Many people ask how to start a dairy farm. With money in your pocket, starting a farm is no problem at all. But there are things to consider before and after starting that are very important: for example, where the farm is, and whether a vet, cattle feed, a good milk price and easy milk sales are available there. Many also want to know what the farm should look like and how many cows to start with for the business to be profitable. This article is for those who want to start very small, at the lowest cost, as a pilot project to learn the business, or whose budget is small.
The plan
Budget: Tk 380,000 and two cows (with calves) giving at least 15 litres of milk each. Cowshed: 30 feet by 15 feet, which must have electricity and water. Now for the accounts.
One-off costs
- Two milking cows: Tk 300,000
- Cowshed: Tk 60,000
- Electricity and water: Tk 20,000
Monthly income and costs
Income from milk sales: 20 litres x Tk 50 = Tk 1,000 a day, so monthly income is Tk 1,000 x 30 = Tk 30,000. The article shows 20 litres because a 15-litre cow will not give 15 litres for all 8 months; the yield falls gradually, so an average of 10 litres a day has been used.
Monthly costs: an employee's salary of Tk 7,000; feed at Tk 150 per cow per day, or Tk 9,000 a month; medicine and other costs of Tk 2,000. Total costs: Tk 18,000. The more cows there are, the lower the average salary cost per cow for one employee.
Monthly profit: Tk 30,000 - Tk 18,000 = Tk 12,000. It will take 31 months, or 2 years and 7 months, to recover the one-off cost of Tk 380,000.
Keeping the income going
As a strategy to keep this monthly income steady, you will need to buy two more milking cows after 8 months as a second step. You will then be in a cycle and will never have to pay for feed and salaries out of your own pocket. Major accidents or illness, which are beyond our control, are not included here.
What will your balance sheet look like after 2.5 years? It is very important to understand how much your assets will be worth, meaning how many cows you will have and what they are worth. If you can work that out, you will understand for yourselves how the dairy business will go and can make your own decision. The writer asks those who want to start a dairy business to work out their assets and share the figure in the comments, saying it will benefit them.
Source: Staff Correspondent. First published in Bengali on The Agro News.
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