Improve performance with farm benchmarking

Family farms make up around 80% of Britain’s agricultural landscape, however a lack of planning for the future may be putting these important businesses at risk. To demonstrate our support and commitment to family farms across the UK, Volac is proud to co-sponsor Farmers Guardian’s ‘Year of the Family Farm' initiative. In the latest part of the series we take a look at farm benchmarking, a hugely powerful tool for the family farm.

Year of the family farm series

Year of the Family Farm has been running throughout 2017 and as part of the initiative a Year of the Family Farm series has been launched which aims to address the issues facing family farms and identify opportunities which will help them become fit for the future.

The latest part of this series focuses on farm benchmarking which can be a hugely powerful tool in cutting costs and improving performance. However in reality, the number of farms undertaking benchmarking is likely to be nowhere near as high as it should be. So how do you carry out effective farm benchmarking and who do you compare your performance with?

Why is benchmarking so important for family farms?

Farm benchmarking is focused on a series of marginal gains to improve performance, rather than wholesale change and can be particularly beneficial to family farms who are more likely to prefer to cut costs than to invest capital to improve their operation. While it can show simple savings to be implemented immediately, the information can influence a long-term strategy, leading to a gradual evolution in the farm’s structure and operation.

Anything which can be measured can be scrutinised, from yields, labour and fertiliser costs to feed conversion, age at first calving and daily liveweight gains.  There is nothing new about the process, but technology has now made it easier to capture and compare data quickly and easily.

Pressure on farm incomes and an acceptance that support payments are likely to reduce raises the importance of farms sense-checking their performance against other farms. Strutt and Parker partner Rob Wilkinson says more farms need to do it.

I suspect there is an element of benchmarking which goes on in most farm businesses, but a lot of it will be off the top of the head. “We have tried to encourage it for years and interest is born out of farming without Basic Payments. Farmers need to look at how they are going to put money back into their bottom line. “But the amount of people physically sitting down and filling out data is probably very few.

How do you start farm benchmarking?

To get started with farm benchmarking, follow these 5 steps:

  1. To begin with, start with the set of accounts
  2. Look at Farm Business Survey’s website and enter the data
  3. Take advice from a further source, such as a consultant or analyst
  4. Act practically on it by using an independent source who can analyse it and suggest the next steps
  5. Join and participate in a discussion group – national or regional

Farm benchmarking in action

The more people you can measure yourself against the better, says Wiltshire dairy farmer James Wright.

Benchmarking on Wiltshire dairy farmer James Wright’s family farm begins as soon as the calves are born. Mr Wright farms a herd of 370 pedigree Holstein cows in the North Wessex Downs and starts by measuring a newborn calf around the middle with a weighband.

He says: “Every calf is born at different weights and we are aiming to get it to double its birth weight by the time it is weaned.” Mr Wright also utilises technology, such as a Volac automatic feeder for his calves, which he says allows different staff members to manage calves, as the machine keeps track of what each individual calf requires.

The farm then collects data on the cow’s fertility, health and yields, which Mr Wright measures against other farms and his own previous performances. He says keeping track of a cow’s fertility is paramount. “If she is only bulling for one hour in the middle of the night, we would probably miss the heat, so cows wear pedometers. “These measure the cow’s movement, as when a cow is in heat she will move around more.

It means we have eyes and ears on the cows 24/7, with the aim to get them back in calf quicker. “We are aiming for an 80 per cent plus survival rate from birth to second calving.” Mr Wright benchmarks across three different groups: nationally through his Sainsbury’s Muller contract; locally through his vets, Drove vets; and against a group made up of a ‘very diverse group of farms’, including low input and high input systems.

He says: “We can look at different aspects and we can see which way would suit the farm.” Mr Wright says due to benchmarking carried out on-farm, he is always adjusting the way it works, which has helped improve the farm’s performance.

“The more people we can benchmark against the better.” He denies benchmarking is simply a ‘box-ticking exercise’ and encourages those who might be cautious about sharing data to do it. He says there is a bonus to be made from benchmarking and reaching targets set by buyers.

There is a bonus to be made. It is a motivator for staff and it will lead to being more profitable. “In terms of milk contracts, it is about making sure you get into their top band.

Mr Wright encourages farmers who are cautious about sharing data to look into joining benchmarking groups, as results are confidential between those who present at meetings.

Volac will keep you up to date on the latest advice and support throughout the initiative, and you can also get involved on our Facebook page or Twitter, using the hashtag #YOFF.

Find out more about farm benchmarking here or to catch up on the full series visit FG Insight.