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Attitude as a Function of Marketing for Farmers and Ranchers

by Charles H. Rust
Revised 2/96

Keywords: Marketing, systems, skills, management, marketing objectives, price, profit, cash flow, risk, marketing plan, attitude


Marketing of grain and livestock is an indispensable part of the farm and ranch business in Montana and must be dealt with daily. Successful marketing is as much a function of attitude as it is of skill. A positive attitude toward marketing grain and livestock will help build enthusiasm and allow the time needed to develop new skills and set realistic marketing objectives.

Most would agree that marketing is one of the most difficult and frustrating challenges facing farmers and ranchers. It is frustrating because there are unanticipated forces such as weather changes or government action that can quickly drive prices upward or downward.

For the marketer who has a positive attitude and realistic objectives, fluctuating markets provide opportunities, but for others they can be frustrating. Grain and livestock marketing systems are highly complex. Prices are affected by actions and events at all levels of the system.

Attitude Factors

Important attitude factors for successful marketing are:

  1. Know what you can and cannot do. Some argue that successful marketing is more a function of luck than skill and they can't do anything about it. Other producers believe they can and should learn to anticipate most major market moves. Thus a key to successful marketing is to determine what you can do and what you cannot do.
  2. Enjoy marketing. If you enjoy marketing, you will likely be reasonably successful at it. People usually do well at the things they enjoy. If you do not enjoy marketing, you likely will have very limited success regardless of your skills.
  3. Learn new skills. To be a successful marketer a person must be willing to learn new skills, whether it is understanding and using chart formations or understanding the use of option markets. A successful marketer must learn new skills and sharpen old ones.
  4. Develop an integrated and balanced management approach to your business. Marketing is not practiced in a vacuum independent of the rest of the farm business decisions. Marketing decisions must be judged by the impact they will have on the financial aspects of the farm business. Time and effort spent on marketing must be balanced with the needs of the rest of the business.
Marketing Objectives

Marketing objectives usually reflect the attitude of the producer. Some marketing objectives commonly considered to be important by many producers are:

  1. Selling at the highest price of the year. This goal may be rather unrealistic-trying to predict future price movements is difficult at best.
  2. Selling above the average price. This may seem like an easy goal for the aggressive marketer, but for others it is not. However, bear in mind that selling at a price above average will not guarantee a profit.
  3. Making a profit. This is the goal of almost every producer. To do this you need to calculate potential profit levels from various sale prices. If you don't calculate your potential profit level, selling at a seemingly good price may actually result in a loss.
  4. Selling to meet cash flow needs. Although cash flow needs should not dominate your marketing program, they cannot be ignored. Try to manage your cash flow needs in such a way that it helps and does not hinder your marketing program.
  5. Minimizing risk. Price risk is of special concern to farmers who are highly leveraged financially. In marketing, managing risk essentially means not losing sight of the financial consequences of a sale.

Obviously, a successful marketing program embodies more than one of the goals or objectives listed; it may involve several. Farmers and ranchers must develop the proper mix of goals to suit their individual situations. After the goals have been determined, a marketing plan can be developed to achieve the goals. The marketing plan will likely be different for each farm or ranch and it will incorporate the various production, financial, and marketing skills of the operator and his/her family. Occasionally the operator will set the objectives and then contract with someone else to assist in developing a marketing plan.

To develop an effective approach to marketing, the owner/operator must keep a positive attitude toward marketing and know what he/she can and cannot do. Then the owner/operator must develop the skills and strategies that will best fit the farm or ranch operation.

Charles H. Rust is a member of the Western Extension Marketing Committee and an Extension Marketing Specialist at Montana State University.

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