Entrepreneurship in Dairy Cattle Sector: Key Features of Successful Administration and Management

Abstract

In this study, data envelopment analysis is applied to 47 dairy cattle farms to estimate their level of efficiency in the utilization of the available resources and to identify the most efficient ones. The analysis is based on technical and economic data collected through a farm management survey. The main structural and financial characteristics of the most efficient farms are presented, revealing the features that make them better than their peers. A comparative financial analysis is applied between the efficient and inefficient farms, highlighting the appropriate farm structure and determining the major cost drivers in modern dairy cattle farming. The results show that there is still room for improvement in intensive dairy farming. Dairy cattle farms must operate with increased variable cost and utilize their infrastructure at full capacity to decrease their fixed cost per cow. Farms should increase their economic resilience and be less risk averse in an environment where margins to lower production costs in highly intensive farms have been narrowed down. The findings of this study verify that dairy cattle farms of entrepreneurial mindset have the potential to rise to the future economic, environmental and social challenges that will affect the survival of the sector.

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“…It is difficult to disagree with the conclusions of G. Koutouzidou et al (2022) that dairy farms need to always ensure their economic sustainability -despite the state financial support, which is not stable in Ukraine. In this context, the conclusions of M. Klopčič et al (2019) are quite accurate that instability in the choice of further development strategy by dairy farms due to changes in state financial support policy makes future decision-making insufficiently effective.…”

“…These issues are constantly being discussed by European scholars. G. Koutouzidou et al (2022) focus on the issue of the efficiency of the use of available resources by dairy farms. The authors present the main structural and financial characteristics of dairy farms with different efficiency, which resulted in the formation of the appropriate farm structure and the identification of the main cost factors.…”

The role of inbreeding depression on productive performance in the Italian Holstein breed

“…Among several economically relevant traits in the dairy industry, fat, and protein are two of the most important milk components included in payment systems. For dairy cattle farmers, achieving high protein yield ( PY ) and fat yield ( FY ) is key for maximizing the economic value of their herds ( Koutouzidou et al, 2022 ). This is especially prominent in the Italian context where roughly 80% of the milk is transformed into cheese ( Ablondi et al, 2021 ).…”