Transcript of the lamb marketing masterclass part 1: Know your business
Alice Ritchie:
This is part of our four part Lamb Marketing Masterclass series. This was originally designed to be face-to-face but we've had to adapt to it, which is fair enough. Tonight's session, we're going to explore the options and gain insights about lamb marketing, with guest presenter, Tim Leeming. We'll discuss the importance of planning to achieve your marketing goals, the importance of knowing what drives profit in your business, and what strategies might come into play when things don't go... I'll just do some muting. All good.
Alice Ritchie:
I will start by introducing Tim Leeming and Tim Hollier. Tim Leeming and his wife Georgie, run a self-replacing prime lamb flock, a feedstock business called Paradoo Prime, and background cattle at Pigeon Ponds in Western Victoria. I'll let Tim explain his story a little bit more. So, I'm not going to give you the full bio just yet.
Alice Ritchie:
Tim Hollier, on the right, [inaudible 00:01:02] of two Tims, works with Agriculture Victoria and is currently the Senior Specialist of beef and sheep. He has managed the red meat value chain program for a number of years and has over 30 years experience working in the beef and sheep sectors across extension research, [inaudible 00:01:19], and management. So, I'll let these two introduce themselves. And Tim Hollier, if you wouldn't mind talking about what content we're going to have tonight.
Tim Hollier:
Thanks, Alice. So what I'm planning to do, is just to run through a few slides on the lamb market and the lamb industry, and the sheepmeats industry, and where it's at. And some of the key drivers, some of the components, of the value chain and why it's important that we try and meet certain standards in supplying those things. Tim will also add in comments along those lines. Might hand over and get into the meat of the presentation with Tim.
Tim Hollier:
So the first slide is very much around setting the scene, and it gives a bit of an idea of the market we're coming from. This is an amazing industry, the lamb sector, really. It's one that's actually, generated as a byproduct out of the the wool industry 30 odd years ago, and has grown into a very significant and major revenue industry for Australia, and particularly, for Victoria. And has developed to be with real strengths there, as you can see from the figures there. And from the lamb production area there, Victoria does dominate the production across the state. That is also the throughput, that came through, and a major export market is out of Melbourne, for lamb production in Australia.
Tim Hollier:
Mutton also, has a large productivity there and has maintained. One of the key figures we must be aware of, is we do have a reducing sheep flock in Australia, and that has an impact particularly, on the mutton market. But what we're seeing, is a growth and a real specialization in lamb production, and a growth of specializing in a range of product coming out of the lamb sector from producers. And we're seeing that diversify more and more as that develops.
Tim Hollier:
You did see on that chart there too, very much, the competitors. There are not many competitors in the lamb sector. China is certainly the major player in production, but it's all domestic. The two big export countries is Australia and New Zealand, and Australia is very much taking a lead share there, with a reducing sector in New Zealand.
Tim Hollier:
This slide here, is very much about, "Why is it important to do what we do well?" We have an export market and a domestic market. We've got a growth of a high valued red meat product here, in lamb, and that is already differentiated from a commodity product, while it's being developed, particularly with the lamb sector. And so, we've got to look at trying to protect our market share and grow our market share. We've got to try and keep lamb on the menu and so, keep the quality of the product, and meet the expectations of the consumer, and thus, give that consumer the confidence of the product.
Tim Hollier:
Very much the same story with export market, in the customer and the consumer having confidence in the product. We want to protect the market share we've already got, but look at the opportunities and how we may grow, and where we might expand to. We've been very much dominated by the growth in the export market with the US, but there is now major other markets that are actually, giving us opportunity.
Tim Hollier:
We've put a lot of product into China, still. And then, the UK and the EU are certainly, opportunities for a high value product that pays a very high price, going forward. Did you want to add any comments here, Tim, around these slides?
Tim Leeming:
Yeah. Good day, everyone. I think what it really outlines, is how exciting the industry is. That we've got a pretty good diversification now with our exports, and it's sort of matured, as Tim alluded to before. I think the industry, from 25 years ago, when I started in the industry, lamb was fat lamb, and as Tim said, it was probably regarded as a bit of a byproduct. And I think, MLA, and the industry itself, has come a long way and it's very exciting to be a part of it. And especially, I think, we're getting that... When I started in the early 90s, lamb was $1.40 a kilo, in the mid 90s. We all know what it's worth at the moment, so it's been a pretty good ride.
Tim Hollier:
Thanks, Tim. And I reckon [inaudible 00:06:46] is that, the price there, that we all maintain, and we keep growing those prices with... Meet the customers requirements, the consumers requirements, and grow that, particularly, export market. And make sure we differentiate well with those products, so we have the commodity type products in mutton, but it's the high valued product of lamb that we've got to continue to look to grow.
Tim Hollier:
You might move on to the next slide from there. Thanks, Alice. So, this one's around the three C's of marketing; the customer, the competitors, and the company. What important in here is that, as I said before, we've got a high valued product, you need to sort of differentiate and meet what the customer needs, so that you actually understand the market you're trying to target, the customer, what they actually want. And so, you're not producing a product and offering it out there to whoever's willing to buy it, you're producing a product that actually, meets those customer's needs.
Tim Hollier:
And those customer's needs are driven by their customers, which end up at the end of the chain, the consumer. And that products' got to hit the quality expectations that you were trying to provide. You've got to understand what those needs are, and understand the sort of credence values, or those values that are put around a product, that help underpin it. And they may be things around, the growing [inaudible 00:08:13] value ones, around animal welfare, and sustainability, and all those sort of factors too, that are starting to be important.
Tim Hollier:
Particularly, when you're actually pushing a high value product that you want a high price for, and a high value return, there's all these extra requirements, that as producers, we should be adding segments into the value chain that we should be thinking about. As it was said before, you need to differentiate from your competitors, know your industry and where it is at the moment, and what the expectations are.
Tim Hollier:
A key component here, is understanding that those customers and sometimes, competitors, are going to be... You may be targeting processors, you may be targeting feedlots, you may be targeting grass finishes. We're seeing more diversification in what those segments of the chain are, and you need to understand their requirements, of whatever they might be, and how do they maybe, target in the end product. And we just need to differentiate, "Well, where?"
Tim Hollier:
The key one here, for everything though, is the company, and be good at what you do, and be good at what you're good at. So, understand, "How does your business work? What are the key things that drive it? Where do you need to bring in extra skills or resources to actually, make things happen? And how do you understand your business so you know where there may be room for improvement, and then apply to that?" That's probably opening the door for, hopefully, where Tim will follow through from there. Thanks, Alice. We might move on to that one if we can. Tim, all yours, mate.
Alice Ritchie:
There we go. I'm so busy muting people, I guess I forgot to unmute myself. So I am going through and just muting where we can so that we don't too much background noise, but if I have missed you, then feel free to mute yourself. We're trying to work out those beeps as well, so they won't be quite so distracting. Just while we introduced Tim, I'm just going to pass the presentable across. And Tim Leeming, can get going introducing some of your stories, Tim. You're based at Pigeon Ponds, if that's correct?
Tim Leeming:
Yes. Thanks, Alice. A big welcome to all of the attendees tonight. I'm a bit humbled to be asked to present on this, and I promise you [inaudible 00:10:45] the classes put a fair bit of pressure, and all those beeps of people coming in. There's certainly a lot of people that I know, that are probably a damn sight better than me at marketing their product, but I'll have a go anyway.
Tim Leeming:
Just to give you a bit of a background, I've been farming on my own and as a partnership with my wife, for the past 23 years, and with my wife, since 2005. We run a self replacing... It's in prime lamb flock, in Southwest Victoria, sort of between, Harrow and Balmoral, in Red Gum Country. We're a 600 millimeter rainfall area, fairly undulating country. And yeah, we've enjoyed a lovely season, and we've been very fortunate over the last four or five years to have some great seasons of rain.
Tim Leeming:
I suppose, to give you a bit of an outline, and before we proceed tonight, it'd be good to get a little bit of a background on who's listening in and participating tonight. So, because we're talking about marketing, I'd really like to find out a little bit more about you guys and whether, you've actually got a marketing plan per se, and what's your main marketing method for your lambs. Alice will put up a poll, that should be on the right hand of your screen.
Tim Leeming:
So if you can just click on those two questions, and I promise you there's very little questioning during the night. So this is about as taxing as it gets. But what it will do, is give us a bit of an idea, especially myself, in some of the things we might talk about in a bit more detail, knowing a little bit more about the background of the listeners. So, if you can have a bit of a stab at those, that'd be great.
Tim Leeming:
And while you guys are answering some of those questions, I'd like to get you to have a look at that slide on the screen now, and just look at those different means of marketing our lambs that we've got, in Australia. Probably many of you, would probably, use nearly all of those different methods of marketing our products, and some of those you might prefer above others. And you might also, have different methods for different types of livestock. So, whether that's the animal that you're marketing, whether it's export lamb, as opposed to a late drop fetal lamb, or it might be something a bit more specialized. So whether you're using the hooks, or auctions plus, or whether you're actually, taking the opportunity of the sale yard at different times during the year.
Tim Leeming:
So, as I said, I think I've pretty much used all of those means, but we should be getting a bit of a poll soon on...
Alice Ritchie:
Yeah.
Tim Leeming:
Where everyone fits.
Alice Ritchie:
We've got about... [inaudible 00:14:27] but some pretty good results. So, I might just give people another 10 seconds to do any final clicks that they might want to do. And then I'll close it. Would you like me to share these results, Tim? So we can all see a bit of a mix across. It's a pretty good spread, I must say. I'll just...
Tim Leeming:
Yeah, I think it'd be great.
Alice Ritchie:
Yeah. Now we've just got about 15 seconds for final responses, and then I'll flash up the poll results, because it is quite an interesting mix.
Tim Leeming:
Great.
Alice Ritchie:
So we've got about a even split between yes and no, "Do you have a lamb marketing plan?" With a few people saying, "I don't know what a marketing plan is." And we've got, with the main marketing methods, about 14 people, so about 30% are saying, they go through the sale yards. Roughly the same amount go through a stock agent, roughly the same amount haven't answered yet, but that's fine. We do have a fair number that guy over the hook, so just under 20%. And about 15% through auctions plus. So, the one thing that doesn't tend to get too much is either, paddock sales or contracts, just gets a few.
Tim Leeming:
All right. Thanks very much, Alice. Yeah, as expected, pretty big spread. And I guess, there'll be a lot of overlapping there, as you only had the one choice. So, no doubt, many of you would use a number of those means. Look, I think the one that sort of stands out on that list there, on that slide, is agents. And I certainly will say that, stock agents have been part of our marketing team and a part of our business all the way along. And we've had a number of agents through a number of different companies over the years, but it's not as though we go through agents like changing channels on the TV, we've had some very long term stock agents involved in our business. And all of them have been wonderful actually, and we've had an excellent experience, but I think that's something that I'll lead to a little bit later on, is the importance of having a very good team behind your marketing plan.
Tim Leeming:
So we'll just move on, and what I'd like to probably start on, is where does your marketing begin? And for us, and for me, and Georgie, my wife, and Scott, who works with us, where it starts, the whole marketing of your product, actually starts when you create it, when you create that product. And one of the important things is taking control of what you've got control of.
Tim Leeming:
And what I mean by that is, having that ability to get the best conception and nutrition into those ewes before they're joined, and have joining so you can get as many lambs conceived as possible. And we're very big advocates of the last time you manage your program, and we're also very big advocates, of making sure that we've got condition scores on our ewes at all times of the year. And we think that is extremely important, to create that data on your farm, so you know where you get your best responses, especially for joining. So, that's where it starts.
Tim Leeming:
So obviously, you will have a set amount of ewes that you might join. If they're in a good condition score at joining, over a period of time, once you've pregnancy scanned for a number of years, you can build up a bit of a profile on how many lambs you're likely to conceive, in regards, for that condition score when the rams went in. So, that's where it starts for us.
Tim Leeming:
And then, I suppose, it's utilizing, "What's the information available?" And as I said, taking control of things you've got control of. And that's you pasture base, the way you manage your grazing, or the way you feed your livestock. The way you might pregnancy scan your singles, twins, and even triplets. But it's also, looking at some of the information that we have out there, and that... I know everyone's probably going roll their eyes when I say, "Looking at long term forecasts." But things that, once we do get those breaking rains and during the season, and I'm thinking from a general sense, is things like soil moisture. And that is so important to make some decisions, especially about your mark, heading towards the end of the year, and what sort of options that you might choose.
Tim Leeming:
Creating consistency in your production system is really important to us. We've bought a lot of land over the years, and with that comes the pressures of paying it off and being consistent in what you produce, and making, and turning a profit. So we'd like to bring in some consistency on, "This is how many ewes we've joined. This is how many they're likely to conceive at a certain condition score." And then, we're trying to manage those fetus to survive, so we've got as many lambs as we can to wean at the end of the year. So having paddock records is really important to us as well. And I know that's a little bit off the mark, as far as marketing, but it's very important to know what you've got to sell at the end of the year.
Tim Leeming:
Understanding what you're good at. And for us, in undulating Red Gum Country, we're blessed with a bit of shelter. So understanding what your environment is, and where you can, I suppose, use it to its greatest potential. So we really like our survival rates. Also, putting in some disciplines around monitoring those growth rates of your stock. And those of you that have got self replacing systems, or you buy your genetics at similar places, that you can build up a bit of a profile on your growth rates. Understanding your growth rates of your lambs during... And you might take weights at marking, and then you might take the next lot of weights at weaning. Gives you a bit of an idea of when those lambs might be on track to either, be finished, or to be marketed elsewhere off the farm.
Tim Leeming:
So getting those weaning weights per mob is really important to us, and we've done that for a long time. Monitoring, as I said, is super crucial in building up that database of knowledge. In our part of the world, in Southwest Victoria, we've got a very reliable break. One of the things that is under your control, is your time of lambing. For us, the end of June, is when our first lambs hit the ground. And that's purely driven on the ability to get the right amount of feed up in front of twin bearing ewes. So, if we want 1500 kilos up in front of a twin bearing ewe, we think that the 28th of June, gives us the most reliability of being able to produce that amount of feed, pretty much every time.
Tim Leeming:
What isn't that reliable, is the other end of the season. And that's sort of, [inaudible 00:22:54], I suppose, it's a business and we've built in some flexibility into what marketing options we have at the other end. So what I mean by that is, getting to know your environment is just as important as getting to know your genetics and your capabilities of your livestock. But also, understanding what you're good at and what risk management you can build into your marketing plan. So, having goals and targets is all very well and good, but we've still got to have the ability to have some flex in the system.
Tim Leeming:
So in my early days, I aimed at finishing all my lambs, and that was a goal. And I guess, that was a pressure on us as a business, to make sure that we finished all our lambs, even if it was just to a domestic trade weight type of lamb. Since then, and I think, experiencing some very challenging years between 2002 and 2007, and obviously, a drought in that latter part of those years, really I suppose, matured our outlook, and built in some flexibility. 2005 was also, the latest break in about 45 years, in this district, which is a second to third week of June break, which had some serious impacts on so many businesses in this part of the world. But it also, made some changes in our business and that's where we went from, a start of June to an end of June, on the back of that year. I didn't want to go through the fact of feeding ewes with lambs at foot ever again, I didn't particularly like it, and we haven't done it ever since.
Tim Leeming:
So, some of those things, obviously, impact the later you lamb and the growth rate potentials of wet winters, and your pasture base, and understanding the pastures that your animal's graze, can have some serious impact on the marketing of that product at the end of the year. So for us, we decided that in the event we could finish lambs, we would, but then we would, for the lambs that may not have made those weights, or the fact that we wanted to try and work on our weaning percentage and our lamb survival, and our conception, that obviously, by doing so, we'll have more multiple born lambs. We wanted to have a flock that was hitting that, I suppose, optimal seasonality, as in, that it was conceiving at a more moderate condition score profile, and that we were getting a better conception, and a later joining. So all those aspects impacted on what our final weights were, especially in very average, or failed offspring's.
Tim Leeming:
So we had to market our lambs in a different direction to a finish market or to a hook lamb, and that's where we started to market using the means of auctions plus, and other methods, even direct to customers over the years, that were [inaudible 00:26:46] of our lambs. So, that's sort of how we've progressed over the last few years. And the bulk of our product now will go to a finisher market or a feeder lamb market, rather than a finished product. Sales guarantee, and I think having a very clear... And as Tim, in those earlier slides... That differentiation of you, I suppose, to your competitors, but also to make your product stand out. And maybe, try and add to the value chain, I guess, in information, that might make your product just a little bit more attractive than others.
Tim Leeming:
The big attraction this year, I think, is anything that possibly could walk on four legs and eat grass, with the amount of grass that's around at the moment, has certainly made for a very buoyant cattle and sheep, and lamb market. But providing information I think, is really important, especially in relation to the customers that buy our feeder lambs. They want to know certain aspects of the genetics, they may, or may not, want to know some of the other things that I've listed on this slide. But I think, any information that is going to help and assist the marketing of your products is really important. So some of the things, even using [inaudible 00:28:27], which is not mandatory with a non [inaudible 00:28:30] animal. But we think it's important that we're putting that information there, access to be doubles, putting together big lots of lambs that are more attractive for bigger distances, putting the information of what sort of pasture that those lambs are going to go back onto after the assessment, all those sort of things. And obviously, animal health records are paramount, but having a well disciplined register of that information on your stock, I think, is valuable.
Tim Leeming:
So, knowing your cost of production. And this is, as Tim, I think, alluded to earlier, that the profit drivers of your business. And we've been [inaudible 00:29:25] our business for a long time, since the mid 90s. And understanding, "What's the important drivers of your farm profitability?" And for a self replacing prime lamb flock, obviously stocking [inaudible 00:29:43] is super important, and weaning percentage, and price received, and ultimately, the kilograms of lamb produced per hectare, at a good price over, and trying to reduce the cost as much as you can. So understanding those components of your business is really important to us. And yeah, I think that's really influenced how we market our lambs now, as opposed to how we marketed our lambs in the early days of, as I said, having the pressure to try finish your lamb. Now we've got a lot more flexibility in our business.
Tim Leeming:
Yeah, so using that, coming into a spring, or in that winter period, when you're thinking about your marketing plan, or conceiving what you might be doing with your product, I think, having the data, having the weights on your lambs, having a condition score on your ewes... I know that seems a bit [inaudible 00:30:53], but your carry over reproduction in your flock is so important. And that was hammered home to us a lot during those nasty failed springs, of years like 2014 and 15, where it was a real driver of maybe, early weaning those lambs to give that ewe her time to recover. and to think about the profitability of your business and the conception, and weaning percentages of the following year. So that can be a real six month thought process, preempting what might occur if the spring fails, or we have a drought situation.
Tim Leeming:
So benchmarking is really important, and I encourage you to get involved with actually, doing a cost of production on your lamb if you can. And then, just as some of you have got a marketing plan, some of you would have a plan in your head, that it mightn't be written down. But I think, you know, as I said, making sure that you've got some sort of risk management and flexibility in where you go, making sure that you've got... Providing a transparent and doing the utmost on the quality control of your product, is super important. As Tim said, we've got a highly valuable industry, and we need to manage it from a risk point of view. And we know all the downside risks to the red meat industry and we really need to be on the front foot, from farm level, right through to the top of the industry.
Tim Leeming:
Using the information that we have at our fingertips; advisors, agents, understanding the customer, and I think, enjoying the feedback over the years, of when the hook lambs. And we still do hook lambs, but generally, hook our dry ewe lambs in a June market, which is usually a premium price market. But we also, tend to market lambs most years, of the heavier end of our first drop lambs.
Tim Leeming:
This year, for an example, we've got a grass feeder market, very [inaudible 00:33:35], store prices, and we actually market our winter lambs two or three weeks earlier than normal. And we decided against a hook market and put them into a feeder lamb market. Because, we could see that there was a little bit more of an advantage, even though we've got grass coming out our ears, and plenty of opportunity to put weight on, on those lambs, we thought that we would pull the trigger early. And one of the real key things that helps us pull the trigger in our system is, I suppose, having a weaning discipline. All our lambs are weaned, between 60 and 70 days of age. And that gives us plenty of opportunity to pull the trigger on our marketing plan, whenever we like. So, whether that's selling lambs at 13 weeks of age, or taking them through to an older age, without that disruption of what weaning might do to some weight gain.
Tim Leeming:
Clicking through... Now, I think I might just see if there's any questions out there. Alice, and girls, if you've had any questions?
Tim Hollier:
Tim? I might just add to what you've said there, Tim, which was really good. But around information flow and the information you can provide on your product to your customer, but also, be aware of feedback of information. And what information you may get back to help you understand how well your product went, and how it might go forward. And a lot of people will say, "Well, think of the processor, and we might get fat and weight." And that's about it. Yes, that might be right, but we're at a bit of a major change area, I think, for the industry, in the next few years, around a lot more information about the product.
Tim Hollier:
As start to come forward, as a lot of tools are starting to be developed about analyzing the lamb product going forward. And that can be flowed back to a producer to modify their on farm management and production systems. But also, what information, with [inaudible 00:35:50] in Victoria, and you start to get more information, and electronic systems, we can actually record a lot more information. And that information can start to flow back from, whether it be a feed lot, or whoever else might be able to collect data. So, I think we're going to be in the information age going forward, and we really need to know how to manage that information for your benefit as a business.
Tim Leeming:
Yes. Absolutely, Tim. And I probably brushed through a few of those slides. And one of the things that really does drive what we do is, I guess, that continuous improvement of our product, but we thoroughly enjoy, and we do have a lot of repeat customers on our product, in buying our lambs. And one of the things, is that follow up and communication between the people that buy your product, and to see how it performs.
Tim Leeming:
So, the [inaudible 00:36:58] is certainly a very handy tool, in that, I've got a couple of clients that buy my lambs, that are very great at sharing growth rates with those lambs, and how they perform on their various types of feeds that they might put them on. So getting that feedback's great, and I guess, where genetics comes into the product.
Tim Leeming:
We started off in the early days, of being in the cycles of performance bred and lamb plan, and genetics. And we were all told in the early days of the lamb industry, that growth was king and we needed lean lambs. It's quite amazing, the little journey that we've had in our business, where we, not blindly, but we certainly followed that script, in the early days, of growth was paramount, and weight was the thing that paid you. And we certainly, were growing lambs really quickly, but we found that we were also developing a ewe base that was getting bigger, and bigger, and leaner, and leaner. And our lamb was hitting the weight target but it wasn't hitting the fat target, especially in some failed springs, that we can have up in this Red Gum Country, where we farm.
Tim Leeming:
So we needed to change our genetic direction, which we hadn't in the last 12 years of moderating, [inaudible 00:38:38] with fat and muscle, and I suppose, setting the bar a little bit lower on that extreme growth, and just to get a maternal flock I guess, a self replacing maternal flock. And I think, there's some really good feedback in meat eating quality, of putting that fat back into the lamb. And I had some lamb cutlets tonight with some vegetables, which were very tasty. I do like having some intramuscular fat in my chops and my lamb, that's for sure.
Alice Ritchie:
It's always important to consider, that one of the people eating your lamb, might be you. I've just got a quick one, Tim. Going back to the pie graph slide, looking at your... Was it conception rates? Can you just explain some of that a bit further? What exactly we were looking at there, and what does that relate to marketing, to you?
Tim Leeming:
Look, I think, you can't sort of... And I know running a business, you don't want to be up and down like a yo-yo and [inaudible 00:39:57] system. So the thing that underlines these three years I've got on those pie graphs, and this is just our first cycle lambing in our commercials, that we've got a condition score that's in the background of all those three years. And starting at three-two, going to three-three, and then, three-five, in 2020. So we actually conceived more lambs per ewe as those three years progressed.
Tim Leeming:
But one of the things that we're very proud of, and we put a lot of work in, is that our lamb loss, or our lamb survival, even though those three winters were completely different, and had some certain challenges [inaudible 00:40:47] they were actually, wetter winters than the long term average, our lamb survival stays the same. So even though we've got more multiples in there, our lamb survival stays the same. So we take control of that production system, so there's no surprises that, all of a sudden you've got 500 more lambs, or 500 less lambs, than what you've aimed for. So that's important, we can certainly streamline how much we produce and expect in a year, I suppose. So that's what they're about.
Alice Ritchie:
Fantastic. Apologies for the slight echo there. A question about contracts. They're not as popular this year, as we've seen from that data, just from the group. What's their role in your marketing plan? Both Tims might have an idea on this.
Tim Leeming:
I'll go first, I suppose. Lamb contracts, for us, due to the fact that we have used lamb contracts, and I think lamb contracts are a fantastic tool for the industry and especially, a progressive industry. This year, I think, taking out a lamb contract was actually, a really good risk management tool, because of the unexpected. And we're all quite concerned of the circumstances we're in, in Victoria this year. And I would not begrudge anyone that has taken out a contract just to shore up, not only that kill space, but also take a healthy price for part of their lamb, or part of their product. So, I think contracts are fantastic, actually. Tim, I don't know whether your-
Tim Hollier:
Yeah. No, I agree. I think you're right.
Tim Leeming:
conception is-
Tim Hollier:
What it really is, is a risk management tool for you. And I think, that whole risk management for your business is going to become more and more important with our changing environments, and everything. You don't have to contract your whole turn off. It's a component of using the best advice you can, and then work on how much for your business, how do you manage a bit of that, and kind of contract you do, and underpin that pricing structure that you're chasing, so you can cover yourself for a bit, or a season. But not under run at a season that actually, has particular prices associated with it. So, contracts can be just that tool to help you with that risk management [inaudible 00:43:44].
Alice Ritchie:
I've got another question around, having a good team around you and having worked with agents, and other people in the past. What do you look for in an agent, when it comes to marketing? And what might make you change, either leave, or join, a new one?
Tim Hollier:
All my agents have left me, actually. So, [crosstalk 00:44:18] what I mean by that... No, absolutely not, and I don't mean it in a way that, bigger companies, and going to bigger and better things, is the reason that the agents left me. It wasn't because they didn't like us. And I would like to think that we're still very good friends with all our agents, that have worked with us. Yeah, I think your agents is only as good as you make your agent. I think that it's important to have fantastic communication and actually, sit down and work with an agent. And make sure that your agent is on your page, and understands what you're good at, where you want to go, what your goals are. And understands probably, some inner parts. Doesn't have to know exactly everything about your business, but if they they understand your business well, I think they perform well.
Tim Hollier:
We've all been a big cavalier in hooking lambs and [inaudible 00:45:30], because I think they provide a tool for a lot of people to market stock. But I've always, I suppose, had a reasonable amount of debt on my shoulders, so I always like to produce something and then know pretty much what I'm going to get. There might be a little bit of flex in the skin price, I've weighed the lambs before they got onto the track and gone to the meat works, so I've had a pretty good damn idea of what I was going to get. So all those, I've always liked about... I think we were a bit of a gambling [inaudible 00:46:07] in Australia, and I don't like gambling. Gambling with my finished product and hoping for the best, and aiming for a buoyant market on sale day.
Tim Hollier:
Our agents always understood that we like to sell either, in the paddock, in the property, or we like to sell where we've got control on a reserve, or where we've got a known price, if we hit that grid well. And those things are really important, I think, and if your agent understands that, then I think you'll have a good experience with your agent.
Alice Ritchie:
Okay, great one-
Tim Leeming:
Alice, I might add a comment there. Tim, here.
Alice Ritchie:
Yeah, go ahead Tim.
Tim Leeming:
That whole team thing, I think that's really important. One thing about farming is that you've got to be an expert in so many different areas. A whole range of expertise required to farm well, and thus, if you can help bring good experts and expertise around you, and a good agent who helps you with your marketing, you can certainly do that. Yeah, that's where the benefits can be and help allow you to actually, assist you in your decision making, and also take some of the pressure off you to target some of the other areas of your business too. So yeah, and that just about an agent, but that could be skills in any space, to help you in your business, become an expert across the whole range of skills required.
Tim Hollier:
Yeah, and in saying that, Tim, I know a number of people that have got confidence in their own ability to direct market their stock, and we've direct marketed lots of sheep over the years. But very few are probably, as I said before, we've had enough liability on our shoulders that we probably didn't have the ability to risk a couple [inaudible 00:48:12] driving down the driveway and not getting paid for them. So, that's where the old agent guarantee is pretty important to us. But yeah, I think, if they're a great team member and they add to your business, then I can't see why we would not use an agent, to be honest.
Alice Ritchie:
That actually, leads really [inaudible 00:48:40] into another question we've got. Just thinking about all the market information and associated analysis that's going on. How do you stay abreast of that while running your property at the same time?
Tim Hollier:
I think market intelligence, it's not an exact science, put it that way. There's so many things that... I think actually, seasons this year is a prime example of the buoyancy, I suppose, after three years of prolonged drought, and terrible circumstances in New South Wales, and Queensland, and other parts of Australia. And as Tim said before, we've got a very low ewe flock at the moment with very good demand for our products. And then, we've got this restocking demand of the [inaudible 00:49:47] as well, that actually, probably assists in the buoyancy of the sheep market as more of an attraction, and maybe a little bit more of a guaranteed future business to be in.
Tim Hollier:
There's a lot of factors that build up a bit of market intelligence. And I think it's about as exact as long term weather forecasts, if that helps. But I think, some of the things that we do have in our control, is understanding where you're soil moisture is, what are the predictions of weather? I think, that probably, has bigger impact on price than anything, really. And it certainly, if you think about the circumstances surrounding the drought in New South Wales on the cattle prices, that this time last year, as opposed to, this time, this year, it's chalk and cheese, and that's basically moisture driven. Using your own skills of reading papers and listening to, whether it's [Robert Herman 00:51:16] at [Macano 00:51:16], or whoever you might subscribe to, to get that little bit more insight into markets, and the information out there, anything to make your decision more accurate is obviously valuable.
Alice Ritchie:
Yeah. One last one [inaudible 00:51:33] actually, how important are the use of scales in your operation? And I'm just going to flick through to the end here.
Tim Leeming:
Yeah, scales... And don't worry, I've only just recently purchased a [flash away drafter 00:51:53]. So that was my 10,000 lamb present to me, so I had to get to 10,000 lambs before I invested in too fancy an infrastructure. What I did do as a 23 year old, the first bit of machinery or equipment that I bought under my management of the farm, was a Prattley weight crate that I imported, that had to come out from New Zealand, obviously, from Prattley. I've still got it to this day, I'll put a new floor through it, a new side through it, because I've gone through three sets of weigh bars, and three monitors. We used it today, actually, to get some weaning weights. That poor bit of machinery, that's fallen off backs of [inaudible 00:52:48], and gone on lease country, and is now 25 or 26 years old, and was $1,050, that bit of equipment is super important for us. And it's probably more important, on the weights, marketing your end product, than at the end product, because most stock agents now have got one. I actually had scales for a lot of [inaudible 00:53:16] stock agents. Had scales, but I shouldn't mention that.
Tim Leeming:
But yeah, I think weighing stock and especially, conditions growing you're mature age, or your breeders, your ewes, super important. But weighing your lambs on the way through to your market is really important to understand. Your capabilities of your farm and environment, and genetics, but also, to make some pretty strategic decisions on the market at the end, in relation to the season. So scales are a must. But you don't have to go and spend 20 grand, you can get a good set of scales for probably three or four. [crosstalk 00:54:03]
Alice Ritchie:
I think that pretty much wraps up. I don't have any more questions sitting here, but I do have some questions for the audience. So I'm going to open a final poll, we've got a couple of our official questions that we have to ask, because we've got to say that we're doing something meaningful, hopefully. And a couple of questions that I would really like you to have a think about. So, what sorts of things might you want to find out more about? Or perhaps, do differently or have a go at? And would you like to have more information about developing a marketing plan? So, if you wouldn't mind just filling in that poll that's up on your screen. I would really appreciate it, because it helps us to make sure that our future sessions really hit the mark. And one of the first things I'm going to do, is work out why all those beeps keep happening. Thank you very much to both Tim and Tim, do you have any final remarks? Just while we've got this poll taken?
Tim Hollier:
Here you go, Tim. Look, by now it's very... Well, half an hour probably. It's pretty hard, when talking to a laptop screen, to analyze an in depth marketing plan, but hopefully people got something out of my yabbering. But yeah, I think, one of the things that Tim and I spoke about the other day, and with Alice, and the girls involved in this, Kirstie, and Kate, is it's not a time to be complacent in the industry. We're enjoying some terrific prices, and I think we're just going to probably, take charge and be proactive. And then try and improve, and protect our market access at the moment, and hopefully expand it, would be nice to get into the EU if we can. That's me.
Tim Leeming:
Tim, to add to that too, an interesting one is that, those markets are going to be really important, but as we get more information flow happening both ways, up and down the chain, people keep records and particularly, processes, and they know who supplies what at times. And your reputation is really important and how well you can underpin that is driven by your market, how you work with your market, and how well you provide good information. So, I reckon the whole reputation of you as a lamb supplier, a sheep meat supplier, are driven by the stuff that we've been talking about.
Tim Hollier:
Yep.
Alice Ritchie:
Absolutely. Thank you very much to both Tims. Tim Leeming had a very long session there, so we really appreciate that. And Tim Hollier, thank you very much for joining us, and just providing a good point of discussion, it's really helpful.