Greg Lardy: Make calf marketing plans now
August is upon us! It doesn’t seem like its possible for it to be here this soon but the summer has gone by rapidly. Hopefully you’ve had a chance to enjoy some summer activities with friends and family. This year has certainly had a variety of challenges to deal with, but hopefully you have come through those with flying colors!
This week I’m going to focus my column on calf marketing. Too often we focus a lot of time and attention on all sorts of production issues and marketing becomes an afterthought. There are a number of actions you can take now to more effectively market your calf crop. Here are some tips that will help you bring home a bigger check this fall. Given the supply situation the industry is facing, it should be a good fall to market calves, and, with a little work at sharpening your marketing skills, your calves will bring even more.
• Contact previous buyers and discuss your marketing plans and options. If you haven’t kept records of who purchased your calves in the past, begin to keep those records. I realize it may be harder to do if you market through an auction market, but, at a minimum, you should contact the auction barn and discuss potential marketing alternatives with them.
• Evaluate your current situation carefully. Determine if your previous marketing plans worked effectively or if there are some aspects which should be changed. With the rapid escalation in feed prices we have experienced, it may be time to change your marketing program. Feed prices are going to continue to be volatile, so flexibility will be an important component of a good marketing plan. Does yours let you change with relative ease?
• Work with your veterinarian to develop a sound pre-weaning vaccination program for your calves. It will pay for itself in return customers who want to purchase your cattle. Be sure that you also evaluate your cowherd nutrition program at the same time. Nutrition plays a big role in immune response.
• Inform potential buyers about specific programs for which your cattle qualify for (e.g. breed specific programs, vaccination programs, etc.).
• Determine whether or not you will sell calves directly off the cow or if you will background or precondition them on the ranch. Inventory your feedstuffs to help you evaluate the decision from an economic standpoint.
• Work with your lender to be sure your marketing plan fits the cash flow needs. Determine if your current operating note will be sufficient to cash flow the plan you have developed.
• If you plan on selling source- and age-verified calves, go through your records and determine if you have the data in place to qualify. If you have the data, take advantage of the price premiums for those cattle and market them effectively. These programs pay dividends to those who are able to keep the records. It will pay to have those documents in place.
• When marketing through a sale barn, work with the manager and staff ahead of time. Be sure to give the staff enough time to adequately advertise your cattle to potential buyers. Explore any potential special sales that your cattle may qualify for. Many sale barns have specials for specific breeds or vaccination programs. Buyers look for opportunities to purchase larger groups of similar cattle. It makes sense to explore these marketing opportunities.
• Focus on making your cattle as uniform as possible in weight, color, and conformation. It will make marketing your calves much easier no matter which marketing outlet you utilize. Selling calves in uniform load lots is a proven way to bring home more dollars.
• If you have good quality heifer calves, consider marketing them as part of a replacement female sale later in the winter. In many cases, this will return extra dollars and reduce the effect of the typical heifer discount.
• There is value in information. Notice I said information and not data. For data to be valuable, it must be turned into information. Potential buyers don’t want to see photocopies of all of last year’s individual carcass data. They are interested in a summary of the carcass characteristics of your herd and any closeouts or performance records you have. Remember, information, not data.
• With fuel prices remaining high, transportation costs are an even more important part of the equation. Carefully weigh your options and evaluate shipping costs for each marketing alternative.
• When you get calves ready to ship this fall, try to minimize handling stress. This will reduce shrink and result in a calf that is better ready to meet the challenges of life in a feedlot.
I hope these simple pointers will help you put some additional dollars in the bank this fall.
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Cost savings, easier workload, better animal and rancher health are driving a shift to calve with nature in South Dakota.