What does your beef customer want?

Understanding your beef customer starts with knowing your true buyer, then doing what it takes to meet their needs.

Doug Ferguson

October 14, 2022

6 Min Read
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Do you know who your customer is? When I ask that question most people get this vision of the end consumer in mind, and possibly the thought of a foreign trade deal tries to slide into their mind as well.

The definition of the word customer is: a person or organization that buys goods and/or services from a business. To be direct the person who writes you a check for the cattle you sold is your customer. Unless you direct market the end consumer is not your customer.

A past mentor of mine told me to increase my income I needed to serve more people, or offer better service. Let’s pretend our operation is running at capacity. That means we only have so many cattle to sell. Since there is a finite number serving more people is not an option now. So we should focus on offering better service to our customers

The way to offer better service to your customer is know your market. What do the buyers willing to spend the most money there want? Figure that out and give it to them. In doing this you cannot cut corners, or pull up short.

Understanding ‘reputation’

This week I saw a few big strings of reputation cattle sell. The first bunch in this example were weaned thirty plus days. They were all black, vaccinated and on a feed program. These cattle were not the market toppers that day, as one might expect. Two buyers that could have bid them up chose not to.

The problem with this bunch is the feed program they are on. It is a good program, to a point. The cattle will eat the stuff, and they will gain. If you start them on it and leave them on it the feed program is awesome. The problem is when a customer buys them, and is trying to make money with them, that person will feed them more economically. To be direct, the two times I bought these cattle it was like my back grounding yard became rehab. Not all of them make it out of rehab.

I didn’t bid on these cattle this time. I don’t want to own them again. The co-bidder stopped $10 before his stop sign. A strong and seemingly clear signal has been sent from past customers, not wanting to become repeat customers, that the service is not worth it. In this case the service is the weaning, vaccinations and feed program (mostly just the feed program) is not worth it. Reputation cattle work both ways, do your cattle have a good one or a poor one?

The cow/calf operation selling these cattle is clearly a feed customer. The goods and services they pay for does them little good since it devalues the cattle by driving away repeat buyers.

Later in the week I saw the co-bidder of the group mentioned above pay a $15 premium for a fancy string of blacks that were right off the cow and haven’t had any vaccinations. This is opposite of what marketing experts tell us to do. The thing is these cattle fit his program, and he can do something with them.

This buyer knows what his customers what. He knows how to deliver it to them. He has done it for years with consistency and that has built his reputation. If he bought that first bunch I wrote about and they fall apart on him, the will likely underperform for his customer when he resells them.

I mentioned not stopping short or cutting corners. If we are trying to offer better service to increase the value of the cattle we are selling by vaccinating them, we must be sure to do two things. First be sure to use top quality products. There are vaccines on the market that are worthless. Save yourself the money and spare your calves the stress of processing them if you’re going to inject them with junk.

Then tell us what you vaccinated them with and when you gave it to them. Don’t just tell the sale barn they “had shots” when you check them in. As a buyer I am now guessing. Did they have a full round of good vaccines, or did they get a seven-way and a pink eye shot at turn out time? Did they get a few rounds of Draxxin and Baytril?

What kind of vaccinations?

Here’s the thing about shots. The buyer is usually going to give them what he wants them to have when they get to his place. Do you know what those guys are vaccinating for/with? If not find out, and then that’s what you give them to add value. It’s not what you think they should have. It’s not what your vet thinks they should have. It’s what your customer thinks they should have. (Be clear on what I just wrote, this is from the perspective of adding value)

Then there is the weaning thing. I’ve written on here many times before and today I do it again. Commit to it or don’t do it. Selling short, weaned cattle is telling buyers you don’t care. By selling short-weaned cattle you are only offering a problem, not a service.

I had to chuckle as I saw some past cow/calf operators trying to buy stockers this week. (They decided to change their program and got out of cows.) Their comments about how cattle were represented, as far as weaning and vaccinations, about brought me to tears. But you know what? This is why preconditioners get paid, we fix what others mess up. Remember value-added marketing is only added value IF you capture the added value.

A cattle market view

This week replacement quality heifers caught up to a $15 premium. Feeder bulls and unweaned cattle were up to 25 back.

Here is something interesting. Cattle sold on a slide this week up to a point, usually around the six weights. Whatever that price was for that weight, is about what the heavier weights sold for as well, give or take a few bucks. If all the cattle sell for the same price that price is also the Value of Gain. If you pay attention these price relationships jumped right out at you, and it was simple to see what to be buying. For those of you who rely on a computer generated ranking system to dictate what you buy I have bad news, you were mislead.

If you wish to learn more about sell/buy marketing that works, we have a school coming up in December. There is more info at our website.

The opinions of Doug Ferguson are not necessarily those of beefmagazine.com or Farm Progress.

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