How to Start and Manage a Micro Dairy, Part 4: Location, Location, Location


| 3/15/2013 1:22:29 PM


The number one rule of real estate is location, location, location. The same goes for micro dairies. This means more than the physical plot of land that will house your micro dairy. This aphorism extends to the location of the farm in relation to potential consumers and retail locations, housing for animals and access to essentials like water. Keep in mind: the primary concern for anyone in any stage of running a micro dairy is the comfort, health and safety of your animals.

tie stall barn tie stall cow barn

A typical tie-stall barn for cows, also called a milking barn.

Before you buy a piece of land, consider your business model. If you plan to sell milk and dairy products directly from the farm, you need a location that offers easy access to a solid and reliable customer base. Think of your micro dairy like any other retail business. Customer accessibility is key. A small farm at the end of a long dirt road may provide a nice, quiet setting for you, but it will not likely draw enough people to buy your products. Bob-White Systems has calculated that a micro dairy needs three customers for every gallon of milk produced a day. This is based on market research which says that the average milk-drinking family buys one gallon of milk every three days. One Jersey cow produces five gallons of milk per day and will, according to this model, require 15 regular customers to buy all of the milk produced in one week. Hopefully, five of these customers will stop at the farm each day. If you plan to sell your milk and dairy products through retail stores, you face a different set of challenges. If you cannot easily and quickly deliver the products to the store yourself, you will have to pay distribution costs.  Think about how far and how long it will take you to drive the milk to enough stores to make a profit.

free stall
An example of a free-stall barn for cows.

Enough doom and gloom. I know several people who operate successful three or four cow micro dairies in communities with good customer bases. These dairies routinely sell 100 gallons of raw milk per week, and their production costs hover at $3 per gallon. The milk sells for $6 to $8 per gallon, which yields a gross profit of $300 to $500 per week. This, of course, is not enough to support a family, but it is a good supplemental and dependable income if you enjoy the micro dairy life. 

cow milking parlor
A cow milking parlor.



Once you’ve worked out your business model, you need to think about the setup of the micro dairy. The traditional rule of thumb in the northeast is two acres of pasture for every cow. At my farm in South Royalton, Vermont, I reserve four acres of pasture for every cow. This gives me a buffer in case of a dry summer, when high temperatures can dry up precious grass. If you do not have four acres for every cow, you should be prepared to supplement what pasture you do have with hay. 





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