Marketing is a full-time job. Those who make little effort get justifiable returns.
Why is it that we'd never consider it appropriate for someone to be a part-time lawyer, a part-time accountant or, as an even better example, why would we ever want to fly with a part-time pilot?
We wouldn't have confidence in these people doing their job part-time because the best do it full-time. Why then do so many farmers function as part-time marketers and think they can be successful at it? Quite honestly, I have never been able to answer that question.
Along those lines, “part-time marketers” often rely on one piece of information (that might be six months old) or information that they could have picked up free in a magazine or some other media, and make major business decisions from it.
I've often felt guilty myself at times for providing such information. In the course of a year, I give about 60 speeches, write numerous magazine articles like this and tape nearly 100 television interviews. In the case of speeches, I could give a bearish talk on a Tuesday, but by Thursday, a crop report may change all the fundamentals. I would then do an about-face in the markets and if those who listened to my speech on Tuesday weren't listening to me on Thursday or Friday, they would still be making inaccurate assumptions and uninformed decisions.
Why do people continue to make decisions in this manner?
Twenty-six years ago, when I started in this business, we used to joke about the three reasons many farmers make marketing decisions:
- They need the money.
- They need the bin for next year's crop.
- It's starting to smell.
Fortunately, most of you have moved beyond this and have a more sophisticated marketing approach. But it never ceases to amaze me how fitting these three statements still are for many. It's truly frustrating watching people self-destruct when it comes to marketing because they won't admit what they don't know. And, consequently, they're certainly not willing to ask for or, more specifically, pay for advice to help them do a better job.
Marketing is even more important. In the next few months, marketing is going to be even more important than it has been since 1996, when the Freedom to Farm Act was passed. This current bill will likely be extended through next year's crop. Beyond that, we'll have a new bill with new rules, and new marketing techniques will need to be used. At the risk of sounding like a broken record, to be successful in these markets you need to:
Be a good student of the fundamentals and know how to read a balance sheet for corn and soybeans.
Have a solid understanding of technical analysis and the basics of bar-chart rules.
Have an understanding of the various marketing tools and know when and when not to use them.
Be willing to commit a substantial amount of time to marketing.
Know how to control your emotions in marketing.
Commit yourself to solid goals and objectives to help in your decision-making process.
To me, marketing is the most fun aspect of running a farm business. I realize that's not true for many producers. But the reason that it's not true is that in most cases there is a lack of understanding of how markets work.
But like becoming good at any profession or at any athletic endeavor, it takes a lot of work. Marketing is something that cannot be done on a part-time basis, and you need to be willing to make decisions in markets when the “markets” dictate it's time to make decisions — and not when the bills are due or the bins need to be emptied.
If you would like to pursue more information on this subject, feel free to call toll free or e-mail us at the address below.
Richard A. Brock is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report. For a trial subscription and information on Brock services, call 800-558-3431 or visit www.brockreport.com.