Out Yard Financial Analysis by David MacFawn

Out-yards can be beneficial and enjoyable.  Where you locate your hives is very important for colony well-being and honey production.  A varied pollen source is important for the colony’s nutrition, for both brood and adult bees.  As your bee operation grows, a small or sideline bee operation could benefit from out-yards.  Out-yards that you can service within a day may be affordable and workable.  A basic financial analysis is in order to determine if you can cover your costs for that out-yard.

 

Traveling may be beneficial to access a location where the plants bloom earlier due to warmer weather.  In my case, I live in the Columbia, South Carolina area and have out-yards not only in South Carolina but also southern Georgia.  Southern Georgia is far enough south that the Maples bloom around the end of December / first of January.  A nectar flow starts in the February time frame which means I can build up colonies in January and February for splitting and/or honey production.  The nectar flow in the Midlands area of South Carolina starts around the first of April and continues thru about the first of June.  Hence, I can move the hives from southern Georgia back to South Carolina to catch the South Carolina flow.  This will give me about four to five months of nectar flow.  I can split around the middle of February to the end of March in Georgia, and split again in South Carolina in the May/June time frame, and again in July / August prior to cotton and soybeans.

 

A beekeeper can consult the literature, university and state extension web sites for information on blooming plants in various regions of a state.   Beekeepers can also consult on-line historical weather data (like http://www.weather.com/ ) for location temperature averages.  Also, many counties have on-line land owner, address, and parcel size information to locate land owners willing to allow you to place a bee-yard on their property.  As you can tell, advance planning is important to determine where and when during the year to establish your bee-yards.

 

It typically takes two to three years to determine if an out-yard location is profitable.  Yearly weather variations occur.  Also, the beekeeper needs to determine how many colonies the location can support and how many colonies the beekeeper can manage at the particular location.  In most parts of South Carolina, 20-25 colonies maximum seems to work well for both the location vegetation and being able to work the colonies in about a half a day, with the remaining time traveling.

 

In addition to truck mileage cost, there are trailer “rental” costs plus your time.  This is compared to the value of the honey or pollination that you would do, to determine if you can make money on the out-yard.  You need to determine your per pound honey value from your accounting records.  The value of your honey production can be determine by the jar selling price divided by the weight, typically in pounds in the United States.  You will also find that your hive investment will be covered more by an increase in honey production or pollination.  The beekeeper will also be able to build up his colony numbers quicker.

 

If you do not own a trailer, you may want to consider renting one initially until you are sure the out-yard is productive and you will need one permanently.  A trailer with a ramp is recommended if you do not have the hives on pallets and a fork lift to load and unload.  Transporting spare equipment also needs to be considered.  The hives should be strapped / duct taped and a cargo net over the hive cargo.  Also, the hive entrances should be closed.  I use a #8 hardware cloth cut to the entrance size, folded and stuffed into the entrance.

 

Trailer  size approximate number hives can transport
4’x7’  8 hives
5’x8’  12 hives
5’x9’  15 hives
6’x12’  28 hives

It is cheaper per hive to transport a “full load,” of hives than a partial load.  This may be eight to ten colonies or more in a pickup (depends on if you want to stack them).

 

I use a spreadsheet to do “what ifs” for tradeoffs between distance costs, trailering cost, honey and pollination revenue.  This analysis does not have to be elaborate but something quick and simple will do.  However, depending on distance, there may be other travel expenses, bottling expenses, and overhead expenses.  Also, with pollination there may be feed cost.

I typically determine mileage to each of the out-yards for the US federal mileage rate and also for the gas only expense (gas per gallon / miles per gallon) for comparison.  The federal mileage rate will give me closer to actual total cost and the gas only expense will give me the up-front expense.  I add the trailering cost to determine a total cost.  On the revenue side I calculate the honey produced in each out-yard for total honey revenue, and add the pollination revenue.  I can then calculate the out-yard profit and total profit, and the additional revenue from establishing the out-yard.  A resulting additional out-yard profit per hive can be determined (honey production from the existing colonies and splits).  It should be noted that it will take 2-3 years to see if your assumptions that the spreadsheet are based on are correct.  Also, in this analysis I am only accounting for some of the variable cost (marginal cost), not the fixed and overhead cost

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Out-yards are typically needed for a growing operation.  However, up-front planning is necessary to make sure you locate the out-yard such that you can cover your expenses and make money.  It should be noted that there is a distance/volume/revenue relationship in establishing out-yards.  The more hives that you can transport for the distance and the expected revenue is important.  There is typically a minimum number of hives that need to be transported for the distance to make money.

 

David E. MacFawn

Lexington, South Carolina USA

dmacfawn@aol.com