Home              College of Veterinary Medicine             Washington State University                 WSU Faculty &Staff Page

                    John Gay, DVM PhD DACVPM               AAHP                  FDIU             VCS

Industry Questions for Herd Production Medicine

Version 2.1     Updated September 18, 2000


Purpose of these Questions:

The purpose is to provide an industry-focused framework for developing an understanding a segment the agricultural animal industry (e.g., commercial beef cow-calf, beef stocker, beef feedlot, dairy, custom calf raiser, sheep, swine farrowing, swine finishing, seedstock producer or other) that is sufficient to enable the practitioner to:

  1. Assemble and, over time, modify an effective, innovative package of veterinary services to deliver to clients engaged in a particular segment of the livestock  industry that takes advantge of opportunities and of trends in that segment.

  2. Understand clients' perspectives, their "bottom line", and the information that they require for decision making when the practitioner is marketing, establishing, justifying, and monitoring services provided to the client in a particular segment of the industry.

  3. Understand the current and likely future trends in an industry segment, the likely impact of these trends on clients in that segment, and the consequences for veterinary practice in that segment. Powerful economic and social forces are causing rapid change in some segments of the livestock industry.

  4. Understand the basic economic structure of a client's business, indentify the key economic and production benchmarks for that industry segment and know the means for assessing them.

[Return to Contents List]

Note: The following ordering is a somewhat logical order rather than a rank of importance. Some of these questions are intended to jumpstart your thinking or to start you thinking from other than the conventional veterinary perspective rather than having a concrete answer. If you note errors, oversights or ommissions, please let me know.

Industry Demographics: (What is the basic structure of the industry?)

  1. Based on their resource inputs (e.g. capital, feeds, labor, water, land, genetics) and product outputs (e.g. calves, milk, seedstock, cull animals, finished animals), what are the natural segments of the industry? What major factors determine this segmentation?

    Ex: Registered seedstock vs. commercial livestock, low input grazing vs. high input intensive dairies, home-raised vs. custom dairy calf raisers, backgrounders vs. feedlots, stocker or yearling grazers vs. conventional cow-calf operations, primary livestock enterprise (primary family income is from livestock operation) vs. secondary livestock enterprise (primary family incomes is from elsewhere), equity operators vs. margin operators.

  2. What is the scale (range of size) of enterprises (in terms of number of production units, typically number of head, facility and stock investment, gross income) in an industry segment and geopgraphic region of interest to you? To achieve your desired income from production medicine, how many of these operations do you need as clients and what will you cost them per production unit?

    See USDA Census of Agriculture. Select Data Query by Geographic Region, State, County, Table 14.

  3. What general factors affect this distribution (e.g. transportation costs, weather, water, feeds, ancillary services, land availability, marketing opportunities, environmental and business structure restrictions, supporting commercial and social infrastructure (specialized equipment and feed suppliers, hoof trimmers))?
  4. What are the trends in these distributions? What types of enterprises are disappearing and what types are growing? What general factors are driving the changes? What is the effect of these trends on veterinarians and the packages of services they deliver?

    For a good discussion see a write-up on a 1997 talk by Purdue ag. economist M Boehlje that appeared in the Agway Cooperator.

    For a discussion of the meat industries, see:

    "The Changing Meat Industry: Implications for the Beef Sector and Cooperative Extension's Role" (Bailey, Bastian, Glover, Menkhaus, 1993) (note - the HTML is in three parts)

    "Today's Changing Meat Industry and Tomorrow's Beef Sector" (Bastian, Bailey, Menkaus, Gover, 1994)

    For the banker's perspective, see Federal Reserve Bank of Kansas City Economic Review

    From the Plains to the Plate: Can the beef industry regain market share?

    Consolidation in U.S. Agriculture: The New Rural Landscape and Public Policy

    U.S. Agriculture at the Crossroads in 1999

  5. In which geographic regions are new enterprises being established, what is their scale, and what factors are determining their location? What are the consequences of these developments on the rest of the industry? On emerging opportunities for veterinarians?
  6. How does the total production of an industry segment vary year to year and how does this variation affect prices? What causes annual and longer cycles? What is happening at the enterprise level to cause this cycling? What are the characteristics and the critical economic and production indicators of the enterprises that do not survive the bottoms of these cycles? What are the effects of these cycles on veterinarians and what are the opportunities?

    Ex: The annual cycle in beef calf prices and cull cow prices, the "7 year" beef cow cycle

  7. [Return to Contents List]

Industry Structure:     (Do I really have an accurate picture of the players in the industry that my clients are in?)

  1. What major resources and services (e.g.: skilled and unskilled labor, water, forage, capital, land, management skills, replacements, housing, specialized equipment, marketing opportunities) are required by enterprises in a segment in different regions?
  2. What is the optimal physical quantity and economic value of these major capital (fixed) resources on a per production unit (or other capacity measure) basis (e.g. yield per head, labor hrs per head, facility investment per head, winter feed cost per head, yield per acre)? What are the generally regarded target values ("rules of thumb") for a given type of enterprise? What values indicate a low likelihood of survival for a particular enterprise? A high likelihood?

    Ex: What is the typical investment in free stall housing or in a milking parlor on a per lactating cow basis? In a feedlot feed mill on a per head basis? In ranch grazing land on a per cow basis? What is a dangerously abnormal amount?

  3. For typical values, check the following:

    Morris, DL, ed. (1995). Standardized Performance Analysis of Beef Cattle Operations. Vet Clin North Am Food Anim Pract 11(2) July 1995.

  4. What are the relative values of these resources between regions? What is the competition for these resources in different regions?
  5. What affects non-fixed, operating resources (especially feed and water) availability and value year-to-year?

    Ex: Alfalfa hay costs in different areas – drought, rain timing, irrigation water availability, opportunity competition from other crops.

  6. What are the different market routes for a segment's products? What causes price differences and marketing cost differences between regions?

    Ex: Haulage costs for milk from milksheds to population centers, milk marketing orders

    Dairy Industry: Information on Prices for Fluid Milk and the Factors That Influence Them (GAO report)

  7. What is the tendency toward vertical integration (controlling more stages of production)? What factors are driving this trend? What are the likely consequences for the rest of the industry? For the veterinarians serving this segment? What new opportunities will this vertical integration provide for veterinarians (e.g., linkage between cow-calf producers and feedlots, including certification of freedom from selected diseases and of prior processing)?
  8. What is the tendency toward product differentiation away from a commodity market (e.g., dairy producer-handler production of special cheeses into niche markets, branded beef lines)? What are the roles for veterinarians in these (e.g., certifying food safety, assisting in genetic selection)
  9. For an example of a failure in the beef industry, see "Niche Marketing Considerations: Beef as a Case Example" (Bastian and Menkhaus, 1997)

    For an example of a success in the beef industry, see Harris Ranch Beef

  10. What is the tendency toward horizontal integration (increasing scale or size)? What factors are driving this trend? What are the likely consequences for the rest of the industry and for veterinarians?
  11. What is happening to the numbers of enterprises relative to the numbers of animals in different regions? Why? What are the likely consequences for veterinarians?

For comparison of costs and prices between years:     AIER Cost-of-Living Calculator

[Return to Contents List]

Industry Environment: (political, environmental, social, tax, legislative, land use, animal welfare - What outside forces will impact my clients' livelihood?)

  1. What are the major producer organizations representing industry segments and what are their primary concerns?

    Selected Examples: American Farm Bureau, National Cattlemen's Beef Association (NCBA),
    American Dairy Association, National Milk Producer's Federation (NMPF)

  2. What are serious controversies potentially affecting segment enterprises in a region? Who are the opponents to segment enterprises in a region and what are their motives? What will be the effect of adverse outcomes on the economics of operations? What are the likely consequences to these enterprises if a disadvantageous legal outcome occurs? How are veterinarians involved and how will they be impacted?

    Ex: Manure and waste management, water conservation and allocation, odor control, food safety, animal rights and welfare, urban encroachment, waterway pollution, manure disposal, nuisances (flies, dust) affecting other high value crops.

  3. How does the local, state and federal tax code influence industry structure and how does it influence decisions by investors to make short and long term investments in particular segments? What other factors influence investment by outside investors?
  4. What is the effect of government programs (commodity support programs, water projects, environmental pollution control, trade) on the economics of industry segments and what is the likely trend of these programs? What will be the effect of these trends on the economic and production goals of operators?

    Ex: USDA CRP program, emergency grazing, and the beef cattle supply

  5. What is the effect of current international tariffs and quotas? What is the likely effect of anticipated changes in these? What will be the effect of these trends on the economic and production goals of operators?

Ex: Importing countries requiring imported products of livestock origin to originate from herds free of specific viral, bacterial and parasitic diseases.

[Return to Contents List]

Typical Production Cycle:    (What is the life cycle of the livestock in my clients' operations?)

  1. What is the production cycle of individual animals and of enterprises in an industry segment?

    Dairy Ex: Cow freshens, is bred optimally at 80 DIM, dries at 305 DIM, has a 45 day dry period and calves again. Calf is liquid fed for 40 days, weaned at 50, progressively grouped and bred at 15 months. If dairy is grazing based, herd calving is synchronized to the grass growth.

  2. Beef Ex: Spring-calving herds vs. fall-calving herds

  3. How does the production cycle of a segment relate to other vertical components of the industry and to prices?

    Ex: Spring calves from cow-calf operations going to winter stocker grazing operations to feedlots for finishing.

  4. Ex: Annual price cycle for weaned calves and for cull cows (With veterinary input, how can a producer exploit these?).

  5. What are the measures of quality of the output of a phase of a production cycle? What is the economic value of a unit of that qualtiy?

    Dairy Ex: Premiums paid for low cell count milk, for high protein milk, for low bacterial count milk.

  6. Beef Ex: Docks for brands on sides, horns, intact bull calves, "out of favor" breeds or cross breeds, non-uniform lots.

  7. How does the annual climate cycle affect the production cycle of a segment (e.g., the forage cycle), the production system selected by each segment (e.g., warm housing vs. hutches, drylot vs. free stall), and what is the effect of adverse year-to-year variation (e.g., drought years, excessive rainfall years)? What opportunities do these variations and the producers’ need to manage them present to veterinarians?

    Beef Ex: Herd culling and minimum cost supplemental feeding of beef cows during drought.

  8. Ex: Substitute unusually cheap purchased feeds for previously raised but more expensive home-raised feeds if the raised feeds can be stored without significant loss.

  9. What are the critical points or phases of the production cycle and what are the major problems of animals that are associated with these points?

    Ex: Calves: Transition from monogastric to ruminant (dairy), transition from liquid to dry feeds (beef and dairy), weaning (beef and dairy), grouping (dairy).

  10. Ex: Cows: Late pregnancy feeding (beef and dairy), transition to peak lactation (dairy), re-breeding (beef).

  11. What are the animal husbandry objectives (e.g., nutrition management, animal density, animal comfort, group selection, production) during each critical point or phase of the production cycle? What are the values of typical goals (e.g.: age at first calving, peak lbs., days open, lbs. feed per lb. gain, ...)?

    Ex: Rapidly getting dairy cows to maximum peak milk (How does this relate to total lactation production?).

  12. What is the optimum timing or length of components of this production cycle for an individual animal? What is the economic cost per day of a component being longer or shorter (the cost of being longer are often different than the cost of being shorter and are often different between types of animals, such as heifers verses cows)?

    Ex: 24 months of age at first calving vs. younger or older (dairy), 45 day dry period vs. longer or shorter (dairy), 80 days in milk at conception vs. longer or shorter (dairy)

  13. What are the inputs and outputs during each phase of the production cycle? What are the typical market values of these inputs and outputs?

    Ex: value of ration components for lactation, price of semen for breeding, value of a newborn calf, cost of teatdip.

  14. What are the typical production system problems of each phase of this production cycle? How are these problems detected and who detects them? Is detecting these problems earlier beneficial and, if so, how might this detection be done? What are the consequences of late problem detection? What are the current and potential roles of the veterinarian, both in detecting, solving, and preventing these problems?

    Ex: Pneumonia in recently weaned calves, coccidiosis in grouped calves in winter, hypocalcemia, ketosis, coliform mastitis, laminitis or displaced abomasums in peri-parturient cows.

  15. How can these problems be prevented and what can be monitored other than the occurrence of the problem to determine if prevention practices are effective and sufficient? What individual animal records and record summaries are needed? What are current and potential roles of the veterinarian?
  16. What are the veterinary-related events the occur in this production cycle? What are the cost versus benefits of each of these? On what basis can the veterinarian justify the use or non-use of each of these?

Ex: Vaccination timing for calves and cows, bull breeding soundness exams, pre-breeding exams, cow pregnancy checking.

[Return to Contents List]

Goals, Economics, and Survival:     (What is the bottom line of my client's business?)

  1. What are common economic and non-economic goals of enterprise operators in an industry segment? How do these goals differ and even conflict between segments?
  2. What is the likely minimum economic size of segment enterprises by region? What are the major factors determining this threshold?
  3. Ex: See Bailey K, Hardin D, Spain J et al. An economic simulation study of large scale dairy units in the Midwest. J Dairy Sci 80:205-215 (1997)

  4. What are the key economic and production measures that determine short and long term survival of an enterprise in each segment in different regions? How are these factors measured and how are they related?
  5. Ex: 1997 Milk Production Costs from 871 Wisconsin Dairy Farms, Univ. Wisc. Center for Dairy Profitability

    Ex: Cost of Production (COP) Analysis and Benchmarking Your Beef Operation (New Zealand)

    Ex: Managing for Today's Cattle Market and Beyond (Arizona State Univ)

  6. If the primary product is a commodity, what are the key indicators that a producer is a low cost producer compared to other producers in the segment?
  7. What are the subsidiary production measures that are commonly used, how are they measured, and how are they related to the key economic measures?
  8. What are the important economic measures and objectives during each phase of the production cycle?
  9. What is the economic value of a unit change of each of these measures? How does this value change over the ranges of the base unit (i.e., how linear is the relationship? E.g. cost of days open)? Which have the potential of the highest return per unit of investment (time, dollars) by management? Which the lowest?
  10. What are the facility investment vs. sub-optimal production risk tradeoffs (e.g. free stall vs. drylot and coliform mastitis, swine production and housing management strategies - EMW, off-site, all in / all out)? What are the break-even points?
  11. What are the risks (market prices, epizootics, climatic, reproductive failure, ...) to enterprise survival in the different segments? How are these risks managed? What is the veterinarian's role in this risk management?
  12. What is the economic cost of "failures" (e.g., clinical mastitis, failure to breed, calf death, BRD case, ...) that veterinarians have traditionally been involved with? How many normal units of production or net profit does it take to balance the economic loss of a typical case (particularly in terms of net profit)?

[Return to Contents List]

Livestock Replacement and Genetic Improvement:    (How do my clients improve the inherent productivity of their livestock?)

  1. What are the genetic characteristics of economic importance in each segment and what is their heritability? Do these characteristics differ and even conflict between segments?

    Ex: Larger sized weaned calf vs. optimal carcass size for packer

  2. What is the economic value of a one unit change of each of these genetic characteristics?
  3. What are the different methods of managing replacement raising, breeding and selection? How rapid is the expected rate of improvement when they are used?
  4. What are the important parameters in raising replacements (e.g., rate of gain, cost of gain, age at purberty, age at first calving, weight at first calving, life time production) and how are they related and managed?

Dairy Ex: Relationship between rapid rate of peri-pubertal weight gain and loss of future lifetime productivity (for a review, see J Anim Sci 1997 75:846-51(?))

Beef Ex: Selection and raising of replacements (for a review, see J Anim Sci 1992 70:4018-35 (?), J Anim Sci 1993 71:3155-63 (?))

  1. What are the benefits, the risks, and the economic consequences of different genetic management strategies? How do these different replacement breeding strategies impact other aspects of the enterprise such as labor and capital requirements?
  2. What are the names of the more famous seedstock (bulls and cows) in selected breeds and their records (a must for working with registered seedstock producers!)?
  3. What are the major groups standardizing genetic evaluations? How do these groups function and what traits do they measure?

    Ex: National Dairy Herd Improvement Association (DHIA, dairy)     DHIA Handbook,
    Beef Improvement Federation (BIF, beef)      BIF Guidelines for Uniform Beef Improvement Programs (180 pages)
    (Note: Historically, the BIF server has been very slow and your browser may time out before the getting the page)

  4. What is the veterinarian's current role in replacement breeding and selection? What are the opportunities for veterinarians?
  5. What is the genetic impact of veterinarian-advocated selection practices on other economically important heritable traits?

Beef Ex: What are the effects on frame and birth weight from selecting larger pelvic opening size in heifers? The potential relationship between selecting bulls on the basis of testicular size and precocious purberty in their offspring? What are the effects on birthweight of selecting on yearling weight alone (see J Anim Sci 1998 Feb;76(2):458-67 )?

[Return to Contents List]

Producer Information Sources:     (How do my clients find out about alternative ways of doing things?)

  1. What are the primary sources of production-related information for producers in the different industry segments? How do the better managers differ from the poorer managers in their use of information?
  2. Who are the information providers that compete with the veterinarian and what is their usual level of knowledge? How do operators perceive veterinarians relative to these competitors (credibility, knowledge, bias, cost, ...)?
  3. What are the major trade magazines (free advertiser supported and subscription)?
  4. What is the role of the Internet? What is the characteristics of the producers that use the Internet? How is the Internet changing the role of the veterinarian changing with respect to providing information and evaluating information?
  5. How is the role of the veterinarian changing as operations increase in size? What are the opportunties for farm-derived information on larger operations?

[Return to Contents List]

Veterinary Interventions and Services:    (What can I do for my clients?)

  1. What are the current veterinary interventions or services typically delivered to an industry segment in different regions?
  2. What are the potential veterinary interventions and services that may constitute a package for each of the industry segments?
  3. What are the veterinary skills and knowledge currently required to execute these interventions and to provide advisory services? What is likely to be necessary in the future?
  4. How do producers perceive these services and the veterinarian delivering them? Who are currently and potentially the veterinarian's competition and how do producers perceive each? What are the competition's expertise and skills? What are the veterinarian's competitive advantages and disadvantages?


  5. Wise, JK (1995). The U.S. Livestock Market for Veterinary Medical Services and Products. AVMA Annual Report.
    Wise, JK (1988). Livestock producers' attitudes about food animal veterinariran. JAVMA 192:543-544.
    Wise, JK (1988). Livestock producers' ratings of alternative veterinary information sources. JAVMA 192:808-810.

    National Animal Health Monitoring System (NAHMS) Reports (click on species - extensive surveys of randomly selected producers on information sources, use of veterinarians, management practices, disease problems, production results and economics)
    Beef Feedlot (COFE - 1995) - Parts I, II
    Beef Cow-Calf (1997) - Parts I, II, III
    Dairy Cattle (1996) - Parts I, II, III

  6. What currently available technology is under- or over-utilized by many veterinarians delivering services to an industry segment? How can the veterinarian's competition use this technology?
  7. What is the likely impact of developing technology on existing and potential veterinary interventions or services? How can the veterinarian's competition potentially use this technology?
  8. What are the benefits and costs to the enterprise of each intervention or service (in terms of production, dollars, management and labor time, disruption of routines, ...)? What, if any, are the potential impacts of each intervention on other phases or aspects of the production system?
  9. How can these interventions and services be marketed? What information is needed to support the value of these interventions to the client? What are the most important incentives and disincentives for a manager to adopt an intervention or service?
  10. How can the veterinarian monitor the benefit/cost of these interventions and services, evaluate their effectiveness, and document their results?
  11. How do veterinary interventions affect enterprise risks and their management?
  12. What is the approximate minimum clientele "mass" to justify making the investment necessary (time and money) to develop the knowledge and skills for each intervention or service? What is the likely long-term trend of this clientele "mass"?

[Return to Contents List]

Relationships Between Service Providers:   (How do I work with others who also work with my clients?)

  1. What relationships occur between service providers to typical enterprises?
  2. What is the role of the veterinarian in these relationships?

Ex: Coaching a Winning Team of Consultants (Moormans)

Building and Managing Effective Farm Teams (Jeffrey Reneau, University of Minnesota)

[Return to Contents List]

Production Medicine Information Sources for Food Animal Veterinarians:    (Where can I find out about better ways of doing things?)

  1. What are the relevant professional organizations for food animal veterinarians in each production sector?
  2. What, where, and when are the major professional meetings that are relevant to food animal practitioners?
  3. What are the relevant scientific and professional journals for production medicine veterinarians?
  4. What are the major textbooks covering relevant production medicine topics at the level of information needed by the production medicine veterinarian? While in practice, how can the practitioner become aware of relevant new texts?
  5. What are the other major sources of printed information on production medicine topics and how can items be obtained (particularly those containing relevant economic information)?
  6. Who and where are the academic clinicians specializing in particular industry segments that have a nation-wide or international reputations? How can the practitioner contact them?
  7. Who and where are the private practitioners serving particular industry segments who also have a nation-wide reputation for production medicine? How can the practitioner identify and contact them?
  8. What are the means by which practicing food animal veterinarians can update existing expertise, acquire new knowledge and skills, and maximize credibility? What is the relative effectiveness and cost of each in terms of effort required, knowledge gained, time in-practice, time away from practice, and expense?

Ex: Post-graduate programs at the Great Plains Veterinary Education Center (beef), University of Wisconsin Dairy Herd Management Certificate Program and Pennsylvania State University (dairy).

Ex: Seminars associated with national meetings of professional associations such as the AABP.

[Return to Contents List]

page URL: http://www.vetmed.wsu.edu/courses-jmgay/IndustryQuestions.htm

Return to:  John Gay's Homepage         College of Veterinary Medicine Homepage        Washington State University Homepage

Copyright 1998-2009 John Gay, Washington State University, All rights reserved
WSU Copyright Policy                WSU Disclaimer and Freedom of Expression Policy
Homepage URL: http://www.vetmed.wsu.edu/courses-jmgay/
Site Comments to webmaster@vetmed.wsu.edu