Potato Grower

WWW.POTATOGROWER.COM 37 4073-19Dragon-Line16h.indd 1 1/8/20 3:15 PM While nickels and dimes separate producers, whole dollars separate marketers. United Potato Growers of America By Buzz Shahan Chief Operating Officer MORE DAVID & HAROLD Profit rides on more than just a quality product. As you may recall from last month's United column, David awoke one day to find himself the owner of an Idaho farm. It was a large dairy farm willed to him by his grandfather. David did not grow up on a farm; rather, he was a city boy from Chicago. His life had been exemplary: Eagle Scout; high school valedictorian; University of Chicago Bachelor of Economics, graduating summa cum laude; Harvard MBA; career as marketing consultant for such companies as IBM, Toyota, General Mills and Procter & Gamble. It is probable that no single American exceeds David's education or talent in product marketing. He is renowned. His consulting fee can exceed $100,000 per day, considered great value to those who pay it. David does not have to farm, but he wants to farm. He wants to raise potatoes, America's favorite vegetable, and has been consulting his neighbor, Harold, to learn the business. At least he thought going into it that potato farming was a business. Since then, he has learned that potato farming in Idaho has little in common with any business model he has ever encountered. Harold has produced over 30 potato crops and says that since he began farming 30 years ago, unending harsh markets have whittled the number of Idaho potato growers down by about 75 percent. Among the survivors, each must be good at producing high-quality potatoes or they wouldn't still be farming. But, according to David, that is where Idaho's current level of expertise ends: at only the halfway point. "Tell me, Harold," David inquires, "How much are your assets worth?" "I'm not sure of the exact number, but they're worth a lot." "What do you do to protect those assets?" "Protect them?" "Yes," David answers. "What do you do to assure that your assets remain intact, that they produce a fair rate of return, especially taking into account all the risk farming entails?" "I do a good job as a farmer. That's how I do it!" Harold responds, a bit heated at the question. "Look at it this way, Harold," David says calmly. "Growing and selling potatoes is one thing. Marketing them is quite another, and marketing them is where the money is. Marketing them is where growth is. Marketing them is where economic security is. Marketing is where I've spent my whole life. In my many consultations about marketing, no one has ever asked me a single question about production. Efficient production is a must. But while nickels and dimes separate producers, whole dollars separate marketers. And with so many potato producers contributing to the same market supply chain, only chaos comes from failure to manage that supply chain—failure to manage the market." "What you say makes sense," says Harold pensively. "I've researched the deal, Harold," says David. "Certain potato-producing regions consistently beat Idaho by several dollars per hundredweight. They do this by working together to manage the market supply chain. It's not that hard to do." "I've heard about that. Do you think Idaho can do it?" "Of course Idaho can do it. They only have to decide that they want to do it."

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