Financial performance of family dairy farms

The financial performance of 10 southeastern Pennsylvania dairy farms, ranging in size from 45 to 155 cows, was studied. Income expenses, debt, profit, and cash flow were examined, and the values of these factors were found to be similar to those of large studies on farms with similar herd sizes. More than half of the farms had supplemental income from nondairy farm-related enterprises, such as beef cattle, poultry, crops, and custom work. Because cash profit is not synonymous with true profit, true profit was somewhat difficult to determine for most of the 10 farms. The author concludes that the families on the well-managed farms he studied do have a high quality of life-they pay their bills on time, take vacations, drive nice cars, and use modern farm equipment. The profit potential for family and small dairy farms is important for veterinarians who include this type of farm as part of their clientele. Dairy practitioners can offer insight to these farmers if they have some knowledge of the financial realities and additional expertise in animal management.