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Old Mule Farms

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910B04

OLD MULE FARMS

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 other identifying information to protect confidentiality.
Richard Ivey School of Business Foundation prohibits any form of reproduction, storage or transmission without its written permission. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Richard Ivey School of Business Foundation, The University of Western Ontario, London, Ontario, Canada, N6A 3K7; phone (519) 661-3208; fax (519) 661-3882; e-mail cases@ivey.uwo.ca.
Copyright © 2010, Richard Ivey School of Business Foundation

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.
COW-CALF OPERATIONS

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 is...

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