Why projects like BigC won't fly

[Jason]

In another thread that has been derailed, I asked RandyK for clairification on the plan of BigC and he confirmed they wanted a per head check off type payment from every animal sold in Canada.

Number 1 problem, this means the gov't is picking a favorite business.

Number 2 problem, all cattle sold to other packers, including producer owned, would have to pay. This would be a direct attack on the freedom to conduct business on a level field.

Number 3 problem, beef from a plant subsidized in this manner breaks free trade agreements with our trading partners.

Randy also suggested the payment would be backed with 1 share in the plant, making everyone who sells 1 animal a part owner in said plant.

Problems of logistics would be huge. All shareholders get notice of earnings etc, some of those shareholders could possibly be Cargill and Tyson.

A plant would have a hard time competing for cattle if they give their competitors a balance sheet.

These are just very basic problems with the plan. And I might add with most producer backed ventures right now. Expertise needs to be sought before a good plan can be established.

For example 1 plant proposed near Lethbridge had the fellow pushing it say:'we just need to get the cattle killed and the beef will find markets'. Although I agree we need slaughter capacity, any plant has to have a marketing planfor the beef they produce BEFORE they have it. Without having a market, or knowing the price the beef will bring, makes any plans virtually worthless.

If anyone wants to engage in civil debate about this please post.

 

[rkaiser]

1). The levy based plant proposal would only happen after a democratic vote. Don't understand the "picking a favourite term" Jason. Please explain.
2). Talk of packer owned cattle being part of the levy has been constant. My opinion is that packer owned cattle be exempt. Why would producers want Cargill and Tyson to own a major part of the plant with their own Packer owned cattle allowing them that option. Remember Jason, this proposal has not even moved to the feasability study level yet and likely won't with people like yourself opposing it before they even understand it.
3). How are you considering this a subsidy? The idea only includes the government as a bank. Unlike the millions in grants doled out to Cargill and Tyson et at.

Should BIG C hire your expertise Jason. After all, one of their main supporters (yours truely) is, according to your buddy SH, a pimple on your ass.

Far better that we just lay back and watch Cargill and Tyson buy out every plant in Canada hey Jason. Far better that we watch these new plant proposals start up and then be buried by the power of Cargill and Tyson with the "so called efficiency". Or what I call "their war chest".

 

[Jason]

Randy, from your own admission in another post you never even considered the packers end of this industry before you started your own branded product. Suddenly you know for a fact they don't fight fair and will not allow anyone to succeed. HOW?

As soon as one packer gets preferential treatment, ie a check off, it is an unlevel playing field. The gov't would have to authorize such a scheme so they would be picking a favorite, or saying this operation is the one to back.

I appreciate the idea it would go to a vote, but as you have said it will fail. So why waste time and energy pushing it still?

I think producer owned ventures are terriffic, if they are well thought out and stand on their own. Just assuming you can start a plant with no experience makes me wonder about folks. Too many I have seen are just a crooked guy looking to score a quick buck off the back of other producers.

I have posted numbers before about how many cattle it would take to support a venture, and your right Randy it is hard to compete against Cargill and Tyson. They have years of experience. They can't run a plant out of business if that plant can compete on the slim margins they can, but they are not going to just sit back and allow someone to take profits from them either.

I think these plants will need some feedlot support, not just producer support. I don't know if there is the true desire to invest in a business that has such slim margins MOST OF THE TIME. If there was huge money to be made there would already be more plants running.

Should BigC hire me? No thanks I don't have the desire to try to float an idea I can't support. I have asked repeatedly why this idea is so sound and all you can come up with is the gov't is going to lend the money. But we both know they aren't. If they did it could be a subsidy under WTO, especially with the check off to pay it back.

If I was to work on a producer owned venture. I know where one of my first calls would be, for advice from someone who has proven a true understanding of this industry.

 

[Anonymous]

Randy: " After all, one of their main supporters (yours truely) is, according to your buddy SH, a pimple on your ass."

Wrong again Randy, I didn't say you were a pimple on Jason's ass.

I said from the standpoint of understanding this industry YOU WOULDN'T MAKE a pimple on Jason's ass. You can't get anything right can you?

You can't comprehend what you read so you misinterpret it to say what you want it to say. You are so pathetic that way.

Randy: "Far better that we just lay back and watch Cargill and Tyson buy out every plant in Canada hey Jason. Far better that we watch these new plant proposals start up and then be buried by the power of Cargill and Tyson with the "so called efficiency". Or what I call "their war chest"."

You're sucking your thumb again.

USPB didn't get government grants to buy into National Beef and they didn't rely on all producers to pay for it. The producers that were willing to take the risk bought shares in the company. Eventually, the producers bought the entire plant and now they own it.

Pattern after USPB rather than looking to the government to save you from the dreaded Cargill and Tyson.


~SH~

 

[rkaiser]

I am a supporter of the plan boys, not the architect. The part that frustrates me about trying to promote the idea is folks like the two of you who twist their own BS into the story. I realise that the two of you are so overcome with anger towards my disagreement with your packer ass kissing that you will forever be the biggest twisters.

BIG C has never looked for GRANT money SH. I'm soory you can't hear that, thus the capital letters. Would you like me to say it again?

As far as the roadblock about the WTO which Jason is trying to wiggle in, I believe that your opinion on that one is wrong Jason. This Levy could be collected in a number of ways and each producer would become a shareholder just like the public company called Tyson foods.

The government loan idea was simply to bring the government on side, and maybe get their support for BSE testing for market access which is a big part of the BIG C agenda. If a vote were to happen and a good business plan designed, maybe a corporate bank would back the loan, who knows. We all know that Cargill and Tyson not only have government loans but grants and concessions as well.

Sure some of the plant proposals on the table include self serving individuals, in fact most will. That's capitalism. The BIG C plan would leave room for none of this, but would still be a capitalist, venture.

Bottom line is, it is an idea, and granted an idea that is not complete. But it does offer a positive alternative to what the two of you see as a fine and dandy industry. An industry that I compare with the Oil industry as a lemonade stand right next to Hooters.

Cut it down all you like boys, you know deep down that if it wasn't Randy Kaiser supporting it, you could find some postives in it. It is not that different than the USPB plan, and may be even better, but you'll be forever held back by your emotions.

 

[Anonymous]

Randy: "The part that frustrates me about trying to promote the idea is folks like the two of you who twist their own BS into the story."

Anyone can make a discrediting statement like that but it takes a real man to back it up and show where it actually occurred.

Do you want to split the hairs between a government GRANT and a government LOAN?

You better have something better than that or will you just make another discrediting statement like you always do create an illusion of my BS?

I'll bet you take the chickensh*t way out again.


~SH~

 

[rkaiser]

If you don't know the difference between a grant and a loan SH, no one can help you but a grade 6 school teacher.

Would not a vote among producers tell us if they were willing participants or not?

Might have to have a clause to let whiners like yourself off the hook from the benfits the other producers would realise. :roll:

 

[Econ101]

Jason, Governments have picked favorites before. Due to the efficiencies of scale, almost all utilities find themselves in this position. This is the case for companies that are known in economics as "public goods".

Just look at the way Tyson is trying to treat Canadian workers. You say it is okay as long as it benefits you. That tells something about you. Don't worry, you fit right in with the Tyson mentality. You are as easy to control as their chicken producers but at a much lower cost. I guess that is efficiency.

Companies like Tyson are all too willing to change your idealistic view of competition and capitalism into more market power with your help. I just wish everybody else wasn't affected by your decisions

 

[Sandhusker]

I suppose the government bailing out Chrysler was not playing favorites? How about Farm Credit? What about all those S&Ls?

 

[Anonymous]

Econ.,

It is your world of governing the free enterprise system that discourages achievement. Be successful, BUT NOT TOO SUCCESSFUL or econ and blamers like him will try to regulate you out of existance. What do you think took Tyson to their current level of production? Oh, let me guess, Mafia ties right? Perhaps some other lame brain conspiracy theory. It's liberals like you that want to regulate prosperity and punish achievement that are the problem with this industry. The GREEN ENVY MONSTER. How dare you be successful if I'm not. Nobody can be that successful without screwing somebody right? You're anti corporate attitude is so sickening. To break up the large efficient packers who can keep their doors open with $10 - $15 per head margins WHILE THEY SELL EVERYTHING BUT THE "MOO" AND PAY ACCORDINGLY would mean less money for producers. That's exactly what narrow minded anti-corporate packer blamers like you are promoting. Now your blaming buddies want to save the feeding industry from their pricing mechanisms. You blamers are the epitomy of arrogance.


Like I said Randy, I knew you would take the chickensh*t way out rather than backing your claim.


~SH~

 

[frenchie]

Randy .

You will just have to show them boys , thats all. :wink:

 

[Tam]

If you don't know the difference between a grant and a loan SH, no one can help you but a grade 6 school teacher.

Would not a vote among producers tell us if they were willing participants or not?

Might have to have a clause to let whiners like yourself off the hook from the benfits the other producers would realise. :roll:

I agree with all your points Jason and think this should not pass as in the past this industry has taken the stand we will not ask for subsidies as they would only cause problem with our Trading partners. Just look what was said about the money we recieved during the total disaster that hit our industry because of BSE. As soon as the border reopened the buss was about the money we recieved from the set aside program as it was seen as an unfair subsidy that would affect the price we would be willing to take for those cattle. Do we really need any more problems because a group of guys that can't write up a business plan that includes paying back they own loans?

Randy maybe we should ask you what is the difference in a Government grant and what Big C is asking for, a Government Loan ? A grant is money the plant would recieve that it is not responsible for the repayment of. What you are asking for is loan that the plant will not be responsible for repayment of, as that is what our checkoff dollars will be doing for you. If the repayment of the loan is not coming out of the profit of the plant it is a subsidy and creates an unlevel playing field for all competitors to deal with including those plants that have private money invested. And as far as public owned companies people have the right to become a sharehold by willingly investing their hard earned money. But with your plan we will not have a choice as everytime we sell an animal we become shareholders in the plant along with every other producer in Canada.
The only way around Jason's Number one reason is as if every plant in Canada gets a percentage of the Manditory Checkoff dollars collected on behalf of the slaughter industry, which means Tyson and Cargill too. As if they don't then the Government will be playing favorites. :wink:

 

[Brad S]

First, Jason is right, you must have a strong market plan with alternate markets. Big C may have some good market plans - they'd better.

USPB is indeed a good model to emulate. One thing USPB did is to fit into the normal market scheme. This normal market scheme evolved because of competitive advantages, and USPB harnessed them. Big C wants to deny the evolution of advantages in the beef belt. We all understand this compulsion, but now the border is open, the old market evolutionary patterns are quite determinative. One example: those meat processors currently striking that plant in Canada wouldn't do that in Garden City.

 

[rkaiser]

I apologise once again for your inability to understand Tam, and thus your twisted idea that "the plant would not be paying back the debt". The plant is the producer share holders Tam. What is so hard to understand about that. NO GRANT MONEY!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

BIG C is not asking for a subsidy. I understand that I will never convince you of that, and it is a free continent we live on, so just like SH you can spew your opinion and try to convince others, just because of your emotions.

I agree with you Brad, and Jason on the idea of subsidies helping out the industry. Where were you Jason when Tyson and Cargill stood in line for their government cheques. Could have used staunch supporters of capitalism when that was going on.

Your last point is interesting Tam about every plant recieving the benefits of a levy. That is definately part of the BIG C agenda. However the favorite part would stop with Mutinational companies. Any Canadian producer owned plant could be eligible but give me a break with the Cargill and Lakeside thing.

Never in my life have I seen a group more determined to play the puppet for the mutinationals.

Packer Super Hero says -

It is your world of governing the free enterprise system that discourages achievement. Be successful, BUT NOT TOO SUCCESSFUL or econ and blamers like him will try to regulate you out of existance.

Blamers regulate SH :lol: :lol: What a joke. The only regulations being set in both of our countries are by the politically powerful mutinationals themselves or the ass kissing packer lovers who can't see beyond their nose.

If you feel that contol of an industry by few players is good, your red liberal attitudes will never be changed. I will never see that as good. Good for anyone. Trying to say that people who want change to this ideology, which matches communist Russia more than any free country, makes me sick.

Every one of you blind followers of the "good idea" of huge corporate domination in the cattle industry make me sick.

Comparing our industry to the soft drink or oil industry is always a good comback for you all. Tell me "packer defenders" which of those industries would have stood by and watched, and even clapped their hands during a salmon run like the one that occured in Canada from Sept. 03 up until the border opened (with lingering excessive profits still occuring).

Great stuff to keep backing people off with your ego bashing, it obviously keeps supporting your own. But Jason, Tam, and SH have become lost in their hated toward Rcalf, or any other individual that suggests anything different than the all too obvious packer slant (USDA, CCA, NCBA etc.) this industry has chosen.

 

[Northern Rancher]

But won't Big C become a packer also-the road to hell is sometimes paved with good intentions-some branded beef programs have had less than stellar results for their participants. I think that alot of producers in Canada particularily don't have the capital to risk after the whole border fiasco. Starting to build packing plants here after the border closed is kind of like planting a tree-the day you need you need the firewood. The whole idea would fly alot sooner if all producers retained ownership but to be honest most cow/calf guys could care less how profitable their calves are once the sale barn cheque clears.

 

[Tam]

First, Jason is right, you must have a strong market plan with alternate markets. Big C may have some good market plans - they'd better.

USPB is indeed a good model to emulate. One thing USPB did is to fit into the normal market scheme. This normal market scheme evolved because of competitive advantages, and USPB harnessed them. Big C wants to deny the evolution of advantages in the beef belt. We all understand this compulsion, but now the border is open, the old market evolutionary patterns are quite determinative. One example: those meat processors currently striking that plant in Canada wouldn't do that in Garden City.

From Randy

The government loan idea was simply to bring the government on side, and maybe get their support for BSE testing for market access which is a big part of the BIG C agenda. If a vote were to happen and a good business plan designed, maybe a corporate bank would back the loan, who knows. We all know that Cargill and Tyson not only have government loans but grants and concessions as well.

Sure some of the plant proposals on the table include self serving individuals, in fact most will. That's capitalism. The BIG C plan would leave room for none of this, but would still be a capitalist, venture.

Bottom line is, it is an idea, and granted an idea that is not complete. But it does offer a positive alternative to what the two of you see as a fine and dandy industry

I would hope they would have a good business plan too but after reading this quote from Randy a co founder of Big C can you see a business plan? all I see is an IDEA filled with If's, woulds and maybes. Add to that the fact that a co founder can't explain their plan so producers can understand it. Randy has the opinion that this offers a postitive alternative but can he back that statement with a good business plan, that we can all vote on. Are we to just vote on an Incomplete Idea that may change once Big C gets its unlimited funding via Checkoff dollars and they get around to designing a plan.

If a vote were to happen and a good business plan designed, maybe a corporate bank would back the loan, who knows.

I find it strange that a group would go so far as to have big meetings all over the country asking for a levy on the Checkoff (which is not what the Checkoff was designed for) without a business plan in hand. They don't even know if they could get a loan on the merits of their business plan. Don't you think Big C should at least have to find out before saddling the beef industry with even higher deductions from our sales receipts. The whole Big C IDEA has to many questions and not enough answers.

I apologise once again for your inability to understand Tam, and thus your twisted idea that "the plant would not be paying back the debt". The plant is the producer share holders Tam. What is so hard to understand about that.

I have to ask You Randy when Tyson and Cargill get government loans who pays them back and where does the money come from? It is to my understanding that Tyson and Cargill like most others would be paying these loans back out of the PROFITS FROM THEIR PLANTS not with Checkoff funds collected by the competition and handed over to them.
When you are not paying down your debt from the PROFITS OF THE PLANT you are putting yourself at a very large advantage over ALL other plants that are paying their debts from THE PROFITS OF THEIR PLANTS. How many other public owned companies do you know that sell an UNLIMITED amount of shares on a daily bases? And what do you think thoses added shares sold every day are doing to the value of the first shares given away? If a share is bases on an animal being sold how will anyone ever know what that share is really worth? They can't as every time an animal is sold the percentage of ownership that share represents would change to fit the new amount of shares, adjusting the value of the share down to match the total value of the plant. If I went to a bank and told them I have these shares in the Big C slaughter plant just what value do I say they are worth? If I can't put a face value on them what good are they to me? There is no way these shares given away to everyone will ever have a true value as long as Cattle are still being sold in Canada.

 

[Jason]

To be fair, I singled out BigC because Randy is here to help us understand the idea.

However, many proposed plants have no business plan, or a very naieve one.

There is one around Edmonton that an aquaintance of mine went in to the 'office' and asked to see the owner. A fellow came out and was asked how he could be the owner if it was a co-op. Stutter, stammer... uh uh ..then he was asked if he could provide a business plan, stutter, stammer,uh uh no business plan. Just give us $2500 and you own part of this proposed plant.

The plant proposed for Pincher Creek has no environmental assessment even being considered. No idea of where the workers will come from, and no intention of furthering the project until they have another 1500 producers on side with $2500 each. They have no idea if the water is available to the proposed site, and until the new power lines are constructed they grid is unstable from too much wind development in a small area.

The plant proposed in Lethbridge is the one that the "rancher" behind it says beef will just sell if we get the cattle killed. He has no idea where it will sell to, or at what price. He is also an accountant and at 1 function he was asked to speak at about tax planning, he made the statement:" the tax act is very difficult to understand and we just have to guess at some of it." He got a few comments from some savvy cowboys about if he doesn't understand the tax laws why would they get him to do their books.

Canada Farm Direct has approached indian bands in this area looking for funds, no business plan.

Back to BigC, I would like to know about the shares as well. Tam makes a valid point about the number changing as more cattle are processed.

Lots of questions not many answers.

 

[Econ101]

Without the protections of an economic law like the PSA, any small packing plant can be forced out of business. Predatory pricing with packers who have deep pockets can close any of the small margins in this industry quickly. A good health scare like Hudson had with its operations and a little help from a paid off govt. agency can put a company out of business really quick.

This is not a free market system, it is not smart business tactics, it is not the fittest survive, it is market power and it exertion in the political committees who are supposed to be overseeing them. It is fraud and it is criminal. The FBI will never do a real investigation because of Arlen Specter and other industry "friends" on the hill. I am sorry it is the cae, but is looking more and more like that every day.

Economics runs the world and too many are caught in the details to see what is really going on behind closed doors.

 

[Sandhusker]

Toss in a recent case of them shutting the door on a small packer trying to establish a niche market (BSE tested beef).

 

[Anonymous]

Econ.: "Without the protections of an economic law like the PSA, any small packing plant can be forced out of business. Predatory pricing with packers who have deep pockets can close any of the small margins in this industry quickly. A good health scare like Hudson had with its operations and a little help from a paid off govt. agency can put a company out of business really quick."

How can a small packing plant be forced out of business if there is so much money in the packing industry???

How can a small packing plant be a victim of predatory pricing IF THEY HAVE THEIR OWN CAPTIVE SUPPLY OF CATTLE?????

Tell your doomsday profit "SKY IS FALLING" rhetoric to USPB while they count their cash.

It can't be done, there's no hope, the end is near, we're all doomed, join R-CULT today. ZZZZZZZZZZZZZZZZZzzzzzzzzzzzzz! It never ends!


~SH~