Feed Strategy - November 2019 - 22

22 ❙ FeedStrategy

FEED ACADEMY
BY IOANNIS MAVROMICHALIS, PH.D.

Marketing nutrition by
extending credit
Doing business on extended credit lines is as common
as it is expensive, but often remains the only way.
deals. Even these widely acceptable terms assume a
robust banking, financial and justice system and an
ethos of honor and credibility, which are common
in several markets, but sadly not all.

Two ways to extend credit
When certain markets demand extended credit
lines, and this is the only way a nutrition business
can enter or even survive in such a competitive
environment, there are only two ways this can be
accomplished. And, lamentably, neither of these
ways benefit the end user: the farmer. But, in the
markets we are discussing, the farmers are also
being forced to accept extended credit lines backwards from their own buyers. As such, they simply
transfer the lack of liquidity from their buyers to
their suppliers. This is not only a matter of liquidity,
but also a mitigation of risk because a default from
a buyer often causes a cascade of defaults along
the line that affect the farmer and consequently the
nutrition supplier (among all other suppliers).

Incorporate financing costs into margins
The first way to afford selling to a market that

Read blogs by Ioannis Mavromichalis: www.FeedStrategy.com/blogs/13

www.FeedStrategy.com ❙ November 2019

vasabii | Shutterstock.com

I

once visited a large poultry cooperative organization with one of my customers, who wanted to
market a new vitamin and trace mineral premix
line I designed. Everything seemed to be going
well, as the premixes were designed for optimal
profitability, the margins were reasonable, and
quality was meticulously assured. The deal broke,
however, when the president and CEO of the
cooperative asked for a 12-month credit
line. In less than five minutes, we were
driving back to our offices having
forgotten all about this "opportunity," because this 12-month credit
line meant an exposure of several million
dollars, which my client was not ready to
gamble upon.
For some readers, such stories might seem
exotic and extraordinary. For others, however, they
recognize their own market conditions. In general,
it is not uncommon to extend a courtesy credit line
of 30 days, with 90 days being a more generous
term, especially among trustworthy business partners. There are virtually no cash-on-delivery deals
in our industry or any business-to-business (B2B)


http://www.Shutterstock.com http://www.FeedStrategy.com/blogs/13 http://www.FeedStrategy.com

Feed Strategy - November 2019

Table of Contents for the Digital Edition of Feed Strategy - November 2019

Feed Strategy - November 2019
Contents
In the Mix
FeedStrategy.com
Climate change and animal feed: mycotoxin risk mitigation
How to adapt to the changing mycotoxin landscape
Scientists seek new ways to combat spread of mycotoxins
Feed additives that will succeed in 2020 and beyond
Marketing nutrition by extending credit
More feed, fewer mills: feed industry consolidation
How to target protein content in late-lactation cow diets
Critical junctures in early chick nutrition confi rmed
How pelleting influences particle size in animal feed
Products
Advertisers’ Index
Feed Strategy - November 2019 - CT1
Feed Strategy - November 2019 - CT2
Feed Strategy - November 2019 - Feed Strategy - November 2019
Feed Strategy - November 2019 - Cover2
Feed Strategy - November 2019 - CT3
Feed Strategy - November 2019 - CT4
Feed Strategy - November 2019 - Contents
Feed Strategy - November 2019 - In the Mix
Feed Strategy - November 2019 - FeedStrategy.com
Feed Strategy - November 2019 - Climate change and animal feed: mycotoxin risk mitigation
Feed Strategy - November 2019 - 5
Feed Strategy - November 2019 - 6
Feed Strategy - November 2019 - 7
Feed Strategy - November 2019 - How to adapt to the changing mycotoxin landscape
Feed Strategy - November 2019 - 9
Feed Strategy - November 2019 - 10
Feed Strategy - November 2019 - 11
Feed Strategy - November 2019 - Scientists seek new ways to combat spread of mycotoxins
Feed Strategy - November 2019 - 13
Feed Strategy - November 2019 - 14
Feed Strategy - November 2019 - 15
Feed Strategy - November 2019 - Feed additives that will succeed in 2020 and beyond
Feed Strategy - November 2019 - 17
Feed Strategy - November 2019 - 18
Feed Strategy - November 2019 - 19
Feed Strategy - November 2019 - 20
Feed Strategy - November 2019 - 21
Feed Strategy - November 2019 - Marketing nutrition by extending credit
Feed Strategy - November 2019 - 23
Feed Strategy - November 2019 - More feed, fewer mills: feed industry consolidation
Feed Strategy - November 2019 - 25
Feed Strategy - November 2019 - 26
Feed Strategy - November 2019 - 27
Feed Strategy - November 2019 - How to target protein content in late-lactation cow diets
Feed Strategy - November 2019 - 29
Feed Strategy - November 2019 - 30
Feed Strategy - November 2019 - Critical junctures in early chick nutrition confi rmed
Feed Strategy - November 2019 - 32
Feed Strategy - November 2019 - 33
Feed Strategy - November 2019 - How pelleting influences particle size in animal feed
Feed Strategy - November 2019 - 35
Feed Strategy - November 2019 - 36
Feed Strategy - November 2019 - 37
Feed Strategy - November 2019 - 38
Feed Strategy - November 2019 - Products
Feed Strategy - November 2019 - Advertisers’ Index
Feed Strategy - November 2019 - Cover3
Feed Strategy - November 2019 - Cover4
http://www.feedstrategy-digital.com/201911
http://www.feedstrategy-digital.com/201910
http://www.feedstrategy-digital.com/201909
http://www.feedstrategy-digital.com/201908
http://www.feedstrategy-digital.com/201907
http://www.feedstrategy-digital.com/201906
http://www.feedstrategy-digital.com/201905
http://www.feedstrategy-digital.com/201904
http://www.feedstrategy-digital.com/201903
http://www.feedstrategy-digital.com/201902
http://www.feedstrategy-digital.com/201901
http://www.feedstrategy-digital.com/201812
http://www.feedstrategy-digital.com/201811
http://www.feedstrategy-digital.com/201810
http://www.feedstrategy-digital.com/201809
http://www.feedstrategy-digital.com/201808
http://www.feedstrategy-digital.com/201807
http://www.feedstrategy-digital.com/201806
http://www.feedstrategy-digital.com/201805
http://www.feedstrategy-digital.com/201804
http://www.feedstrategy-digital.com/201803
http://www.feedstrategy-digital.com/201802/
http://www.feedstrategy-digital.com/201801/
http://www.fi-digital.com/201710
http://www.feedmanagement-digital.com/201711
http://www.piginternational-digital.com/201711
http://www.piginternational-digital.com/201710
http://www.fi-digital.com/201710
http://www.piginternational-digital.com/201709
http://www.feedmanagement-digital.com/201709
http://www.fi-digital.com/201708
http://www.piginternational-digital.com/201707
http://www.feedmanagement-digital.com/201707
http://www.fi-digital.com/201707
http://www.fi-digital.com/201706
http://www.piginternational-digital.com/201705
http://www.feedmanagement-digital.com/201705
http://www.fi-digital.com/201704
http://www.piginternational-digital.com/201703
http://www.feedmanagement-digital.com/201703
http://www.fi-digital.com/201702
http://www.piginternational-digital.com/201701
http://www.feedmanagement-digital.com/201701
http://www.fi-digital.com/201612
http://www.piginternational-digital.com/201611
http://www.feedmanagement-digital.com/201611
http://www.piginternational-digital.com/201610
http://www.fi-digital.com/201610
http://www.feedmanagement-digital.com/201609
http://www.nxtbook.com/nxtbooks/watt/pigi_201609
http://www.fi-digital.com/201608
http://www.feedmanagement-digital.com/201607
http://www.piginternational-digital.com/201607
http://www.fi-digital.com/201607
http://www.fi-digital.com/201606
http://www.feedmanagement-digital.com/201605
http://www.piginternational-digital.com/201605
http://www.fi-digital.com/201604
http://www.feedmanagement-digital.com/201603
http://www.piginternational-digital.com/201603
http://www.fi-digital.com/201602
http://www.feedmanagement-digital.com/201601
http://www.piginternational-digital.com/201601
http://www.fi-digital.com/201512
http://www.feedmanagement-digital.com/201511
http://www.piginternational-digital.com/201511
http://www.piginternational-digital.com/201510
http://www.fi-digital.com/201510
http://www.feedmanagement-digital.com/201509
http://www.nxtbook.com/nxtbooks/watt/pigi_201509
http://www.fi-digital.com/201508
http://www.feedmanagement-digital.com/201507
http://www.piginternational-digital.com/201507
http://www.fi-digital.com/201507
http://www.fi-digital.com/201506
http://www.feedmanagement-digital.com/201505
http://www.piginternational-digital.com/201505
http://www.fi-digital.com/201504
http://www.feedmanagement-digital.com/201503
http://www.piginternational-digital.com/201503
http://www.fi-digital.com/201502
http://www.feedmanagement-digital.com/201501
http://www.piginternational-digital.com/201501
http://www.fi-digital.com/201412
http://www.feedmanagement-digital.com/201411
http://www.piginternational-digital.com/201411
http://www.piginternational-digital.com/201410
http://www.fi-digital.com/201410
http://www.feedmanagement-digital.com/201409
http://www.piginternational-digital.com/201409
http://www.fi-digital.com/201408
http://www.feedmanagement-digital.com/201407
http://www.piginternational-digital.com/201407
http://www.fi-digital.com/201407
http://www.fi-digital.com/201406
http://www.feedmanagement-digital.com/201405
http://www.piginternational-digital.com/201405
http://www.fi-digital.com/201404
http://www.feedmanagement-digital.com/201403
http://www.piginternational-digital.com/201403
http://www.fi-digital.com/201402
http://www.feedmanagement-digital.com/201401
http://www.piginternational-digital.com/201401
http://www.feedmanagement-digital.com/201311
http://www.nxtbook.com/nxtbooks/watt/pigi_201311
http://www.fi-digital.com/201311
http://www.piginternational-digital.com/201310
http://www.feedmanagement-digital.com/201309
http://www.piginternational-digital.com/201309
http://www.fi-digital.com/201309
http://www.feedmanagement-digital.com/201307
http://www.piginternational-digital.com/201307
http://www.fi-digital.com/201307
http://www.fi-digital.com/201306
http://www.feedmanagement-digital.com/201305
http://www.piginternational-digital.com/201305
http://www.fi-digital.com/201305
http://www.feedmanagement-digital.com/201303
http://www.piginternational-digital.com/201303
http://www.fi-digital.com/201303
http://www.feedmanagement-digital.com/201301
http://www.piginternational-digital.com/201301
http://www.fi-digital.com/201301
http://www.feedmanagement-digital.com/201211
http://www.piginternational-digital.com/201211
http://www.fi-digital.com/201211
http://www.piginternational-digital.com/201210
http://www.feedmanagement-digital.com/201209
http://www.piginternational-digital.com/201209
http://www.fi-digital.com/201209
http://www.feedmanagement-digital.com/201207
http://www.piginternational-digital.com/201207
http://www.fi-digital.com/201207
http://www.fi-digital.com/201206
http://www.feedmanagement-digital.com/201205
http://www.piginternational-digital.com/201205
http://www.fi-digital.com/201205
http://www.feedmanagement-digital.com/201203
http://www.piginternational-digital.com/201203
http://www.fi-digital.com/201203
http://www.feedmanagement-digital.com/201201
http://www.piginternational-digital.com/201201
http://www.fi-digital.com/201201
http://www.nxtbookMEDIA.com