How do you, as a farmer, measure the success of your farming operations? Is it through the yields of your crop, the multiplication of your livestock, or how well-known you have become as a farmer? In many cases, it is really none of the above.
A crop farmer would probably rejoice at the sight of all those hectares of cabbage or pumpkin fields stretching as far as the eye can see.
It is surely an indication that good profits are to come from that. It is an indication, but not the ultimate decider. Hang on, we will get to what is the ultimate decider in a moment. Let us take another example.
If you have a cattle farming enterprise where the focus is on raising weaners for the market, the first indication of a successful business might be the number of calves you have available to send off to the market, right? Well, there is more than what meets the eye if you are really into determining the real returns of your farming operations.
The real test of your farming operations is maximising what you eventually get out of the operations in the end.
The crop farmer might have a hectare full of cabbage ready for the market, but this is just the beginning of it all.
There are variants along the way that stand between the time the cabbages leave the farm, and how much money eventually lands into your pocket.
The same applies to our cattle farmer in the example above.
It does not really matter how many weaners he loads onto the truck destined for auctions, but rather how much he gets to take back home at the end of the day.
These are the real tests of farming.
Simply put, the main indicator of how successful you are as a farmer depends on how well you manage the hidden costs of farming.
How do you manage costs that are hidden, you ask? Well, you must peel through layers of costs to get to them, and address them as soon as you find them.
Let me break it down for you. A farmer taking his cattle to an auction might cater for transport costs in his planning, but not for the costs of the people helping him load the cattle onto the truck, to which he pays some nominal fees.
Also, a calf or two might not be in the kraal at the time of auction, and someone would have to be hired to look for it.
That is, of course, another cost we never expect. What about the fuel you use to go to your communal farm every month?
Do you consider vaccination, feed and lick costs in your final costs of farming before declaring that you made a profit?
All these costs need to be broken down and assigned per cattle so that you can properly determine the actual success of your farming operations.
Our crop farmer above needs to take the costs of fertilisers, the seasonal workers he employs for weeding, and also the cost of fuel for his trips to manage the farm.
Dear farmers, there are costs that we often ignore in our farming operations. We dismiss them as being too nominal or small to account for. This is a grave mistake.
Consider all costs – even the small ones – and you will uncover the real cost of farming.
You will uncover the hidden costs that lay in ambush of your farming operations.
Until then…
*Charles Tjatindi can be reached at editor@omututa.com.