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Who are you producing for, the customer, or consumer?

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Murgen

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With all the talk about captive supplies, quality, yield etc, I thought I'd start a thread wondering who you are producing for, the customer or the consumer?

My feeling is that if you are selling into a cash market, you are producing for the customer(packer) If you are producing and selling into a grid or Branded beef product, you are producing for the consumer.

How do we get to producing more for the consumer wants/desires and creating the demand that is needed in the beef industry?

I know Randy is producing for the consumer! Are there any others?

I won't post any articles by Gary Smith, until later in the discussion, but I was just wondering what your thoughts are? Are you selling on average? Or producing a product that fills a specific niche, and getting paid for hitting a specific target?
 

graybull

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It is short sighted to produce for the next entity in the marketing/ownership chain rather than for the final consumer.
 

mrj

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It seems to me those producers using accepted BQA practices and working always to improve the quality of their cattle are producing for BOTH the customer and the consumer, in cases where they are not one and the same.

MRJ
 

the chief

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MRJ said:
It seems to me those producers using accepted BQA practices and working always to improve the quality of their cattle are producing for BOTH the customer and the consumer, in cases where they are not one and the same.

MRJ
\


So, MRJ, do you produce CATTLE or BEEF? Beef is what the consumer eats. CAttle is what your customer buys.
 

mrj

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chief, the best way for me to answer your gracious question is to say it depends on which marketing scenario we are using for each sale. We have marketed directly to individuals who paid for the processing and the beef they received. Our accessibility to such customers is extremely limited given the time we have available, population density within a hundred miles of our ranch, etc.

However, 113 years of tradition on this ranch has been that we sell beef, beginning with Grandpa Tom Jones riding the train with the 4-5 year old "beeves" from Midland, SD to Chicago, IL or Sioux City, IA. Unlike some ranchers, there has never been a disconnect in our minds over the fact that we are raising CATTLE to produce BEEF!

We continue that tradition of being mindful that the CATTLE we RAISE will become BEEF for CONSUMERS, our ultimate CUSTOMER, no matter where or how we market those CATTLE. That marketing may take place in the country with the yearlings going to a local feedlot, or out of our backgrounding lot with the heavy calves going to a more distant feedlot, or after carrying them through the feedlot, and processing plant with the BEEF going into a program product, or selling yearlings through an auction, whether local or video. No matter where or how the CATTLE we RAISE are MARKETED, our management practices are to create the best BEEF we can afford to raise given what is possible on the land and climatic conditions we have. Does that answer your question adequately?

MRJ
 

Econ101

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MRJ said:
chief, the best way for me to answer your gracious question is to say it depends on which marketing scenario we are using for each sale. We have marketed directly to individuals who paid for the processing and the beef they received. Our accessibility to such customers is extremely limited given the time we have available, population density within a hundred miles of our ranch, etc.

However, 113 years of tradition on this ranch has been that we sell beef, beginning with Grandpa Tom Jones riding the train with the 4-5 year old "beeves" from Midland, SD to Chicago, IL or Sioux City, IA. Unlike some ranchers, there has never been a disconnect in our minds over the fact that we are raising CATTLE to produce BEEF!

We continue that tradition of being mindful that the CATTLE we RAISE will become BEEF for CONSUMERS, our ultimate CUSTOMER, no matter where or how we market those CATTLE. That marketing may take place in the country with the yearlings going to a local feedlot, or out of our backgrounding lot with the heavy calves going to a more distant feedlot, or after carrying them through the feedlot, and processing plant with the BEEF going into a program product, or selling yearlings through an auction, whether local or video. No matter where or how the CATTLE we RAISE are MARKETED, our management practices are to create the best BEEF we can afford to raise given what is possible on the land and climatic conditions we have. Does that answer your question adequately?

MRJ

Hopefully the market signals you get from the market tell you how well you are doing that. In the Pickett case, Pickett claimed that the market signals failed and the cash market was discriminated against unfairly. I hope you always get paid for the quality you produce, MRJ, but Pickett proved to a jury of 12 that he and the others in the cash market did not.
 

mrj

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Econ101 said:
MRJ said:
chief, the best way for me to answer your gracious question is to say it depends on which marketing scenario we are using for each sale. We have marketed directly to individuals who paid for the processing and the beef they received. Our accessibility to such customers is extremely limited given the time we have available, population density within a hundred miles of our ranch, etc.

However, 113 years of tradition on this ranch has been that we sell beef, beginning with Grandpa Tom Jones riding the train with the 4-5 year old "beeves" from Midland, SD to Chicago, IL or Sioux City, IA. Unlike some ranchers, there has never been a disconnect in our minds over the fact that we are raising CATTLE to produce BEEF!

We continue that tradition of being mindful that the CATTLE we RAISE will become BEEF for CONSUMERS, our ultimate CUSTOMER, no matter where or how we market those CATTLE. That marketing may take place in the country with the yearlings going to a local feedlot, or out of our backgrounding lot with the heavy calves going to a more distant feedlot, or after carrying them through the feedlot, and processing plant with the BEEF going into a program product, or selling yearlings through an auction, whether local or video. No matter where or how the CATTLE we RAISE are MARKETED, our management practices are to create the best BEEF we can afford to raise given what is possible on the land and climatic conditions we have. Does that answer your question adequately?

MRJ

Hopefully the market signals you get from the market tell you how well you are doing that. In the Pickett case, Pickett claimed that the market signals failed and the cash market was discriminated against unfairly. I hope you always get paid for the quality you produce, MRJ, but Pickett proved to a jury of 12 that he and the others in the cash market did not.

From what I've read about that case (and granted, I've not read the entire transcript), and IMO, it seems obvious that the judge is more accurate and trustworthy than is the jury, IN THAT JURISDICTION, INFAMOUS FOR JURIES HITTING CORPORATIONS WITH DEEP POCKETS WHERE IT HURTS.

MRJ
 

Murgen

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Hopefully the market signals you get from the market tell you how well you are doing that. In the Pickett case, Pickett claimed that the market signals failed and the cash market was discriminated against unfairly. I hope you always get paid for the quality you produce, MRJ, but Pickett proved to a jury of 12 that he and the others in the cash market did not.

Was the spot market discriminated against, or were the contract cattle paid a premium. (some were even discounted to levels below the "spot" market). Risk vs. return.

How does one selling into the cash market obtain market signals on quality etc? Do they get feedback on their product quality and how it compares to average? How do you make improvements and become more efficient without feedback?
 

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