Money!!

kevthegaff

Well lads i find this time of the year crazy with money going out, i try to clear my fert, meal, contr and rent as soon as possible without entering my overdraft. I only buy machinery with money i have and buildings are left till the end of the year to gauge what i have. I do a budget sheet in the start of the year which i should do more often! its normally in the milking parlour when im tallying expenditure/income in my head. What do the rest of ye do??

micraX

Grants. Haha

Milked out

Something i have to work at big time as well here, I guess the easiest way is to set out what you want to do at the start of the period and try to budget it at whatever the milk price looks like it will be, allowing x amount for extra feed due to bad weather. Thats the problem I have with using cashflow for too much is that if you use it when its there enough may not be held for when prices drop and you get caught then for repayments or whatever

Viewtodiefor

kevthegaff wrote: »

Well lads i find this time of the year crazy with money going out, i try to clear my fert, meal, contr and rent as soon as possible without entering my overdraft. I only buy machinery with money i have and buildings are left till the end of the year to gauge what i have. I do a budget sheet in the start of the year which i should do more often! its normally in the milking parlour when im tallying expenditure/income in my head. What do the rest of ye do??

The good old delaval who's "reincarnated" used to rave about not using cash flow for machinery and buildings etc as you do run into lean spells! He has a point to be fair. Cash flow is the life blood of any business and often is what puts some under. Having said that its very easy borrow too much. I'm kinda in the same boat here as haven't borrowed but done lots of upgrading. I'm lucky as I don't have a mortgage etc so that makes it easier to do. We also sell about 30 bullocks to factory in early April which helps a lot. Not saying they leave much behind but they pay the bills! This is the one thing i will miss if we go down all dairy route. Basically we clear all meal fertiliser bills before Xmas and like you spen a bit over the winter. Meal for the finishing cattle and any others over winter is paid when they are sold.
Any machinery from now on and milk tank which I'm buying this year will be borrowed and put over 7yrs. Just makes it easier and allows a build up of cash hopefully! As a cushion, as this will be important in low milk price times. Fail to prepare then prepare to fail as they say.

Miname

I'm suckling to beef here and will always try to have a few cattle to go at a couple of times of year, then with the main batch to go in the autumn. I try to get everything paid out of these smaller groups and then whatever is still there in september is mine for the keeping.

kevthegaff

Im lucky too no mortgage just had to renovate a house with cash flow over the years, all thats left is stable fencing!. I dont realise how lucky im seeing lads having to build a house on the farm. Is machinery tax deductable over 7 years or for that year only?

Viewtodiefor

kevthegaff wrote: »

Im lucky too no mortgage just had to renovate a house with cash flow over the years, all thats left is stable fencing!. I dont realise how lucky im seeing lads having to build a house on the farm. Is machinery tax deductable over 7 years or for that year only?

Over seven years as far as I know. Not sure can it be put in over shorter time. Maybe lakill can help? You'll get the interest too as tax deductible i think

Timmaay

kevthegaff wrote: »

Im lucky too no mortgage just had to renovate a house with cash flow over the years, all thats left is stable fencing!. I dont realise how lucky im seeing lads having to build a house on the farm. Is machinery tax deductable over 7 years or for that year only?

Agreed fully here, well I plan on building a house down the line but having a site and all that makes it wayy easier. In terms of the farm cashflow, bury your head in the sand, and set the dog on the postman so he can't give ya bills But nay, this year, selling culls straight out of the parlour now instead of hanging on to them and fattening them for the autumn has given a nice cashflow boost. The contractor usually doesn't sting us with the big bill for the 1st cut until later in the summer, usually after the big June milkcheque, big help also.

I said it to my mum that we are doing less and less wintermilk, and could well be out of it soon, she said straight out that it will hurt cashflow in the winter badly. I just picked up a meal bill which was still not paid from the winter and told her that would be gone also ha, she had no answer to me then!

Miname

say with you lads dairying, is there not a regular cashflow thus giving you the option of juggling credit for a while during the year until there is a surplace. from an outsiders point of view i would have thought that these months would be giving you the best return. i would have thought grass is plentiful, cows all milking and a monthly cheque that these would be the oportune times to gather a bit of money together.
I know fertiliser and silage would be a major outgoing but would it not be a lot easier gather up a surplace that would be required for now. I know every year is different with the amount you may put out but it should be predictable to within say a margin of 15%.
How are the new boys going to overcome these lean times presuming no culls to go the first y ear and big overheads. Reilig said here one time if he didnt have the money he wouldnt buy something, i agree to an extent but with all the start ups are people allowing for a contingency fund. I know when i was starting out i spent more time bringing animals out to cover bills that i hadnt forseen .

Timmaay

Miname wrote: »

say with you lads dairying, is there not a regular cashflow thus giving you the option of juggling credit for a while during the year until there is a surplace. from an outsiders point of view i would have thought that these months would be giving you the best return. i would have thought grass is plentiful, cows all milking and a monthly cheque that these would be the oportune times to gather a bit of money together.
I know fertiliser and silage would be a major outgoing but would it not be a lot easier gather up a surplace that would be required for now. I know every year is different with the amount you may put out but it should be predictable to within say a margin of 15%.
How are the new boys going to overcome these lean times presuming no culls to go the first y ear and big overheads. Reilig said here one time if he didnt have the money he wouldnt buy something, i agree to an extent but with all the start ups are people allowing for a contingency fund. I know when i was starting out i spent more time bringing animals out to cover bills that i hadnt forseen .

Its in part due to most dairy farmers being full time on the farm, against other enterprises where a large percent of farmers are only part time so have a steady wage also. Most farmers in any case are happy enough to operate close enough to the limit, ie if an opportunity to expand comes up, like purchasing land beside you etc, and this means afew years of tight cashflow then its a worthwhile tradeoff.

Farmer Pudsey

Viewtodiefor wrote: »

Over seven years as far as I know. Not sure can it be put in over shorter time. Maybe lakill can help? You'll get the interest too as tax deductible i think

You can lease purchasse it over a shorter period. Loads of lads might lease it over say 3-5 years. Disadvantage is in theory you have to put the value on the machine on the books at the end of the lease period. Most lads trade it in against a new lease so it becomes a vicious circle.

Some lads get caught up in cash flow. They then have some parts of the operation that are unprofitable or with a low margin. I know a lad that runs a small beef operation with the dairying he finishes the cattle out of the shed at 2 years of age. His point it pays the fertilizer bill. I made the point that the calves and the feed bill for the bullocks would do the same thing.

Alot is about cash management. Some lads if they have cash in hand it burns a hole in there pocket. This is the one strenght good drystock farmers have it is the ability to understand what is profit and what is required to pay the bills. It is the same with dairying it the ability to manage money. It is exactly the same with household finance, if you constantly need to borrow for everything you will never create wealth. If you have to pay 1-2%/month for co-op or merchant credit, pay leasing or car finance it is hard to get ahead.

It is different if you have the ability arrange you finances so that this will not happen. This is the difference between cashflow and profit.

blue5000

In suckling here too, and up to now 80% of money came in in the last 3 months of the year. Cash flow on fulltime suckler farms is a joke unless some of them are taken to beef. The big problem is getting over the hump from selling weanlings to selling finished cattle. I think teagasc discussion groups should tackle this problem before better grass management, managing money is more important. Just my 2 cents, pardon the pun.

Deepsouthwest

kevthegaff wrote: »

Well lads i find this time of the year crazy with money going out, i try to clear my fert, meal, contr and rent as soon as possible without entering my overdraft. I only buy machinery with money i have and buildings are left till the end of the year to gauge what i have. I do a budget sheet in the start of the year which i should do more often! its normally in the milking parlour when im tallying expenditure/income in my head. What do the rest of ye do??

I always use cashflow for machinery, buildings, reclamation/drainage etc. in the good yrs I'll do a lot, in the lean yrs, just keep my head down and cover costs. I only go down the bank loans route for land purchase

lakill Farm

kevthegaff wrote: »

Im lucky too no mortgage just had to renovate a house with cash flow over the years, all thats left is stable fencing!. I dont realise how lucky im seeing lads having to build a house on the farm. Is machinery tax deductable over 7 years or for that year only?

Capital allowance for machinery is over 8 years in straight line . ie 12.5% of the cost each year.

visatorro

Timmaay wrote: »

Agreed fully here, well I plan on building a house down the line but having a site and all that makes it wayy easier. In terms of the farm cashflow, bury your head in the sand, and set the dog on the postman so he can't give ya bills But nay, this year, selling culls straight out of the parlour now instead of hanging on to them and fattening them for the autumn has given a nice cashflow boost. The contractor usually doesn't sting us with the big bill for the 1st cut until later in the summer, usually after the big June milkcheque, big help also.

I said it to my mum that we are doing less and less wintermilk, and could well be out of it soon, she said straight out that it will hurt cashflow in the winter badly. I just picked up a meal bill which was still not paid from the winter and told her that would be gone also ha, she had no answer to me then!

had the same conversation/row with older generation here. some people are hard to get thru to. i was asking them to explain how every spring producer in the country copes. i didnt get an answer!

allbuiz

Farmer Pudsey wrote: »

Alot is about cash management. Some lads if they have cash in hand it burns a hole in there pocket. This is the one strenght good drystock farmers have it is the ability to understand what is profit and what is required to pay the bills. It is the same with dairying it the ability to manage money. It is exactly the same with household finance, if you constantly need to borrow for everything you will never create wealth. If you have to pay 1-2%/month for co-op or merchant credit, pay leasing or car finance it is hard to get ahead.

It is different if you have the ability arrange you finances so that this will not happen. This is the difference between cashflow and profit.

So how does a new entrant grow without loans?

J.O. Farmer

allbuiz wrote: »

So how does a new entrant grow without loans?

Loans to grow the business is for capital investment over the long term. I think Pudsey was talking about the short term expenses for the current year.

allbuiz

J.O. Farmer wrote: »

Loans to grow the business is for capital investment over the long term. I think Pudsey was talking about the short term expenses for the current year.

Yeah but u won't do that as a new entrant in first few years.

Timmaay

J.O. Farmer wrote: »

Loans to grow the business is for capital investment over the long term. I think Pudsey was talking about the short term expenses for the current year.

Agreed, merchant credit of 1 or 2% a month is utter robbery and no farmer should include it as part of the plan, however longer term loans at say 5% per yr are fine once they are growing the business.

allbuiz

Timmaay wrote: »

Agreed, merchant credit of 1 or 2% a month is utter robbery and no farmer should include it as part of the plan, however longer term loans at say 5% per yr are fine once they are growing the business.

So u would get a five year loan to fund 1 years expenses which would result in a cost of 25% interest. How does that make sense?

Farmer Pudsey

allbuiz wrote: »

So how does a new entrant grow without loans?

There is no point in growing a business unless it is profitable. too many farmers get caught up in cash flow and the fear that some one else might make money out of it if they exit it.

It is all very well talking about borrowing, however farming is a low margin business so you have to remember that before you start. The OO and other posters were talking about cashflow issue's. Too many farmers get caught up in this running maybe a loss making or low margin part of the business so as to have money to meet bills.

The other part I was talking about was a mature business, too many now believe the mantra about leasing and owning nothing. Over 30 years tillage farmers have gone from owning all there own equipment and land to leasing and renting most still only have a wage out of the business, however they have goo cash flow

allbuiz

Farmer Pudsey wrote: »

There is no point in growing a business unless it is profitable. too many farmers get caught up in cash flow and the fear that some one else might make money out of it if they exit it.

It is all very well talking about borrowing, however farming is a low margin business so you have to remember that before you start. The OO and other posters were talking about cashflow issue's. Too many farmers get caught up in this running maybe a loss making or low margin part of the business so as to have money to meet bills.

The other part I was talking about was a mature business, too many now believe the mantra about leasing and owning nothing. Over 30 years tillage farmers have gone from owning all there own equipment and land to leasing and renting most still only have a wage out of the business, however they have goo cash flow

Well that depends on your outlook on life, I agree with you about being cautious with borrowing and keeping bills low and profits high but farming is up and down, always was, always will be!

There is a large amount of capital required to start and it does need to be got from somewhere. Fellas having a few different enterprises on farm is good risk management as in if dairy farmer and price of milk collapses as in 2009 what then?

In relation to tillage farmers owning nothing, that's grand if you want that but what will you have as your retirement fund?

blackdog1

Use cashflow for most upgrades and loans for machinery and new sheds. Pre paid for fertiliser last December , so no fert bill till may. Normally pre buy and clear in april. After that clear it every month in milk cheque. Also give contractors a cheque every month and clear at sfp. Have all bills paid by December normally. I have a budget each year for improvements and normally spend this in February. One bit of advice is clear all your direct costs if possible! .

Meso Harney

You can say that again;)

blue5000

blackdog1 wrote: »

Use cashflow for most upgrades and loans for machinery and new sheds. Pre paid for fertiliser last December , so no fert bill till may. Normally pre buy and clear in april. After that clear it every month in milk cheque. Also give contractors a cheque every month and clear at sfp. Have all bills paid by December normally. I have a budget each year for improvements and normally spend this in February. One bit of advice is clear all your direct costs if possible! .

blackdog1 wrote: »

Use cashflow for most upgrades and loans for machinery and new sheds. Pre paid for fertiliser last December , so no fert bill till may. Normally pre buy and clear in april. After that clear it every month in milk cheque. Also give contractors a cheque every month and clear at sfp. Have all bills paid by December normally. I have a budget each year for improvements and normally spend this in February. One bit of advice is clear all your direct costs if possible! .

blackdog1 wrote: »

Use cashflow for most upgrades and loans for machinery and new sheds. Pre paid for fertiliser last December , so no fert bill till may. Normally pre buy and clear in april. After that clear it every month in milk cheque. Also give contractors a cheque every month and clear at sfp. Have all bills paid by December normally. I have a budget each year for improvements and normally spend this in February. One bit of advice is clear all your direct costs if possible! .

Ok OK I think we get the message how brilliant things are for you........

allbuiz

blackdog1 wrote: »

Use cashflow for most upgrades and loans for machinery and new sheds. Pre paid for fertiliser last December , so no fert bill till may. Normally pre buy and clear in april. After that clear it every month in milk cheque. Also give contractors a cheque every month and clear at sfp. Have all bills paid by December normally. I have a budget each year for improvements and normally spend this in February. One bit of advice is clear all your direct costs if possible! .

How long have you been farming to have these reserves established? New entrants wont have these resources or knowledge and there are things beyond anyone's control like price and weather. A new entrant could be faced with a spring like last year and I dont think they would have those reserves to sustain that.

Deepsouthwest

allbuiz wrote: »

How long have you been farming to have these reserves established? New entrants wont have these resources or knowledge and there are things beyond anyone's control like price and weather. A new entrant could be faced with a spring like last year and I dont think they would have those reserves to sustain that.

Seems like ur having a go at this guy just because it seems he's got his house in order. He's got a plan and he's sticking to it, that's good farming in my book

allbuiz

Deepsouthwest wrote: »

Seems like ur having a go at this guy just because it seems he's got his house in order. He's got a plan and he's sticking to it, that's good farming in my book

No I'm not, I'd shake the hand of a well organised farmer but my point is how can a new entrant be expected to do this without reserves? Its not as if the profit margins are anything exciting.

whelan2

allbuiz wrote: »

No I'm not, I'd shake the hand of a well organised farmer but my point is how can a new entrant be expected to do this without reserves? Its not as if the profit margins are anything exciting.

new entrants have it very handy, no quota etc, instead of complaining about it just go and do it.

Farmer Pudsey

allbuiz wrote: »

Well that depends on your outlook on life, I agree with you about being cautious with borrowing and keeping bills low and profits high but farming is up and down, always was, always will be!

There is a large amount of capital required to start and it does need to be got from somewhere. Fellas having a few different enterprises on farm is good risk management as in if dairy farmer and price of milk collapses as in 2009 what then?

In relation to tillage farmers owning nothing, that's grand if you want that but what will you have as your retirement fund?

allbuiz wrote: »

How long have you been farming to have these reserves established? New entrants wont have these resources or knowledge and there are things beyond anyone's control like price and weather. A new entrant could be faced with a spring like last year and I dont think they would have those reserves to sustain that.

Allbuiz one thing farming has taught me is that it cannot sustain heavy borrowing. I see lots of farmers carring leases and repayments on substancial amounts of cash and after payments have only a moderate wage out of the system. If you think that the issue last spring could be resolved by borrowing and going down that road you will get a shock.

Borrowing is sustainable in Dairying however in the livestock it is not as slightest mistake can leave you in serious trouble. Yes I have a land loan however I had the comfort of knowing that I could back up part of payments from my wages. At present farm is paying for itself, However I did not borrow machinery or stock and would still not ( maybe this is the reason that I tangle with friesians) as it cannot be sustained. I have a small overdraft ( this is to aid cashlow it allows me to write cheques and pay bills kinda on time.)

Borrowing cost money maybe 6-9%/year on non asset backed loans. On 150K that means that you have to find 9-13.5K/year in interest alone and if these loans averaged over 5 years another 30K in repayments. This is a huge cost in a low margin business. Along with this if this it may have either tax implications during the term or at end of term.

10K is a lot of money to be giving someone just to use there money

kevthegaff

whelan2 wrote: »

new entrants have it very handy, no quota etc, instead of complaining about it just go and do it.

I dont agree with ye firstly 44k gallons doesnt go to everyone, i bought 42k and got 2k free. They are also starting from scratch in uncertain times. Some have to put in new roadways, water, cubicles, parlour, bulk tanks, buy dairy stock(very hard when lads are selling the worst) and also have to catch very quickly in dairy farming techniques. Some lads take over a dairy farm with all these already in place and all they have to do is turn on the parlour!. A few lads around here are still only putting in theyre parlours milking with a mobile cos theyre tied up with cashflow problems. They also have no shares and often there not inheriting them

whelan2

kevthegaff wrote: »

I dont agree with ye firstly 44k gallons doesnt go to everyone, i bought 42k and got 2k free. They are also starting from scratch in uncertain times. Some have to put in new roadways, water, cubicles, parlour, bulk tanks, buy dairy stock(very hard when lads are selling the worst) and also have to catch very quickly in dairy farming techniques. Some lads take over a dairy farm with all these already in place and all they have to do is turn on the parlour!. A few lads around here are still only putting in theyre parlours milking with a mobile cos theyre tied up with cashflow problems. They also have no shares and often there not inheriting them

every situation is different, fine some people get it handed on a plate- i didnt and i am glad it was that way. Whats the point in complaining if you want it go for it

kevthegaff

whelan2 wrote: »

every situation is different, fine some people get it handed on a plate- i didnt and i am glad it was that way. Whats the point in complaining if you want it go for it

Your saying new entrants have it handy, im disagreeing with you. Thats not complaining???

whelan2

kevthegaff wrote: »

Your saying new entrants have it handy, im disagreeing with you. Thats not complaining???

i was getting at a previous poster , apologies

whelan2

kevthegaff wrote: »

I dont agree with ye firstly 44k gallons doesnt go to everyone, i bought 42k and got 2k free. They are also starting from scratch in uncertain times. Some have to put in new roadways, water, cubicles, parlour, bulk tanks, buy dairy stock(very hard when lads are selling the worst) and also have to catch very quickly in dairy farming techniques. Some lads take over a dairy farm with all these already in place and all they have to do is turn on the parlour!. A few lads around here are still only putting in theyre parlours milking with a mobile cos theyre tied up with cashflow problems. They also have no shares and often there not inheriting them

in reality though its always been the same when i started out quota was £2.50 a gallon, built a 8 unit milking parlour, put in cubicles, roadways , fencing etc. Bought cows....

sheebadog

whelan2 wrote: »

in reality though its always been the same when i started out quota was £2.50 a gallon, built a 8 unit milking parlour, put in cubicles, roadways , fencing etc. Bought cows....

........guaranteed income...........

blackdog1

allbuiz wrote: »

How long have you been farming to have these reserves established? New entrants wont have these resources or knowledge and there are things beyond anyone's control like price and weather. A new entrant could be faced with a spring like last year and I dont think they would have those reserves to sustain that.

Farming with my father for 7 years.. been a hard old slog..we're all year round calving so cash flow is good. Never got any free quota bought it every year so far even this year. I always have my overdraft maxed out at end of tax year. Don't have a family yet either to worry about. We always worked with a duel purpose cow that averages 7500 litres a year with 1.5 tonne of feed but has the capacity to go to 9000 litres very easily. I finished my shed loan last year so that helped too.. I didn't have a fodder crisis last year either just made it by the skin of my teeth.

allbuiz

Farmer Pudsey wrote: »

Allbuiz one thing farming has taught me is that it cannot sustain heavy borrowing. I see lots of farmers carring leases and repayments on substancial amounts of cash and after payments have only a moderate wage out of the system. If you think that the issue last spring could be resolved by borrowing and going down that road you will get a shock.

Borrowing is sustainable in Dairying however in the livestock it is not as slightest mistake can leave you in serious trouble. Yes I have a land loan however I had the comfort of knowing that I could back up part of payments from my wages. At present farm is paying for itself, However I did not borrow machinery or stock and would still not ( maybe this is the reason that I tangle with friesians) as it cannot be sustained. I have a small overdraft ( this is to aid cashlow it allows me to write cheques and pay bills kinda on time.)

Borrowing cost money maybe 6-9%/year on non asset backed loans. On 150K that means that you have to find 9-13.5K/year in interest alone and if these loans averaged over 5 years another 30K in repayments. This is a huge cost in a low margin business. Along with this if this it may have either tax implications during the term or at end of term.

10K is a lot of money to be giving someone just to use there money

I agree with you about keeping loans to a minimum and tried to do so myself but inevitably I had to borrow.

I too have a full time job but would feel a new full time entrant is exposed.

allbuiz

blackdog1 wrote: »

Farming with my father for 7 years.. been a hard old slog..we're all year round calving so cash flow is good. Never got any free quota bought it every year so far even this year. I always have my overdraft maxed out at end of tax year. Don't have a family yet either to worry about. We always worked with a duel purpose cow that averages 7500 litres a year with 1.5 tonne of feed but has the capacity to go to 9000 litres very easily. I finished my shed loan last year so that helped too.. I didn't have a fodder crisis last year either just made it by the skin of my teeth.

Well aren't you the lucky one

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kevthegaff

I started 6 years ago as a new entrant, bought all quota i had, i had a cubicle shed but have put in a parlour done up roadways, water, bought in all stock from scratch, inherited a land loan, came into all sorts of problems in the beginning. im finding cashflow better this year. Id imagine depending on the situation of the new entrant it will take 5-10 years to be in a good position financially

blackdog1

allbuiz wrote: »

Well aren't you the lucky one

Theres plenty people doing better than me but I don't begrudge them. I ask questions and try to learn and improve. There is a type of person about who tries to bring a fella down if he's doing well rather than looking after his own affairs .

cjpm

blackdog1 wrote: »

Theres plenty people doing better than me but I don't begrudge them. I ask questions and try to learn and improve. There is a type of person about who tries to bring a fella down if he's doing well rather than looking after his own affairs .

Well said

whelan2

allbuiz wrote: »

Well aren't you the lucky one

how do you make that out

RightTurnClyde

whelan2 wrote: »

in reality though its always been the same when i started out quota was £2.50 a gallon, built a 8 unit milking parlour, put in cubicles, roadways , fencing etc. Bought cows....

sheebadog wrote: »

........guaranteed income...........

Like Whelan, and Kev and I'm sure a few more here, had to do the same purchased everything from quotas to cows to sheds. I borrowed to the hilt from 2003 on and was happy to do so, but once the agreement to abolish quotas came in all borrowing stopped and I have been paying down debt as quickly as possible in the last few years. The last of the expansion is being done last year and this year out of cash flow. It's a major draw on cash flow and even though cash out of the farm has been very low, tax is a big cost. ( something the new entrants taking out big loans need to be aware of) . But the place will be well set up next year, with very manageable repayments, no more expansion for a number of years, all capex done.
I very much agree with Sheebadog the insurance policy diss appears next year on April 1st, and people really need to have their financial affairs in order. The advantage Ireland has is the ability to produce milk cheaply from grass. There's no point in throwing away that advantage, by having big fixed costs of loan repayments.
There are going to be bigger fluctuations in milk price, and if borrowed heavily you need to be sure that you are ready to carry that big fixed cost ( +tax) on the bad years. The New Zealand system's success is based on grass and low fixed costs.

Oldtree

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kevthegaff

What would ye rate as high borrowings with 100 cows lads/lasses? just wondering!

Greengrass1

kevthegaff wrote: »

What would ye rate as high borrowings with 100 cows lads/lasses? just wondering!

Hard to go past the 2,500 per cow IMO. In my case were double that but that's the mortgage so dontbknow what you would look on that as. Its a very manageable. And it'll be even more manageable next year when we have more cows milking. Yrs of fertility problems and lack of grass/fodder has hurt the business but.
We will have to do yard improvements with cash flow for a few years as I don't really want to take on any more loans.
Keeping a lot of replacements thus year and last and getting rid of beef has hit cash flow too but I hope its for the better

mahoney_j

kevthegaff wrote: »

What would ye rate as high borrowings with 100 cows lads/lasses? just wondering!

hard to know kev without knowing full story,Mortgage,Family.level of investement required on farm etc.as long as core business is good anywhere beteween 3 to 5 k per cow is managable as long as its for nesecities and something that will make u more money and ur working day easier

keep going

Someone asked earlier how to establish a reserve and the way we did it was stop spending for a year, used to be on overdraft all the time and now we never use it

whelan2

keep going wrote: »

Someone asked earlier how to establish a reserve and the way we did it was stop spending for a year, used to be on overdraft all the time and now we never use it

it depends on the size of your overdraft, i had a massive overdraft , was never out of it, paying interest the whole time . I got a loan to get rid of it. Last year when things where bad i git a small overdraft i dip in and out of it every month its handy to have it there as a cushion in lean months.

moy83

whelan2 wrote: »

it depends on the size of your overdraft, i had a massive overdraft , was never out of it, paying interest the whole time . I got a loan to get rid of it. Last year when things where bad i git a small overdraft i dip in and out of it every month its handy to have it there as a cushion in lean months.

The overdraft is very handy but if you're in it all the time , something has to change . Some of my mates in the buildings got left with massive overdrafts when work got quiet . I seldom use mine anymore instead I ask for money the second a job is finished and if I dont have money in the account nothing is bought