Both the owner and grower need to discuss the various responsibilities expected and come to an agreement. Table 2 lists possible considerations that need to be reviewed. The cost of contract raising heifers will primarily be based on the responsibilities of the contract and the size of the heifer. There are several ways to arrive at a fair fee arrangement. These include payment based on per pound of gain, per head daily charge, feed plus yardage, and option to purchase.
Payments based on pounds of body weight gain during the contract period are usually preferred.
Cattle are weighed in and weighed out. The predetermined price per pound of gain is simply calculated and the total price is known. It is suggested to pay a portion of the total price on a monthly basis to provide steady income for the grower and avoid putting a large cost burden on the owner at the end of the contract. Then, at the end of the growing period, the dollar difference based on out weight is calculated for the final payment. With the per pound fee arrangement, it is very important to monitor suggested dairy heifer growth and perhaps establish a penalty for over conditioned heifers.