Date of Graduation

5-2015

Document Type

Thesis

Degree Name

Bachelor of Science in Agricultural, Food and Life Sciences

Degree Level

Undergraduate

Department

Poultry Science

Advisor

Goodwin, Harlold L.

Reader

Popp, Jennie

Second Reader

Anthony, Nick

Third Reader

Watkins, Susan

Abstract

Poultry operations require numerous variable inputs for the operation to run. Due to this it is extremely difficult for poultry growers to estimate the financial capacity of the operation. The poultry industry had evolved over the years from back yard non-commercial hobby farms to vertically integrated contract farms. These changes have made it extremely important that poultry growers fully understand the revenue, expenses, and income associated with the operation. Under the contract system, it is difficult for poultry growers to have a full understanding of and expectation for their projected expenses and revenues from the operation due to variability in production conditions and prices and the flock-to-flock variations in revenues that result from the tournament pay system. Therefore, accurately estimating their projected cash flow becomes problematic because of the method used to determine their payments as well possible bonus incentives. In addition, traditional poultry operation budgets are therefore often difficult to use and interpret. Projecting cash flow into the future is complicated by unforeseen circumstances such as changes in revenues and costs that normally occur year to year (Cunningham & Fairchild, 2012). The purpose of this project is to create an excel program to help poultry growers better estimate and analyze the cash flow of their operations. The program will take into account a major portion of the possible revenues and expenses the grower may have related to the broiler operation. Taking into account the major sections will help give the grower as accurate as possible a portrayal of their financials. The excel program being created, called Arkansas Broiler Enterprise Assessment Tool (AR B.E.A.T), will allow for growers to have the ability to input information regarding their own operation rather than using generalized budgets. AR B.E.A.T is designed for use by contract broiler growers that are working directly with integrators. All independent contract operations are different. Therefore, the program uses a panel of 7 growers along with current research to build the default calculations. As the user works through the program, they will enter their own information and the totals will recalculate based off of their inputs. In the event growers do not have their own information, the panel defaults are there for users that do not have full information about the operation. It is great for potential growers to gain an understanding of the potential revenue, expenses, and income to expect from the operation. Growers can also utilize the program to run “what if scenarios” to determine how changes in costs and other areas will impact the overall financials of the operation. AR B.E.A.T is not perfect and it does have its limitations just like other financial analysis tools. Ultimately it comes down to the growers’ decisions and management of the flock.

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