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The true cost of managing a 1000 plus cow dairy farm through a single cowshed.

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Executive Summary

Defining what is the true cost of managing a large scale dairy farm in New Zealand is not just about the financial cost but also the social cost and what the perception of the industry is. Through my study I have defined each area into the financial impact and the social impact it has on people in the industry.

The financial side of running these businesses is not just what we pay for a manager but also the network that is around them or in a corporate scenario above them. This is what I would call the true cost. For example, if a manager is paid $100,000 and you have a farm consultant that charges $15,000 then the true cost of managing that farm is $115,000.

If you are running a corporate farm the same equation would apply but also the cost of governance and in some cases a central desk would be added to that cost. If the entire board is paid $10,000 per farm and a central desk is charged at $40,000 per farm then the true cost could be between $150,000 and $175,000.

I found the social impact side of my interviews the most trying and difficult of the process. The willingness and just how open my fellow farmers were with me was very humbling. The emotional journey that I went on through this process was incredible. From meeting farmers that did not have a worry in the world nor did they have any significant stress levels nor frustration around their business to then drive down the road and interview another farmer that had actually attempted suicide or had a serious relationship breakdown.

The true cost of managing a 1000 plus cow dairy farm through a single cowshed – Murray Jamieson