Purchase Price

[HDRider]

Do you use a ratio of potential sales price to purchase price to ball park purchase price?

For example, if 4's are selling for $185, I'd pay $1,600 for a 5 year old cow.

Another example, again, if 4's are selling for $185, I'd pay $3,500 for a two year old bull for breeding.

Is there any validity in this line of thought?

 

[Aaron]

Take the ballpark average and take out approximately 15% of the value. That is your price with a healthy margin for market instability. So if your average 5 year old is $1600, find someone with the same quality that will sell for around $1400 or less. The bull would be around $3000 under the same thinking. That way you never have to worry about a market correction - you already have a built-in safety buffer.

 

[js1234]

Do you use a ratio of potential sales price to purchase price to ball park purchase price?

For example, if 4's are selling for $185, I'd pay $1,600 for a 5 year old cow.

Another example, again, if 4's are selling for $185, I'd pay $3,500 for a two year old bull for breeding.

Is there any validity in this line of thought?

We do on Cows. Figure bulls a little differently, I posted it recently on a different thread here on sales page.

 

[Caustic Burno]

Do you use a ratio of potential sales price to purchase price to ball park purchase price?

For example, if 4's are selling for $185, I'd pay $1,600 for a 5 year old cow.

Another example, again, if 4's are selling for $185, I'd pay $3,500 for a two year old bull for breeding.

Is there any validity in this line of thought?

Two calves max to buy a cow.
Four to five to buy the right bull.
Bought two heifers this week for the price of two calves.
Got to be willing to haul a empty trailer home from the barn.
Have to be sitting there weekly when the buy comes through don't get caught up in the bidding either.

 

[bigbull338]

around here the price depends on the breed of cows and bulls your looking at.example i know a man that has some reg horned hereford bulls coming 2 for $3500ea.where as reg beefmaster bulls aved $5675 a hd.reg open beefmaster heifers $2400 reg bred heifers $3675.these aves was from a sale 2 days ago.

 

[Caustic Burno]

around here the price depends on the breed of cows and bulls your looking at.example i know a man that has some reg horned hereford bulls coming 2 for $3500ea.where as reg beefmaster bulls aved $5675 a hd.reg open beefmaster heifers $2400 reg bred heifers $3675.these aves was from a sale 2 days ago.

Unless you are seed stock producer those prices for a cow she would never turn a profit in a commercial operation in her life.

 

[Bigfoot]

I haven't bought a back to the farm cow in years. I doubt I ever buy another one. I'm putting together a decent size group of heifers to breed in May. I'd like to think, that their salvage value will be about equal to what I gave for them. Not really like having money in the bank, but I view them as capitol.

 

[Stocker Steve]

Do you use a ratio of potential sales price to purchase price to ball park purchase price?

Less than 100%.
For commercial cows I like to pay less for the replacement then what I sold the cull for. This means I have to sell breds, and then be patient on buying back bred replacements.
Obviously this does not work when culling average sized opens, but usually we only have 1 to 2% open cows per year. Kit would say we overfeed. :hat:

 

[bigbull338]

around here the price depends on the breed of cows and bulls your looking at.example i know a man that has some reg horned hereford bulls coming 2 for $3500ea.where as reg beefmaster bulls aved $5675 a hd.reg open beefmaster heifers $2400 reg bred heifers $3675.these aves was from a sale 2 days ago.

Unless you are seed stock producer those prices for a cow she would never turn a profit in a commercial operation in her life.

a few days ago i talked to the ag teacher that reserves all of my reg heifer calves that are show prospects.he said he had 3 kids to catch scramble calves.but all of my cows are having bulls.only have 2 top cows left to calve.but they will be out of the show window.but thats the way it goes.