Customer Highlight: Chappell Feedlot
Tom and Cindy Williams are not native to Chappell, Nebraska, but what they’ve invested in the community has shaped the town for over 40 years. Both grew up in Broken Bow, Nebraska and are each other’s high school sweethearts. Tom went a year at Kearney State College and then decided he wanted to go down and rodeo and go into Animal Science so he went to Oklahoma State.
Cindy was still a senior in high school when Tom went south. They decided to get married in August, the summer before Tom’s junior year of college. Together, they moved to Stillwater for Tom’s last two years at OSU.
“We didn’t wait to turn 20 like people do today,” Tom laughed.
This was all taking place during the Vietnam War. Tom finished his degree in 1971 and got called in the draft shortly after. He got into a National Guard unit in Idaho, where his parents had moved after leaving Broken Bow. He says he got into the guard unit because they had already had their first son, Travis.
“After I got out of Boot Camp we jumped around to several different jobs,” Tom said. “So in 1980 we moved out here to Lodgepole and went to work for Merlin Carlson’s ranch. He was president of National Cattlemen’s at the time, so he wasn’t around too much.”
Ten years went by and their daughter was now a senior in high school. Tom took a job in Beatrice, Nebraska with an independent feed company. A lot of it was because of money. The ‘80s as a ranch foreman were tough.
“It was a bad time,” Tom said. “Interest rates went up to 18% all of a sudden and Merlin had been buying land and paying interest. He managed to hold on but it wasn’t good for a while.”
Tom was getting paid by two big feed companies and one independent one to do swine, dairy and beef nutrition and sell feed. He didn’t really like it but the pay was about three times the salary he was making per year.
After about a year and a half, a funeral brought them back to the area and Tom had talked to Merlin about his plans for the feedlot and the ranch.
“I talked to Merlin about leasing the ranch,” Tom said. “Now I didn’t have a lot of money, but I figured I could probably take in cows for somebody and run that ranch because I’d been running it for ten years.”
Merlin thought about it and called back and said ‘I think we can get something done but what we really want is to sell the feedlot and keep the ranch.’
That wasn’t Tom’s first interest, but it was still cattle and it’s more business and less tasks. Tom knew he liked the business side of things, so they took it.
The Williams have had several partners over the years but are now partnered with the Tuell’s out of Windsor and Billy Hall from OK. Billy Hall acts as a silent partner and PR, procurement for the feedlot. He lives in an area where there’s a lot of fall calves and prior he worked for Ratcliff Angus.
They have grown their operation and as of this interview, were about to write a check to be long-term debt free. The Feedlot has a lot of retained ownership customers, not too many investors. They ultrasound, sort, get carcass data and get involved in peoples’ operations and their herds’ genetics.
“Tom grew up around a cow-calf operation at his grandfather’s farm outside of Broken Bow,” Cindy said. “That’s what he knows and likes, and he’s also very interested – and good at – genetics and nutrition.”
The Chappell Feedlot has a specific niche in the cattle feed business and it’s toward the rancher, because Tom likes to help them with their bull picks and their genetics. It’s different from other feedlots in that they don’t feed 100,000 head at a time.
“I always say we’re a specialty feedlot,” Cindy said. “We cater to the rancher and give them the information they want on their caracasses and what they need to do genetically to get better beef.”
The Feedlot is now paid per quality of the carcass instead of cash per pound. The Williams say that is why they are still around, as small as they are. They hire a woman out of New Mexico to come do their “scanning” for them. Scanning measures the carcass value of a cow, similar to the process of an ultrasound for pregnancy. It measures back fat, marbling and shows the ribeye.
Dr. Brenthouer designed the technology and its program at Kansas State years ago. It’s been tweaked since, but it projects optimum outdate based on marbling and back fat. The Williams operate on grid, which means they are paid on value – discounts if they’re too fat, premiums if they grade well, etc.
“Other feedlots get carcass data but hardly anybody ultrasounds sorts like we do,” Tom explained.
Tom then showed me a spreadsheet that has genetic and breeding information of every cow on their lot. It shows marbling, yield-grade (which is ribeye size and back fat), and the different prices or values of the cattle. Tom explained to me what all the numbers meant. Even with good genetics and cattle that are sorted by ultrasound, there’s quite a difference between the highest value and lowest value of the herd, which isn’t uncommon.
“Now it’s the power of genetics,” he said. “If you can get rid of here down (pointing to the median value to the lowest) and start kicking them up genetically, you begin to breed higher-quality cattle.”
Tom is a numbers guy, which makes him great at both his job and to have as a customer of the Bank. The Williams have been steady partners of ours since they arrived in Lodgepole in 1980.
Upon a new partnership about 8 years ago with the Chappell Feedlot, Tom & Cindy were persuaded to switch banks, as the partner was on the board of a bank in Colorado. After about a year, Cindy made a firm decision that they’d be switching back to Points West.
“I said, ‘I’m done, I’m not working with your accountant, I’m not working with this bank,’” Cindy said. “We have 30 years of history at [Points West], they’re a lot easier to work with, we know Bruce [Batt, CEO], he knows the cattle business, so you know, we just came back here.”
“We’ve just been very loyal to this bank and they have always worked with us, bad years and all,” Tom added.
The acquisition of Deuel County Bank came under adverse circumstances. The former president had been charged and convicted of bank fraud, so it understandably made some customers distrustful of the new bank coming in.
“There were definitely some that left and some bitterness,” Cindy said. “But we stayed, because early on in the conversation with Bruce and [Tom Olson Sr.] we just said we were going to stay.”
We are grateful that they made the decision to stick with us since our acquisition in 2003. The Williams are a pleasure to work with and their business has supported the Chappell Community in more ways than one.
Since 1992, their primary goals have been to provide exceptional customer service and assistance to retained ownership customers and investment feeders. They are most proud of the relationships they have built over the years and would like to thank all of their customers for bringing their high quality cattle for them to manage.
The commitment of their progressive customers to genetically build a better product, combined with their dedicated team and end point management has become a model for success and we at Points West Bank are lucky to bear witness to that success!