Back in 1995, things were looking pretty bleak over at Eastern Breeders Inc. at Kemptville.
Finances were on the proverbial manure heap and staff morale was at an all-time low. Something had to be done... nobody was sure what or how, but something had to be done and pretty fast. After all, EBI is a farmer-owned cooperative and farmers haven't much patience for finances that are sliding backwards.
A management change led to the hiring of Vince Bosquet as General Manager and a five-year turnaround plan was set into motion. Last year, as members learned recently at the EBI annual meeting in Kemptville, the plan began to bear fruit considerably ahead of forecast.
While revenues were down by four per cent to $7.4 million, the more important number posted was another 4.5 per cent trim off of operating expenses, bringing them down to $6.9 million last year and allowing the company to show a $56,000 profit. Since 1995, operating expenses have been chopped by 34 per cent or $3.5 million.
The true sign of management in control is a demonstrated ability to adjust to a loss in revenues. Faced with dropping semen sales, lower prices for the doses, and reduced demand for insertion services, Bosquet and his team have been able to adjust accordingly by working away at the expenses side of the ledger, primarily payroll.
It's always unfortunate when employees have to be sacrificed to the bottom line - in the case of EBI, 30 per cent since '95 - but that's a hard truth of sound business... the trade and returns must be there to justify the positions.
There are some structural developments in the AI business which Bosquet and company, although not completely powerless, are hard-pressed to counter balance. Competition world-wide is intensifying while the market is shrinking due to consolidation in the dairy industry and production efficiencies, leading to fewer cows needed to produce the same amount or even more milk.
That situation is not about to go away. It's about to become more acute. Where EBI can and must continue to exert true power is on managing expenses.
And you can't haul the load if you don't have the horses. EBI's financial turnaround seems to coincide directly with the arrival of Bosquet on the scene, a fact duly noted at the annual meeting by president Donald Bell. And it's duly noted here.