What a corny way to negotiate

To escape from the media’s obsession with the upcoming election, we have been pleased, in our house, to divert our attention away to the third series of “Clarkson’s Farm”.  For those of you who have not seen this, there have been 24 episodes so far of the efforts Jeremy Clarkson, journalist and TV personality, has made with his partner Lisa to farm the thousand acres, known as Diddly Squat Farm, he bought as an investment in the Cotswolds. Ably assisted by a young man called Kaleb who is now famous for his good-natured contempt of the “townie”,  Clarkson and 75-year-old seasoned farm hand, Gerald, whose incomprehensible dialect is one the funniest features of the series, Clarkson and Co were said to have done more to promote the understanding of farming and farmers in one series than the BBC farming and country programmes did in 25 years. He climbs lots of steep learning curves and, with the ever-tolerant Lisa, opens a shop and diversifies his land trying wilding and new crops with varying degrees of success.

We binge-watched series three and loved it so we decided to go back and refresh our memories by watching series one again.  In the final episode, Clarkson is to be seen at harvest time at the end of his first farming year.  His crops – barley, oilseed rape and wheat - are cut with a combine harvester and Clarkson is seen driving alongside in his immense (far too big according to Kaleb) Lamborghini tractor towing the trailer into which the precious cargo is deposited. With the crops safely stored, the business of selling them begins.

This process sees Clarkson visiting a flour mill with his trusty agricultural agent and sidekick, Charlie and a plastic bag of harvested wheat grains. One of the many things we learn from the programme is that wheat, unlike the other crops, is not just sold by weight but that quality in the form of protein content is also critical.  The proportion of protein in the grain determines whether it can be used for milling into flour or will become hen food.  “Top Dollar”, we are told, comes with a protein proportion of more than 13% and can make £30 a tonne difference to the price and when you are harvesting 96 acres this is significant as somewhere over 330 tons will be produced.  Charlie estimates a protein content of 13.4%, the miller, Paul, pessimistically manages expectations at 12.6% and takes the sample off to be analysed leaving Clarkson and Charlie in nail-biting tension discussing the fact that hen food wheat will sell for a mere £155 per tonne where “Premier League” wheat will sell for upwards of £185.  We are flies on the wall as the pair plot their strategy: “If the protein content is good, we’ll ask for £200 and be willing to get back into the Range Rover telling the miller we’ll think about his offer if it’s less than that.”  Clarkson confesses to hating haggling, Charlie smiles wryly.

The miller returns and tells the pair that the protein content is 13.5% and is the best he has seen this year.  He says that he will take all of the wheat and that he will mill it and do a future deal with Clarkson so that the flour can be sold in the Farm Shop. Clarkson almost does a jig at the news and asks the miller how much he will pay for the wheat.  “£180 to £185” says Paul.  Clarkson says “Done” immediately (and he probably has been!).

There are lessons aplenty here for the negotiator as well as the budding farmer.  In no special order they seem to be: explore the power balance – did the fact that the miller declared the wheat the best he had seen give the seller leverage? I believe that it could.  Was the target price of £200 a tonne realistic?  Hard for me to say but I suspect it was not unrealistic and could have been Clarkson’s opening proposal.  On which subject, the quality and the apparent eagerness of the miller who had signalled his keenness to buy put Clarkson in the driving seat to make a proposal at his end of the bargaining arena but he sat back and said “make me an offer” – not a great tactic for optimising the price you might get. The miller’s suggestion of £180 to £185” is also something of a problem – he probably means £180 but Clarkson and Charlie will have heard only £185.  We never find out what the final deal was but with 330 tonnes that £5 difference is worth £1650 to Clarkson who, we later learn, barely broke even running his farm in his first year. Is the negotiator’s first offer likely to be the best one?  I think not.  The price is a haggle – one variable and a linear scale but the miller introduced another tempting variable – the milled flour.  Clarkson might have been able to influence the overall value of the deal by agreeing on flour price as a part of the sale of the grain. What about the packaging, the printing of the Diddly Squat Farm logo on the flour bags and maybe even delivery to the farm shop?

Nevertheless, Clarkson was pleased and proud of his wheat quality, so I am left thanking him for the wonderful series of programmes and for the opportunity to pull out a few things for this blog. If you have not seen “Clarkson’s Farm” I recommend that you take a look not just for the negotiating lessons!