Agricultural Engineering Today

In order to provide custom hiring services of harvesting machinery, an understanding of the concept of fixed and variable cost is essential. Combine harvester (CH) along with four smaller harvesting machines namely reaper binder (RB), panicle harvester (PH), self-propelled vertical conveyer reaper (VCR) and tractor operated vertical conveyer reaper (TOVCR) were evaluated for scope of entrepreneurship development. The degree of operating leverage (DOL) was found highest for PH among all the selected harvesting machinery. A 10% increase in area of operation could produce a 37.3% increase in net operating income for PH followed by that for CH (27.21%), TOVCR (20.33%), RB (8.13%) and VCR (4.98%). Highest B:C ratio was found for the reaper binder (3.25) followed by combine harvester (2.16), tractor operated vertical conveyer reaper (1.47), panicle harvester (1.45), and vertical conveyer reaper (1.41). All capital budgeting parameters do favour the combine harvester for selecting as a harvesting machine for the custom hiring services. From remaining four machines the priority can be given to the reaper binder followed by self-propelled vertical conveyer reaper and panicle harvester because internal rate of return (IRR), net present value (NPV), payback period (PBP) and benefit cost ratio (BCR) justify the machine for making investment as custom hiring of harvesting machines. Study reveals that tractor operated vertical conveyer reaper was not suitable because of negative net present value (NPV) value.