George and I sat down and crunched some numbers recently, and I wanted to share our findings. I think this will be interesting for a wide audience – including our own customers, customers of other farms, and other farms.
We started adding up what it actually costs us to raise chickens on pasture the way we do. Let’s start from the beginning. They need a place to stay. As you may know, we have a mobile coop structure that we move around so that our birds are on fresh pasture – a tasty green “salad bar” for them to eat in addition to the feed we provide to them. I haven’t even factored in the initial cost of that housing into the breakdown, but between our time and labor, fuel transporting supplies, lumber, hardware, cattle panels, and the large tarp, it cost us about $400 to build. Bear in mind I am only using Michigan’s minimum wage of $8.50 as the basis of our “hourly wage” which the farm has never been able to pay us – it’s simply for the purpose of demonstrating that there is a cost involved, even if we aren’t paid for it. Additionally, the sun and weather always takes a toll on the coop, so the tarp has to be replaced yearly, along with miscellaneous hardware – to the tune of about $50 annually.
We order day-old chicks that are sent to us from the hatchery, or we get them locally from a farm supply. Wherever we get them, it costs on average about $2.50 per chick. And whether we get those locally or pick them up at the post office, it costs us fuel to go get them. These calculations use 50 birds as the basis, as that is what we can reasonably manage raising under the conditions we feel are appropriate. We are assuming all female birds, because that’s what we’ve had the best success with in terms of keeping the birds from getting hostile and therefore avoiding injury and death from each other.
We bring them home, and they require heat lamps to keep them warm for the first few weeks, particularly if the nights are still cold. We use about 336 Kwh of electricity (500w bulbs x 2 x 24 hours x 28 days). At .08 per Kwh, that is $26.88 in electricity.
Our labor requires two humans per day putting in an average of about 15 minutes per person, between feeding, watering, and moving the coop around. That brings us to a total of about 35 hours labor for the 10 weeks we raise our female birds. 35 hours of labor x $8.50 minimum wage = $297.50.
For ten weeks of raising birds, we need about 25 fifty pound bags of feed, at $15 per bag. That’s $375 in feed. Plus the fuel back and forth to get the feed.
Finally, the birds need to go to the processor to be slaughtered and packaged. We have to transport them there, and our processor is a 48 mile round trip that we must make twice – early the morning of for dropoff, then again late that afternoon for pickup. We must have a way to contain them during transport and keep them from flapping around and injuring themselves or one another – there are specialized poultry transportation crates that we have for this purpose. These cost us about $100 each plus the shipping to get them to us. We have half a dozen of these – we had to spend well over $600 to get these. Again, that cost is NOT included in my per bird cost calculation. But it should be considered, because we had to spend that money or these chickens couldn’t get to the processor.
As far as fuel, we figured that our mileage adds up to about 154 miles between the drive to acquire the chicks, getting feed, and going back and forth to the processor. And honestly, it’s probably more than that. That means about 13 gallons of gas in our truck, and while gas prices are lower now, they typically raise in the summer (or for any old reason), so we used an average cost of $3/gallon, for a total of $39 in fuel costs to raise each batch of 50 chickens.
All these figures added up means it costs us just over $21 per bird on average. Now, consider that we sell for $5/lb and our birds are typically anywhere between 3.5-4.5 lbs. We’ll use 4 lbs as an average because that’s what the majority of them weigh in at or around.
That means we sell that bird for $20. A 3.5 lb bird sells for $17.50. Best case scenario, a 4.5 lb bird sells for $22.50. But very few of our birds are that large.
That means we are selling at a loss.
Our primary purpose in raising these chickens is for our own table. Can you see why we don’t pursue selling at a farmer’s market or trying to find other venues to sell more chicken? Simply put, we cannot afford to do that. Not only would our sales incur a loss, we would have additional costs to bear – the price the market charges to the seller, purchasing a pop up tent, purchasing mobile freezer equipment, the fuel back and forth to the market, and the time and labor we spend preparing, loading, driving, selling, loading, driving, unloading when we get home.
Truthfully, we can’t afford to sell chickens at the price we have been charging. And we know that the price we are charging is more than what you can get chicken at the supermarket for – but they are hardly comparable products. Our birds are raised in a completely different, and we think, better, manner than those mass produced units. Our method is very cost and labor intensive – but we and our customers can tell the difference in quality. Quality of life matters for these animals, and it shows in the meat they produce for us.
Running these numbers down has been eye-opening for us. We aren’t really sure what to do. Should we look for ways to cut costs? How would any ideas we have for doing so affect the quality of life for these animals in our care? Should we raise our per pound price? We obviously can’t continue to operate at a loss.
We have lots to contemplate.