Researchers at Aberystwyth University have identified a simple yet highly effective set of metrics which could be used to help improve the financial performance of livestock farms.

Regular data collection and benchmarking can help farmers improve their business performance, and Key Performance Indicators (KPIs) are important measures that can help with this. 

To date, however, it has been unclear which KPIs specifically impact the financial performance of beef and sheep enterprises.

A recent study by researchers from the Department of Life Sciences at Aberystwyth University extracted data on livestock performance from the Farm Business Survey.

The Farm Business Survey provides information on the financial, physical, and environmental performance of farm businesses. Data is collected by Promar in England and Aberystwyth University in Wales.

Looking at around 500 suckler beef and sheep farms across England and Wales, the researchers examined indicators that measure costs, mortality, productivity and forage area per livestock unit.

Results from the study found that there were several KPIs significantly associated with gross margin per head in all enterprise types, particularly for measures of livestock productivity.

A positive association was seen where increases in calves per cow per year and lambs per breeding stock increased gross margin per head.  Concentrate feed per head had a negative association in all enterprise types, meaning as inputs increased, gross margin per head decreased.

Nia Lloyd, lecturer in Agri-Business at Aberystwyth University said:

"Suckler beef and sheep farms have and continue to face many external challenges.  However, changes in business management, particularly livestock management could provide the opportunity for farmers to improve their efficiency and profitability.

"Our study has demonstrated significant associations between gross margin and specific KPIs at a system level. This simple yet highly effective set of metrics could provide livestock farmers with the information they need to make informed changes to the management of their business and to improve its financial performance and resilience."

The study is the first to demonstrate the influence of livestock production KPI's on the financial performance of beef and sheep farms in England and Wales, and underlines the importance of regular data collection and benchmarking.