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## Practical Poultry Farm Business Performance Calculations

**Introduction**

In this article, I share VERY practical, real-world tips on performance metrics that you can calculate daily, weekly, monthly, and at the end of the year to accurately determine whether your poultry farm is performing optimally at each stage.

These performance measures are NOT aggregated measures. In other words, they are NOT measured in monetary terms. Instead, they have NO units that are ratios, utilization rates, and percentages that help (a) establish a normal trend of your farms behavior (b) quickly identify/detect deviations from that trend so you can take corrective action in time.

Please note that these measures are tried and true built into the custom spreadsheet software I created for a client who runs a twelve thousand (12,000) layer poultry farm.

**You can quickly and easily calculate performance indicators to check the health of your farm**

You would be interested to know that this client actually enters ALL the data into the software on his laptop using completed copies of a special record keeping form that I designed (after a farm visit which included a review of existing/required records) for farm staff to use DAILY .

He once shared with me how he discovered some anomalies in the data recorded by a supervisor using automatically calculated performance indicators in the software.

The point is, KNOWING the performance metrics you can calculate to VERIFY how well your farm is doing from an OPERATIONAL and FINANCIAL perspective is very important.

You can do it yourself, as the calculations are really simple and easy to use. However, if you’re running a large (or growing) agricultural business, you may come to a point where it adds more value if you save yourself the hassle of doing such calculations by hand.

Instead, you can automate their calculations (using custom software like mine) and spend your time managing your agribusiness more intelligently by learning the trends of your performance indices over time to make timely/effective decisions that lead to total profitability.

**Here are three (3) VERY useful poultry farm efficiency metrics that you should know and use regularly:**

**1. Mortality rate (%)**

During the egg-laying cycle of a batch of birds in a poultry farm, there will be deaths or losses that occur for various reasons. This could be a disease outbreak, fire, predators, etc. It is important to take steps to prevent a recurrence.

Such losses must then be accurately documented with the necessary adjustments to stock records.

There is NO farm where there is no mortality. However, the management of the farm needs to reduce it to a minimum. You will be able to easily monitor the death rate by calculating it daily. In this way, you will be able to detect any changes, take action in time, so that there are no surprises at the end of the month!

By the way, if you track this index, it will be easier for you to come to terms with unexpected drops in egg production.

To calculate the death rate (%):

Number of dead birds x 100

———————–

(Opening Stock + Closing Layer Stock) x 0.5

**2. Production per chicken day (%)**

Properly documented mortality records will help you accurately estimate a hen’s daily production, which is the number of eggs produced divided by the total number of egg-laying birds on the farm for the period in question, assuming each bird lays an egg per day.

It is common knowledge that it actually takes a bird about 26 hours to lay another egg after the previous one. That’s why we don’t expect to set a target of 100% chicken production per day for our flock. Instead, it would be reasonable to expect that 80 to 90% of birds will lay eggs each day, so if our calculations yield results in this range, it would indicate a fairly satisfactory performance.

To calculate the productivity of a chicken day (%):

Number of eggs obtained x 100

———————–

(Opening Stock + Closing Layer Stock) x 0.5

Production on your chicken day will decrease based on recorded mortality unless you calculate as shown above. Understanding this will help you compare your results to other farms that may not be aware of this subtle difference.

Note that this method of calculation helps you to really check if your birds are becoming less productive because it prevents the losses that arise from the fact that these birds are still alive, seem to lay less often – something that can force you start to worry or take unnecessary corrective action.

**3. Feeding rate (grams per bird)**

Available farm and literate records all indicate that each laying bird should eat about 100-105 grams daily.

To calculate the feeding rate (in grams per bird):

Total amount of feed in kilograms x 1000 x 100

——————————

(Opening Stock + Closing Layer Stock) x 0.5

By using the total number of kilograms converted to grams that the layer birds were fed to divide the total number of birds raised per day, you will get an indication of how well they are being fed; if they are underfed or overfed.

Each condition has its own consequences. Malnutrition can lead to poor egg production; overfeeding leads to waste – and of course higher production costs, which you definitely want to avoid so you don’t eat into your bottom line!

By calculating the daily feeding rate for each battery cage or pen, you can quickly check and confirm that the birds are getting the right amount of food. It will also help you keep track of your feed stock balance and thus help you plan for new purchases.

**IMPORTANT NOTES:**

**1). **To achieve a “weighted” – and therefore more realistic – result, the formulas described above use the derivative of the average of the sum of the beginning and ending stocks of ovipositors as the denominator.

**2). **If you do NOT have a reliable paper farm data recording system that is diligently maintained by your competent farm staff, you will NOT be able to rely on the results obtained when calculating these performance indicators. It would be like what is often said about the computer: garbage in, garbage out (GIGO)!

**SUMMARY**

Many people are engaged in poultry farms here. Many are planning to start. Some hope to borrow money from banks or friends/relatives to start their own. Unfortunately, very MANY – just like their catfish farming counterparts – have ANY knowledge of what it takes to intelligently manage the business data analysis aspects of their businesses.

Knowing how to measure the operational performance of your agribusiness is essential to ensuring long-term success. The three pointers I discussed above can help you in this regard. Learn to use them.

**But this is only ONE side of the story**. You also need to know how to measure your farm’s financial performance – and perhaps compare it to other farms or even to an overall benchmark.

**There are at least three financial performance ratios that can be calculated to tell you if your farming business is growing or NOT**.

They will tell you if you have improved at the end of this year compared to last year or two (2) years ago. They will also tell those investing in your business (or who want/plan to) how financially strong your farming business is – compared to last year etc.

If you’re considering BUYING an agricultural business, you’ll want to know how to calculate these three (3) ratios to make sure your investment pays off!

**Note that the financial ratios I mention are NOT aggregates like the income statement (aka the income statement) or the statement of net worth (aka the balance sheet)**. These are NOT unit-based metrics, making them (like the agricultural operations measurement indices discussed above) easy to use for comparison.

You can get a special report from me detailing how to calculate these very powerful farm business financial performance ratios.

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