Growing Origination, Growing Margins
Lacey Seibert, Director of Sales Enablement at Bushel, sat down with three influential voices in grain to talk about growing origination.
Seibert was joined by Jason Wheeler and Roger Gattis, hosts of the Elevators Cut Podcast and Grain Merchandising Specialists for White Commercial Corporation, and Neil Schuller, Manager- Freedom® Pricing Tools at The Andersons, Inc.
Working with grain facilities across the country, the Bushel team has heard common themes in the challenges faced by our customers including:
- Overworked employees
- Market volatility
- Thin margins
Seibert asked the panel if they have been hearing similar themes and how they help customers and colleagues navigate those challenges.
The group discussed the power of buying bushels correctly as an essential step in protecting margins and how offers should be used as a tool of discipline and risk management for their farmers. Buying bushels, ahead of harvest, allows the elevator to better plan their business decisions like forward sales and inventory management.
Next, Seibert asked our guests to chat about how offers can help protect margins.
Neil Schuller stated, “By giving the producer a sound reason to put the order on to begin with, it’ll drive more volume, and the margin levels that you’re looking to achieve because it’s really getting the producer to focus on what is it that you’re trying to accomplish here for the profitability of your operation.”
Offers allow the elevator to buy grain at their bid. They do not have to push and pay too much. This protects their margin. Offers drive volume and margin for the elevator but also profitability for the farmer, because it is a disciplined decision to sell at a profitable level.
Offers enable the elevator to plan budgets, manage logistics, plan & make sales, and manage inventories. Additionally, offers impact volumes. The magic with offers is that the farmer is making a conscious commitment to sell you the bushels if the price hits, that is the first important step towards owning that grain.
Next, the group talked about how offers benefit farmers, as a risk management tool.
Offers are an important disciplined approach for the farmer to manage their grain marketing risk. Orders create the opportunity for the elevator to contact their farmer and have a meaningful conversation. When the market is so volatile and so fast, offers are the best way for farmers to capture opportunities.
Agricultural technology has made great strides in progress and will continue to grow as more technology is developed and deployed. Farmers are (and will increasingly) demand the use of technology to help them make informed decisions and do business more efficiently. Lastly, the panel spoke about ways they have seen farmers embrace new technology as a part of their grain marketing.
Want to hear more about growing origination and growing margins? Watch the full webinar here.