There is one thing that you can always count on in production agriculture – the prices for your production and inputs are going to go up and they are going to come back down. Let’s take a look at 5 ways to inject discipline into your marketing so that you can avoid frustration and stress caused by market volatility.
- Know Yourself
Do you find yourself satisfied when prices are high, and anxious and indecisive when markets are trending downward? Most people are. If this describes you, take stock of your emotions. Try to intentionally break free from the market’s emotional roller-coaster and become cold and calculating toward price. This can be especially helpful when "news of the day" is causing you to rethink what you had planned to do. "Knowing yourself" is directly related to the next point.
- Preplan dynamic strategies
You can execute decisions confidently if you’ve preplanned your marketing strategies. For instance, let’s say you already know what you’re going to do if the market goes up a little or a lot, or down a little or a lot. When the time comes to pull the trigger, you can do it . . . if you’re not emotionally caught up in the moment. Good decisions are not arrived at during anxious moments. Look at every possible market scenario, develop goals and price targets for each scenario and then pull the trigger when those targets are hit. Preplanning dynamic strategies takes emotion out of your marketing, which helps you to maintain discipline.
- Make decisions in advance of market moves
Farmers are good businesspeople. Good businesspeople like to gather and research all the facts before making a decision. However, if as a marketer you take the same wait-and-see approach, by the time you act, opportunities will have disappeared. While it goes against all that you may be used to as a successful businessperson, train yourself to make marketing decisions without complete information. Making decisions ahead of time is a trait of disciplined marketing. How can you do that and still be successful? Preplan strategies for whatever the market may do.
- Define roles and communicate
When more than one person is involved in marketing decisions, a common challenge is agreeing on what to do. Many times, business partners, spouses or others involved in marketing haven’t defined their roles. If you take some time and establish each person’s role, you can prevent indecision down the road. It’s okay for each person in the farm partnership to have input in the planning. Ultimately, though, there has to be a commitment to execution – who, what and when. Establishing this up front can prevent frustration later. Also, keep communication lines open between all involved to prevent second-guessing. Questioning decisions after the fact only creates more indecision down the road.
- Set goals
Goals give you something to strive for. Goals help dictate marketing strategies and inject discipline into marketing decision-making. Plus, when goals are in concert with your operation’s overall financial position – and your lender and business consultant are in the loop – you’re more likely to remain consistent with marketing compared to a producer who does not regularly set goals. Remaining consistent is crucial. That’s because successful marketing is about building a solid average price for every bushel grown . . . over the long haul.
Admittedly, being a disciplined marketer takes work. However, as someone who has to plan, plant, nurture and harvest a crop, you already have the mindset to do accomplish it.
Scott Stewart is president and CEO of Stewart-Peterson, a commodity marketing consulting firm based in West Bend, Wis. You may reach Scott at 800-334-9779, email him at firstname.lastname@example.org
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