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Making a living from sheep
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<blockquote data-quote="Sandpit Farm" data-source="post: 6617859" data-attributes="member: 1646"><p>Nope the rent should definitely be included even though it isn't a cash cost. It is still a true cost as you could rent the land out if you chose. Equally, a labour cost should be added as you'd have to pay a shepherd if you were out of action for some reason.</p><p></p><p>The beef enterprise is subsidising the sheep enterprise at your farm if you don't allocate some of those costs across to the sheep.</p><p></p><p>It is the TRUE COP you need. If true cost of production shows you are making £0 profit - you can make £0 profit on 10 ewes or £0 profit on 500 ewes - the outcome is the same but the work is very different. It is only really justifiable to make £0 profit repeatedly if you are accruing an asset (like paying back finance on land etc). </p><p></p><p>You have to weigh up why you are doing it. If it is a hobby and you love it, you can justify working for free. If it is to make money, you have to work out how you can make the best return per Ha. Do you just bale the grass? put it through a sheep? a cow? or rent it out?</p></blockquote><p></p>
[QUOTE="Sandpit Farm, post: 6617859, member: 1646"] Nope the rent should definitely be included even though it isn't a cash cost. It is still a true cost as you could rent the land out if you chose. Equally, a labour cost should be added as you'd have to pay a shepherd if you were out of action for some reason. The beef enterprise is subsidising the sheep enterprise at your farm if you don't allocate some of those costs across to the sheep. It is the TRUE COP you need. If true cost of production shows you are making £0 profit - you can make £0 profit on 10 ewes or £0 profit on 500 ewes - the outcome is the same but the work is very different. It is only really justifiable to make £0 profit repeatedly if you are accruing an asset (like paying back finance on land etc). You have to weigh up why you are doing it. If it is a hobby and you love it, you can justify working for free. If it is to make money, you have to work out how you can make the best return per Ha. Do you just bale the grass? put it through a sheep? a cow? or rent it out? [/QUOTE]
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