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Leakage and wastage

Looking at your businesses, leakage and wastage may be costing you more money than you realise.

Economically, companies in New Zealand have been through six good years, however as the economy hardens, we need to take a close look at our businesses to reduce any leakage and wastage.

It is the same in farming, the same issues apply. Leakage and wastage areas may include:
  • Too much chemical being purchased and not used, or being left to sit in the shed.
  • Too much, or the wrong dairy detergents being used.
  • Putting too much fertilizer on, or the wrong type being used.
  • Tearing around on 4wd bikes, and making a multitude of trips to the back of the farm, when one well-planned trip would have sufficed.
  • Dairy water heaters being too hot.
  • Dripping taps of all makes and models, including hot and cold.
  • Allowing staff to take shortcuts, which get out of control, and then they may start using all your gear and disposables too.
  • Purchasing goods and materials, not using them, and then not taking them back for a refund.
  • Purchasing items on impulse, rather than necessity and then having them lying around not used. How many gadgets and gizmos have we all bought on impulse which have never been used.
  • Power leakages on electric fences, making them ineffective.
  • Earth dams that leak.
  • Leaking pipe fittings, tanks, troughs etc.
  • Wasting diesel oil, grease and other disposables.
  • Not putting things away properly. Contamination or rust sets in, making items no longer usable.
  • You can even apply leakage to finance. Are you paying too much for your finance?
  • Is there a lot of unused machinery lying around. Could it be sold, or could you lease it out? Do you waste money on it? Is all your gear covered, or does it sit out in the rain?
On the farm, if you are able to make savings of 5%, then the figures would look something like the following:

300 cows producing 100,000 kg/ms @ $2.00 p/kg farm running costs $200,000
A saving of 5% equals $10,000
This amount goes straight onto your bottom line.

Summary

Leakage and wastage is everywhere you look. Now is a prudent time to take a close look at everything you do and try to cut back on leakage.

Talk to your team about it finding ways to eliminate leakage and wastage. Put it intopractice yourself, and you will be amazed at the improvement in your bottom line and also the improvement in your attitude.

The difference between success and failure could be just watching out for leakage and wastage.


 

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