The chicken biz

This email, from Greg Gunthorp of Gunthorp Farms, appeared on the APPPA mailing list, in response to another email which spelled out the chicken-related woes of the writer and ended with a plaintive question: “Is anyone out there making money at this?” I offer it without comment, but if you don’t want to read the entire email I’ve pulled a few important sentences out and listed them at the end.

I think you can look at both sides of this and decide it can or it can’t work. I always tell people they need to read Allan Nation’s editorials in the Stockman Grass Farmer. Buy all the back issues for at least 3 years.

I’ve been through the whole process and made it to an economically justifiable level. If I had it to do over again I’m not sure I would take on meat chickens as an enterprise. Enterprise selection is critical in building a sucessful business. Some luck is required. Excellent management 24 hours a day seven days a week is essential. Way more work than you can ever imagine is the cornerstone.

Shortly after we got started in the direct marketing I was doing a farmers market in downtown Chicago (140 miles from our farm). By the time I got all my chores done so I could be gone from the farm for a day, got everything around and loaded for the market, made it in time for the market, did my restaurant deliveries afterwards I would be awake for 24-30 hours. And I slept for a couple of hours when I got home and I had to go back to work to take care of the animals so I could be ready to slaughter pigs the next day.

I did that for three or four years before I had enough restaurant customers I no longer had to do the market. At the time we were part owners of a federally inspected meat processing plant 35 miles from the farm. I was the managing partner. Our losses per partner were manageable until I finally couldn’t do it plus the farm plus the marketing anymore and I stepped away from managing. We were paying for our share of the losses that last year when I wasn’t managing for a long, long time.

I think if you do some checking USDA has put money into 30+ producer cooperative packing ventures (none in mine! USDA is only here to hassle us!) and out of those 30+ I think the only one left is the Meadowbrook pork plant in Rantoule, IL and if you read the news they are in court all the time with their members over payment on pigs. I always tell people there really is a reason there aren’t any federally inspected little poultry slaughter plants. USDA is part of the reason but plain and simple economics is the real reason. And yes, I have a fully inspected USDA multi-specie processing plant right on our farm.

So I guess what I’m trying to say is yes there are a handful of people across the country that have put together a WHOLE SYSTEM that has low cost well thought out production of the correct enterprise, combined that with cost effective quality legal processing (of their own or a co-pack arrangement), and implemented a marketing plan that brings in the dollars per animal and the volume of dollars to make it all feasible. I’ve got to tell you that you will have to look for a long ways to find sucess stories and most of us have had a long hard road to get here that virtually no one would wish on their worst enemy. Every single agency of the local, state, and federal government has been here to put up road blocks at every single step of the way as if the pure economics of the situation wasn’t enough. No bank on the planet wants to loan money on such a crazy venture until you have a proven track record.

Anyhow, our season is almost over for the chickens and turkeys and a few months left on ducks. We do pigs close to year round. We’ll have done about 40,000 chickens, 400 turkeys, and 10,000 ducks this year plus 600 or so pigs. (We’ve still got over three thousand chickens in the field cause my freezer is full.) And yes, we will make some money this year. My family has always raised pigs on pasture. At least fourth generation. I started direct marketing ten years ago. We do alot better financially with the pigs than the chickens but I’m not sure I’d have got myself into enough restaurant doors with just pigs alone. Chickens are so much more management and labor intensive per pound of sellable product compared to pigs on the production and processing end. I highly suggest everyone re-read that statement several times cause I think the same thing could be said for milk, beef, lambs, goats, and sheep/goat milk.

Hang in there. It can be done if you want it bad enough. Keep the management level high all the time. Concentrate on labor saving ideas. Concentrate on marketing your product for really good margins. Concentrate on cutting costs. Read Allan Nations editorials. Hang in there. Make it work on paper first cause its never as good in the real world. Good luck.

Greg

Here are some important excerpts.

  • By the time I got all my chores done so I could be gone from the farm for a day, got everything around and loaded for the market, made it in time for the market, did my restaurant deliveries afterwards I would be awake for 24-30 hours. And I slept for a couple of hours when I got home and I had to go back to work to take care of the animals so I could be ready to slaughter pigs the next day. I did that for three or four years before I had enough restaurant customers I no longer had to do the market.

  • Chickens are so much more management and labor intensive per pound of sellable product compared to pigs on the production and processing end. I highly suggest everyone re-read that statement several times cause I think the same thing could be said for milk, beef, lambs, goats, and sheep/goat milk.

  • We’ll have done about 40,000 chickens, 400 turkeys, and 10,000 ducks this year plus 600 or so pigs. (We’ve still got over three thousand chickens in the field cause my freezer is full.) And yes, we will make some money this year. [Emphasis added]

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