|Minnie Lou Bradley
Let me begin my after-lunch talk with a horror story. It is not for the faint of heart or stomach. It is an actual tale of what is happening in the beef industry. We hear of tales around the sale barns where little bunches of cattle are being discounted for lack of uniformity, quality and various other reasons, but this one is a Texas-size tale and told by the ranch manager at a Hereford field day this past summer. They can no longer sell their calves, some 11,000 of them, to their major buyers without providing registration papers and expected progeny differences (EPDs) on the calves sires.
Has this large ranch lost their proud independence of some 100 years?
This ranch runs some 14,000 cows. Can you figure in your head the number of bulls they turn out each season? When talking that number of bulls, even my slow way of calculating speeds up when I think that I might help supply him with his bull needs. Folks, can you imagine turning out 560 bulls a year? They average buying some 100 head annually.
Ive known and lived near this ranch for 45 years. They were in the drivers seat. Purebred breeders fell on their knees to get them to buy the champion carload of bulls in Denver each year. Order buyers were the same. How great it was to be able to deliver to the yearling man or feedyard some 11,000 head of calves at a dollar a hundredweight.
As you can imagine, the ranch family was very independent. No one told them what breed to buy, quality or anything else. What has happened in these past five years? If old-timers could come back from their graves, they would not recognize anything about the ranch but perhaps some old landmarks.
A new reality
Today the buyers of the 11,000 calves are telling this old independent family not only the breeds of bulls they are to buy, but they want to look at the registration papers and the performance records of all the bulls siring the calves before they will bid on the them.
Has 100 years of independence made this fourth-generation ranching family bitter or made them turn a deaf ear to the buyers of their calves? Hardly. Why? Because they are progressive commercial cowmen, and they have a businessman heading up the family organization.
They are the new generation that can forgo independence for security. They welcome interdependence. For 100 years sheer size allowed them to be independent, and the ranch had the reputation of wild cattle: Gather the few and to hell with the rest. Who cared? Buyers just thought that was the way of life on a large ranch.
Not so in the year 2000. Today the ranch is cooperating and sharing information with its buyers while becoming interdependent with other systems of the beef industry. Coordinating with others in the industry has made them money.
What does that mean to me as a purebred breeder who sells bulls to them? Now I dont make my matings and condition my bulls to my own personal whims, but I want to visit with the ranch managers and talk of their needs and the needs of the next system in the industry. Their needs are my concerns as their concerns are the needs of the feeders and the feeders know the concerns of the packer and likewise to the meat counter. Its partnering for the good of all the beef systems.
Once, the above-mentioned ranch had no idea that their wild cattle had an effect on eating qualities, as well as feed efficiencies. This west Texas ranch is a long ways from the consumer, but those cowboys now have an interest in her picking up beef at the counter. For the first time those old tobacco-chewing cowboys realize that their wages depend on the consumer stopping at the meat counter and purchasing beef.
Different thought process
Only a few short years ago and I am sure most of you remember the saying went, and was often true, that one system of the beef industry had to be losing money for the others to profit. How wrong that thought was! No industry can prosper and grow with one of its segments losing money.
Most of us grew up believing that theory, as most of us in the purebred business believed blue ribbons pinned on some bull by one person on a given day in an artificial setting was the way to select our next herd bull. Before the 80s, what purebred breeder asked himself if his new herd sire would be what the industry needed, if he would sire efficient cattle in the feedyard, if his calves would hang up the kind of carcass that pleased the packer and, lastly, please the consumer?
The way I remember things, we purebred breeders thought we knew more than our commercial customers. The feedyard was only a motel selling feed, and the packers were the meanest, sorriest men on earth. But wait a minute. Arent each of them our customer, and havent they always been? Who buys our cattle to pay our bills? Isnt it each of them? I dont believe you could have found the words far-sighted and open-minded in any cattlemans dictionary.
It took the great financial losses of the late 70s and 80s to wake everyone up to the harsh reality that we could not continue to exist as an island; we needed to partner up and find the needs of everyone beyond the cow-calf man. As much as we all hated to admit it, each segment had the same goal to make a profit. And the only way for that to happen was to gain more market share and to stop the bleeding from those chicken boys. Who thought that chicken would ever be more than a Sunday dinner and a picnic?
Learning through experience
I am the guilty person. I believed, as I have mentioned, that the feedyards and packers were making all the money and denying me and my commercial customers the opportunity to make a profit, while they were pocketing all the profits. So in 1986 I talked my family into hocking our lifes work and investing everything into the building of a small feedyard and a beef packing plant.
What a ride we have been on since that day in October 1986. I have lived every aspect of each system of the beef industry, and I am here to tell you that it is a ride that everyone who owns a critter should experience if only for a short time. I have gained respect for each and now understand the problems of each segment.
What about those steers coming into the yard that range in weight from 400 to 900 pounds? Those that came to die? What about those whose feed efficiency is off the wall? What about those with a disposition problem that wont eat or drink? Whose responsibility was that?
Those same cattle are expected to come through our beef plant. What are we to do with the 500-pound carcass? The 1,000-pound one? A ribeye of 9 inches and one with 19 inches? The bruises, the dark cutters, the injection sites, a grubby hide or one branded all over? Should I really pay the same for all of these variables? Selling on the averages is what our market has been about.
Our little family operation couldnt stand that, and value-based marketing was developed. Informing the cattlemen of the kind they were sending us has enabled all of us to turn things around and make it a profitable venture for all of us.
There were a few years when we spent more time with bankers than we did with our feeding and packing business. Retained owners through our feedyard and beef plant stayed with our program as they were learning for the first time about their individual cattle, from weaning to the meat, and were being paid a premium for better-than-average cattle. With the cattlemens knowing the changes they needed to make, the cattle became better and more consistent. The retailers could see a difference, too, so they began to buy more product.
Back in those days no one used the words coordination or interdependence, but that was what it was. The cow-calf man was working and sharing with the feedlot, the packer and the retailer. Each was sharing information back and forth. That allowed us (B3R) to cut out the $250 in defects and inefficiencies that the National Cattlemens Beef Association (NCBA) had identified as costing the industry on every finished steer and heifer that was being marketed.
Another $150 in inefficiencies and poor management was occurring on the farm and ranch on each cow in the herd. By each of us sharing our facts and figures, all the systems cow-calf, feedyard, packer and retailer were able to bring a pleasing product to the consumer, doing it with less waste and each segment of the industry receiving a premium for our product.
The quotes, Quality is the best way to improve profits, and, You can neither control nor manage what you cannot measure, are so true; but, acting as independent segments, none of us had the information needed to make the needed improvements so profits could be realized.
No one thought we could survive, but 14 years later we have continued to grow and prosper. We have because we shared information with our customers on both ends our commercial cowmen and our retailers. We have paid the cattlemen who wanted to do better, and they have rewarded us with better cattle each year.
As long as we can help ranchers add value to their cattle and, at the same time, produce the cattle more efficiently from conception to consumer, then we all do well.
None of these successes could have been obtained if we had remained an island. Once we decided to work with all systems of the beef industry and share ideas and rewards, it has become a great ride for everyone.
Cattlemen who remain independent will continue to struggle. Those who choose to establish relationships and become interdependent will have unlimited opportunities.
|"The chain is no greater than each link in the cattle business."