What if you could cut $70,000 of expenses out of your budget for 2026, with no negative consequences? Well, most dairy farms can. Why? Because your team may be more capable than you think.
With the projected low milk prices for 2026, it’s crucial to rethink how we manage labor resources to help our operations cashflow. In fact, overstaffing is one of the most common drains I see on dairy farms’ bottom lines. Before you onboard your next full-time employee, here are three ways to rethink labor on your dairy farm:
1. Assessing Overstaffing and Streamlining Workflows
One of the primary areas for potential savings is labor efficiency. It’s not uncommon for dairies to be overstaffed. In several cases, I’ve worked with dairy farms where a simple reorganization of tasks resulted in significant savings. For example, by evaluating how employees are utilized across different areas, such as feeding and milking operations, farms can operate more effectively without the need for additional hires by cross-training team members to be proficient in more than one area.
Recently, I visited a dairy facing financial struggles, and they were milking all their cows three times a day. After conducting an audit, we found that the employees had the capacity to handle four milkings a day. By reassigning tasks and realizing the existing workforce’s full potential, we increased production by five pounds per cow per day and improved the farm’s bottom line without additional hiring.
2. Leveraging In-house Capabilities
Another overlooked opportunity lies in the balance between in-house labor and outsourcing. By training existing staff to perform essential tasks that are often outsourced, like breeding or hoof trimming, farms can save substantially. This approach empowers employees and can lead to job satisfaction while reducing external vendor costs.
3. Maximizing Managerial Involvement
I’ve seen managers who spend too much time in the office rather than capitalizing on opportunities to streamline operations by working alongside their team. By understanding and participating in daily tasks, managers can not only spot inefficiencies, but also and motivate employees to work collaboratively and hold them accountable to making every paid hour count. Managers are often surprised to find out just how much of the day employees are spending on socializing or taking breaks. The only way to know is to be there, working alongside the team.
To successfully manage through low milk prices in 2026, it’s essential to evaluate and optimize your labor strategies. Proactively incorporating these changes will not only help you manage the challenges of the upcoming year but also lay the groundwork for team expectations and efficiencies that will continue to keep your business profitable in the future.
For more on this topic, tune in for Episode 297 of the Uplevel Dairy Podcast:
