A Complete Guide on How to Start a Dairy Farm Business

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How to start dairy farming business from scratch?

Whatever be your background and experience with cows and the milking business, when starting a dairy farm business, you need to consider these important tips related to the dairy industry in order to run a successful dairy farming business.

Though there are many opportunities available in the agricultural industry, dairy farming is a thriving one due to the importance of dairy farming, as all the produce from this industry has a good demand in the market.

You may need a solid investment in the beginning, but you can reap good profits eventually. There is a huge demand for milk and milk products all over the world in all locations, so it stands to reason that this could be a really lucrative business idea for you!

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starting a dairy farm business

Business Plan for Dairy Farm Business

Any business needs planning and so you need to chalk out a dairy farming business plan.

  • Prepare a dairy farm project report and calculate the annual cost for upkeep of animals, the annual produce and the amount you expect to reap from your dairy farm. You can check out the dairy farm profit per cow and base your calculations on it.
  • Check out local demand for the produce.
  • Decide on food sources and labour.
  • Create breeding plans, whether through artificial insemination programs, bull’s service etc.
  • Learn about some farming practices, like breeding, managing manure, weaning, crop management etc.

Try getting some experience working at another successful dairy farm initially before you make a small dairy farm design.

  • It requires heavy capital investment, so if you don’t have enough funding, you can apply for a dairy farm business loan from banks.
  • Connect with a local vet and discuss the possibilities in your area.
  • Visit the local market to know about nutritious food available and the feeding costs. You can also produce foods by yourself.
  • Consider where you will be selling the produce.

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Location for Your Dairy Industry

How to start a small dairy business?

  • Select a proper location to house your dairy farm business. Renting a piece of land is easier than buying a new farm. After your dairy farm is well established, you can purchase a new farm.

It is advisable to select an elevated piece of land, so that water and wastes don’t stagnate. Don’t use fertile land.

  • The structure should be durable and be protected from cold winds and rain. In a loose system, you don’t need to spend much and there is always room for expansion. On the other hand, you can opt for conventional sheds or barns, which might be more expensive.
  • Cowsheds in your dairy farming business should have boundary walls and be gated. You will need a separate shed for calves.

Tip: You can buy an existing farm and do necessary repairs or buy and start one all by yourself.

Business Plan for Dairy Farm Business

What You Will Need

Now that you have a proper shed in place, you have to fill it with all the necessary equipment for your dairy farm business.

  • Facilities for storing milk, which is very important in commercial dairy farming
  • Milking parlors and stanchions
  • Storage area for feed and manure
  • Tractors and other equipment
  • A well for water along with a water transport system
  • Financing dairy operations

You will need around 80 sq ft open space and 40 sq ft house space for one cow, though it varies based on the breed.

Also Read: 10 High Profit Food Business Ideas with Small Investment

Training/Experience for Modern Dairy Farming

  • Basic training in dairy cattle farming business. You can take online courses where you can get training on dairy cattle and learn about dairy farm management practices.

Remember: to look out for universities having agricultural department and dairy specialists.

  • Visit nearby local dairy farms to see and learn about latest efficient practices in dairy farming and about different dairy products.
  • Read dairy magazines.
  • Visit cattle markets.
  • Work for a dairy farmer before starting your own dairy farm.
  • Keep learning and keep up with the latest technological improvements in the dairy industry in order to improve efficiency.

Note: Check out the different types of dairy farms in order to select a suitable one for your business!

Species and Breeds

The most popular dairy animals for a farm are cows and goats.

Tip: Contact nearby established dairy farms to get information on local markets.

  • Select breeds that can thrive well in your climate. Always begin with the best breeds.
  • Check out the local demand for the breed milk, butter and cheese.
  • Select a breed based on your location, the facilities available, the market demand and the main production purpose while starting a dairy farm business.

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Cattle Feed

how to start a small dairy business

High quality feed is necessary for your cattle for proper milk production and health.

  • Work with a nutritionist in order to create a proper feeding ration suitable for your cattle.
  • 50% of the diet will be forage, such as grazing on grass and hay.
  • For the other half, you can grow your own barley, corn and oats and process them. Purchase molasses and beet pulp from a feed mill.

Working with Vets and Vaccination Programs

Veterinarians must routinely visit your dairy farm in order to conduct check ups, treat illnesses and for vaccination programs.

dairy farm management
Image: americandairymen.com
  • Observe your animals on a daily basis to detect illnesses and problems early on.
  • Farm animals can succumb to many common endemic diseases, respiratory problems etc.
  • All cattle farmers have the responsibility for safeguarding the health of the animals on their farm.
  • They have to draw up appropriate plans for vaccination with the vet and other herd health planning measures.

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Dairy Farm Financing and Marketing

While beginning your dairy farm business, you must keep expenses as low as possible. The cost to start a dairy farm will depend on the size of your farm, the number of animals, the products you are planning to sell, your location and so on.

  • Opt for a rented land in order to reduce your dairy farm business investment.
  • Buy used equipment. You can easily upgrade the technology at a later stage.

Warning: However, never start with poor breeds of cattle.

  • Keep minimum number of people for labour.
  • Connect with other farmers of the area. Exchange ideas and tips. You can even share grazing pastures or farm equipment to reduce costs.
  • Marketing can prove to be challenging, as your produce will be in rural areas in most cases, whereas the processing companies are placed in urban areas.

Animal Feed

Your cattle will need nutritious food in order to produce milk and also for the health of the animals.

  • You can produce your own animal feed and crops in your farm and animals can graze on it.
  • Ensure that your cattle have a balanced diet, with a mix of pasture grass and fodder or silage and adequate protein. The amount will vary according to the breed, the animal size, milk production levels etc.

Feed requirements for lactating cows are different from those of calves.

Tip: Take help from animal nutritionists about feed to be given to the cattle, for lactating cows or dry cows.

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Waste Management

Learn about composting as it is the most efficient and sustainable form of waste management on your dairy farm.

  • Cattle in your farm can produce lots of manure, so you can use it as a natural fertilizer, especially if you are also harvesting crops in your field.
  • You can also prepare organic manure by mixing cow dung with earthworms and dried plant materials and sell it.

dairy farm business

Last Word – Starting a Dairy Farming Business

No matter the season or the place, there is always a great demand for milk and milk products. You need not start a dairy farm on a large commercial scale. You can just begin on a small scale and then expand it gradually after you are familiar with the ins and outs of a dairy farm.

To get a good yield and income, make sure to select good breeds of cattle, feed, house and handle them properly.

Most dairy farm businesses focus on selling raw milk, but you can also opt for selling other dairy products like butter, cheese, powdered milk and further down the line expand to other related industries in the business.

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In the US, there are around 42,000 registered dairy farms and it is projected to grow at an annual rate of 1.3%.

If you can conduct a proper market research, you can easily sell raw milk as well as other dairy products, as there are many industries making use of these and other byproducts.

In addition, there are not many obstacles to entering the dairy industry with most inputs being easily available.

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