April 2007
Learning from Automakers

Last month we asked growers what it would take to make supply and demand more equal. I am amazed but not entirely surprised by the results.

Sixty-three percent of those who answered the question said that planting less is the way to achieve a more balanced marketplace. Only 24 percent responded that the potato industry needs to add value. And only 14 percent thought marketing should increase.

In addition to those who answered our survey on the Web site, I received several responses from growers. And most of them answered that the industry needs to plant less. And after that statement followed more than one exclamation point.

One grower responded that we need to look to the auto industry.

It would seem to me if one went back thru history of yields and plantings ,that the times of high prices are when there is less supply. I would suggest that the same is happening with Ford and GM.”

Though they are certainly struggling, Ford and GM and Chrysler and all of the other auto makers aren’t simply cutting back. And they’re not sitting still. They’re adding something to their product to give the consumers something more. They are adding value. Once again this year, Detroit played host to the annual North American International Auto Show. I don’t go a day without hearing or reading about the newest gadget or improvement to vehicles. If it isn’t an F-250 Super Chief that can run on hydrogen, ethanol or gasoline, it’s a Dodge hatchback with illuminated cup holders and cooled storage bin to keep sodas cold.

More than 60 new vehicles were unveiled during the course of the show. That’s 60 new ways to bring in customers. That’s 60 new products they didn’t have before.

Of course, not every consumer is going to rush right out and buy one of these new cars. But some will. And they’re willing to pay a pretty penny for those special aspects to the cars. And there will always be a market for a no-nonsense sedan that’ll get people from one place to another.

Yes, the auto industry in the United States is being given a run for its money. But they aren’t giving up. And they certainly aren’t just handing the market over to international companies.

Not every consumer will need or want a pre-sliced potato product. Not everyone will buy prepackaged, ready-to-serve meals. But there are those who will. And they don’t mind paying for it. And don’t worry, there will always be room for the bulk russet that has been the staple for this industry for a long time.

I believe it’s going to take a concerted effort from everyone in the industry. And planting less won’t solve the problem alone. There needs to be a balanced supply of potatoes, but there also needs to be added value and marketing. Cutting back won’t cut it alone.

75 Applewood Dr. Ste. A
P.O. Box 128
Sparta, MI 49345
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