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MyFarm contracts 2011

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Contracts available with MyFarm

There are a number of ways farmers can be rewarded for working on MyFarm properties.
  1. Contract milking – our rate for 2011/12 was set at $1.05 - $1.10/kgMS.
  2. Manager on a regular monthly salary
  3. Earning a share of farm profit
 
Contract Milking
In general terms, the Contract Milker provides his/her labour, knowledge and skills to manage the business, along with (the cost of);
  • All staff required to operate the property
  • Small plant and equipment (e.g. tools, motor bikes, calf rearing equipment)
  • All shed expenses
  • Electricity requirements (not including irrigation).
Click here to view a typical MyFarm operating budget for a contract milker on a 600-cow farm. In this example the contract milker would occupy a managers home as part of fulfilling the contract, would be able to draw a $100,000 ‘pre-tax salary’ from their contract milking business, and is forecast to generate an operating profit after tax of $13,000 in year one, growing to more than $30,000 after the third year.
 
Management contract
The alternative to the above is an employment contract – at MyFarm we use standard fixed term agreements based on the Federated Farmers employment agreement.
 
Earning a share of profit
MyFarm also offer a share of profit for both contract milkers and managers if the farm business achieves 90% of the farm's Earnings Before Interest and Tax (EBIT) targets;
  • Earnings Before Interest and Tax is equal to the Total Farm Income less the Farm Operating Costs (and excludes interest and tax costs).  To align with the contract period the EBIT target is measured on a production season basis (e.g. from 1 June to 31 May).
  • The target is set at 90% of the annual budget.  Any EBIT returns above this are eligible for the share of profit.
  • The level of sharing will depend on the agreement negotiated but typically ranges from 10% to 25%.

Looking for more information?

  • Click here to see example budgets for contract milking and profit sharing
  • Click here to find about Equity Management with MyFarm
Or pick up the phone and contact Jenny in MyFarm recruitment 0800 693 276                
Email jenny@myfarm.co.nz