Potato Grower

46 POTATO GROWER | SEPTEMBER 2021 THE CHIEF MOTIVATOR Money is always the motive, but whose money? United Potato Growers of America By Buzz Shahan Chief Operating Officer Consistent prosperity in the potato production business does not result from good luck. It comes from practical, data- based business management. Television is full of ads pushing financial management companies. Notable about these companies is the way their salespeople—stockbrokers— are compensated. This happens in one of two ways: 1) "Money managers" are compensated according to client portfolio volume regardless of stock performance, or 2) they are compensated according to client portfolio volume and stock performance. So, what can be going through the mind of someone who invests with a volume-based company and not with a performance- based company? Shouldn't an investor question the motive of the person managing his or her investment? Shouldn't an investor select a money manager whose motive aligns with their own? Think of the term "fiduciary." Broadly speaking, the term speaks of financial duties that fall under two categories: Duty of loyalty and duty of care. "Duty of loyalty" means that the fiduciary's interests align with the client's; no conflict of interest allowed. "Duty of care" means that the fiduciary cares for the investor's wealth by maximizing its growth. Imagine how different Wall Street would be if every stockbroker's income depended on the performance of their recommended trades and purchases. In a strictly fiduciary scenario, the 1929 stock market collapse, the Great Depression that followed, and the huge 2008 market tumble might never have happened, at least to the degree they did. History mistakenly gives too much credit in these cases to the over-speculating investor. It must be remembered that the investor had to have someone complete the transaction. This same thing happens every day in certain segments of the potato business. Potato producers' job is to produce potatoes, and they are good at it. While one would assume that producers have an interest in market dynamics, their actions often indicate otherwise. Because it is producer oversupply that too often gluts potato markets, is it only the producer's fault when this happens? Without good advice from those who sell their crop, whose fault is it when market glut destroys a crop's value? What if packing/sales organizations were compensated only when the producer makes a profit? How much more stable would potato markets be? One need not look far to discover regions that stabilize their markets through sales organizations acting as their producers' fiduciary. A tour of such areas reveals new storages, new tractors, new pivots, six-figure farm managers, state-of-the-art packing facilities, and debt-free landowners. And here's the key ingredient: While packing/sales staffs get most of the credit for these excellent economic outcomes, a quick look at the grower list that makes up those local cooperatives' boards of directors reveals that everyone in the loop holds tightly to market data. Consistent prosperity does not result from good luck; rather, it comes from practical, data-based business management. 208.745.1105 POTATO STORAGE 2361-17BehlenBuildingSys13h.indd 1 7/26/19 9:31 AM

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