Dairymen, how do you measure up?

“How do I know if I am competitive?”

“How can I become more competitive?”

These were the questions from producers that led to the development and publication of Dairy Excel’s 15 Measures of Dairy Farm Competitiveness in 1997.

Those same questions are just as valid today and can be answered in the context of today’s dairy industry using the newly-released 2008 edition of the 15 Measures.

The 15 measures fall into 10 broad areas, which together provide a good view of the competitiveness of a dairy farm business.

Measures of Dairy Farm Competitiveness

1. Rate of production

2. Cost control

3. Capital efficiency

4. Profitability

5. Liquidity

6. Repayment schedule

7. Solvency

8. Mission

9. Maintain family’s standard of living

10. Motivated labor force


How do you measure up?

These measures represent key characteristics of the most competitive dairy producers in the Midwest. Some dairy producers already exceed many of the measures.

While a single dairy business is unlikely to meet all 15 measures, dairy producers who meet most of the measures are competitive with dairy producers anywhere in the world and enjoy a high standard of living.

In the published guide that’s available, each measure and its competitive levels is described in detail.

These pages explain each measure, tell how to compute and interpret it, and discuss the desirable range.

The measures were designed to be easily calculated with information readily available on most farms. We also suggest changes to help a dairy operation move into the desirable range.

The feed bill

One of today’s most frequently asked questions concerns controlling increasing feed costs. Measures 2 and 3 focus on feed costs for the total herd and for the milking herd.

Appendix tables provide targets based on current market values of hay and corn, as well as methods for monitoring feed costs on the farm.

Some dairy businesses do not meet many of the measures. Without change, these producers will likely be exiting the dairy business within the next 10 years. For dairy managers who are willing to change, calculating the 15 measures for their business will help identify critical areas for improvement.

Get a copy

The new “15 Measures of Dairy Farm Competitiveness” will be available both online and as a for-sale publication. Individual full-color, 50 page publications can be ordered through your local Extension office beginning May 1.

A downloadable online version can be found at http://dairy.osu.edu, Ohioline after April 20.

About the Author

(Dianne Shoemaker is an OSU Extension dairy specialist located at the extension center in Wooster, Ohio.) More Stories by Dianne Shoemaker

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