A farm’s brand affects everything from input costs to the ability to acquire farmland and employees. Creating a brand for the farm is an important business decision.
"Your brand is reputation capital," explains Brett Oelke, a University of Minnesota Extension agricultural business expert. The question for producers, he says, is whether they manage and intentionally create their farm brand or let it occur on its own.
"Everything and everybody is a brand," says Oelke, who also owns Innovus Agra LLC—a farm and agribusiness marketing and management consulting firm. "Brand marketing is part of an overall business plan."
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Growth-oriented producers have a stake in the image they choose to present to their customers, both internal and external. Internal customers include employees, business partners and family members, while external customers include landlords, suppliers, seed customers, grain buyers and other farmers for whom you provide custom work.
One benefit of a positive brand is the ability to get a low price for inputs fast. It’s important to focus on developing a positive brand because "businesses talk to other businesses about customers," Oelke says, noting that it’s in your best interest to be highly regarded by suppliers.
Farmers aren’t the only ones who are cost conscious. Suppliers also want to keep their transaction costs low; they don’t want 40 phone calls to discuss price. While loyalty to suppliers is good, Oelke says sometimes it makes sense to deal with more than one. Take bankers—if one decides to pull back on ag loans, you need to have a backup, Oelke says.
In creating a positive brand, don’t neglect the importance of being organized. This will help you and your suppliers be as efficient as possible, he says.
With buyers of your commodities, "you want to be the go-to person, or at least a strong No. 2," Oelke says. For example, one producer was able and willing to deliver 15,000 bu. of corn to an ethanol plant in January when it was –15° and a blizzard. "Basis had been 25¢ to 35¢ under the board, but he got 15¢ over," Oelke says. Differentiate yourself from the competition.
Once you’ve got a strong positive image, you have to promote your brand. Show that you are valued and trusted to non-farm siblings, Oelke says.
"They need some of your time and understanding," he says. "The people we need the most, we sometimes neglect the most. Many farmers do a poor job of sharing information with those who can make their lives miserable later."
Brand yourself with landlords and prospective landlords, he recommends. While money is important to them, it’s not always at the top of their list, he adds. Through actions and your communications, create the image that you are a good steward by taking care of their resource.
Equally—if not more—important is trust. "If you want to find out how important trust is, start talking to landlords about flex-land leases," Oelke says. "That takes a great deal of trust on the landlord’s part."
Communication is crucially important with landlords, yet many landlords only hear from tenants one or two times a year, he says. However, landlords say they would like to hear from tenants four to 10 times a year. To help keep landlords informed, Oelke is a big believer in newsletters. But there are other options. For some, it might be as simple as sending a text in the spring saying you’re ready to go to their field next. For others, in-person meetings might be more appropriate. "It’s called public relations," Oelke says.
- March 2014