Profile of a Successful Manager: From Beef, Eggs, and Grain to a Dairy

The decision to convert to a dairy operation was not an easy one for James and Ann Shipley. Approximately I year of planning with help from Extension personnel, lenders, and farmers was completed before the final decision was made. The Shipleys had owned and operated a beef cattle, egg, and grain farm in the Powell Valley area of East Tennessee for 3 years. However, they were not satisfied with the net income and return on investment from this operation.

Experience played a key role in converting to a dairy operation. Jim had operated a dairy in partnership with his brother for 10 years and had worked as a dairy inspector for the State. Also, Ann is a practicing veterinarian.

Farmers Ann and James Shipley, Extension Leader Mike Haskell, and area farm management specialist Kevin Ferguson discuss the favorable economic consequences realized from switching to a dairy farm. (Photo by Nancy M. Cann, University of Tennessee)

Construction of the dairy facilities began in the spring of 1987, and the first cow was milked in August of that year. The cow herd presently consists of 107 head, and the cropping system includes 51 acres of double-cropped corn and wheat silage, 25 acres of alfalfa, 10 acres of mixed hay, and 200 acres of pasture. Additional alfalfa and alfalfa haylage are contracted from local producers.

The Shipleys' management strategies are simple yet effective. These strategies include maintaining a debt load of less than $2,000 per cow, planning the purchase of inputs, and allocating as much time as possible for evaluating and making management decisions.

"Never finance beyond the expected life of the asset," James said. Borrowed capital has been utilized to finance longterm assets, while the sale of beef cows and savings were used to finance short-term assets for the dairy.

When purchasing inputs, the Shipleys "shop and compare" in a 200-mile radius of the farm. Their purchasing decisions are characterized by the statement, "Be aware of what is available, and never buy anything at one man's price."

The Shipleys have a young son, William Andrew. Future goals for the farm include expanding to 150 cows, reducing feed costs, and increasing milk production. James and Ann realize that expanding the cow herd will require additional crop acreage. Foundation plans have already been made to accomplish this goal while maintaining a debt load of less than $2,000 per cow.

The Shipleys have a keen understanding of the competitiveness of American agriculture. They also realize that to be successful, they must maintain an efficient operation in the years ahead. If their first year of operation is any indication, the Shipleys should be a mainstay of American agriculture in the future.

Kevin W. Ferguson, Area Farm Management Specialist, University of Tennessee Agricultural Extension Service, Dandridge, TN.