Management of Dairy Business
January 28, 2013
There are many factors which impacts on management of dairy business but following factor can also influence the management.
Period of 12 months of every business in which financial statements & business plan are prepared for any business.
Pakistan Govt. accounting period is from 1st Jan – 31 Dec.
Our current (Corporate Dairy Farmings) accounting period is from 1st Jan – 31 Dec.
Drawbacks of current accounting period: Following are drawbacks of current accounting period.
- Difficult to manage whole season in 2 different accounting periods.
- Your half season is concern with current year & half season with next year.
- Difficulty in record keeping.
- Unable to present next year plan easily due to two different seasons in one year.
- Two different lactations in one year.
- Some cows of 4th, 5th & 6th lactation can dodge you due to low production but you have to face them throughout the year or will make you to change the plan which is not good indicator of good management.
- If 100 cows violate your plan & convert their calving in next year they will hit your whole performance of the year also imbalance CM.
Benefits of accounting period from 1st July-30 June: Following are benefits.
- You will enjoy only one whole season or lactation in current year.
- You are much confident about your next CP.
- You have exact idea about how much animals are pregnant & how much will be calved in this season despite even it will violate about 30-60 days, but will facilitate your current year.
- You are able to give exact plan for feeding demands throughout the year according to classifications of herd.
- You are in position to do better classification timely.
- You are able to make culling list of animals timely based upon performance of the last lactation & will not hit your CM anymore.
- If one cow is showing repeat breeding again & again till at the end of season, you can make decision about it in next plan.
- You will be smarter to make strategy plan for growers & heifers.
- Will find you confident about calves’ management.
- Your production in season will provide much better support in off season to maintain high CM or for improvement of CM.
- Your cropping team will also have exact idea of demand of livestock.
- Your purchase team will fulfill demands of livestock team as picture will clear about demands rather than in exceptional cases.
- You will enjoy peak lactation of all cows in same year.
- As you have to breed all cows it will give you smooth time for breeding in same year which make your conception rate high.
- As you are enjoying peak lactation of all cows in same year it will make your average production high.
Legal Rules: Every business has its own accounting period depending upon business choice & nature of business that what it demands.
As Corporate daries farming is a Joint Stock Company (corporate) & is a legal entity which is running under the legal ordinance of 1984.But by consent of top management it can be change easily.
Few businesses in Pakistan are seasonal like textile or sugar etc. so they make their accounting period according to their seasons. Likewise dairy business also falls in seasonal category because it mainly concern with from Sep-April by production, breeding, calving & feeding etc.
Summary: According to my mind & my study, nature of dairy business need accounting period of 1st July- 30 June.
It will make your business flourish & profitable.
The main point is that when your business year will start then you will start from low production which makes you conscious for your CM, you will work for it with new spirit & zeal. By this way after chasing of 3 months you will catch your targets near at the end of first quarter & or beginning of 2nd quarter. Then you will maintain it first & also will improve your production for next 6 month with this behavior & potential.
In mostly business it has been seen that people start with good production they take easy & waste all that which they have to gain in next high potentials period. But in dairy business if we waste it once then we have to lose it precious lactation which we never return back.
An example of financial organizations is that their accounting period starts from 1st July – 30 June as their peak months are October to January. They follow same concept of accounting period & their champions are target oriented, achieve their targets by spirit & zeal.