![\"Horsedrawn](\"https:\/\/smallfarmersjournal.com\/wp-content\/uploads\/2019\/11\/sfj_horsedrawn_dairy_01.jpg\")
Horsedrawn Dairy<\/h3>\n
Economies of Scale: Slow and Small Turn Profit<\/strong><\/p>\n by Sara Bredesen of Argonne, WI. Originally appeared in January 2006 edition of Farm Country, The Newspaper That Cares About Rural Life.<\/em><\/p>\n John Davis said he remembers tractor salesmen coming to the family farm when he was a kid. Their pitch was that you could sell four horses, fill the stalls with six cows, and buy a tractor that wouldn\u2019t have to be fed all winter.<\/p>\n \u201cIf you just use arithmetic, that works,\u201d Mr. Davis said, \u201cbut if you do the math, six cows won\u2019t support that tractor, and if you get enough cows to support the tractor, you need a bigger tractor. It won\u2019t work unless you get bigger, and bigger, and bigger.\u201d<\/p>\n For Mr. Davis and his wife, Judy, economies of scale mean staying small and doing the math.<\/p>\n All of the work on the Davis\u2019 80-acre farm in Price County is done with draft horses. Fields are rotated through corn, soybeans and pasture for the 10 to 14 Holsteins that supply the family\u2019s main business.<\/p>\n Six years ago, Mr. Davis ran some calculations that changed his tiny dairy into one of the state\u2019s handful of farmstead milk bottling businesses.<\/p>\n \u201cAt $9 a hundred weight in the year 2000, milk was not profitable at any weight.\u201d He said that increasing the herd size and going to bigger equipment didn\u2019t add up to a net profit.<\/p>\n \u201cI chose to do this (bottling) to increase the value from 9$ to $32 a hundred weight, and then it sounded real good.\u201d<\/p>\n It took Mr. Davis two years of research, collecting and repairing used equipment, and working through food safety regulations to get the plant up and running.<\/p>\n \u201cI didn\u2019t know what I was doing, and nobody would tell me,\u201d he said. \u201cThe only advice I could get from anybody was \u2018don\u2019t do it.\u2019 You\u2019re destined to fail as soon as you accept that as the Gospel, so I just ignored them and did it.\u201d<\/p>\n Mr. Davis describes his plant as \u201ceven smaller than family size.\u201d He constructed the building and learned how to weld stainless to put it all together himself. The plant has the basics of bulk milk storage, a cream separator, batch pasteurizer, plate cooler and bottle washer.<\/p>\n He added a glass-front cooler and self-service display area for on-farm sale of whole milk, 2 percent, cream, chocolate milk, eggs and cheese.<\/p>\n Even with sweat equity, the investment came to about $86,000, but Mr. Davis said the business is profitable.<\/p>\n Production is as small as the plant. Mr. Davis bottles two to three times a week, putting up 450 half-gallons.<\/p>\n Excess milk is sold to NFO in exchange for credits on cheese for the shop. His wife, Judy, delivers milk to area \u2018mom and pop\u2019 grocery stores in a refrigerated truck.<\/p>\n Mr. Davis said he chose returnable glass bottles for visual appeal and economics, although it created some problems.<\/p>\n \u201cRight at first, it didn\u2019t work at all, especially the cream bottles. They\u2019re just too cute,\u201d he explained. \u201cI couldn\u2019t get any back, and I was making the bottle company rich. I said there\u2019s nothing we can do. We\u2019ll just have to fill everybody\u2019s knick knacks and kitchens with a flower vase, and when they\u2019re all full, they\u2019ll start coming back.\u201d<\/p>\n The Davis\u2019 have ten-year-old triplet sons who help on the farm. Mr. Davis said he would like to increase his herd size to about 20 when the boys are big enough to do more work. He said the farm doesn\u2019t have the capacity for more animals, and he isn\u2019t interested in getting bigger.<\/p>\n \u201cI have a hard time not selling heifer calves and heifers,\u201d he said of the high demand and prices they bring, \u201cbut I\u2019ll have to start keeping more pretty soon.\u201d<\/p>\n His herd is mostly older cows, with the youngest being 4 and 8 years old, and the oldest at 15.<\/p>\n He said he averages only 30 to 40 pounds a day from the cows but doesn\u2019t push for much more.<\/p>\n \u201cI don\u2019t try,\u201d he said. \u201cWith an older cow, you can\u2019t push them. They\u2019ll just quit.\u201d<\/p>\n Mr. Davis grows all his own feed, working the fields with his horses and hauling beans and corn to the local elevator with the same animals.<\/p>\n Mr. Davis said he doesn\u2019t make any claims to environmentalism, although his business methods might look like it. He uses glass bottles and horse power, because they are economically sound. He farms organically, although he is not interested in buying into \u201corganics\u201d or its politics. He doesn\u2019t tout \u2018natural\u2019 on the label.<\/p>\n \u201cI\u2019m calling mine \u2018milk,\u2019\u201d he said. \u201cMy customers see the farm, they see the milk, they taste the milk, they come back. It\u2019s that simple.\u201d<\/p>\n \u201cI don\u2019t promise them that it will cure cancer or prevent it. I don\u2019t promise them that it is going to put the ozone back,\u201d he said. \u201cAnd, I don\u2019t promise them that it\u2019s going to make them feel any better tomorrow than they feel today. I just put good, healthy milk on the market at a reasonable price, and I farm in a conservative method that is not polluting.\u201d<\/p>\n Mr. Davis admitted that he prefers working with horses, but he gets some benefits from those tractors that the salesmen touted when he was a kid.<\/p>\n \u201cAt one time, I had saved up enough money to buy a John Deere,\u201d he explained. A good friend said, \u2018John, if you\u2019ve got enough money to buy that tractor, just buy some stock in John Deere and go rent one for as long as you need it.\u2019 I still have the stock in John Deere, and I haven\u2019t had to rent that tractor in 25, 30 years. The John Deere stock is doing real good\u2026 and so are the horses.\u201d<\/p>\n<\/div>\n![\"Horsedrawn](\"https:\/\/smallfarmersjournal.com\/wp-content\/uploads\/2019\/11\/sfj_horsedrawn_dairy_02.jpg\")