was the tip off? A broken gate? Hoof prints all over the front yard?
Clue
Nope, the tip off was the cow and heifer numbers on the farm’s Jan. 1, 2010 and Jan. 1, 2011 inventories were exactly the same.
After just a little checking into herd records, the numbers were correct for the beginning of the year, but the herd had grown and updated numbers should have been used for the Jan. 1, 2011 inventory and balance sheet.
Unusual? No, actually fairly common, and I run into this several times a year when working with farms new to enterprise analysis. It usually happens when trying to reconstruct a Jan. 1 inventory well after Jan. 1.
Good news
The good thing about this particular situation is these “found cows” represent growth of the dairy’s herd (and income) that would otherwise have been missed in the analysis of the dairy enterprise.
In cases where the opposite was true — the cow and heifer numbers had actually gone down — it is a red flag to address.
Herds that are using herd management software should be able to print out inventories of at least the cow herd, and hopefully the replacement herd as well. The system may, or may not be able to give you a historic inventory.
In other words, get your Jan. 1 inventory printed on Jan. 1 or thereabouts, because you may not be able to go back to that date later.
Feed
Next big area to check is feed inventories. What is really out there? (versus what someone thinks is out there.) What is there today? Trying to estimate three or six months later is extremely difficult.
These inventories are used for planning feed needs and developing your cost of production. Inaccurate numbers in lead to inaccurate numbers out which don’t help planning one bit.
Machinery and equipment are kind of like cows and feed. As farms get bigger and are spread over multiple geographic locations, these items become harder to track.
Equipment there today should match up with what was on last year’s inventory plus what was bought less what was sold or decommissioned. Doesn’t always happen …
Coming up with a good system to identify and inventory machinery and equipment at least once a year is a must.
Inventory
Dairy farm inventories should not cheat themselves out of valid assets of the business. Assets such as semen, vaccines and meds, milk house supplies, seed, fertilizer, etc. are usually found on all farms and are frequently missing as current inventory items.
While not huge items, their combined value can be substantial for some farms.
There is an ideal window of opportunity for the inventory and it is this week. Let’s get out there and get it done!
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