Melanie Barkley, Livestock Extension Educator, Penn State Extension
(previously published on the Penn State Extension, Animals and Livestock page)
Review your sheep records. 
Record keeping is certainly not one of my favorite tasks related to raising sheep, but it certainly is necessary. In order to have a good handle on some of your production practices, you need to review your records on a regular basis. This includes not only financial records for filing taxes, but your production records for evaluating the sheep flock.
One of the most important indicators of profitability in a sheep operation is the lambing percentage. There are a couple figures to consider with the lambing percentage. First, start with the number of lambs produced compared to the number of ewes that lambed. Then, look at the number of live lambs at birth as well as the live lambs a month after lambing and the number of live lambs at weaning. Compare this to the number of ewes that lambed to calculate some percentages.
Set a goal to wean a 200% lamb crop, an average of twins, every year. Yes, we sometimes have those years that you would like to forget about, but we certainly want to have our ewes producing twins on a regular basis in order to maintain profitability. You might also want to take a closer look at the death loss. A good goal is for the lamb death loss to be 5% or less. Good mothering ability, good nutrition so that lambs are healthy and vigorous at birth, and good nutrition to support high quality and quantity of colostrum and milk are all important for producing lambs that are more likely to survive to weaning age.
Weaning weight records are very good evaluation tools. Adjust the weights so that you can make a fair comparison between lambs born as single, twins and triplets as well as factor in differences in the sex of the lamb and the age of the ewe. Keep in mind that the highest weaning weights may not necessarily translate into profitability! Why not you ask? Consider the frame size of those lambs and their ability to thrive on pasture. Most production type operations focus on pasture as their main, if not sole source, of nutrition for both mature ewes and replacement ewe lambs. Each operation needs to consider what size ewe best meets the nutritional resources on the farm as well as the markets where those sheep are sold. I encourage each producer to set a production benchmark for adjusted weaning weight. Producers can go a step further and set a benchmark for adjusted post weaning weight also. This will help account for both ewe milk production as well as genetic growth potential in the lamb. As you set your goal, consider what your goals are for your operation. What is your target age and weight when you market your lambs? What is an acceptable weaning weight range for your lambs? As you select more for a benchmark, lambs should become more uniform in size and weight.
What other records should you evaluate? Annual cost per ewe can help you achieve a reasonable maintenance cost per sheep or it could also help you evaluate the need to maintain the same number of ewes or expand to spread the fixed costs across more ewes. Maybe you need to consider efficiencies in feeding sheep. Should you own and maintain hay making equipment or would it be more economical to buy all your hay? Perhaps labor is a factor and you should consider custom harvesters to make all your hay.
Each sheep operation has a unique set of circumstances that make that operation profitable. Start by taking a serious look at your records to determine where you could improve production or become more efficient. As you develop your record keeping system, remember that it should be both easy to use as well as easily accessible. Records can be hand written or computer generated. The key is to collect useful information that will help you make profitable decisions in the future.