Just a few ideas to be shared by Foundation Horse breeders across the country.
Lots of us raise horses, breed horses, feed horses, ride horses and sometimes like to sell horses. All of us have noticed that prices have dropped over the past year and are trying to figure out why it has happened, and what we should to adjust.
We need to realize that supply and demand drives all markets, whether it is the NY Stock Exchange or our local horse market. If we are going to sell anything, there needs to be someone, somewhere, who wants it more than we do. The next step is finding that person, and the final phase of a sale is the seller receiving payment and presenting the buyer with a satisfactory product.
When the national economy is going strong, lots of folks have money to spend and this does two things. It allows inferior products to be sold and it allows marginal buyers to buy these products.
Following the events of 9/11 and the slowdown that has followed, both of these reasons have become significant to the Foundation Horse market. Think of how much money simply evaporated, when the Dow Jones average dropped from 11,000 to just over 7500 (this was approximately a 40% drop). The owners of these shares who had $100,000 in value pre 9/11 now had only $60,000, and if they were getting income from dividends, the loss was even greater, as many of these were diminished. The slowdown also reduced the job market, and thousands of workers, who were making good wages, had their jobs vanish or were the victims of layoffs.
Needless to say, many horse owners and breeders were included in the two categories above. Add into the equation that a third of the US has been in a drought, which has increased the costs of keeping horses in many parts of the country, and the results, less demand, more horses for sale, has resulted in LOWER PRICES!!
What can we do to take advantage of the current situation? Oddly enough, there are always two sides to a coin, and the downturn in our market provides some definite opportunities, as well as some traps!
Lets take a look at some of the positive things we can do!
First, take a good look at your breeding stock. Put a grade on every horse you own, from a 10 for the best, to a 1 for the least desirable. Sell the weakest ones first! Do not get caught up in the reflex that being cash short seems to bring out in many of us, which is "Sell the Best, and Keep the Rest". This philosophy will be very detrimental to your program, and cost far more in the long run, than you can realize, even though, in many cases it seems to be a stop gap solution.
Second, realize that all breeders are in the same situation that you are, and don't be afraid to make an offer for those horses that you have admired, but felt were to high priced in the past. Two things may work in your favor, one is that your judgement of what you think is desirable may not be the same of the current owner, and the other is that the current owner may need cash fast! Make your offer; it may be accepted in a month or two down the road, as the owners finances change.
Third, improve your horses family percentages, color, conformation and ability. Just because a horse is Foundation bred is not as important as if it is 25% Driftwood or Leo, color sells and a well proportioned and balanced horse that can be an athlete is always in demand. Don't kid yourself, blue and red roans, buckskins, palominos and duns will always bring a premium over sorrels and bays, all other things being equal.
Fourth, make use of the Internet. All of you who are current members of the Hancock Breeders Association, the Foundation Horse Registry and the Foundation Quarter Horse Breeders Association, are eligible to advertise horses for sale and standing stallions, with picture ads, on this site, at no charge. You may use both the Foundation Horse Market and Stallion Barn sections. Don't be shy, your horses are on display seven days a week and 24 hours a day, far more available than newspaper and magazine ads and much cheaper!
Good luck and happy trails!
The Home Office