Seedstock Business

Seedstock Business

• What does Gardiner, Pharo, and Leachman have in common with Jordan, Oprah, and Trump?

• What do the names Precision, Traveler, New Trend, Bando, Scotch Cap mean to you?

• What is the value of AI over Natural Service?

Branding

“You do not merely want to be considered the best of the best. You want to be considered the only ones who do what you do.”

Jerry Garcia of the Grateful Dead

Bottom Line: Be Unique!!

Branding

• Leachman• Pharo• Ohlde• Fink• Gardiner• Werhmann• Camp Cooley• Circle A

• Building a Reputation!

Branding

• Category: Farm Equipment

• Brand Name: John Deere

• Tagline: Nothing runs like a Deere.

Branding

• “Company”: American Angus Association

• Category: Registered British Seedstock

• Brand Name: Angus

• Tagline: Old - The Business Breed New - Serving the Beef Industry

Branding

• “Company”: American Hereford Association

• Category: Registered British Seedstock

• Brand Name: Hereford

• Tagline: The Efficiency Experts

Branding

• Company Name: Mid-America Beef Alliance

• Category: Hybrids

• Brands: Balancers and SimAngus

• Tagline: The Simplicity of One Breed, the Power of Two.

UMC BRTF Herefords

RFI/EfficiencyCarcass Value, primarily MarblingCalving EaseMaternal• Mature size• Mate to Angus to produce Maternal Lines• Function

What can we be the best in the world at?What are we passionate about?What can we make money at?

Branding - Homework

• Our brand is the only (category) that (different).

Zag by Marty Neumeier

Advertising - Homework

• Heritage: When beef was king, so were Herefords.

• Leadership: The Leader………• Preference: Four out of Five …….• Reposition your competition

Branding - Homework

• Company: UMC BRTF• Category: The Leader in Efficiency Cattle!• Brand: Hereford • Logo: • Tagline:

Branding - Homework

• Company: UMC BRTF• Category: The Leader in Hybrid Cattle!• Brand: SimAngus • Logo: • Tagline: • Choose 4 Angus bulls • Choose 4 Simmental bulls

Commodity or Consumer Monopoly

• The best marketer in the US is Kit Pharo.• Second is Lee Leachman.• The best breeder of type is Tim Ohlde.• The best customer service is Gardiner,

Schiefelbein, Circle A, Wulf, Power Genetics, etc.

Seedstock Marketing

Trends affecting the Seedstock Business

Trends – Fewer Bulls Needed

• The US needs fewer bulls due to smaller cowherd (ie. Drought and pasture converted to crops)

• The US needs fewer bulls due to increasing production on fewer cows.

Trends – Breed Demand

• Branded beef programs and grids change the demand for certain breeds and biological types– More Angus– Less Brahman

Trends – Breed Demand

The preferred breed composition is 50-75% Angus with 25-50% Continental. No more than 25% Brahman.

-Tom Brink, Five Rivers Cattle Feeding

Target is 70:70:0Today, we hit 60:50:10

Trends – Demand for Hybrids

• Simplified breeding program increase the demand for Hybrid seedstock– Simple– Capture hybrid vigor– Breed Complimentarity– Over 1/3 of registrations at Gelbvieh and

Simmental are hybrids. Percentage is even higher with Maines and Chianina.

Trends - Knowledge

• Technology demands a more sophisticated supplier.– Genetic Evaluations– Carcass data– Embryo Transfer– DNA– Marketing– Customer Service

Trends - Size

• Consolidation at the cow/calf level increases the need for larger or cooperative seedstock suppliers.– Supply all the genetic needs.– Advanced customer service.– Minimum of 100 bulls to be a player.– Elite suppliers are over 200 bulls.

Trends – User-friendly

• Increased labor costs and cowherd size increases the need for user-friendly genetics.

–Cannot tolerate physical problems–Do not want to pull calves, treat pinkeye,

milk cows, etc.

Trends – User-friendly

user-friendly genetics

Trends – Customer Service

Simple: -Delivery-Hybrids-Newsletter

Intermediate:-Volume-Multiple breeds-Field Day

Complex:-Buy-back-Heifer Development

Trends – Alliances

• Increased communication and alliances “dictate” management protocol.

Trends – Shows

• For Mainstream Bull Production, beef cattle shows have essentially no value or at least greatly decreased in value.

Shows are still important to Shorthorn, Maine, Chi breeders.

Differentiate

• Genetics

• Volume

• Education

• Customer Service

Trends – MO

• Small increase in number of seedstock suppliers over 100 hd of bulls/yr but most will remain small and subsidized.

• Greater interest in service after the sale (calf marketing).

• Large increase number of hybrid bulls sold.

• Continued interest in carcass value with more emphasis on efficiency.

Trends

Want to be a leader?

“Find a parade and get in front of it.”Zag by Marty Neumeier

Trends

Want to be different?

“Hit the ball where they ain’t.”Zag by Marty Neumeier

The Five P’s of Marketing

• Product• Packaging• Place• Price• Promotion• “The Purple Cow”

Product

• Breed • Category within a Breed• Genetic Value

Categories Diverge

*It is very difficult to be everything to everybody!!

British

AngusShorthorn Hereford

Efficiency

Marbling

Balanced

Carcass MaternalGrass-based

Genetic Improvement

Genetic change which defines the animal as optimum for maximum profitability.