Old Mule Farms

In: Business and Management

Submitted By fiona0314
Words 2454
Pages 10
For the exclusive use of S. Jiang, 2016.




David M. Currie and Lorena Mošnja Škare wrote this case solely to provide material for class discussion. The authors do not intend
to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and
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Version: (A) 2010-05-03

In March 2009, Donna and Jim Green looked with dismay at the financial statement summarizing the
performance of Old Mule Farms for the year 2008. Old Mule’s cow-calf operation had experienced
another year of losses. Especially frustrating was that the losses occurred despite the Greens’ multiple
efforts to improve the farm’s efficiency. While these efforts improved performance compared to 2007,
they were not sufficient to overcome the decline in calf prices, so the operation continued to lose money
(see Exhibit 1). If the situation did not improve, the Greens faced the threat of losing the farm that had
been owned by the family for three generations.

The cow-calf segment is the foundation of the beef cattle industry. A ranch maintains a herd of cows,
each of them expected to wean a calf once a year. Like a human, the gestation period of a cow…...