Brand Identity

[grassfarmer]

farmers_son, I see you agree that the present system is unworkable and that
cattle producers will need to find ways to capture a fair portion of the consumers food dollar. You comment "It is just a matter of when it happens not if it happens." how will it happen though? that's the problem I have in understanding at the moment.
There are the overwhelming odds of the current processor stranglehold extending down now into the feedlots and even back to the ranches through packer "supply management" as Randy articulates very well. We have politicians who are happy to turn a blind eye (or take a bribe, whichever)we have "industry" politicians who are clearly working for the packers and not the producer. A fine example would be our illustrious CCA leader Hugh Lynch-Staunton who stated that producers have no business being involved in the processing side of beef production "if they want to benefit from further processing of beef they should own Tyson shares like I do" I believe was the quote. No doubt the fact that Ranchers Beef is struggling will be heralded as proof that the ABP/CCA were right all along and there should be no producer owned processing facilities.
I would like to change the industry for the better - see producers get a fairer return for their efforts but how do we start that change happening? It seems to me that I can either spend a lot of time and effort trying to change the system politically (difficult with the other 96% of producers either so apathetic or asleep at the wheel that they won't get involved) or I can concentrate on my own direct marketing operation. I notice that most of the really successful marketers like Salatin do not spend their time trying to change the system for the benefit of the average producer in the conventional system - they work for themselves in business terms and then try to lead others by example outside conventional agriculture.

[rkaiser]

I guess if I were to just stay at home and have my darn bulls delivered each year, my attitude may change to more of that home stuff Iain. But going out and seeing the struggle in the countryside and at the same time appreciating the support some of these struggling ranchers give me incentive to at least try to assist some of them. We are certainly a long way from becoming millionaires from direct marketing, but is is certainly a step up from conventional. It was almost embarrassing to receive a government cheque for assistance for cattle that I had locked in at $1.05 live when my neighbors had similar cattle stolen from them at 30 to 40 cents when BSEconomics first showed how it could be a cash cow for the packers.

I don't think for a minute that we shut up. I am looking forward to seconding your resolutions at the ABP producer meetings again this fall. No we cannot spend a lot of energy or time on it, but we can not give in either. We know that there is potential for profit beyond the farm gate, and that the industry we involve ourselves in has an extremely corrupt and manipulative sector, and I will be damned if I am not going to tell people about it.
When I talked of the whole supply demand consumer pricing thing - what do others think.
I realise that We are still paying the wages of a few too many folks in our little chain, but how is it that our rib eye can sell for $29.99 a pound, and our local steak fry was going to buy there's for $7.00. I had to make a pretty substantial donation to put 200 sirloins on the plates at 6 bucks, but the compliments were worth it. As well as the flicker of awareness in the eyes of some of the producers at the meal.

Got to be a bit of room between that $29.99 and 7 bucks don't you think. And I mean room for cattle producers in general - not just a few of us.

[cakadu]

Maybe the point is as you say, Randy, we just have to keep talking about it and more importantly, keep showing the success of it working. Like you, we've donated an awful lot in order to get people closer to the product and understanding where it comes from.

Joel has access to fairly affluent markets, but in many respects so do some of the rest of us. Calgary has dollars flowing and it is certainly within an 1/2 day's drive for many. It's not a matter of beating the bigger guy, it's a matter of creating what works for you. I don't think Joel has ever tried to compete in that respect, in fact, he goes out of his way to let folks know he isn't. He doesn't ship his product anywhere, but chooses to sell it locally.

Creating and understanding a system that works for you is what counts and puts the extra value of what you're producing into your pocket and not someone else's.

[grassfarmer]

Cakadu, I'm not complaining of a lack of customers in Calgary or Edmonton, we are finding enough for the rate we are growing our direct marketing at - or should I say for the amount of time we put into it. I enjoy the paydays but not chasing up customers for late order forms etc! The problem would be if a large number of other producers wanted to enter the marketplace - say 10% of Alberta's beef producers wanted to market direct. We would run out of customers real quick. I still would like to see small plants around the province that could do federal, custom kill. I could double my sales tomorrow by selling into Yellowknife and the NWT if I could get them legally killed and allowed to go up there.

Randy, in response to your comment about pricing, demand and consumers I find our customers spend less time considering a $50 per quarter price increase than I do. It never seems to be a problem to them - perhaps that is an advantage of selling them beef in bulk once a year versus selling cuts every week?

farmers_son, if you can achieve a $1500/ acre net annual return through "conventional" agricultural production with pasture based livestock I will certainly pay you $500 for a 2 hour tour.

[cakadu]

Grassfarmer I would be surprised if 10% of producers would want to get into direct marketing. If the BSE years didn't get people to change their minds, then I can't see there being a big rush to do so now....but I've been wrong before.

It takes a lot to direct market and as you've stated one of the many pitfalls is getting people to order in a itmely fashion.

There are a number of people who say they believe the theory of it but have a hard time moving beyond the theory.

Farmers_son, whether or not Joel has his marketing down or just what it is that has him making and keepting the profit that he does, he's actually got a system and it is working for him. He's willing to share whatever information he has and would like to see more doing things in a similar fashion. The thing is to figure out what works best for you and then work to make th emost of it.

[farmers_son]

Grassfarmer: Re obtaining a return of $1500 per acre. If I can net an extra $10 per acre it would make a significant difference to me. I believe returns should be expressed in terms of the most limiting resource, for some that would be acres but it could be per head too. Or per dollar of investment. Or if the operation’s major investment was a building for intensive livestock production then per square foot. On our operation people are our most limiting resource and I tend to focus on return to labour/management or people more than a per acre return because it is possible to get more acres in this part of the province either through purchase or rent. Acres are not my limiting resource. I noted the Salatin’s operation looked pretty labour intensive considering their net was about $200,000. I think my return per person is better than theirs by quite a bit. Only no one is paying me to see how it is done so credit needs to be given to them for that. My next most limiting resource is cash so I calculate my cash return to cash invested, a number I consider more important than return per acre.

I know people in some parts of this province that do very well but their return per acre is truly a small number. But if you have enough acres it works out just the same.

Cakadu: Yes indeed, Salatin does seem to have something that works for him. I think it is important to consider that, in my opinion, his brand identity is himself not his particular production system or product. If someone did duplicate his production success without his marketing success and people skills they would not expect to reap the same rewards. Just a thought, if I were to copy some of what Salatin did I would write a few books like he did rather than raise rabbits. I think there might be more money selling ideas, right or wrong, than selling hares and the market area is much wider.