We know the daily operations of your dairy farm can be more than a full-time job. So, it’s unsurprising that many dairy producers struggle to keep up with the data and stay up on the numbers. Not being meticulous with your dairy benchmarks and their information can hold you back from reaching your financial goals. Learn more about how a focused approach to benchmarks can make all the difference moving into the future.

What is Dairy Benchmarking?

Dairy benchmarking uses a set of key performance indicators (KPIs) to measure various aspects of dairy farm operations, such as milk yield, feed efficiency, and animal health. Dairy KPIs are regularly updated to reflect the latest industry information and allow for comparisons between farms of different sizes, regions, and production systems. Dairy benchmarking not only provides a snapshot of farm performance but can also be used to identify trends over time and make informed management decisions.

Benefits of Dairy Benchmarking

Dairy benchmarking helps farmers identify areas of strength and improvement opportunities. It provides a way to measure performance and improve profitability by effectively targeting resources and investments. Dairy benchmarks can also help farms become more sustainable by monitoring their progress toward sustainability goals.

Adapting a Traditional Business to Twenty-First-Century Metrics

Getting on board with the data-driven world can profoundly affect your profits, as pasteurization had on the entire industry in the twentieth century. Here are a few specific examples of tracking exact numbers and dairy benchmarks that can give you more streamlined returns. These examples encompass both external and internal benchmarks.

1. Market Participants Comparison

Dairy farmers aren’t rivals in the usual sense. But knowing how you measure up to others in the market is a great way to evaluate where you are and where you need to improve. Comparing your KPIs to the benchmarks of your fellow farmers gives you a gauge. To do this, first, you must have your data in order.

2. Action Profit Contribution

Another excellent way to employ benchmark data is to focus your capital and energy on the specific areas that will boost profits. Significant data eliminates the chances of placing your efforts in the wrong areas, wasting time and money. In addition, numbers give you actionable clarity in your decision-making.

3. Having a Professional Presentation for Lenders

If you need to work with a lending institution for expansion or upgrade capital, a dynamic, well-organized analysis of operations, projections, and industry comparisons can make all the difference in landing the deal. Not to mention the added benefits it has with the IRS.

Working with a Dairy Accounting Professional

Your time is limited when it comes to attending to these technical activities. Consider bringing in a trusted partner ready to answer questions, put systems in place, and help solve problems whenever they arise.

For a professional partner and CPA that knows the dairy industry, contact Genske, Mulder & Company, LLP.

We also provide FREE information to clients and non-clients through our Daily Report. Visit “Get My Dairy Report” to stay up to date.