Investing in Livestock Is Saving Money Safely

Buying livestock can help us save money safely so that we don’t spend it.

It can also be an investment since it generates an income, like interest that is earned when money is saved in a long-term investment account at a bank. The animals grow or produce off-spring, and the added weight of meat or new calves are similar to interest being earned. “In the same way that an animal needs grazing to produce meat for people, businesses need to re-invest to generate profits. Knowing where to invest attention or money is crucial, because if we invest it in the wrong place the business may become weaker,” says Selma Shipanga, communication officer at Meatco.

Investing in livestock may earn us more interest than if we invest money in a bank. However, it also has a much higher risk, because if animals are not well looked after they may die, lose value from disease, or they may even be stolen. Investing money in livestock should be approached carefully. Some farmers may think that buying more animals will earn them more income, and thus make them richer. However, sometimes it may be wiser to improve the quality and value of the animals the farmer already has.

It is important to first improve the weakest aspects of the business.Consider this example: “A farmer decides to sell his cattle for the best price he can get. He loads the cattle on a truck and heads to the market place to make the sale. Halfway before he reaches the market place, the truck breaks down and has to be fixed first before he can continue transporting the animals. The farmer has to spend money to fix the truck and it takes him two days to get it done. For the two days when the truck was down, the cattle had to remain on the truck, with no food and no water, which caused them to lose weight. The farmer finally arrives at the market place and sells his animals, but the price he gets is not that great due to the weight the animals lost during those two days when the truck was broken.”

When investing

When making an investment decision, it is a good idea to imagine the farming business as a chain. Only when the weakest link is strengthened will the whole chain be g, and the profits good. If we improve another link that is not the weakest, the chain will still be weak, and the profit will be low.

Source : New Era