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Marketing Plan

Marketing Plan. Why do it? Provide discipline!! Requirements Business risk analysis Production schedule Cash flow needs Price /basis forecasts. Marketing Plan. How to do it? Establish clear objectives Develop a checklist of: marketing / purchasing alternatives to consider

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Marketing Plan

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  1. Marketing Plan • Why do it? • Provide discipline!! • Requirements • Business risk analysis • Production schedule • Cash flow needs • Price /basis forecasts

  2. Marketing Plan • How to do it? • Establish clear objectives • Develop a checklist of: • marketing / purchasing alternatives to consider • key market developments to monitor, and when

  3. Marketing Plan • From the requirements listed, determine pricing targets, operating procedure, and schedule for revising/updating targets. • Afterwards, evaluate how well the plan worked and what should be changed.

  4. Marketing plan Percent Qty Price Tgt Time Tgt 10 20 30 50 70 100

  5. Marketing Plans • Should be set up before first opportunity becomes available for your enterprise • 5-7 year contracts • when appropriate futures/options begin trading

  6. Marketing Plans • Should drive production decisions • Diversification to reduce some risks, or enterprise specialization for other goals • Comparative returns for corn/soybeans should influence production choices

  7. Marketing Plans • Consider probability and size of price change after you take your position • Margin calls or lost opportunities • How would that affect you? • What you would gain from improved or assured results?

  8. Marketing Plans • Consider other factors: • Production risk? • Cost of production? • Lenders requirements? • Financial leverage/viability? • Your ability and knowledge in dealing with market risks?

  9. Marketing Plans • Should be based on what you want to achieve, what you want to avoid • Financial targets • Financial ability to withstand possible adversities

  10. Marketing Plans • Should be based on realistic evaluation of possible and probable market prices • Must determine in advance acceptable levels of target prices and associated size of position, so you will act when the opportunity arises

  11. Marketing Plans • Must periodically reconsider as market realities and price probabilities change • Schedule important times to reevaluate plans based on your situation, commodity market task factors • Plan in advance action plans

  12. Marketing Plans • Requires careful monitoring of relevant market opportunities and price probabilities • Fundamental factors • Technical analysis for turnaround warnings, when to take positions

  13. Marketing Plans • Try to anticipate possible market developments • When something has happened, often too late to do something about it.

  14. Marketing Plans • When quantity risk declines, take bigger positions at attractive prices • When risk of adverse consequences declines, take bigger positions • When price outlook is not clear, but attractive levels, use scale up programs to avoid missing out completely

  15. Marketing Plans • Don’t kick yourself for taking attractive profits, even if you don’t top the market

  16. Marketing Plans • After you have completed your marketing: • How do the actual returns compare with your objectives? • Analyze how you can improve the process next year.

  17. Marketing Plans • If you don’t have the ability or personality for marketing decisions under pressure, hire someone who does! • What is your competitive/comparative advantage?

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