Risk management and the ostrich farming business
One of the most important aspects of ostrich farming and creating a business management profile for the company is a thorough risk analysis. Once you have identified the risks that you will face in your business, you can plan for each possible scenario ahead of time in your business plan, and you will not be caught off guard when the risk is realized.
Many ranchers have been caught off guard by a sudden storm or power outage. Some have had the misfortune that the buyer of their cattle decided not to buy after all, at the last minute. How you react to these risks will determine the success or failure of your ostrich farming business.
Let’s look at some of the risks you may face:
Supply chain.
In order for your ostriches to stay healthy and happy, they need to feed every day. How will you ensure that the food you need on a daily basis is delivered on time? Will you keep extra rations in case your supplier can’t deliver on time? Will you sign a contract that requires your supplier to deliver on time? What can you do if your supplier does not bring the correct food or the required amount of food?
Slaughter dates.
Once the slaughter date has arrived, he realizes that his slaughterhouse has not been prepared for his arrival. How can this be prevented? It is essential for a productive processing phase that both the slaughterhouse and the ostrich breeding company maintain their slaughter dates. These need to be set up well in advance and strictly adhered to.
Power outages.
Although this risk is not a problem in some ostrich farming companies, it can become a significant problem during ostrich egg incubation. What precautions have you taken in the event of a power outage? How long will your incubator keep warm, humid, and airflow if the power fails? Is there an alarm to warn of a power outage? Will you need a generator to back up the startup? If you use a generator, how will you prevent deadly fumes from entering the incubator to prevent the death of ostrich eggs?
Chicks that still require artificial heat in the rearing stages will need to receive heat from an additional source during power outages. What can you do so that these chicks do not suffer from the cold? Some farms rely on electric fences to protect ostriches from poachers and predators. Will a longer power outage affect your fences? What backup plans can you make?
Do you have a refrigeration unit for processed ostrich meat? Is there a backup plan to keep them up and running in the event of a power outage?
Market requirements.
It is very important that you assess the risks in the market well in advance. Does the market you intend to serve require certification? If so, where will you get this certification? This must be done well in advance of slaughter in some cases, and in other cases even before the first ostrich arrives on the farm.
How stable is the market you will serve? What will you do if a major buyer backs out of a contract at the last minute? Where will you find an additional market for your products? Potential markets are always worth looking at, even if you don’t produce enough to supply all markets immediately. This will ensure that you can remain competitive, because you know the market, and will pave the way for an eventual expansion of your ostrich farming business. And it will provide you with an alternative clearinghouse in the event of an emergency.
Inclement weather.
With weather patterns changing around the world, risk analysis needs to be done even when it comes to weather. We all know the expected weather patterns in our areas, but still, sudden changes or fierce storms catch us off guard. Will you have a place of refuge for your ostriches in extreme weather? If there is no barn, could you build some kind of shelter for them?
When cold weather hit South Africa in the late 1990s, a farmer protected his cattle from the deadly extremely cold winds by stacking hay bales in a sturdily constructed circle and keeping them in it overnight. It suffered no losses, while all the farmers in the district suffered hundreds of losses with all their livestock. The key was being prepared.
There are many more risks to assess. If a fire breaks out in one of the pens, how can you save your ostriches? Alternatively, if there is a flood, what can you do? By identifying as many risks as possible and putting plans in place for these risks, your ostrich farming business will never be caught off guard.