PRICE SLIDES & WEIGHT STOPS

Price slides and weight stops are effective tools that can give confidence to buyers and sellers using a platform like Legendary Livestock.

Weight Stops

A 25 pound weight stop is a simple tool that protects a buyer from paying for significantly more pounds than anticipated.  If a 25 pound weight stop is used, the buyer is only responsible to pay for up to 25 pounds over the base weight. 

Case 1 below shows an example of when a weight stop would be used.  The buyer in Case 1 only pays for 775 pounds.  In Case 2, the weight stop is not triggered because the seller in this case agreed to a 2% pencil shrink to be applied to the scale weight. After the shrink pounds are removed, the weight no longer exceeds the 25 pound weight stop.

 

Case 1

Case 2

Contracted Base Weight, lbs

750

750

Scale Weight, lbs

780

780

Shrink %

0%

2%

Shrink, lbs

0

15.6

Paying Weight, lbs

775

764.4

Weight Stop Present

Yes (Triggered)

Yes (Not Triggered)

 

Price Slides

Because knowing the exact weight of livestock on a delivery date is impossible, a price slide allows for pricing flexibility to protect one or both parties.  There are multiple industry variations to using a price slide.  Legendary Livestock is using the following system for website users choosing a price slide.

The slide is measured in dollars per hundred weight ($/cwt) or cents per pound. $10/cwt is the same as 10 cents/lb.

A price slide works on the assumption that heavier animals receive lower prices per hundred weight (cwt).  

One Way Slide – Only applies when the delivery weight is higher than the contracted base weight.

Two Way Slide – Applies in both cases of the delivery weight being higher or lower than the contracted base weight.

Circle 25 Slide – Slide applies only to the first 25 pounds over or under the contracted weight. The Circle 25 slide also carries a 25 pound weight stop.  If an animal weighs 720 pounds at delivery, but the contracted base weight was 750 pounds, the buyer pays for the 720 pounds, but the slide only applies to 25 pounds.

Example 1. If the sale weight of an animal is 10 pounds over the contracted base weight and the seller allows a 12 cent/pound slide, the contracted price per hundred weight is reduced by $1.20/cwt (10 pounds x $0.12/pound).

Example 2 (Two way and Circle 25 only). If the sale weight of an animal is 10 pounds under the contracted base weight and the seller allows a 12 cent/pound slide, the contracted price per hundred weight is increased by $1.20/cwt (10 pounds x $0.12/pound).

Please see our slide calculator page for easy calculations using all the price slide and weight stop scenarios allowed on Legendary Livestock.

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