Cow numbers have been relatively steady after the increase during the high milk prices of the second half of 1996. In January 1998, Florida had 5,000 more cows than two years ago but 2,000 less than March 1997. Production per cow in January 1998 is lower than the same month two years ago. Premium Atlanta 17.24 1.20 17.57 1.20 17.33 1.00 Up. The size of the bottom line, or profits, directly affects the profitability of a business.
Profitability is defined as the rate at which profits are generated from invested capital.
The following table lists the results of 1996 for a sample of Florida dairies on the Dairy Business Analysis Project. Several things should jump out at you when looking at this table. The next thing I hope that grabs your attention is the large difference in total expenses per cwt. Higher production per cow magnified the results of good cost control which show up in the operating profit margin. The operating profit margin shows what portion of each dollar of gross revenue was profit.