Offering staff the chance to own cows in the business is maintaining a good policy of recruitment and retention for a New Zealand dairy business that operates 58,000 cows.
But while a sharemilking structure, together with farming scale, underpin this model, it could work for British farms too.
The key is that cows remain in the business, allowing it to hold onto genetic progress and maintain biosecurity. And no more than 30% of the herd is in employee ownership.
See also: How a business develops young people to manage dairy farms
Business Facts: Dairy Holdings, New Zealand, South Island
Herd sizes range from 650-1,000 cows
66% of farms based in Canterbury, all irrigated
100% pasture based
Staffing
Dairy Holdings (DH) is New Zealand’s (NZ) largest dairy farming employer, with 400 staff at peak season, including farm, field and office support staff.
Finding good employees is no longer easy, even in NZ, and chief operating officer Blair Robinson says while their staff are still predominantly Kiwi, they are heading closer to a 50-50 mix with other nationalities.
To work as a farm operator (contract milker or sharemilker), however, requires residency, although within farm teams, staff can be on work visas ranging from one to three years.
The business employs eight to 10 sharemilkers, who own cows and get a share of the milk price.
They also recruit contract milkers, who are building equity to step into sharemilking and, eventually, farm ownership.
The latter are responsible for hiring and managing each farm’s labour units and usually have a good network, so know where to find good workers, says Blair.
Cow ownership for employees has featured from the beginning because the company began with sharemilkers who had their own cows.
As the business has grown, this aspect has simply been developed.
“We still want to create opportunities for the very best to go through to cow ownership and, surprisingly, this has endured. We attract and retain good people,” he says.
© Dairy Holdings
Employee owners
Some 16,500 cows in DH are now owned by its employees.
The vast majority belong to people running the farms, but there is a tractor driver who owns one cow, and a few of the office-based staff have 10-20 cows each.
“It’s a sound investment for them – it’s a bit of glue for us. They build equity and own the cows, and we lease them back.
“When the lease ends, we need to make sure we supply them with a sound, pregnant cow,” he explains.
“The farm employee is able to grow cow numbers at speed over the years. Some build up to owning 400-500 cows and can then apply for a sharemilking position.
How the scheme works
“You need to own at least 50% of the stock on a farm to be a sharemilker,” he adds.
In its 25 years of operation, about 50 of DH’s sharemilkers have gone on to farm ownership.
Blair says their system works around set calendar dates.
There is a call to “express your interest in buying stock” in October/November, and sales are completed by the end of May/beginning of June, ready for calving at the end of July.
Cows are traded through the company’s website and an employee needs approval (from senior management and their team supervisor) to buy.
“It takes a bit to work through, and you have to be objective and prioritise where it might be oversubscribed.
“Prioritising is based on employee performance, but the scope is quite wide: health and safety, leadership, development of their team members, their own development, particularly in leadership and financials, farm appearance and farm performance [milk production, reproduction],” he says.
“Last year, we had 5,000 animals wanted by 40 people and we helped facilitate the sale. We do not set the price, or receive money, and payment is outright – not attached to salary.
“We have a closed herd and the first right of refusal to buy. Values track the market value.”
Employee cows are leased back to DH with written contracts. Progeny belong to the owner, and there are options for youngstock to be reared and sold as surplus or join the business.
“We lease back at about $165 (£73) a cow a year and $141 (£63) for a first-calved heifer. We pay in two instalments. This year, cow prices averaged $1,860 (£828), so it’s an 8.8% return.”
The numbers
58,000 Crossbred cows in 2025
360 People employed
60 Dairy farms owned
20 Support properties owned/leased
28,000 Heifer replacements calving at two years
Cow ownership at 30% of herd
To work, the model needs people to grow their equity, then move on to create an opportunity for someone else, says Blair.
Otherwise, it stalls once someone owns most of the cows.
To maintain employee ownership at about 30% of the herd, “people need to leave, and people need to arrive”, which means cow owners must also be willing to sell.
Depending on cull rates, youngstock calving down and sharemilkers leaving, it all needs to balance out.
“We wouldn’t see that proportion grow, as there is a financial impact. We get it to attract and retain really good people. There is a trade-off of giving up assets, but we capture it by increased performance,” he explains.
A bad influx of Mycoplasma bovis about five years ago prompted DH to make the herd closed.
It runs its own support farms for bulls, youngstock rearing and dry cow outwintering, and no outside stock can enter the herds, including employee purchases.
This approach ensures genetic progress is kept by the company, he explains.
“We use high-fertility bulls and have got good results on our crossbred cows.
“If sharemilkers leave and keep taking good cows, or people bring their own cows with them, we don’t know what we are going to get, so being closed means we have been able to narrow our genetic spread.
“All our cows are good, and herds continue to improve. Otherwise, it’s two steps forward and one backward.”
Staff retention
The benefit of working for DH is continuity, for both staff and the farm business, says Blair.
Traditionally, sharemilking involves moving around to progress up the ladder into greater responsibility, bigger farms, and cow ownership.
This means families have to move too. By contrast, the DH career path allows progress while staying in the same community.
“Cow ownership is hard to quantify in retention and motivation, but it’s a stepping stone. We want people to succeed, and it has to play a part in our staff retention.
“People feel like they are getting ahead when they can rear and purchase stock. Staff tell us they feel like they are succeeding. It’s about creating a good reputation as an employer and people wanting to work for you.
“Reducing our staff turnover has been a real focus for us, and we have seen reductions of five to 10% annually over the past three years.”
