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Calculating profit

post #1 of 7
Thread Starter 

I just started with the cornish x this summer and raised and sold 3 batches.  We will definitely do it again next spring.  But I am wondering how much it is worth it in reality. It is nice to have  several hundred in my hand...but obviously it is not profit.  I wonder how other farms calculate profit.

 

I added up what each batch cost me in chicks, food, processing, ice and bags.  I also added up the cost of building a HH, extra waterer and feeders.  I know technically I need to amortize those costs, but I am not quite sure how to do that...so I basically say that these guys paid all that off.  

 

I also keep several birds for my own consumption and they are paid for by those that I sell.  Do you count your profit with the value of those birds added in?  (as in I kept $50.00 worth of birds so my profit is $50.00 more).

 

Thanks, I am trying to be official!

post #2 of 7

If you use birds for your own consumption then you need to count that in too cause you'd be buying them from the grocer.

 

You have to calculate everything including electric cost.

 

If memory serves, you can amortize on several schedules. Probably for a hen house, 6 years may work.

 

If you're paying someone to process the birds for you then likely you aren't actually realizing a profit depending on how many birds you're raising. If you have 50 birds, it's probably a wash at best. If you have 500 or more you may be making money, especially if you're buying feed by the ton or in bulk.

NPIP 43-813

“Travel is fatal to prejudice, bigotry, and narrow-mindedness, and many of our people need it sorely on these accounts.

Broad, wholesome, charitable views of men and things cannot be acquired by vegetating in one little corner of the earth all one's lifetime.”                  Mark Twain

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NPIP 43-813

“Travel is fatal to prejudice, bigotry, and narrow-mindedness, and many of our people need it sorely on these accounts.

Broad, wholesome, charitable views of men and things cannot be acquired by vegetating in one little corner of the earth all one's lifetime.”                  Mark Twain

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post #3 of 7
Best way I figured out was to do a cost per bird division....

As with any venture you have start up costs, so they count but if done right they are minimal. I raise the birds on tractors, the first batch of birds that uses a new tractor completely covers the cost with plenty to spare. Every subsequent batch that uses it it's pure profit. You could divide it all out if you wanted to but I don't because there's no need.

Example: With bag feed, I have a total cost cost per bird including processing of $8.00 that's everything except the cost of the tractor. My average sale price is $19 per bird. Which leaves us with $11 profit per bird.

Each tractor costs less than $250 to build, and I do 75 birds per tractor. This means every batch that goes into to the tractor has a gross profit of $1475. So with an input cost of $600(75 birds@$$8) plus the initial tractor cost of $250 that's $850 total spent out of pocket. So net profit is $650 than moves to $900 every subsequent batch.

Because we sell them about a batch at a time this is how we figure the profit. I don't bother including the birds we eat. We sell so many more than we eat it's minimal. Hope this helps
post #4 of 7
Thread Starter 

Thanks.  I am considering the birds I am eating, since I would be paying for them otherwise...Though I would not have paid for as many as are in my freezer right now!! (These are still possibly for sale though).

 

I did go over everything for the 3 batches and I do make a profit over all--larger of course if I add the value of the birds I am consuming in.  The processor is $4/bird and definitely something I would like to eliminate.  But then I would need to invest in more equipment.  I would need 2-3 more cones, plucker, proper scalding pot/set up and a system for gutting.  Maybe next year, we'll see.

 

A question for averaging the price per bird--with large differences in bird weights and even batch weights-can you really count on that number remaining accurate?

 

My 1st and 3rd batch were huge--I had a few 8lbers (dressed), but the rest ranged from low 5lb to mid 7lbs.  My 2nd bath topped out at 7lbs at the heaviest with most being upper 4lbs to mid 6lbs.  

 

I definitely dont do nearly as many birds as you, Slingshot.  I had total of 85 for the summer.  Next summer we are planning more batches, but each one will be 20 ish birds.  If my customer base increases, we will see what we do.

post #5 of 7
Quote:
Originally Posted by cafrhe View Post

Thanks.  I am considering the birds I am eating, since I would be paying for them otherwise...Though I would not have paid for as many as are in my freezer right now!! (These are still possibly for sale though).

I did go over everything for the 3 batches and I do make a profit over all--larger of course if I add the value of the birds I am consuming in.  The processor is $4/bird and definitely something I would like to eliminate.  But then I would need to invest in more equipment.  I would need 2-3 more cones, plucker, proper scalding pot/set up and a system for gutting.  Maybe next year, we'll see.

A question for averaging the price per bird--with large differences in bird weights and even batch weights-can you really count on that number remaining accurate?

My 1st and 3rd batch were huge--I had a few 8lbers (dressed), but the rest ranged from low 5lb to mid 7lbs.  My 2nd bath topped out at 7lbs at the heaviest with most being upper 4lbs to mid 6lbs.  

I definitely dont do nearly as many birds as you, Slingshot.  I had total of 85 for the summer.  Next summer we are planning more batches, but each one will be 20 ish birds.  If my customer base increases, we will see what we do.

All my birds are within a pound of each other, so I guess that's the difference. I've found that customers like the birds in the 4lb range, so that's the weight we shoot for.

We've dialed it in pretty good and have actually been getting lighter with the weights slightly. We sell birds to a local grocery store and just don't have a market for 8lb birds. Even the 5lb birds sell slow, but the 4lb ones go very fast.

The first batch of birds this year were my heaviest averaging 4.73lbs than we got 4.45 and 4.42 and so on. At 2 feeding a day we get very repeatable results.

I'm picking up some restaurants and they want birds slightly smaller for thier pricing purposes. This may move me to a male female processing schedule or something similar, time will tell.
post #6 of 7
Thread Starter 

When I move to self processing, I will have more control over the weights.  My customers are local people who are looking for local food.  Many are families who want several meals out of the bird (like me!).   Right now it looks like the 5lb range is most requested.  I could probably save my self a week of food if I processed at 7 weeks.  But the middle batch threw me--they were a good 2lbs lighter than the other 2 batches.  Very pretty, good feathers, happy and active birds, and much smaller.  There were only 20 of them (other 2 batches were 30).  

 

I have to have 25 birds for him to give me a set date, or else he fits me in with other orders.  Probably easy enough if I planned better.  But my thought for next year is more batches of fewer birds and I will feel less overwhelmed by processing ourselves.  Just need a plucker!!  Or listen to whiny kids who are forced to pluck!

 

How do you get them consistent weights?  I have had much smaller birds in with the 'big boys'. At 6 weeks old my last batch had live weights from 4lb 11oz up to 7lb 15 oz.  They are straight run and while the biggest are male--there are some huge females and small males as well.

post #7 of 7
Quote:
Originally Posted by cafrhe View Post

When I move to self processing, I will have more control over the weights.  My customers are local people who are looking for local food.  Many are families who want several meals out of the bird (like me!).   Right now it looks like the 5lb range is most requested.  I could probably save my self a week of food if I processed at 7 weeks.  But the middle batch threw me--they were a good 2lbs lighter than the other 2 batches.  Very pretty, good feathers, happy and active birds, and much smaller.  There were only 20 of them (other 2 batches were 30).  

I have to have 25 birds for him to give me a set date, or else he fits me in with other orders.  Probably easy enough if I planned better.  But my thought for next year is more batches of fewer birds and I will feel less overwhelmed by processing ourselves.  Just need a plucker!!  Or listen to whiny kids who are forced to pluck!

How do you get them consistent weights?  I have had much smaller birds in with the 'big boys'. At 6 weeks old my last batch had live weights from 4lb 11oz up to 7lb 15 oz.  They are straight run and while the biggest are male--there are some huge females and small males as well.

My processor does birds every 2 weeks so that's how I stagger the batches of birds.

Next thing I do is cull before I put the birds in the tractors, any birds that are noticeably smaller are taken out, I tried keeping them but they just don't gain even though they eat plenty. I use the birds for bait( I'm a trapper) don't know if that would work for you with only 20 but that's the first step

So I start with a pretty even group then I do split feedings. One early after I move the birds and one later like 5pm I feed enough so after the initial frenzy there's plenty left, this lets less dominant birds feed also. This is a balance because I want all the birds to eat but not live at or guard the feeder. There's enough to go around but not much left, this also keeps more aggressive birds from growing faster.

We have a 1000 bird state limit with no inspection so we can't process here although I would love to and it would save me $3 a bird. We were going to build a outdoor pavilion and have a feather man full unit installed, the state said we need to do it indoors with under ground holding tanks and all kinds of nonsense, so we are stuck paying.
Edited by slingshotandLAR - 10/20/15 at 5:44am
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