TFF Benchmarking - "Grains of Thought"

[D14]

If a farm has diversified then it cannot benchmark when it comes to fixed costs because they are spread over the entire diversified business. Splitting costs down for each business is pointless and irrelevant because it's the overall profitability that matters. Some items of machinery cannot easily be split and allocated to the farming part of the business either such as a forklift and tractor if they work across other businesses so even the stubble to stubble costs are distorted.

It would be useful for variable costs but surely that's what the price threads are all about such as diesel and fertiliser threads with costs in them? We filled up a red tank on Monday at 41p/l. I rang 4 suppliers on Friday within 10 miles and the cheapest got it on the day. Not sure how benchmarking can help me on that? Or fertiliser/chemicals etc?

 

[Clive]

If a farm has diversified then it cannot benchmark when it comes to fixed costs because they are spread over the entire diversified business. Splitting costs down for each business is pointless and irrelevant because it's the overall profitability that matters. Some items of machinery cannot easily be split and allocated to the farming part of the business either such as a forklift and tractor if they work across other businesses so even the stubble to stubble costs are distorted.

It would be useful for variable costs but surely that's what the price threads are all about such as diesel and fertiliser threads with costs in them? We filled up a red tank on Monday at 41p/l. I rang 4 suppliers on Friday within 10 miles and the cheapest got it on the day. Not sure how benchmarking can help me on that? Or fertiliser/chemicals etc?

certainly hard on fixed costs for a diversified business - it's a problem I have myself on my own farm, we are sticking to the easier subject of variable, yields etc to begin but in time maybe could develop told to help pull fixed costs out of even diversified businesses, anything is possible with enough resource behind it !

useful for fixed costs and product price comparisons etc though I think - the idea going forward (IF) this gains enough traction is we can bring in the comparison stuff like what are you paying for fuel, fert, etc vs others - I would really like to see it go that way and we will ask the questions TFF members what the answers to

As I keep stressing though we will only be able to continue to develop this if enough members use it, response so far is quite encouraging though so not looking bad !

Really is a case of if you want this kind of thing developing here for members and becoming of some real use of using it or loosing it !

 

[Brisel]

we will scrap the first one and use the latest version, it will be time stamped

I have to resubmit mine too - I forgot to "refresh" Gatekeeper before doing the gross margin headings so my fungicide costs for wheat were understated by £22/ha.

 

[Clive]

I have to resubmit mine too - I forgot to "refresh" Gatekeeper before doing the gross margin headings so my fungicide costs for wheat were understated by £22/ha.

no problem - the data will get cleaned up before results are created and duplicates removed so only the most recent submission is included

 

[Brisel]

If a farm has diversified then it cannot benchmark when it comes to fixed costs because they are spread over the entire diversified business. Splitting costs down for each business is pointless and irrelevant because it's the overall profitability that matters. Some items of machinery cannot easily be split and allocated to the farming part of the business either such as a forklift and tractor if they work across other businesses so even the stubble to stubble costs are distorted.

It would be useful for variable costs but surely that's what the price threads are all about such as diesel and fertiliser threads with costs in them? We filled up a red tank on Monday at 41p/l. I rang 4 suppliers on Friday within 10 miles and the cheapest got it on the day. Not sure how benchmarking can help me on that? Or fertiliser/chemicals etc?

If you don't think it will help you then don't do it. You get out what you put in.

If you want to look at individual enterprises on your farm for fixed costs then you have to do your best to split them up. For arable you can use standard CAAV figures for ploughing, spraying etc.They aren't far wrong - a discussion group I used to belong to spent a lot of time benchmarking combining and osr establishment costs and for most of us the costs weren't that far different per acre. You can find the CAAV costings in pocketbooks like John Nix under the column "farmer's own cost." I'm all arable with stewardship but nonetheless I have a "black hole" which is the difference between my labour & machinery costs from my management accounts and the operational costs from all the machinery passes across the crops. A large discrepancy can be attributed to other enterprises or some wastage. Mine shrank considerably when I got out of beef - I still have one because the farm does "estate stuff" like schools days, village fetes, environmental stewardship and game covers. Allocating costs between a beef and a sheep enterprise are very tricky but arable vs stock you can have a go at. Forage production - contractor vs having your own silage kit?

Fixed costs are a hard one but they are where most farms vary the most - most crop growers have roughly similar variable costs. The only major variants are blackgrass and occasionally grain marketing. I'v deleted an old FW article on the spread between the top 25% and the bottom 25% - in that article variable costs were within 10% but fixed costs were hugely different. Output varied too - attention to detail got a bit of extra performance. For crops a look at fungicide cost per tonne of output can help you see where you have pitched your input spend.

Procurement - would you like to know what others spend on the same products? Yes, fuel is down to what day you buy it on & the price tracker threads in TFF are great for chems, fertiliser & fuel but are you getting the best deal?

 

[Clive]

If you don't think it will help you then don't do it. You get out what you put in.

If you want to look at individual enterprises on your farm for fixed costs then you have to do your best to split them up. For arable you can use standard CAAV figures for ploughing, spraying etc.They aren't far wrong - a discussion group I used to belong to spent a lot of time benchmarking combining and osr establishment costs and for most of us the costs weren't that far different per acre. You can find the CAAV costings in pocketbooks like John Nix under the column "farmer's own cost." I'm all arable with stewardship but nonetheless I have a "black hole" which is the difference between my labour & machinery costs from my management accounts and the operational costs from all the machinery passes across the crops. A large discrepancy can be attributed to other enterprises or some wastage. Mine shrank considerably when I got out of beef - I still have one because the farm does "estate stuff" like schools days, village fetes, environmental stewardship and game covers. Allocating costs between a beef and a sheep enterprise are very tricky but arable vs stock you can have a go at. Forage production - contractor vs having your own silage kit?

Fixed costs are a hard one but they are where most farms vary the most - most crop growers have roughly similar variable costs. The only major variants are blackgrass and occasionally grain marketing. I'v deleted an old FW article on the spread between the top 25% and the bottom 25% - in that article variable costs were within 10% but fixed costs were hugely different. Output varied too - attention to detail got a bit of extra performance. For crops a look at fungicide cost per tonne of output can help you see where you have pitched your input spend.

Procurement - would you like to know what others spend on the same products? Yes, fuel is down to what day you buy it on & the price tracker threads in TFF are great for chems, fertiliser & fuel but are you getting the best deal?

Happy someone gets it it has the potential to be great and a real use, like all things that won't happen overnight though and wont happen at all unless it gets used

 

[dontknowanything]

What's the difference between what Gatekeeper does with the data, which sent Clive into a rage with threats of legal action, and this scheme?

 

[Clive]

What's the difference between what Gatekeeper does with the data, which sent Clive into a rage with threats of legal action, and this scheme?

Gatekeeper - default opt in (illegal IMO) and the information flow is a one way street, what are you getting back from it as a farmer ? and you PAY for gatekeeper ! Bloody cheeky if you ask me ! and the moment a credible alternative to GK exists for my business I will move system as a result

TFF Benchmark - you opt in not out (BIG difference) and farmers get some useful info back re performance, pricing and feedback about products that might help you run a more efficient business, TFF is free to use

It was what GK did and my strong opinion on that that spurred me to do this, people are collecting data form is everywhere you look. its a fact of modern life these days and I want to make sure that as much of that as possible benefits farmers as much as everyone else, we need to take some control of this and this represents us as farmers having a go at that

Of course ideally it would be 100% independent and we would keep all the info between ourselves but thats not commercially realistic for us given the cost of developing and running this sort of thing.

 

[D14]

Gatekeeper - default opt in (illegal IMO) and the information flow is a one way street, what are you getting back from it as a farmer ? and you PAY for gatekeeper ! Bloody cheeky if you ask me ! and the moment a credible alternative to GK exists for my business I will move system as a result

TFF Benchmark - you opt in not out (BIG difference) and farmers get some useful info back re performance, pricing and feedback about products that might help you run a more efficient business, TFF is free to use

It was what GK did and my strong opinion on that that spurred me to do this, people are collecting data form is everywhere you look. its a fact of modern life these days and I want to make sure that as much of that as possible benefits farmers as much as everyone else, we need to take some control of this and this represents us as farmers having a go at that

Of course ideally it would be 100% independent and we would keep all the info between ourselves but thats not commercially realistic for us given the cost of developing and running this sort of thing.

Unless I am being stupid TFF will collectively send info to a data company who's managing the benchmarking thing? Obviously as stated the info will be anonymous from a farm point of view.

They then send info back to TFF, who then sends to the members who participated.

The data company then sell that info to the likes of Syngenta etc. This then gives the likes of syngenta even more power because they will see the trends meaning they can then alter their business model to suit the trends of the grower?

How will that benefit the farmer that originally provided the information because no way will we see discounts. All we will see is price increases on the popular inputs because thats where they can make more margin. If we keep doing this on an annual basis it gives the input trade even more power.

 

[Clive]

Unless I am being stupid TFF will collectively send info to a data company who's managing the benchmarking thing? Obviously as stated the info will be anonymous from a farm point of view.

They then send info back to TFF, who then sends to the members who participated.

The data company then sell that info to the likes of Syngenta etc. This then gives the likes of syngenta even more power because they will see the trends meaning they can then alter their business model to suit the trends of the grower?

How will that benefit the farmer that originally provided the information because no way will we see discounts. All we will see is price increases on the popular inputs because thats where they can make more margin. If we keep doing this on an annual basis it gives the input trade even more power.

If you read back too my earlier posts this is something we are doing with a partner, some collective data but no individual data will be used by the 3rd party we are working with to make this development possible - something is NEVER for nothing but I hope the difference here is we as farmers get some useful info back, unlike every other data collection system I have come across. There will be no direct contact to you as a result of his other than the results email, your personal data, email ad etc is safe and protected by the data protection act as always on TFF

The assumption is that information is used against us and I used to feel the same, however if you think it through without the conspiracy theory attitude then why would that be the case ?

Information actually just makes our suppliers more efficient, i.e. they can better predict product use so better match production to demand - how often do we have thread on here saying a certain herbicide or fungicide is in short supply ? On the flip side over production means waste and that cost of course gets past on to us in the price we pay and also has a price to the environment. If supplier sees a trend for farmers to use a competitors product it might make them think about lowering prices to compete and make their offer more compelling

Manufacturers want feed back, if a product isn't liked or isn't working its in their interest to know about that, but its also in our interest to be able to provide that feedback

Too much of a "them and us" attitude in UK agriculture I reckon that you just don't see in other countries, its in everyone interest to make a more efficient supply chain when you really think about it

Stuff like this is expensive to do, TFF can not afford to develop these tools alone so if we want something worthwhile we have to partner with those that can, I have not allowed this lightly, many meetings and making sure our members are put first, their data is safe and private and they get something back that they normally would not took place before we agreed o giving it a go

It really is harmless and MIGHT just be useful - Im personally looking forward to future sets of questions where we might compare what we last paid for fuel or a certain input in our specific area vs other farms of similar size etc. thats the kind of place this can possibly go I hope

It's not compulsory, its there to use if you want to but no one is being forced to do anything, if not many use it then it will end and at least we can say we tried for you all when in future threads members ask if there could maybe be a way we can all better compare performance and prices etc !

 

[rob1]

knowledge is power

 

[opininionated]

On the flip side over production means waste and that cost of course gets past on

Now there is a principle farmers could learn from industry

 

[trevorrix]

What are you doing about us organic arable farmers with zero inputs apart from seed, and less than half conventional yields?

 

[Clive]

What are you doing about us organic arable farmers with zero inputs apart from seed, and less than half conventional yields?

its aimed at conventional wheat farmers to start just to try and prove if there is demand for this..................which I have to say it may looks like there isn't despite all the threads in the past suggesting a way to compare prices and costs it seems in reality when offered the chance that the average TFF member really isn't interested enough to take part.

Responce so far is disappointing, unless that changes this next week this is unlikely to be developed further I'm afraid

 

[Brisel]

Organic makes gross margins irrelevant. Operational or net margin would be more appropriate. There's the rotational margin to consider too, as yours will have longer fertility building phases versus one break crop for "conventional" growers.

 

[Beamont]

The elderly amongst us well remember the ICI cereal surveys in Hants Wilts,Glos and Oxon and the benefits they brought. Like wise some of the "ten tonne clubs" gave very useful benchmarking info

 

[trevorrix]

And does anyone remember the ICI Wheatrace, a competitive game for groups of farmers that ran c1980 for four years.?

 

[An Gof]

And does anyone remember the ICI Wheatrace, a competitive game for groups of farmers that ran c1980 for four years.?

I remember that. It morphed into Corn Quest for students. Managed to get to the final with my mates at Harper. They presented us with a posh wooden notice board with engraved plaque for the college. Was originally put up in the old main building by the post pigeon holes. Wonder if it's still at the College.

 

[SilliamWhale]

F weekly used to do a wheat cost challenge. I'd be interested in reading all that sort of data for all crops

 

[shakerator]

its aimed at conventional wheat farmers to start just to try and prove if there is demand for this..................which I have to say it may looks like there isn't despite all the threads in the past suggesting a way to compare prices and costs it seems in reality when offered the chance that the average TFF member really isn't interested enough to take part.

Responce so far is disappointing, unless that changes this next week this is unlikely to be developed further I'm afraid

kynetec give me £30 of m&s vouchers for my time in completing paper based records and questionnaire (old local chap takes print outs and gets paid aswell). is there anything comparable here reward wise for submitting.

i get a benchmarking report back and find it of limited use