Optical distorcion

Optical Distortion Notes

I. How much is a pair of ODI lens worth to the chicken farmer?

The value for the farmer is value of substitution in use, in other words substitution of the existingmethod “debeaking”. So the value of a pair is

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So let us consider the benefits to the farmer per bird per year. The sources of benefits are

1. Reduced chicken mortality.

Mortalityreduced from 9% to 4.5%

The present cost of a surviving bird (including dead birds) is = $ 2.61
Less the new cost with the lens is $ 2.40/(1-0.045) = - $ 2.51
_________10 cents

2. Feed savings

Assume that the feed depth is reduced by ½ feet. Some of you might have assumed that the feed depth is reduced by 1 foot.

156/2 [Savings for ½ feet per day] X1/20,000 [savings per chicken] X 158/2000 [savings/lb] X 365 days

This gives us feed savings of 11.25 cents.

3. Savings on egg production

This could be because of less trauma. Based on anone egg increase relative to debeaking per chicken per annum.

1 egg X 1/12 0.53

This gives us a savings on egg production to be 4.5 cents.

Thus the total calculable economic benefit to thechicken farmer in use over debeaking = 25.75 cents

4. Other benefits:

Some other benefits you might have thought about:

• Labor cost of inserting lenses versus that of debeaking. This can beseen as a wash (220/hr debeaking vs. 225/hr. lenses).
• Increased egg production among lower pecking order birds
• Less dead birds = less trauma for survivors = more egg production.Segmentation

In geographic terms California is the largest market. Followed by Florida + Georgia + Carolinas. The issue is that ODI is a start up with capital of only $ 200K. This might call for a morefocused rather than a broad roll out.

In terms of farm size it is logical to do to large farms and then medium firms. Larger farms are i) better use of sales force, ii) savings are greater for...