Cracking the Code: Egg-ercising a Profitable Strategy

I would hardly call this a “strategy” for egg sales, but more like a reality of what to expect during cycles of production of your hens. If you look at it in detail, it can help to formulate a plan for pricing to sustain your investment throughout the year.

So, you want to start an egg business. The little fluffy butts just make little gold nuggets right out of their booties that you can eat and provide for your family, and you can sell the excess so that you can make up some of the costs. I’m going to provide some detail in regards to what our experience has been the past 2 years with an egg laying business and hopefully, you can overlay that onto what you’re doing, and hopefully come up with a strategy for pricing so that you’re not hemorrhaging so much money. So lets step back in time for a minute and reminisce where Dos Lobos has been in the egg business the last 2 years…

In 2023

We started out in 2023 with the purchase of 45 chicks in January and then we added 18 more in April to offset the mortality rate in the first batch of chicks. The goal was to get 50 layers for the first year or close to it, given the fact that some would die, and others would turn out to be roosters. We wound up with about 53 that first year, and spent $353 to purchase all of those chicks which averaged us $5.60 per chick, including shipment from McMurray Hatchery.

At the time, I had done a Google search to see how much feed a chicken would eat per day. Google said ¼ pound. If you’ve had chickens for long, you know that’s completely wrong. Apparently, I missed in the search that it said “chicks” and not “chickens” daily intake of feed. So, my calculations of feed was correct for about 2 months, then things became off, and I searched again later and found out it’s closer to ¾ of a pound per head per day that they consume by the time they’re adult size at about 4-5 months old. Ouch.

I bring this up because I was trying to source corn-free, soy-free feed by the bag. No feed store locally sold such a thing, and the ones that supposedly did within 30 miles, I could never get a return phone call from if they had any in stock. I also couldn’t just show up at their store because both of these stores had their hours listed as “by appointment only” – it’s kinda impossible to do business with those hours if you never answer the phone and return calls. I tell this portion to explain how at the time, this narrowed down my options to basically one: ordering online from Grubbly Farms to get corn and soy-free feed. Their feed was $1.50 per lb. That’s EXPENSIVE, but it was still .50 per pound cheaper than the other 3-4 options out there in the online world.

I could have just gone with conventional feed, of course. But I was trying to target a specific market that wanted eggs produced by hens fed this type of ration. In fact, we soon realized that 53 birds x ¾ pound of feed per day equaled 39.75 pounds per day to feed these guys this expensive feed. $59.62 per day x 30 days per month = $1,788.75. For 53 birds; that is NOT sustainable. For posterity’s sake, if every bird by 5-6 months old is laying an egg a day, that would put your eggs at $1.13 each or $13.50 per dozen to break even (yes, they don’t lay every day, but it’s just a quick figure). So after I realized my mistake with my Google search on feed consumption, I quickly had to look for other options, and the only option was conventional feed.

We selected Kalmbach layer feed from a local feed store as it was a hair cheaper than Purina, but still a good quality feed. At the time, it was $28 for a 50lb bag, or .56 per pound. That stopped the bleeding for a bit, but it was still not sustainable because they were eating at least half a bag a day, and foraging the for the other half of their calories. So in the summer months, for roughly $14 per day (half their calories from feed, and the other half from foraging for free off the land), that put us at $420 per month to feed 53 birds. That meant that eggs were .28 cents each if they laid daily. .28 x 12 = $3.36 per dozen to break even on just eggs.

Let’s talk packaging and labeling right quick. I acquired labels at the cheapest I could find at the time at about .50 cents each with all the legal requirements printed on it, and cartons I found the cheapest at .42 cents each. Add that to your total egg cost and now your break-even point is $4.28 per dozen. At this time, I had my eggs priced at $6 per dozen and they stayed priced there for about 18 months. Now consider the fact that hens don’t lay daily, it’s more like every other day, so roughly 3-4 eggs per week averaged out; throw another wrench in there, and add times of stress (heat is a big one… they don’t like heat and will drop production), add the tapering off of laying when daylight hours dwindle in the fall and winter, and now, you’re getting 1-2 eggs per week per bird, or less. Add their annual molt where they don’t lay for 2 months straight… you see where this might be headed by now.

On top of all this, we had just launched our website in August of 2023 to sell eggs and our first batch of USDA processed chicken. We had a few free ads here and there, plus our social media. When we bought the farm in December 2022, I was already receiving calls for eggs in January 2023 with one single free listing, but I didn’t even have birds yet! That was during a time of mass euthanasia of egg laying flocks across the US because of bird flu outbreaks. As replacement pullets came online for these flocks, demand for eggs dried up by the time my first batch started laying at 5-6 months old in June/July. So when I launched our website once we had product in stock, we got 0 sales on our eggs for the rest of 2023.

$420 per month x 6 months = $2,520 spent after the birds reached production age with 0 egg sales. OUCH. And that doesn’t include the expensive Grubbly Farms feed that they had the first 4 months or so of their life before I caught my mistake on feed intake. Our first year was a complete bust. Add to that, 0 sales on the 50 broilers we processed, and break-even on 3 hog halves we sold to friends and family, and a small loss on the first 19 turkeys we processed and sold. That’s another post for another time.

Back to the egg conundrum of 2023… we decided to change feed one more time on the hens in 2023 around September. $0.56 cents per pound was better than it was, but it still wasn’t good, and for conventional feed at that. So we decided since we weren’t getting any egg sales after a month or so after the website launch, we needed to cut our costs on eggs even more. It was either sell birds off or find cheaper feed and hope sales would take off at some point. We opted for cheaper feed since we were already feeding conventional. We found MFM brand layer feed at the feed store for $16 for a 50lb bag, that was $0.32 cents per pound. We fed that for about 2 months and as a result, egg production plummeted and we were only getting 2-3 eggs per day, or a dozen per week. All of the research showed that they should still be laying even though the daylight hours were shrinking, but not enough to stop production completely.

In November 2023, we switched back to Kalmbach so that we could get the egg production back up. It took about a month for the birds to recover and start producing a little more, but at that point, it was well into December and they were laying less and less with the daylight hours shrinking. Still, supporting 53 birds on inferior feed that nixed egg production was $381 per month. Divide that by the 2-3 eggs per day, 1 dozen eggs per week, that’s $95.40 per dozen. The moral of that story is pretty clear… don’t feed the cheap stuff!  Not only that, we discovered that the cheap stuff was so devoid of nutrients, that the chickens ate MORE to try to sustain themselves on their own. So after that, we went back to the Kalmbach feed at $0.56 cents per pound and didn’t look back. Our eggs were going to have to be conventionally fed as that was barely sustainable in itself!

Fast forward to 2024…

We had about 2 dozen in egg sales online from January to April; for whatever reason, in January, a couple of customers started to find us and the orders started to trickle in. I also paid for advertising monthly on Facebook with a budget of $125 per month and I ran ads from February to May, targeting a local audience only… according to the back-end statistics from the website and my ads center on Facebook, 0 of that ad money spent produced a sale. We will never use Facebook advertising again. I think we sold 4 dozen eggs from January to May and sold maybe $200 worth of chicken, all from the same single customer. Eggs from the time the first batch of hens started laying in May 2023 to May of 2024, all got fed to the dogs and the pigs. We gave away as many dozen as people would take, which wasn’t much because people felt guilty getting free eggs from us, but it was better than feeding them to the pigs. In total, I think we gave away about 10 dozen eggs to friends and family in this period.

Our last resort was to get into the farmers markets in order to make this whole meat venture work, the eggs be damned… they weren’t part of the business model anymore, but we kept up production just in case we got sales. At least our 7 pigs were eating well. In April of 2024, Argyle Farmers Market found us on Texas Real Food and wanted us to come be their chicken vendor for the season. So in May, we had our first farmers market and holy crap, we sold out of 20 dozen eggs or so in about 20 minutes, and sold out of about 50lbs of chicken that day, about half of what we had produced our first year in July 2023. Still, it was the only market we were doing at that time, and so another 60 dozen eggs were fed to the pigs that month until the next market in June where we sold another 20 dozen eggs or so in about 20 minutes and sold out of the rest of our first batch of chicken completely. We didn’t do a market in July because we were out of town that same weekend for a wedding, so dozens of eggs were fed to the pigs during non-market weeks, along with 0 online sales still during this time, roughly 80 dozen eggs a month.

I will also add that in January and February of 2024, I added another 78 chicks to the tune of $549 to try and get ahead of our plans for spring farmers markets. That came out to $7.04 per chick… prices had really shot up. These chicks were partially a replacement of about 20 or so I had lost from the first 53 over the course of the first year, and an intention to scale-up. I also had bought an incubator and had hatched about a dozen or so experimental crosses from my first flock. About 6 that hatched were hens and were added to the flock. They are some of my best producers and that was a really good cross breeding experiment with White Leghorns and an F2 Olive Egger rooster I had purchased locally. All of these birds hit their first production when we got invited to a 2nd farmers market in Sanger in August of 2024.

The January and February batches of chicks were… a really hard one. When they had reached a safe age to be placed outdoors, they were provided a shelter in a grow-out pen outside, etc., while the rest of the adult flock of about 30 were in the big coop in our backyard. Around the end of March/April of 2024, we had several weeks of really cold rain. Those dumb little babies would stay out in the rain instead of go into their shelter at night. Despite making sure to go out after dark and make sure they all went inside, they would still venture out and get wet, and get cold, and die. I lost about 20-30 or so babies out of those two batches of birds at about 3 months of age. I wound up with about 50 replacements for the 20 I had lost the previous year, so I was running about 70 laying hens in the later summer/fall of 2024.

As soon as we had some success at the first Argyle farmers market in May, I bit the bullet and upgraded us to a 1 ton feed buggy for $2,650 at the end of May. I had found out that Tony’s Seed and Feed in Meunster not only had the corn-free, soy-free, non-GMO feed I wanted to feed to all of our animals, but they had it for a very reasonable price! Our layer feed went down in price from $0.56/lb for bagged, conventional feed, to $0.22/lb if purchased by the ton. Our 70 or so hens, plus laying ducks (only 6 at that time), had become much, much more manageable, plus, we were now able to feed premium feed that everyone was after! Our monthly feed bill for the hens went from $882 in April (because remember, we now had 70 full sized birds eating $0.42 cents per day in feed at ¾ pound per bird per day), to $0.17 cents per day per bird, to the tune of $346 per month! All of a sudden, eggs were at least starting to become viable as a revenue stream. Still, only about $120 in egg sales in May and June wasn’t enough to recoup any of the cost of the new feed bill, but it was sure a help! On top of that, we never dropped in production with the new feed, so it was still a comparable product in nutrition to the Kalmbach.

Skip ahead to September when we joined the Sanger farmers market and now we were selling 20 dozen eggs or so, per market, 3 times per month. We were able to sell 60 or so dozen eggs per month at $6 per dozen. That’s $360 in egg sales in September and October, but only about 40 dozen in November due to only having 2 markets that month. We still wound up feeding 20 dozen per month to the pigs in September and October because we didn’t have enough sales, but at least we weren’t in the negative completely anymore on eggs. We were up $14 per month on eggs! Ha ha. Honestly, it was a little better than that because the birds were foraging like crazy during the summer months and we were able to stretch a single ton of feed for 70 birds out to 3 months. So one ton of feed at this time was $440 divided by 3 months is $147 per month to feed 70 birds premium feed. So we actually made $420 in the months of September and October 2024 on eggs! It still doesn’t touch what we lost in lack of sales and waste to the pigs since January 2024, but it was a light at the end of the tunnel! (We won’t even touch what we lost in 2023… that’s a sunk cost that will never be recovered.)

Fast forward to November when there were no more farmers markets, sales dropped off immediately, and on top of that, feed prices jumped to $0.33 cents per pound for our new feed. A ton of feed was now $660. To recover that loss, we had to raise our prices from $6 per dozen to $7. In January 2025, I had to refill the feed buggy and the price remained the same as November. In between the time that we ran out of feed and placed an order for more feed in November, the mill informed us that there was a shortage and it would be a couple of weeks before they could mill more feed. So, back to feeding bagged feed we went, only this time, I knew we wouldn’t have a lot of egg sales because there were no more markets, and the girls were laying way less now because winter was approaching. So I opted to save as much as possible, and only bought the (now) $14 per bag conventional MFM layer ration.

We fed that for 2 weeks until Tony’s could get their ingredients delivered, and man, did production drop like a rock! We went from about a dozen eggs a day, to 2 eggs a day in our flock, and they didn’t recover from that until the end of December. We literally got 12 eggs PER WEEK in December 2024 from 70 birds. It was abysmal. Fortunately, or unfortunately, we also only had 2 online orders in all of December and were not experiencing a demand for eggs. By the last week of December, their normal feed nutrition had kicked in, and they started producing a dozen or two eggs per week again. The farm only covered 10% of its monthly operating costs in December from online sales.

On to 2025…

If you made it this far, your head should probably be spinning trying to compute the losses on egg production for 2023 and 2024. Yep, it’s bad. That’s about all I can say about it. Eggs are a very, very tough and volatile market, and if you’re a new farm starting out like us in this time period and no one knows you even exist, it’s even tougher. But, the good news for us as a small producer (but very bad for the big guys) is there’s a new bird flu outbreak making its rounds. Flocks are being put down by the 10’s of millions already around the country, and as a result, we’re seeing egg prices skyrocket in the stores. I priced Wal-Mart cheapy eggs at $5.76 per dozen locally on Friday, January 31st. Pasture raised eggs in Kroger are $9.99 per dozen. My corn-free, soy-free, non-GMO pasture raised eggs right here out of Decatur, Tx are still at $7 per dozen. In January, we produced about 30 dozen eggs as the daylight hours start to extend a little more each day, and I noticed that our egg production has risen by 40% since the last week of December. We sold 25 dozen eggs in online sales in January! We think the uptick in sales is a result of the egg markets imploding in the grocery stores. As a result of egg sales, meat sales have gone up for us, too. We were able to cover 97% of our operating costs in January thanks to meat and egg sales in our online store!

We also have a batch of 30 pullets starting to come into lay right now that we purchased as chicks in September 2024. So our laying flock grew from 70 to 100 to get us ready for the farmers markets to start in March, but we’re able to keep up with the demand for eggs right now thanks to planning ahead in September. Add 6 turkeys, and 16 ducks to that number, and we’re currently running 122 birds in our flock. The turkeys are starting to lay as well and the intention is to hatch their eggs and sell poults and hold onto 30 to grow out for our Thanksgiving crop this year. So far, none of their eggs that we’ve cracked open have been fertilized, so I don’t expect to start hatching turkeys until April/May. In the meantime, we’re eating the turkey eggs since I’m allergic to chicken eggs. We also have about 17 of the original flock from 2023 left that will drop their egg production by 30% due to their age about middle of this year. We purchased 40 Red Star and 10 Olive Egger laying hen chicks a couple of weeks ago from a local grower at Hoffman’s Poultry in Sunset. So, we’re still thinking ahead about replacement and keeping our numbers up. These chicks weren’t nearly as expensive either and were $4.46 a piece thanks to the volume that Hoffman’s orders from the hatcheries. Though I think I’m going to take our 15 or so Rhode Island Red hens this summer and pull their eggs and incubate them around August/September so that I can self-replace from now on instead of ordering from the hatchery so much. That will help with costs a bit.

After sitting down and doing all of this math, I’ve come to learn a couple of things about our flock. We have peak production about 6 months out of the year. For 2 months out of the year, we have 0 production out of certain aged batches due to the molting of their feathers. Then, the other 4 months of the year, egg production drops by 40% for 2 months in a row, and then flips back and increases by 40% for 2-3 months in a row until they start to reach peak production again in the spring/summer months. This is a rough estimate, especially because we’ve lost production just because we decided to switch to a lower quality feed a couple of times. But in looking at this, we can see a cycle start to appear, and thereby plan our flock replacements accordingly; one replacement batch in the later summer and one in the late winter around January/February seems to be the sweet spot for buying chicks to replace aging hens and hens that will soon drop for a couple of months so they can molt.

Below is the trend that I have kind of noticed over the past 2 years in our flock with peak production hitting around April-June, then dropping once the “100 and hell” temps of Texas summer hit and we lose some production, followed by a quick spike upwards again in the fall once temps get to highs no more than 90, then as daylight hours dwindle, production starts dropping by about 40% per month and then rises again by 40% per month starting in January.  This isn't sourced from anywhere, this is just my numbers from Excel.

Based on this trend, I can expect to buy 4 tons of feed throughout the year to feed roughly 100 birds, including a handful of ducks, turkeys, and chicks at varying stages of development (meat production birds excluded). Four tons of feed at current prices of January 2025 will run me $2,640 for the year. We generally gain an extra 4 months of feed off the land via grass and bugs during spring, summer, and fall. So we technically only need to feed enough on paper for 8 months out of the year. Last year, we sold about 220 dozen eggs, but produced at least twice that. That would put our break-even price per dozen eggs for 2024 at $12 per dozen IF, and only if we were feeding our current price of feed. If we had also sold everything that we wound up feeding to the pigs, our break-even price per dozen would have been $4.89 per dozen. Add $0.92 cents for packaging and labeling, our break-even would have been $5.81 per dozen. If we had sold all of our eggs last year and we were priced all year at $6 per dozen, we would have made a profit of $0.19 cents per dozen. Add that up, and that would be $102.60 in profit on eggs all year. Count all the eggs we had to toss because they were too small, too dirty, or got cracked, even if we sold everything else we produced… well, I think you can see that profit go down the drain pretty quickly.

Pretty sad, huh? Especially knowing we spent WAY more on feed last year than that before we got the discounted feed by the ton.

So, as a hope for the rest of 2025, we expect to produce with our current mixed flock, 8,000 eggs this year, which is about the same as last year. On paper, it should be way more than that, especially once we mix these production breeds in that we bought in January from Hoffman’s. Our current flock is a mix of several different heritage breeds and zero production breeds (crosses such as Production Reds/Red Stars, the new ones from Hoffman’s are Red Stars and *should* lay 300 eggs a year each). So far for 2025, we’ve sold 83% of the eggs that were produced. The other 17% were too dirty or were cracked and fed to the pigs (we had a week of snow and ice and our flock LOVES to lay eggs in mud… don’t know why, they just do.)

At best, if we hoped to sell 83% of the eggs we produce the rest of the year (following the January trend), that would be 553 dozen eggs to sell this year, which is $3,873 in revenue, minus the cost of feed at the projected $2,640 for the year, would give us $1,233 in profit this year. Minus $223 for the chicks I just bought to replace older hens this year, plus the cost to feed them until they’re ready to lay, which is about $154 for chick formula for 4 months for 50 birds, equals $856 projected profit on eggs this year. Again, IF they all sell. I will add that I purchased labels by the 1000 this year, that way I could save some money and get our labeling and packaging down to $0.67 cents per carton vs $0.92 cents.

Not calculated into any of our egg production costs, however, is overhead. The cost to house birds, electricity use under heat lamps in the brooder, air conditioner costs in the brooder room in the summer when we start fall batches of replacement layer chicks, the cost of time to collect, clean, and package eggs (which takes 1 person an hour to do 20 dozen eggs by hand without a mechanical scrubber), time and fuel in transport to and from the farmers market or any retail stores that will sell our eggs, and… the cost to pay our mortgage, and ourselves… I have included none of this in our calculations.

We use a “shop rate” to calculate our overhead and our time spent tending to the animals on a daily basis. That’s another post in itself to explain how to calculate a shop rate, but a rough estimate of the time we spend each day feeding, moving birds on pasture, gathering eggs (at least twice per day so the birds don’t step on eggs and break them), the time to clean and package eggs, we’re looking at 2 hours per week on just egg layers, or 104 hours per year. At a shop rate of $100 per hour (overhead, electricity, equipment, the mortgage, and paying ourselves), then the added cost to produce eggs from 100 birds is $10,400 per year. All that said, eggs are just not a sustainable source of income, and not at such a tiny scale of 100 layers.

So why even bother producing eggs? Believe me, we’ve asked ourselves the very same question many, many times. We’ve only done this for 2 years and already we’re saying, “We want out of the egg business!” and then we go buy 50 more layer chicks. Why? Because eggs are the #1 item that brings customers in the door, and not just because of right now with nation-wide egg shortages. Eggs are purely a marketing tool. Everyone loves real, farm fresh eggs. And educated customers want the corn-free, soy-free, non-GMO fed eggs rotated daily on pasture. Why? Because of the added nutrients that it brings. I’ve shown the graphics from APPPA before on our social media page that shows what pasture raised eggs bring to the table nutrient-wise. Plus, it’s better for the birds and is humane. We all have a heart for animals, especially those of us who are so close to them daily.

For sure, one of our strategies going forward with our layer flock is to reduce the number of heritage breed birds (we currently have a mix of 30+ different breeds) and start using more of the production breeds and crosses. That should in theory boost our number of eggs available, and knowing the Argyle farmer’s market, they’ll all sell out. Argyle loves their eggs! I certainly don’t expect to make a profit on eggs, even given everything projected for the year here, maybe break-even this year and then I would be happy. Maybe adding more production crosses like the Red Star will help, but I won’t know for sure until next summer after these 50 have been producing what that will bring. On paper, just 50 Red Stars should produce 15,000 eggs in a year. I highly doubt they can do that, especially when they get into our brutal summer months. On paper, those 50 hens should bring us $8,750 in revenue in a year. I just don’t see it happening, again with the heat in the summer. If you’re in the camp of, “No, you should run heritage breeds only,” I think I’ve laid out a pretty solid 10 page ROI against it here. Unless you’re operating for charity, you can’t run purely on heritage breeds and hope to do better than break-even. Heritage breeds bring income to breeders selling to backyard enthusiasts. I love the heritage breeds, don’t get me wrong. They’re GORGEOUS birds. But they can’t feed the local community at a sustainable level, or price.

So what was the point of all this? I wrote this so that anyone new to this egg business (newer than us) might have a chance to learn what they might encounter. We were new to farming, new to Decatur, and didn’t know what the best sources were for feed, etc. So, we spent 2 years learning and trying not to break the bank and balance a large enough flock to be able to scale up (or down) if we needed to. Until we got into the farmers markets, we were already considering scaling down (ALL the way down) to just enough to produce for ourselves, including the meat production side. Getting started as a small farm is tough, more so for getting your name out there than anything. Don’t get me wrong: the demand for locally produced farm fresh meat and eggs is huge. I see it everywhere, especially on social media and in private online groups. People want locally sourced foods, but getting connected to the farmers is dang near impossible. As a farmer trying to connect with the public, it’s also dang near impossible.

If I had advice to give a new farmer just starting out, it would be this; get yourself into a farmers market as soon as possible. I really like what our friends at Rockin’ P Farms in Sherman has done, and they did a couple of specialty events, had a booth, and just signed people up for half and whole hogs. No need to carry an inventory of meat! That’s smart. Second, as soon as you have a way to get discounted feed by the ton, jump on it. If you have to drive 6 hours to buy from Tony’s Seed and Feed in Muenster, Tx, do it. I’ve heard of farms driving all the way from South Texas just to buy from Tony’s because the value is so high, but the product is so inexpensive. Lastly, run your numbers, and then run your numbers again. Watch your flocks and herds and have a finger on their collective pulse. Have a finger on the pulse of the public, too. They will give indications on where the market is headed. Watch the news. We had bird flu in early 2023 and now again in early 2025. Every market, every disease, it all has a cycle. Position yourself to be ahead of the next cycle, even if that means cutting some numbers via sales of your livestock or culling. Be ready to pivot to other breeds of livestock if the numbers aren’t making dollars and sense.

One thing that I didn’t mention and will stop here and leave it for a part 2 of this post at a later date is the value provided by the manure of your birds on your fields. My flock of 122 birds is producing 30 lbs of manure per day on my pasture. That translates to a lot of fertilizer savings. But, I digress… another day. Thanks for enduring and reading this to the end! I hope it helps give new farmers a better picture of production and I hope it provides the public with an idea of the value that is behind egg production on a small scale.