Simon Schulz has found the right formula for doing more with less.
Hold tight - we’re checking permissions before loading more content
The family farm can support up to 650 cows on its 350ha milking platform, but Simon dropped that number to about 450 when he purchased the business in 2021 from his father Michael.
With the vast majority of the milk servicing Schulz Organic Dairy, he didn’t need excess milk to sell at a cheaper price to others.
Apart from the first year, he’s now producing more from 430-450 cows than when the herd peaked at 650.
Before taking over the farm, Simon researched regenerative farming, including taking a study tour to the US in 2018 ‒ he says that was key to the success.
The farm near Timboon was established in 1972 by Simon’s grandfather Herman, arguably becoming the first organic dairy farm in Australia.
Simon could see the value of regenerative farming from an organic perspective.
“Where my father would previously put a lot of organic fertilisers on at a high cost, we could transition to minimise those and allow biodiversity on farm with multispecies pastures.
“We’ve seen progression each year. Even my father says he can’t believe I’m milking that many cows and producing that amount.
”We’re not high producers because we’re not pouring huge amounts of feed into the cows, but we’re above the industry average and we’re probably the highest producing organic herd.
“I put that down to the change of pastures, particularly focusing on the biodiversity of the species.”
Simon uses blends and recommendations developed by commercial companies. The blend currently being used has 19 different species, split between annual and perennial. The mixes differ each season.
A Soil Key Renovator is used, helping to aerate the soil in the high rainfall area to avoid compaction and pugging.
“We’re only three years into the process and expect it will take another three years to see what it can fully achieve, but we’re already seeing good results in our production figures.
“We’re producing more with 150 less cows.”
The cows average just under 8000 litres on the same milking platform, though Simon is now running beef on some land previously used for raising young stock and fodder.
Simon’s desire to introduce regenerative farming led to the ownership change.
“My father said he didn’t have the energy for that and if I wanted to do it, I’d have to buy the farm from him. That was the catalyst.
“We worked exceptionally well together as supplier and producer but it was time for a new challenge for me,” Simon said.
Being organic wasn’t something up for discussion.
“About a year after my grandfather started, the dairy industry had a milk price collapse and he couldn’t afford to buy the chemicals needed to farm in a conventional way and he was forced to leverage off his experience and my grandmother’s experience back in Germany with biodynamics.
“My father and I followed that trend and we’ve been farming organically for 54 years.”
In 1984, his father Herman built a processing plant and started Timboon Farmhouse Cheese in 1985. In 2000 it was sold to King Island Dairy which was later bought by National Foods before closing in 2009.
In the early 2000s, Simon was a typical teenager with no interest in dairy.
He worked under National Foods for two years in the factory before moving to Melbourne, where he learnt yoghurt production to add to his cheese making skills.
He wasn’t progressing with the Melbourne company and Herman could see his frustrations.
“He said, why don’t you come back and we’ll build another factory, so we converted a very old dairy into a new milk production facility.”
Simon returned to the farm in 2005 and began manufacturing the following year, creating Schulz Organic Dairy.
“We weren’t really in competition with the National Foods factory - we didn’t focus on cheese but on quark and yoghurt and whey-based drinks and sold at farmers’ markets rather than the major supermarkets.
“Through interaction with people, my business acumen grew. Retailers would ask if they could stock us and I’d say yes to everything.
“Some cafes asked if we would do milk for them so we invested in infrastructure and fluid milk is now 90 per cent of the business, backed by yoghurt and a little cheese.
“It’s a complete contrast to what my grandfather envisioned but as a small business, you have to be nimble.”
Schulz Organic Dairy, 20 years old this year, includes the farm, factory and café.
In total there are 55 staff which increases to 65 over the summer tourist period.
The farm is its own entity and needs to be profitable in its own right.
About 90 per cent of the milk is used in the manufacturing facility, with some sales of excess milk during peak production.
Simon has a general manager for the café and manufacturing arms of the business.
“I’m essentially non-operational – strategic only – so I could take on the farm business.
“I didn’t plan to be a farmer but I knew I needed to secure my milk source - because we’re a single source business, it made sense to buy it.”
The herd is 70 per cent Holstein, 15 per cent Jersey and 15 per cent cross-breeds.
“We’re not necessarily chasing butter fat; we’re chasing the volume,” Simon said.
“Baristas and cafes like our blend which has good flavour and texture but also frothability. We don’t standardise our products. What comes off the cows today, the customers will see in the shops tomorrow.”
Simon learnt early on in his dairy career that he was not a ‘cow man’, but he has a team of eight running the day-to-day farm operations.
“My team knows that if I have to milk cows we’re all looking for a new job because I’m selling,” he jokes.
He’s found a way to ensure that will never happen with a new robotic dairy soon to be commissioned.
“We’ll probably have a two-month painful transition, but the system will manage the quality of milk a lot better,” he said.
“It will be more proactive – we will be able to see if a cow is going down in condition. At the moment we rely on operators, and even the best can have an off day and miss little things – the computer won’t.
“The dairy was 40 years old so we had to build a new one anyway. The cost of going robotic rather than conventional is about $1 million more but we expect the labour saving will cover that in five years.”
The farm has had four calving periods to maintain the year-round milk supply, but Simon expects calving to run year-round once the robots are in action.
Simon spoke at the Australian Dairy Conference this year about succession, and the Schulz family is a shining example of succession success.
“I wasn’t interested in dairy farming or manufacturing; I just wanted to be my own boss, but with support and guidance from family, that passion grew and it allowed us to grow as a business,” he said.
“You’ve got to encourage the next generation if they have an idea – give them an opportunity and support them.”
Simon is following that tradition with his daughter now working in the factory on school holidays.