What to Consider Before Selling or Buying Heifers with Doug Ferguson

Doug Ferguson explains sell-buy marketing and how to apply it when trading females in the cattle markets

What if you could raise cattle and be profitable more than once every ten years? Doug Ferguson is changing the narrative and mindsets of cattlemen and women around the country by teaching the sell-buy marketing strategy. During Season 7, Episode 19 of the Casual Cattle Conversations podcast, Doug shares expert advice and stories to explain sell-by marketing, how to apply it to trading females, along with what to consider before buying or selling heifers.

About Doug and Sell-Buy Marketing

Doug Ferguson grew up on a family farm in Nebraska where like many of us he grew passionate about cattle. By the time he was in high school, his mind was set on raising cattle for a living which grew into a passion for marketing cattle too. “The reason I am so passionate about marketing is that I was bombarded with the same message we all hear about cattle being something you do on evenings and weekends and that you need to go to school and have a second job. I thought that couldn’t be true considering the size of the industry.” This mindset led him to a sell-buy marketing school led by Ann Barnhardt, which was exactly what he needed to achieve his desired outcome. Doug has since taken over the school and has taught almost 700 other cattlemen and women how to be profitable by trading cattle.

Sell-buy marketing is what it sounds like. You are selling and replacing on a head-per-head basis and not focused on owning a group of cattle for the long haul. “I’m always looking at buying and selling. Cattle were not meant to be owned. I understand that statement is very abrasive to cow-calf producers, but it doesn’t mean you always have to sell her. You do however have to reassess her value,” said Ferguson. During his sell-buy marketing schools, Doug spends the first day focusing on mindset to help attendees fully grasp sell-buy marketing concepts and how to apply them. “Learning new things is easy. It’s letting go of old ideas that is hard,” said Ferguson. However, one pattern Ferguson sees in his students is that once they let go of the old paradigms and peer pressure from dead relatives, they catch on fast.

How Sell-buy Marketing Can Be Applied to Females

There can be a lot of business opportunities in trading females when you open your mind to the risks and opportunities they provide during specific seasons of their lives. Doug said, “Because of the fallout rate of females, I recommend trading them. The other thing to remember is that you can trade females at bigger margins than you can sell the calves they are weaning off. So, the bulk of your money could come from trading females.” Doug notes that it’s hard to go wrong with buying bred heifers because as long as they breed back, they appreciate in value and will sell for more as three- and four-year-olds. Ferguson provides the following story to serve as an example of how sell-buy marketing can work. “I had a former student who was faced with a drought. He decided not to liquidate and to use sell-buy marketing instead. This allowed him to cull deeper into his herd and then replace the ones he sold head per head with stockers who would eat less and allow him to better utilize the available forage. Then the markets went up for stockers, so he sold the stockers and replaced them with fall-calving cows. He calved out the cows and then re-sold those as pairs and bought back more spring calving cows to get back to where he started,” explained Ferguson. This is an example that involves a lot of trading but also displays how many different opportunities are out there.

Considerations to Make

Regardless of if you are using sell-buy marketing to sell your females or selling them to create another revenue source for the ranch, you need to know the costs and what your customer wants. Ferguson reminds people that just because prices have been good it doesn’t mean you can start guessing your cost of production. You need an accurate number to make smart decisions when trading.

When it comes to knowing what the customer wants, start with the basic checkboxes but think of them as areas where you will be discounted instead of paid more. These boxes could be pelvic measurement, which bull she is bred to, and the calving window of the group, just to name a few. “If you are selling bred heifers, it doesn’t matter what you like. It matters what your customer likes. You have to bring something to market that people want to buy,” said Ferguson. If you aren’t confident in what your customer wants, call your local sale barn and ask them what they see and are hearing from people in your area.

How and where you market cattle is the other consideration. There are pros and cons to both the private treaty and sale barn approaches. Private treaty allows you to be more flexible with when they sell but you won’t get as much exposure and publicity. You also have to hope the check is good. Selling at a barn can increase your exposure, especially at specialty sales when several of the right buyers are all in one place. The downfall of selling through barns is paying commission. It all comes down to which risks you are willing to carry during the process.

Final Thoughts

As you prepare to either sell or buy females in the coming months, remember to update your cost of production, know what your customer wants and ask yourself how much risk you are willing to take on; because while cattle markets have been making ranchers giddy, they are still volatile and can change fast. You can learn more about Doug and his next lineup of schools by going to his website, https://mrcattlemaster.com/