implications of demographic change: who will be your future customer
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Implications of Demographic Change: who will be your future customer. 10 th Annual Crop Insurance Conference. Cole Gustafson & Richard Rathge Dept. of Agribusiness & Applied Economics. January 2003. Traditional Family farm customers are disappearing Consolidation of Ag - PowerPoint PPT PresentationTRANSCRIPT
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10th Annual Crop Insurance ConferenceJanuary 2003
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Traditional Family farm customers are disappearing
Consolidation of AgNumber of farms in ND is declining
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Center for the Study of Rural America, FRBKCThe Twin Challenges in Farm CountryHalf of farm-dependent counties lost population in the 1990s.Three-fourths of farm counties have sub-par economic growth.Mark DrabenstottCenter for the Study of Rural America
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Figure 2. Percent Change in Total Population for the U.S. by County: 1990 to 2000
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Figure 13. Percent Change in Persons Ages 20 to 24 for the U.S. by County: 1990 to 2000
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North Dakota Population Pyramids by State and County:
1980, 1990, and 2000
- Change in Farm Youth,
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Farms and Farm Size in North DakotaSource: USDA, National Agricultural Statistics Service, Census of Agriculture.North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - Fax: (701) 231-9730 - URL: http://www.ndsu.edu/sdc
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Where Farmers Live in North DakotaSource: USDA, National Agricultural Statistics Service, Census of Agriculture.North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - Fax: (701) 231-9730 - URL: http://www.ndsu.edu/sdc
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Working off the Farm in North DakotaSource: USDA, National Agricultural Statistics Service, Census of Agriculture.North Dakota State University, IACC Building, Room 424, Fargo, ND 58105 - Phone: (701) 231-8621 - Fax: (701) 231-9730 - URL: http://www.ndsu.edu/sdc
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Who Are Your Future Customers?Segmentation of markets is occurringLending
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Who Are Your Future Customers?How do lenders tailer products?Profiling (scoring/screening)Obtaining more info about youSelling is key part of job
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Who Are Your Future Customers?Goal is to sell up
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Rural Residence FarmsLimited-resource. Any small farm with gross sales less than $100,000, total farm assets less than $150,000, and total operator household income less than $20,000. Limited-resource farmers may report farming, a nonfarm occupation, or retirement as their major occupation
Retirement. Small farms whose operators report they are retired (excludes limited-resource farms operated by retired farmers). Residential/lifestyle. Small farms whose operators report a major occupation other than farming (excludes limited-resource farms with operators reporting a nonfarm major occupation).
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Intermediate FarmsFarming occupation/lower-sales. Small farms with sales less than $100,000 whose operators report farming as their major occupation (excludes limited-resource farms whose operators report farming as their major occupation).
Farming occupation/higher-sales. Small farms with sales between $100,000 and $249,000 whose operators report farming as their major occupation.
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Commercial FarmsLarge family. Farms with sales between $250,000 and $499,999.
Very large family. Farms with sales of $500,000 or more.
Nonfamily. Farms organized as nonfamily corporations or cooperatives, as well as farms operated by hired managers. In analyzing the farm operator household, this group is excluded.
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Share of farms, land operated, and value of production by typology groupFarmsLand OperatedValue of ProductionSource: 2000 ARMS, USDAIntermediateCommercialRural residence
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Sources of operator household income by farm typology, 2001-02Source: ARMS/USDA20012002200120022001200220012002-20020406080100120140Off-farm incomeFarm incomeRural residenceIntermediateCommercialAll farms
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Who are Your Future Customers?Are you insuring acres or households?
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Who Are Your Future Customers?Who is your customer?Many work off-farm, do not have time for details, paperworkConsumers shop onlineYour customers are shopping alsoWeather, crop, and livestock insurance online
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Farmers Use of Internet
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Types of products sold through electronic commerce
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Who Are Your Future Customers?RMA and private sector provides you with a range of products, need to see where they fit!
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Who Are Your Future Customers?Bundling of services becoming importantLess concerned about competing with other agentsMore concerned with agribusiness concentration