B&Co Rural News November 2017


The Brown&Co labour and machinery costing service builds up information from themachinery fleet, work rate, fuel usage, labour utilisation and down time to provide an accurate cost, understanding the true cost of operations.

Most farming enterprises in the UK cannot operatewithout farm machinery in one formor another. Let’s be honest, who doesn’t love a tractor ? However, theway inwhich farmbusinesses actually source suchmachines can not only have a significant impact on their cost structure, but also on the day-to-day running of the business. There is a simplemethod used to determine whether amachine ismore viable to own or hire, which could save youmoney. Firstly the amount of work that the current machines on the farmare doing needs to be calculated. Many farms will know the number of hours per year that eachmachine does, this is the start point but knowingwhen in the year thiswork is done is also critical.

Secondly the current ownership cost of each machine can be calculated using depreciation, repairs, interest, insurance etc. Once this cost is calculated youwill knowhowmuch it costs you to have thatmachine before putting someone on the seat or fuel in the tank. Once you have this information you can then get a quote to hire a similarmachine on a per week basis. As you have already plannedwhich months themachine is going towork in, you can work out themaximumnumber of weeks that machinewill be used in a year. Following this you canmultiply the per weekly hire cost by the number of weeks you require themachine. If the figure is higher than your ownership cost then itmore viable to own the machine. If the hire cost is lower than your ownership costs, it’smore viable to hire that machine in. Here is an example:

• Provides a true cost per operation by crop type acrossmultiple enterprises

• Helps review labour utilisation and

• Identifies wheremachines, implements andworkers are costly andwhere improvements can bemade

• Assesses the true cost of taking on new opportunities

No. of weeks worked

Weekly Hire Cost

Total Hire Cost

Owner- ship Cost

• Calculates accurate costingwhen reviewing contracting rates



400hp Crawler






Better to hire

advance to keep costs as lowas possible

350hpWheeledtractor 18





Better to hire

220hp Tractor






Better to own

170hp Tractor






Better to own


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