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Four tips to help get grain marketing advice you can trust

Before you hire a marketing consultant, make sure to choose the right one for your farm

Whenever a business is as filled with uncertainty as grain farming there will always be lots of advice out there about how to minimize risk and maximize rewards. Government agencies, universities and magazines like Grainews all offer advice to help make your life that little bit easier. They all share a common disadvantage though: their advice, while free or low cost, is general. You have to decide what tips apply to you and how to make best use of them for your specific situation.

For those who feel they want more specialized help there are many grain marketing consultants out there. Their advantage over free advice is that they will help you craft personalized strategies by looking at both the market and your farm’s particular needs and opportunities. Their advice is not cheap, though. Worse, they may not have the right incentives to look after your best interests. Charlie Pearson, a grain marketing specialist with the Government of Alberta’s Department of Agriculture and Rural Development, has some tips for picking a good consultant.

1. Ask to see their graveyard

Doctors have always had a great public relations and marketing advantage: they can bury their mistakes. Marketing consultants try to do the same, never presenting evidence of their failures when advertising their services. “Have them describe successes and failures and how they dealt with them,” Pearson says. They’ll be resistant to doing it, but insist upon it. If you find out they’ve got only a handful of champions and a cemetery full of ruined businesses and failed farms, hang up the phone right away.

Also hang up if they won’t tell you about their failures at all, or insist they’ve always been right. Someone who has never been wrong in grain marketing has either only been in the game for one season, or is lying through his teeth. Either way, they don’t deserve your business.

2. Inquire about their learning process

Pearson recommends being very thorough when investigating your potential consultant’s knowledge base: “Do they have a good handle on world crop fundamentals? Supply and demand tables? Who Western Canada’s most important customers and competitors are? Important crop reports dates and sources? Will they share their major sources of information, such as USDA data, private newsletters, etc.?”

He also recommends making sure they have professional credentials. “School of hard knocks is okay,” Pearson says, “but I would look for something else. If they are providing agricultural advice, they should be members of the relevant professional agricultural association. In Alberta, [that would be] the Alberta Institute of Agrologists.”

3. Dig deep

Find out how they construct their marketing plans, and what assumptions they make about the way grain markets function. Pearson recommends three good questions to cover the basics: “Do these consultants have an understanding of the farmer’s business and marketing plans? Have they contributed to doing the background work for these plans? In a world of uncertainty, do they contribute to developing a risk management strategy for the farm?”

Most importantly of all, and recalling the previous point, ask how (and whether!) they study their own performance year-to-year and learn from their mistakes and successes.

4. Take responsibility

While a consultant can offer you a lot of advantages from specialized knowledge and years of marketing experience, they can also cost you a lot of money and may leave you feeling dissatisfied. If you’re going to work with a consultant, remember to never surrender your own judgment — don’t let the fact that you’ve paid the consultant money undermine your judgment. Especially don’t let the fact that you’re paying for advice make you lazy about improving your own knowledge. A consultant is just that: someone you consult and ask for advice. You need to know enough to judge whether that advice makes sense for you.

“Accept no consultant will be perfect,” Pearson says, “and that their real role is to help the farmer make decisions by providing a disciplined process and solid information. Ultimately, the authority and responsibility for marketing decisions should remain with the farmer with the consultant providing information to help with a better decision.”

About the author


Michael Flood is a business writer and columnist. You can reach him at [email protected]



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