Is Your Ranch Running At Peak Performance?
Key Performance Indicators can identify strengths and weaknesses in your financial and production numbers and help get your ranch running optimally.
What Are Key Performance Indicators?
Key Performance Indicators (KPI’s) are used to measure the financial and production health of ranching operations, particularly ranches that focus on cow-calf production. Ranches can use KPIs to evaluate different factors that are crucial to the success of their cow-calf operation, and identify whether or not the operation is fulfilling it’s management goals.
Pounds Weaned per Exposed Female
The primary objective for owning breeding beef females is to wean calves. While every rancher has this goal, how they accomplish it over time varies. However, the number of calves weaned and how heavy those calves are serve as an indicator of ranch productivity.
Cost Of Raising Weaned Calves
For management, the best number to know is what it takes to produce a pound of weaned calf. This KPI incorporates the productivity of the ranch and the total expenses it took to create that productivity, and illustrates how efficiently management utilizes those resources.
Operating Ratios
Controlling expenses can be one of the most important exercises for ranch owners and managers. Managers should target operating expenses at less than 75 percent of total revenue. Operating expenses include all expenses except interest and depreciation.
- Operating Expense 64%
- Depreciation Expense 15%
- Interest Expense 12%
- Net Income from Operations 9%