Instead of simply responding to changing prices, farmers plan ahead how they might respond to alternative market outcomes. Written plans may help reduce the emotion involved in making actual marketing decisions. Marketing plans can be based on substantially different foundations. There is no one perfect method and each method will have different strengths and limitations.
Some plans can be purely mechanical.
Examples would include plans that call for pricing equal quantities each month or even each week of the year. There are endless variations on these types of strategies. Another broad form of developing marketing plans is based on cost or cash flow considerations. These plans generally derive price targets that satisfy some degree of profitability or cash flow recapture. These types of marketing plans assume the market will ultimately produce prices equal to or above the derived initial triggers.