Ex ante evaluation of the financial effects of investments
The article contains a suggestion for examining planned investments in terms of their profitability (an ex ante evaluation). Since for the average Swiss farm the remuneration of family labour is far more important than the remuneration of equity capital, interest is primarily focused on the change in either labour utilisation per hour or the actually realised hourly wage. This is determined in each case with a calculation before and after the investment, which requires a cost/ performance calculation on a full-cost basis in both cases. The approach is illustrated by means of an average commercial dairy farm that is converting its tied-housing system into loose housing, increasing its capacity by seven places to a total of 30 cow places in the process. Assuming full utilisation and a constant milk price, the investment enables an increase in labour utilisation of around CHF 4 per hour to be attained.
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Ex ante evaluation of the financial effects of investments