Production sales are an excellent outlet for large breeders to showcase their operation and sell their produce. While you see production sales happening year-round, September through October is the peak season. We were fortunate to have a chance to visit with Todd Cowan of Cowan Ranch, Highmore, South Dakota, about their recent biennial production sale held earlier this month. Cowan has been putting on their own production sale for 14 years, and Todd had some good advice to share for those of us interested in being part of a production sale.

Get Prepared
For a ranch that is considering a production sale, Cowan recommended starting at least one year in advance. Being a year out will give you time to prepare the following 5 areas:

• define your goals
• decide on your budget
• define your market
• shape up your horses
• photograph & advertise

Defining Goals
In defining your goals, you will see exactly what you want to accomplish in your production sale. It should be more than just getting rid of horses. It should be a way to manage your herd, maximize your profits, advertise your operation and future sales, and get people excited about your horses.

• How many horses do you want to sell?
• What is the average price you are shooting for?
• What needs to be done to best showcase the operation as a whole?
• What needs to be done to spread the word?

While you have goals for yourself as a seller, also consider your goals for your buyers. You will want the buyer to walk away pleased with their purchase, satisfied with their experience, and looking forward to your next sale.

• What is your goal for the buyer's experience?
• What do you need to do sale day to show your appreciation to buyers?
• What needs to be done to minimize return rate on horses?
• What is the return policy?

Cowan talked about the importance of the buyer and how important it is to let them know your appreciation for their purchases. "We get lots of repeat buyers," Cowan said. "We do whatever we can to let them know we really appreciate their business, and we always send thank you notes after the sale."

Decide on your budget
The budget for a sale needs to be discussed early on in the planning process. Consider things such as facility additions or maintenance prior to the sale, feed increases or ration changes, additional staff that will be needed, any buyer-extras you will offer, an auction company, horse photography, sale book, advertising, etc. By working out this pivotal segment, the remainder of the planning can take place more smoothly.

After experiencing over a decade of sales, Cowan says that to make it worthwhile, there needs to be at least 50 horses in the sale. This allows enough room for the costs associated with putting on a sale, while you still profit.

There were 74 horses listed in the Cowan Ranch sale catalog this year. There is a selection of weanlings, yearlings, 2-year-olds, 3-year-olds, 4- and 5-year olds and a few senior horses, with the majority being yearlings, then weanlings, followed by an even amount of the remaining age groups.

For an operation like the Cowan Ranch that breeds about 50 mares a year, a biennial sale (every two years) gives them a larger selection of quality horses from which to choose. With needing to put at least 50 horses in the sale, a breeder that only raises 50 horses would be putting in all his horses with no room to hold back horses that are not quite ready that year.

"Having it every two years allows us to put the right kind of quality together," Cowan said. "We have tried it back to back years, and it was alright, but every other year works better for our program."

The following costs should be included in all budgets (based on percentage of overall sales total):
Advertising – 5%
Auctioneer – 1%
Sale management – 4%
Pedigree specialist – 0.2-0.5%
Additional staff – 1-10%

Define your market
It is likely that you have a current set of buyers even without a production sale. While you certainly want to keep those buyers and have them come to your sale, you will also want to market to new people in the industry. Through thought and research, find out the best target audience for your type of horses. Because Cowan's target industry is mostly rodeo-related performance horses, specifically roping, steer wrestling, and barrel racing, they advertise in the Pro Rodeo Sports News and Spin to Win magazines. But because they know their horses are also suited for other types of performance events, they include ads in the Quarter Horse Journal.

Shape up your horses
Shape your herd and decide which horses will go in the upcoming sale early. Resist the temptation to sell those horses private treaty pre-sale. Turn that situation into a chance to get the potential buyer excited about the sale. Those sale horses need to be prepared to be sold. Their training level needs to be current with their age. Prospective buyers will want to look at and handle the horses, and they need to be well-broke in order to handle the attention they will be getting on sale day.

The horses must look their best. Finish makes a night and day difference in how they sell. Good nutrition allows for maximized growth. Larger, more mature weanlings, yearlings, and two-year-olds will sell better than slower growing, less mature youngsters. Help them out with good nutrition. Along with a good feed program, put the horses on an adequate exercise program that allows them to be fit.

"We have our horses on a specialized nutrition program that produces more mature two-year-olds," Cowan said. "They get good exercise and good feed that allows just as much muscle to develop as bone."

Having a nice hair coat is also important. Keeping the horses under cover and out of nature's elements helps in having the nice hair coat. The Cowans start barning their sale horses during the day about two months prior to the sale.

"Keeping them barned during the day keeps them from getting bleached out by the sun and puts a nice bright coat on them," Cowan said. "How their coat looks definitely affects their sales."

Photograph and Advertise
Depending on your budget, the options are vast in spreading the word to the public. Magazine ads, Internet, Web site, television ads, newspaper ads, sale catalogs and direct mail pieces are a few of the advertising opportunities available. Decide how you want to advertise and how long, and then pick the industry-specific avenues to take to best deliver the message. Advertising is expensive, but you can get creative and come up with lesser expensive outlets. Industry-specific newsletters, like this RanchForeman EquineMonthly that covers nearly 400 horse-related professionals, can go directly to your audience with low cost.

"Make sure to pin-point your market, and market to it," Cowan said. "We advertise through the Internet and magazine ads starting in May and continue through September."

When it comes to deciding on your advertising budget, either take a percentage of overall sales or assign a figure per horse. For example, if your estimated sales total is $100,000, decide on a percentage to properly allow for adequate advertising, we will say 5%. This would give a budget of $5,000 for advertising.

On sale day, a pedigree specialist can be brought in to talk about each horse that goes through the ring – a salesman of sorts. This person should be an expert on the pedigrees that you have in your sale.

In order to have a successful advertising campaign, good photos are imperative. There is an art to photographing the horse not many have conquered. This is one area on which you should not skimp.

"You need to get a professional horse photographer," Cowan said. "Taking good horse pictures is one of the most important things you can do to attract people to your sale."

Photographing all the horses going into a sale will be time consuming, but time well invested. Cowan said that they spend about three days with a full crew taking photos of the sale horses. They position the horses in front of nice backgrounds and have their photographer there until the job is done to satisfaction.

Quality is a Must
Cowan emphasized quality. Quality is a key ingredient to the success of a production sale. You must have a good product if you want to have a good turnout and worthwhile sale. Production sales are misconstrued as a way to get rid of the horses ranches don't want to keep for themselves or can't get rid of elsewhere, when in fact, the opposite is true.

"We put horses in the sale that we would like to ride ourselves," Cowan said. "We will hold back colts that aren't big enough and keep them for the next sale. We only put horses in the sale that we know the public will like."

Good Luck!
A production sale takes work, and a lot of it. With research, preparation, good horses and honest business skills, you can make it a success.

"If you have a good product, people will come," Cowan said.

Todd Cowan is an owner and manager of Cowan Ranch in Highmore, South Dakota, where they run cattle and two feedlots, which gives them a reason to raise good horses. Todd's father, Pat Cowan, started the horse-breeding program in the early 70s that continues today. Todd says that their horses are ranch horses before they have any other career. They are started right and give 110% when you ask them for it. They have three stallions that pasture-breed their 50 mares to continue their breeding program. Their production sale is held biennially in September on even years. For more information on the Cowan Ranch or the production sale, visit www.cowanranch.com, email cowan@venturecomm.net or call 605-852-2073.

Concentration:
Cutting

Bloodlines:
High Brow Hickory
Dual Rey
Peppy San Badger
Freckles Playboy
Cutter Bill
Doc Quixote
Poco Tivio
Smart Little Lena
Royal Blue Boon
Cinnabar Cole

Goals: To produce good quality horses with athleticism, good minds and durability

Location: Midland, TX

RanchForeman Member Since: 2005

Scripture:
For it is by grace you have been saved, through faith – and this not from yourselves, it is the gift of God – not by works, so that no one can boast. –Ephesians 2:8-10

Equine insurance is a valuable tool in the financial management of the risk you are exposed to in your horse business. With the cost of horses, feed, training, and hauling today, you can have a substantial amount of money tied up in your horses. An equine insurance policy tailored to fit your needs is a good way to protect the investment you have accrued.

Mortality & Theft Insurance
The basis of most equine insurance policies, and the most important, is the mortality and theft (M&T) insurance. This covers your horse against death or humane destruction caused by accident, illness, or disease, with theft included.

Ex: Your horse is in a trailering accident and breaks his leg. Upon the veterinarian's request, you have the horse put down. The horse would be covered under the M&T insurance.

Special Accident
Another option is the Special Accident policy. These are accident-only policies with theft included that are less expensive, but have limited coverages. The horse is covered against death or humane destruction resulting from bodily injury caused by an external and visible accident.

Ex: You have two broodmares that die. One was killed by lightning and one had an aneurysm. The policy will cover the lightning loss, but not the aneurysm. The lightning is an external and visible accident where the aneurysm is not.

These are great policies to use when a client may be insuring a large number of horses, such as broodmares, foals, weanlings, or older horses. These keep the insurance premiums within budget and still offer accident protection.

Major Medical/Surgery Endorsements
There are additions that can be made to a policy known as endorsements. Major medical, surgery, or colic surgery endorsements that include the cost of veterinary care are the most popular. There are many good plans available, and should be chosen by considering what is the very most they could spend on veterinary care (emergency and non-emergency) if the horse owner did not have insurance on the animal. This protects a client against those unexpected, budget-wrecking procedures that come up from time to time.

• Major Medical: This covers surgical and non-surgical vet bills. Ex: cut forearm that requires stitches, EPM diagnosis and medication, bone chip removal, eye surgery, colic surgery, etc.
• Surgery: This covers surgery only, which is anything under anesthesia. Ex: bone chip removal, eye surgery, colic surgery, etc.
• Colic surgery: This covers colic surgery only. Ex: colic surgery only.

Additional Coverages
With the ever-changing horse industry, equine insurance continues to offer many specialty coverages to horse owners. such as Pro-Foal Insurance, Stallion Permanent Disability, and options to extend Territorial Limits.

• Pro-Foal Insurance – covers the foal's value from the time the mare is pronounced 45 days in-foal (pregnant) until the foal is 30-days old (after birth). Ex: Two mares are bred. The first mare is pronounced in foal 45 days after breeding. When she is palpated at 60 days, the veterinarian discovers she has absorbed the embryo. The second mare carries the foal to term, has a healthy foal, and the foal is snakebit at 15 days of age and dies. Both foal value's will be paid out.
• Stallion Permanent Disability – This coverage offers clients a reimbursement of the insured value of a stallion if he becomes reproductively unusable due to accident or illness. Ex: You stallion is kicked by a mare while breeding and breaks his hip, rendering him unable to breed or mount a collection dummy. The stallion's calculated insured value will be paid to the owner.
• Territorial Limits Extension – This option is designed for clients to use when traveling to foreign countries to international events, or for transporting breeding horses for breeding seasons in the southern hemisphere. Ex: The USET competition is held in Spain, and a client will travel overseas to compete in the competition. A breeding stallion will be sent to Australia for their breeding season from September through December. By extending the territorial limits of a typical policy, the animals are covered in case of accident while abroad.

Renewal Endorsements
One of the most overlooked parts of the equine insurance policy is either the 12-month Extension [also called the Agreed Value Guaranteed Renewal (AVGR)]. These endorsements are either included in your rate, or they have to be purchased. Essentially, the 12-month Extension/AVGR protects your horse's insurability the following year, no matter his condition or value. You would be able to cover the horse at the same value the year following an accident.

Ex: If your horse were to be injured a week before renewal, with the 12-month Extension or AVGR the animal will be eligible for the same insurance policy you currently have on the horse. If you didn't have one these products, your horse may be un-insurable or a company could place an exclusion on the new policy as a pre-existing condition or lower the insured value of the horse.

Rates
The cost of an equine insurance policy is based on the value of horse multiplied by the rate of the policy.

Rates for insurance vary according to the horse's age, use, and breed. In most cases, foals can be insured at 24 hours old. Rates for weanlings and yearlings are fairly consistent. Rates for horses age 2 thru 14 or 15 are usually consistent among horses of similar use and breed. As horses begin to age, the rates will begin to climb. Ex: An 18-year-old ranch horse will have a higher rate than the 8-year-old ranch horse.

Communication with Agent
The most important thing you can possibly do when you have an insurance policy on a horse is to communicate with your agent. No matter what the circumstance or situation, notify him or her of any activities that could affect the health of your horse. The key to keeping endorsements in place is notifying your agent of an illness/injury prior to the policy renewal due date.

Tips
Have your agent explain options available including premium, deductibles, and coverages.

Check with your agent, about rates that may be available to you with the carriers they have a contract with.

Make sure you completely understand what is a covered loss when you purchase the different types of insurance.

Always communicate with your agent about anything that has to do with your horse's health.

About the author: Marvin Tavarez is an agent for Brooks Maberry Equine Insurance Agency. He has been with Brook Maberry for 11 years. Marvin stays active in the horse industry by showing Quarter Horses at AQHA sanctioned shows and PRCA sanctioned rodeos. Contact Marvin at (800) 290-5962 or email mtavarez@toast.net.

Both working cowboys and arena cowboys need a good pair of chaps. The finish on the chaps speaks about the event, the cowboy, and the individuality of the person wearing them. Chaps can be easily purchased at most western supply houses, but what a treat to have them made just for you. We visited with leathersmith Mike Lee of Cowboy Stuff in Blanconia, Texas, for his expertise in custom-making a pair of chaps.

Start with the style
The two most common styles of chaps are shotgun and batwing. The style is usually dictated by the event for which you will be using them. Shotgun chaps run the length of the leg and zip from the upper thigh to the heel. Batwing chaps also run the length of the leg and buckle, button or zip in the thigh area. The batwings are typically seen on working cowboys and in the cutting pen, while the shotguns are seen more in the show pen (reining, pleasure, working cow horse, etc.).

  

Leather weight
When the style and use is decided on, the weight of leather comes into the equation. Working cowboys need heavy leather to protect their legs against the elements. Cutting chaps need weight to move right to best show off a horse in the cutting pen. Show chaps can be lighter in weight because they need to fit close to the leg, mostly for decoration in events like pleasure and reining. It is important that the chaps be the correct weight and not hinder a rider.

"The leather needs to work for its intended us," Mike said. "It doesn't matter what you use them for, they need to feel right and they need to last."

Type of leather
The choices for types of leather are rough out and smooth out. Rough out, or suede, has been the most popular in past years with the smooth out becoming more popular recently. While the purchaser needs to decide on a main type, nothing says you can't use both to finish out a pair.

Yolks & Reinforcements

The yolks are another customizable piece. There are many options with these pieces, such as contrasting colored leather with oak leaf tooling work, matching leather with basketstamp, or simply matching leather. Putting a brand on the yolks is an option, as well as adding color with paint.

Reinforcement pieces are an additional place to display some personality. These pieces are located on the outside of the upper thigh and are necessary for the batwing chaps as this is what reinforces the connector pieces (buckles, buttons, zippers) to the chaps. They can be added to the shotguns as well, but are more for eye appeal than functionality.

Pockets

Pockets can be added to a pair of chaps just like they would be to a pair of jeans, and would serve the same purpose. Two types of pockets are available, the patch pocket and the inverted pocket. The patch pocket is sewn on the outside of the chaps (like the back pocket of jeans) and the inverted pocket is sewn under the chaps (much like the front pocket of jeans). Whether they be for functionality or aesthetics, imagination is the limit to what you want the pockets to look like.

Quality Check
Several things go into a quality pair of chaps. If you are spending the time, energy and money to have a pair of chaps made, do your part to insure that you are getting a quality pair. Look at previous work from the maker, whether it be actual pieces or photos. Four things to look at – leather quality, tooling, stitching and fringe.

Leather should be chosen based on what you will be using your chaps for. As stated earlier, the weight of the leather is determined by the event or lifestyle with which they will be used.

Without knowing a whole lot about leatherwork, you can easily tell the good tooling from the bad tooling. If it passes your standards, go for it.

The stitching needs to be even and interlocking. Each stitch should be seen as an individual stitch that looks tight and secure, and the line needs to be free from skip stitches.

When inspecting fringe, look for consistency. Each piece should be around 1/8" wide. Pride of workmanship can be captured in this area.

"I want to make things as strong, well-built, and lasting as anything in the world, but I also want them aesthetically appealing to the eye," Lee said.

Measurements

The maker will need your measurements, and will tell you what he or she needs. Most likely, they will measure waist to ground, inseam, largest part of thigh, largest part of calf, and distance of waist to knee.

Budget
The cost for a pair of chaps is widespread. Lee starts his no-frills, work chaps at around $150, and the sky is the limit. Extra tooling, specialty leather, silverwork, fringe, etc. make the chaps more costly.

"I like to make chaps that any cowboy can use, but that are also a piece of art," Lee said.

When it all comes together, you will have a custom piece made specifically for you – your body and your style. Enjoy!

Mike Lee has been a leathersmith (officially) for 15 years. He specializes in cowboy saddles, tack and chaps, but can make practically anything idea you bring to him. Lee works out of this South Texas leather shop, Cowboy Stuff, in Blanconia, Texas, close to Goliad. He gets into the leather making because he loves the western heritage and the ever-alive cowboys that still make their living on the land and good horses. Lee's niche is the working cowboy and the cutting industry. Lee had five pairs of his custom-made chaps in the 2006 NCHA Cutting Futurity. Mike Lee can be contacted at (361) 526-4046.

Matacorp, Ltd. is a family partnership in Midland, Texas, established in 1993 by Kenneth Kuethe, wife Regina, and son Justin. While the partnership began with and continues in the oil and gas consulting business, the desire for good horses resulted in a breeding program started in 2001 and continues today.

Kenneth Kuethe grew up on a ranch in Ft. Hancock, Texas, and was raised with horses. While life took him other directions for a while, he knew he had to get back to the horses he enjoys.

"There are times when God puts desires in your heart to get back to what you miss," Kenneth said.

Kuethe had plans to raise cattle on the coastal pastures he owns. When the cattle venture didn't work out as planned, he purchased a 2-year-old mare and put her in cutting training with trainer Lance Wright. As this mares skills developed in the cutting pen, it was evident that this was the kind of mare to start a breeding program with.

"Lance said he had never ridden a mare that wanted so badly to please you," Kuethe said. "So we decided to breed her and that is where we started."

The breeding program has grown over the last several years to 28 mares and two stallions. The showcase stallion is WSR Smart Legacy, a 2001 own son of Smart Little Lena out of a Peppy San Badger/Royal Blue Boon mare. Kuethe uses this stallion to breed his mares as well as about 20 outside mares. Matacorp, Ltd. also owns Starred N Freckled, a 2003 grandson of Freckles Playboy out of a Doc Bar/Poco Tivio mare. He is currently in cutting training with Wayne McCutchen.

He continues to prove his horses in the show pen. Kuethe keeps several horses in training with Chris Patteson, Scott Harrell, and Wayne McCutchen.

"I only put my horses with people I know are good trainers and are good with horses," Kuethe said.

The horse program is a family affair. Kenneth manages most of the daily care of the horses. Regina helps with the feeding and record keeping. Justin, a full-time pilot for Republic Airways, comes in on his days off and helps with what needs to be done.

Along with the oil and gas business and horses, a large part of Matacorp, Ltd. is the involvement with the inner-city youth. Each summer, kids sign on to work for Kenneth. Most of these young men do not have good family lives and have never worked together with or for anyone before.

"We are very thankful to have the opportunity to get to work with these kids," Kuethe said.

Kuethe gives them the responsibility of fixing the irrigation system in the pecan orchard, halter breaking colts, and using farm equipment, such as mowing and disking. As they get older, he lets them do the things that require more responsibility, such as assisting the vet during the artificial insemination procedures. Upon their senior year in high school, he encourages them to go get a job elsewhere, to develop a new set of skills.

"It's wonderful to see the positive changes that take place in how they talk to people and how they figure out that life has more to offer them," Kuethe said. "They figure out that if they want something, they can work hard and go get it."

While Kenneth and his family stay very busy with Matacorp, Ltd. in the oil and gas business, breeding nice cutting horses and working with youth, they stay active in their church and remain centered in the Lord.

"I want my life to be about the Lord, not myself," Kenneth humbly said.