More profitability is a constant quest for beef-cattle producers. There are two basic ways to increase profit — get paid more for the product you're marketing, or decrease the expenses incurred in developing that product.
Superior genetics, for instance, is one way to possibly get paid more for your cattle. But even then, most cattle producers have to take the market price offered. So, in order to increase profit, producers are then forced to consider ways to decrease expenses.
Sometimes, the focus on decreasing expenses can become so intense that we fail to consider the consequences. The blinders go on and we only see how much is being saved, ignoring what it may actually cost to save that expense.
Being proactive pays
One of the most obvious examples of this in our practice is some feedlot clients' lack of facilities to effectively deal with obstetrics and bloat treatments. Hydraulic chutes, which are built primarily for processing, work well for treating animals with respiratory disease, foot rot, etc. But when it comes to pulling a calf from a feedlot heifer, such standard chutes aren't very friendly.
Generally, squeeze pressure must be applied to keep the heifer standing. This frequently makes it very difficult for the obstetrician to even have room to stand behind the heifer while working, let alone trying to get a fetal extractor in the chute to pull the calf.
Meanwhile, bloated cattle can come in with so much gas pressure that a hydraulic chute simply isn't wide enough once they're restrained. The alley leading to the chute can also be very narrow, making it difficult for the bloated animal to breathe until the bloat is finally relieved.
A freestanding manual headcatch with a couple of wing gates could resolve both problems. And if it saved one animal, the expense of the extra equipment would be covered; there would probably even be a savings in labor. But I frequently find it difficult to convince some feedyards to spend the $500-600.
Penny wise, pound foolish
Another area in which producers often look to reduce costs is in animal-health products, which also can backfire. Saving a few cents can wind up costing much more in the long run, something we found to be true in a recent evaluation.
Several of our clients were able to purchase a commonly used product for an average of 40¢/head less than the product they were previously using. In a 50,000-head feedyard that turns its population 2.5 times/year, for example, such savings can be substantial — $50,000.
Our clinic's evaluation of the product, however, indicated the cheaper product wasn't as efficacious as the original (more expensive) product. In the end, after switching, the yard experienced a loss of $3.98/head due to decreased production efficiency. Changes like this can be due to multiple causes. In this case, however, at least some of the change was associated with the product switch. So, a savings of $50,000 in purchase price resulted in at least a part of a net loss to the feedyard of $447,500.
To be sure, keeping a tight lid on costs is a very important component in beef cattle production. But care must be taken to ensure that the savings don't wind up becoming an even bigger expense in the long run.
Producers must ask themselves if the cost savings are truly beneficial. Consult with your herd-health veterinarian for help and guidance in products and practices that are the most cost-effective.
Dave Sjeklocha, DVM, is a feedyard consultant at the Haskell County Animal Hospital in Sublette, KS. He can be reached at 620-675-8180 or email@example.com.
BIF to meet in Colorado
The 2007 Beef Improvement Federation (BIF) Annual Research Symposium and Meeting is June 6-9 at the Hilton Fort Collins in Fort Collins, CO. BEEF is the official publication of BIF.
BIF was founded 40 years ago as a means to standardize programs and methodology — and to create greater awareness, acceptance and usage — of beef cattle performance concepts. This year's meeting features opportunities for producer input on guiding the future of genetic evaluation and genetic improvement of the U.S. beef herd, as well as becoming informed about the field's latest research findings and progress.
To learn more about the conference agenda, visit: www.beefimprovement.org/2007_BIF_Program.pdf or call 785-532-5428.