To be successful, any business person must develop a plan and then devise a strategy on how to work the plan to accomplish desired goals. That’s especially important in the cattle business, where most cow-calf producers would agree that the return on investment on an annual cash basis is typically low.
In order to become and remain profitable, producers must effectively manage the operation by paying close attention to all aspects of the ranch. If this is done correctly, revenue and expenses also will be accounted for. An intentional beef producer is one who takes the business seriously and is willing to go through the process of developing and working a plan for his or her operation. The following is a list of characteristics that successful, intentional producers share. Intentional beef producers:
Find a record-keeping system that works for your individual style, whether a paper ledger or on a computer. The key is to keep records that are meaningful and that you will use to make management decisions. Do not collect data on metrics you will never use, as this creates extra work that will have no measurable outcome you will implement. Keep detailed enough records that you can understand what occurred “once the ink dries” later in time. Identify key production and economic metrics you can use to monitor your operation. Examples of this would be length of calving season and calving distribution, amount of feed/hay/mineral fed, pounds of weaned calf per exposed cow, body condition scores (BCS), pregnancy and calving percentages, weight and prices of all animals sold, and grazing days in each pasture. With the help of the aforementioned parameters, you should monitor inventories of cattle, feed, hay and available pasture forage, as well as production costs and revenue generated.
There is an old saying in the industry that “you can’t starve a profit out of a cow.” This statement is true and has been reaffirmed many times over. The feeding program can account for 40-60% of the total annual cost of maintaining a cow in most operations. This typically equates to several hundreds of dollars per cow annually. Work with a nutritionist to develop a strategic feeding program where the supplemental feed is designed to complement the quality of the forage base the cow is consuming. For spring-calving cows that are fed hay during winter, feeding the lowest quality hay earlier in the winter makes the most sense. Keep the best quality hay for later in the winter, and incidentally, later in the cow’s gestation cycle or early lactation.
Try never to buy hay based strictly on a cost-per-bale basis or to feed on a cost-per-bag or ton basis. Better quality hay may cost more, but it can dramatically reduce or eliminate the need for supplemental feed. The break-even price of hay is the cost at which you would purchase feed to supplement the low quality feed. If you are in a situation where hay must be provided, feed the best hay possible to reduce the need for additional supplementation. The cheapest option is rarely the right feed for the circumstances.
Many times of the year, the cow is more deficient of energy than protein. Remember, a cow is not as concerned with nutrient percentage or concentration of the feed as much as she is with how many actual ounces or pounds of a nutrient she receives daily to meet her needs. Finally, match the cow’s time of highest nutrient requirements — early lactation or around 2 months of calf age — to the time of year when the pastures supply the highest quality and quantity forage of the year. During preconditioning of the calf, balance the cost of gain with the value of gain. In many years, more profit can be made in a 60-day preconditioning program than is realized on the calf coming off the cow.
Determine the type of animal you will sell and when you will sell it. Will you sell the calf right off the cow or after a preconditioning program? Will you retain further ownership into the feedlot but sell live, or sell on a grid? Do you want to market quality replacement heifers rather than terminal calves? The answers to these questions will provide focus to your program.
Regardless of when or where you market calves, remember that uniformity of calf type, age and weight is typically rewarded by the buyers, as it helps them meet their marketing goals as well. Identify value-based marketing programs such as the Integrity Beef Alliance (www.integritybeef.org) to help you collectively market cattle like a much larger entity. No matter how large your outfit is, it can still benefit from selling in a market that has more cattle that are similar to yours. The goal of feedlots is to fill entire pens which could hold as many as 200-300 head, with very similar cattle. One uniform truckload will only fill a portion of a pen. Remember to give consideration to how you market cull cows and bulls, as they typically can account for up to 15-20% of the annual ranch revenue.
What type of cattle will you produce? This goes beyond the concept of uniformity previously discussed. Make sure the calving season is as tight as possible, ideally 60 days or less. If you are a commercial producer, consider the value of heterosis and the advantages built into a well-defined and thought-out cross-breeding program. Identify the breeds you will use, and then work to find the right individuals within each breed to reach your goals. Consider breed complementarity, where the characteristics of the two breeds will be synergized in the resulting progeny. A good example of this is Angus x Charolais or Angus x Hereford.
As the cow-calf owner, you have a moral obligation to the animal to set them up for a healthy life. Work with your veterinarian to develop a comprehensive vaccination and herd health program. Remember to consider that the calves will not live their entire lives on your ranch; therefore, they must be vaccinated against the typical diseases they could be exposed to once they leave the ranch. Become Beef Quality Assurance (BQA) trained and certified. By adhering to BQA standards, you are honoring the commitment to develop and market a quality calf. BQA certification also helps develop consumer confidence in beef. Part of BQA is proper nutrition and health of the calf as well as keeping records. The form at bit.ly/ibeef-vaccination-form is a good example of a whole-herd vaccination record. If you do not have documentation, you cannot prove how your cattle were immunized.
Set a realistic stocking rate for your operation. Visit with a Noble Research Institute consultant, county extension agent, Natural Resources Conservation Service (NRCS) representative or other knowledgeable person for assistance. Make sure that the forages in each pasture are provided rest at different times of the year, across years. Monitor rainfall events and understand the concept of effective rainfall. Not all precipitation that falls will lead to increased forage growth. For more information on effective rainfall, go to: www.noble.org/rainfall-effectiveness. An intentional grazier will record when cattle are moved into and out of each pasture. He or she will consider setting up exclosures to help monitor forage disappearance and growth, will use soil tests before fertilizing introduced pastures, and will use prescribed weed and brush control to reduce invasive species encroachment. A cost-effective grazing principle is to use standing dormant forages instead of hay during the dormant season. Cover crops can add a new dynamic to the grazing operation, as well.
Begin with the end in mind. Determine when you want to sell your calves and what your end-product will be for most years, and work backward from there to develop the management calendar. The management calendar should include the following dates: bull turn-in and pickup (hence subsequent calving dates), weaning and marketing dates, when to BCS the cows, when to work calves for the initial and booster vaccinations, when to conduct a breeding soundness exam, when to scout for weeds, and when to apply fertilizer and/or lime. Additionally, an intentional producer will develop a plan for when to consider grazing each pasture, all the while recognizing that the exact date will vary based on weather and other uncontrollable factors.
Above all else, an intentional producer will learn to be flexible, since so many variables are out of one’s control. However, just because intentional producers have developed and are working a plan it does not mean they cannot adjust as the need arises. Conversely, they will be more strategically positioned to make correct and meaningful adjustments to their plan without wrecking their system, largely because of the knowledge gained from well-kept records.