I don’t like to do it – but every now and then we need to talk about things we don’t like to talk about. Sticking our head in the sand is NOT a very good management strategy! Our problems will NOT solve themselves! Procrastination is NOT our friend!
So, what do we need to talk about? We need to discuss the fact that it is extremely difficult for cow-calf producers to make a decent living. Most are doing well just to break even. Many are unable to break even. Many are slowly eating up their equity just to stay in business. A growing number are being forced to file for bankruptcy. This is NOT acceptable because it is NOT sustainable!
Be honest with yourself… Are you satisfied with your profitability? Are you making enough profit to build wealth? Is your business growing? Do you have a competitive advantage over others in your business? Is your business working for you, or are you working for your business? Are you creating a business the next generation will be anxious to become a part of?
The most frustrating thing about all of this is that many of the things we are dealing with are completely out of our control. I’m referring things like the weather, the markets, the cost of inputs and this coronavirus pandemic. So, whatcha gonna do? It would be a waste of time to whine and complain about the things we have no control over. The only thing we can do is to focus on the things we do have control over – and then take action!
Contrary to popular opinion, there are many cow-calf producers who are very profitable – even during these tough times. While most of their neighbors sit around thinking, “Woe is me,” these producers continue to make the necessary changes in their operation to keep up with the times. They know nothing stays the same. The present is different from the past and the future will be different from the present. If they can do it, others should be able to do it too.
The beef industry is not the same today as it was 50 years ago. Much has changed – and yet nearly all of today’s cow-calf producers operate as though nothing has changed. They forget how much things have changed. Fifty years ago, you could purchase a new pickup for less than $5000. You could purchase gasoline for $0.35 per gallon. Land could be purchased or leased for one-tenth what it costs today. In the last 50 years, the cost of inputs has risen at least four times faster than cattle prices.
It’s no wonder cow-calf producers are struggling to make a decent living. It’s no wonder many are going broke. It’s no wonder the next generation has no interest in coming back to the family farm or ranch. With the cost of inputs increasing at such a disproportionate rate compared to cattle prices, we must change the way we operate if we want to survive. We simply cannot continue to do things the same as we have been doing them for the last 50 years.
Whatcha gonna do? If you are a cow-calf producer, your survival is dependent upon your ability to adapt and change with the times. The sooner, the better. Procrastination is NOT your friend! Unfortunately, it is too late for many producers to make the necessary changes in their program and genetics. However, we believe it is not too late for most producers – but time is of the essence! If you have not already done so, it is time to Change Horses – and it is time to get started on the Ten Steps to Double Your Profits.