It’s quite amazing how the idea of this article was prompted. The author was having quite a heated discussion with his co-workers as to which start would be more profitable either with day old chicks or point of lay pullets. This was followed by a succession of similar questions from differing people the author encountered, who also needed some insight as to which start is more profitable. As a matter of fact both starts are profitable, but for people to compare which start is more profitable than the other they would need to fully understand and appreciate the risks (economical or management related risks) associated with each start. Moreover, the actual question to this discussion shouldn’t be based on comparing which start would be more profitable than the other, but rather how profitable both starts are. The author compared the risks for both starts, assuming two differing enterprises begin production at the same time for an 18 week period.
Risk assessment
Hens usually start to lay at about 18-22 weeks old, the easiest way to start out might be purchasing point of lay (POL) pullets. These are easy to keep, one get instant eggs, literally instant revenue and by this age the cockerels are quite distinctive from the hens. Undoubtedly, this is the most expensive start up method. Moreover getting point of lay requires the best of consideration. This is because farmers that will be selling point of lay may sell bad breeds of birds occasionally and may also lie about the actual age of the birds. This would mean that the birds might not lay at the expected time or they might have poor production. So buyers have to get the point of lay from a reputable producer. Same also goes for the day old too as many sellers can sell bad birds at day old so observance and getting birds from good source is the key.
A different approach would be buying day old chicks, however the level of stockmanship required is quite high, or certainly higher than purchasing POL, such that one might have to wait until gaining some experience before trying this. For example, quite a number of vaccinations are done from DOC to POL which require skill (injection vaccines). Contrary to POL, where two vaccination programs are done in drinking water or as a spray over 4 week intervals. In addition to this, there are lots of risks raising birds from day old in terms of brooding challenges, mortality rate and this is a major reason why people might run away from raising birds from point of lay as there is less probability for mortality.
Economic analysis
These two approaches are relatively good but it depends largely on the availability of capital for each start. Starting with point of lays requires a huge amount of cash which must be available before embarking on the project and as for day old, it only requires little cash to start as the price to raise a day old bird is smaller than that of purchasing a point of lay. The price difference of rearing a layer chick from day old to POL and that of raising one POL pullet can be as much as $12.99. It would actually cost around $5.85 to raise a DOC to POL (18 weeks) and $18.84 to raise a single POL pullet for egg production within 18 weeks. This would mean for the first 18 weeks an enterprise that starts with DOC has a negative gross margin of $5.85 per bird and that of an enterprise producing eggs by starting from POL would be -$5.40 per bird after 18 weeks (Table 3). In terms of gross margin during the first 18 weeks for both starts, it can be noted that there isn’t much of a difference per bird though it be huge with increased number of birds.
Table 1: Simplified budget for an 18 week rearing per bird (DOC start).
| VARIABLE COST | AMOUNT (US$) |
| DOC (per bird) | 1.40 |
| Layer feed (per bird for 18 weeks egg rearing) | 3.00 |
| Vet costs | 0.87 |
| Labour per bird | 0.30 |
| SUB TVC | 5.57 |
| 5% misc. costs | 0.28 |
| TOTAL TVC | 5.85 |
| Gross margin | -5.85 |
Table 2: Simplified budget for an 18 week egg production per bird (POL start)
| VARIABLE COST | AMOUNT (US$) |
| POL (per bird) | 12.00 |
| Layer feed (per bird for 18 weeks egg production) | 0.20 |
| Vet costs | 0.30 |
| Labour per bird | 0.28 |
| SUB TVC | 17.94 |
| 5% misc. costs | 0.90 |
| TOTAL TVC | 18.84 |
The total number of eggs produced from a single pullet over an 18 week laying period, assuming a laying percentage of 80% will be around 101 eggs. If the eggs are sold at $4.00 per crate, the enterprise receives a total revenue of $13.44 per bird (Table 3).
Table 3: Gross margin analysis for raising a single POL for an 18 week egg production period.
| Selling price per crate (US$) | 4.00 |
| Target laying percentage (%) | 0.80 |
| Total eggs for 18 weeks laying per bird | 101 |
| Number of crates | 3.36 |
| Gross income | 13.44 |
| Less TVC | 18.84 |
| Gross margin | -5.40 |
It can be noted that an enterprise that starts from POL would need to sell around 145 eggs (approximately 5 crates/bird) to break-even within a period of around 26 weeks. On the other hand it would also have taken an enterprise that started from DOC, 26 weeks to break-even through selling around 45 units (eggs) and around 34 weeks to realise a gross margin of around $6.00 per each chick from initiation of project.
Table 4: Break even analysis – DOC start vs. POL start.
| Type of start | DOC | POL |
| Target laying percentage (%) | 0.80 | 0.80 |
| Selling price per crate (US$) | 4 | 4 |
| Break even volume (number of eggs) | 45 | 145 |
| Break even period (in weeks prior initiation) | 26 | 26 |
| So these are the careful considerations anyone will have to be mindful of before making the decision as to which start they can pursue. |
Author: James Kabinda – a member of the Windmill Stockfeed Division
Graduate Trainee Student
(B Sc) Animal Production and Technology.
Cell: +263 774 225 873, +263 782 728 999