Asmus Farm Supply: An Outlet Of Knowledge
At Asmus Farm Supply, although crop protection products have helped build the company into a major ag retailer, industry know-how has been the real driver of its success.
October 1, 2012
Driving through the countryside of Northern Iowa, an observer is likely to see plenty of corn and soybean fields spread out among numerous gravel-covered roads that could accurately be described as “off the beaten path.” Indeed, just finding the tiny town of Rake could be a challenge for someone without the benefit of a Garmin as a guide.
Yet, amidst all this rolling farmland and wide open countryside, there is an impressive two-story structure made of glass and fine-crafted stonework. In fact, if it wasn’t for the sprawling warehouses connected to the building, this structure could be equally at home in an industrial parkway in suburban Chicago or the hills of Silicon Valley.
This is the headquarters for Asmus Farm Supply, Inc. (AFS), a 52-year-old ag retailer with satellite locations in Estherville and Manly, IA, and Okabena and Fulda, MN, and Willow Lake, SD. A member of the CropLife 100, AFS has annual sales in the $50 million range. These sales come from a range of areas, including crop protection products, plant nutrition, seed and seed treatment.
And judging by appearances, all these products have made a major impact on AFS’ fortunes over the years. Walking into the company’s main entrance, visitors enter a two-story waiting area, complete with cushioned chairs and views of many of AFS’ offices. But probing even deeper into the facility, visitors will find a few things that would be more at home not at your typical ag retailer, but in some big city hotel or Fortune 500 corporate headquarters. These include a 2,500-square-foot training center (complete with a raised stage and all the latest electronic equipment) and a store room of logoed memorabilia from the company’s manufacturer partners.
“Why do we have a training room?” says Co-Owner Amy Asmus when asked. “Because we have to help train our agronomists and partners to keep them all up-to-date on the latest production methods that are out there. Otherwise, who will?”
Of course, for anyone who has known AFS and its founding ideals, this desire to share information along with products is nothing new, says Co-Owner Harlan Asmus. “I would say that the one word that best describes our company is knowledge,” he says. “AFS is not about just selling products. To be successful, your customers have to have the knowledge to use these products correctly and in stewardship so they are not abusing the chemistries we do have.
“So when we are working with growers,” he continues, “we are not just selling them crop protection products, we are partnering in their business to make their use of these products a success.” It is for this reason, adds Harlan, that all of the company’s agronomists are required to obtain their Certified Crop Adviser status when hired.
Back To The Beginning
In essence, this information sharing approach to its business goes all the way back to AFS’ founding in 1960, says Harlan. “My father, Harvey, started the company when he was 32 years old,” he says. “Originally, he was only a representative for Monsanto and some of its herbicides and he conducted most of his business right out of his car.”
Within a few years, however, Harvey had built up enough of a reputation among existing grower-customers that a few local cooperatives began calling him to supply them with crop protection products as well. This allowed Harvey to build AFS’ first facility in Rake (which still stands today on the company’s grounds, serving as a storage shed for maintenance equipment).
According to Harlan, part of the reason for Harvey’s early success was his desire to move the crop protection business forward with grower-customers in ways beyond just the product sale. “He had a willingness to work with customers on an individual basis that didn’t always exist with other ag retailers at the time,” he says. “The customers were his friends, and he wanted to teach them as much as he could about how to best use the products he was selling them.”
As for Harlan himself, he returned to help his father run AFS once he completed college in 1987. Of course, one of his first experiences was dealing with a crisis of sorts involving an American Cyanamid soybean herbicide called Scepter (imazaquin).
“There were high hopes for Scepter when it came out, but it ended up hurting the corn crop the following years after its initial application,” says Harlan. “I got to see first-hand what it meant to our customers to have my dad sell them a product that didn’t work as advertised.”
Luckily, adds Harlan, American Cyanamid owned up to Scepter’s problems, taking full responsibility for its failure. “The company had an open checkbook and took care of all of the growers who were hurt by using Scepter, no questions asked,” he says.
With the Scepter event behind them, Harvey and Harlan continued to work together building AFS’ business throughout the 1990s and early 2000s, with Harlan gradually taking on more responsibility as the years rolled by. “My father kind of retired from the business in 2002 as his health declined,” says Harlan. “He passed away a few years later, in 2006.”
In between these years, Amy (who had married Harlan in 1987) joined AFS in 2001. “At first, I would come in on a part-time basis to help out with the company’s order-taking and product tracking,” she says. “Of course, this was before computers were widely used in the marketplace, so all of this information had to be entered and tracked by hand.”
Within a year, however, Amy found a software program from Software Solutions Inc. that allowed her to computerize all of AFS’ records. This allowed her the opportunity to become fully integrated into all aspects of the company’s business operations, especially once Harvey had stepped aside. “A lot of these early years for me were spent helping set up and run our satellite offices,” says Amy.
It was at this time in the mid-2000s, she says, that both Harlan and she realized that for AFS to keep growing, it needed to have an expanded headquarters location. So AFS began construction on its current facility. The warehouse was completed first, in 2010, with the main office building being finished in 2011.
“It was very important for us to have a large, modern warehouse to store all of our crop protection products and have someplace where our grower-customers and partners could come to learn whatever they needed to,” says Amy of the company’s new facility. “And you have to have this in today’s world when you consider what kinds of customers you are sometimes dealing with.”
As Amy explains, although AFS counts “several thousand” growers among its customer base, all are not created equally. And she isn’t dividing them up based upon their acreage size, either.
“In my mind, you can divide our grower-customers into three distinct categories based upon their attitudes and ways of conducting their businesses,” she says. “The first are what I call progressive farmers. These are willing to listen to what you have to say and do it because it will make their operations better in the long run.” By her rough estimate, progressive farmers make up approximately 15% to 20% of AFS’ total customer base.
Then there are the “middle-of-the-road” customers. “These growers will listen to what we have to tell them and understand that it’s probably what’s best for their operations to increase yields, but they aren’t willing to jump into that area just yet,” says Amy. “This group wants the progressive farmers to make the first moves and then will follow a few years down the line.” By her estimate, this customer group is the largest, between 50% and 55%.
Finally, there are the 20% to 25% of customers that could be called “deniers,” she says. “These are the guys, usually 60-plus years old, who deny that there is even a problem for them to address or that the problem will ever touch them directly,” says Amy. “All they are looking to do is get by for a few more years before they can sell their farms or retire. This group doesn’t want to do anything extra, even if it means keeping a small problem from becoming bigger in the near future.”
Ultimately, says Amy, it is this group of grower-customers that has helped make one of the agricultural market’s emerging issues — the spread of herbicide-resistant weeds — worse. By rough estimates, herbicide-resistant weeds exist in virtually every state of the country, with new types of resistant weed appearing almost on a monthly basis.
According to Harlan, this is the kind of problem that AFS has tried to address throughout its 52-year history. “There are a lot of people out there that only know the glyphosate era of weed control,” he says. “This group has absolutely no experience with some of the older chemistries that are starting to come back into use. But here at AFS, we’ve worked with these chemistries for decades because of our partnering with every major crop protection manufacturer and can share this information with our customers, on how these products perform best. That’s an advantage we have over almost anyone else in the ag industry.”
Still, not everyone in agriculture sees it that way. According to Harlan and Amy, they’ve noticed a disturbing trend among a few crop protection manufacturers recently when it comes to their perception of ag retail’s ability to address the weed resistance problem. “There are some companies out there that don’t seem to believe that the ag retailers are smart enough to deal with this weed resistance issue on their own,” says Harlan. “Instead, they are looking to put company-owned staff out there and do the ag retailer’s job for them.”
In a few cases, crop protection manufacturer partners of AFS have asked the company for a list of its top grower-customers, “to help call on them as your partner,” says Harlan. “We’ve resisted this request. I look at it this way — if a manufacturer representative makes a recommendation or sells a certain product to one of my customers and it doesn’t work, it’s not the representative that’s going to get yelled at. It’s us.”
In his mind, AFS is better suited to deal with all grower-customer problems, including weed resistance. “We represent all the major crop protection manufacturers and will make the best recommendations to our customers based upon what they need, regardless of which company makes that product,” says Harlan. “But an individual company representative has a vested interest in selling the customer one of his company’s products. That’s one of the main reasons ag retailers are important to this market.”
In the coming years, Harlan believes this ability to balance product need and knowledge will only grow in importance. “I can see a day when there are only four major crop protection manufacturers left and retailer consolidation isn’t going away, either,” he says. “Given these facts, there will definitely be a need for companies such as AFS that provides both products and good information on how to properly use them to growers.”
He also foresees a time when how this information is transferred from teacher and student will change as well. “The way our company and others will communicate with our customers will be very technology-based in the not-too-distant future,” says Harlan. “A lot of it will be done via smartphones and other smart devices. Given that, our business will have to become something that works 24/7. Daily or weekly communication won’t be good enough anymore.”
Amy agrees with Harlan, adding that this is one of the big reasons AFS has continued to embrace its knowledge heritage with its new facility and training center. “How do you continue to get good industry information to not only the new people coming into agriculture, but the people who are trying to keep up with all the changes that are happening at the speed of light?” she asks. “That’s what we are here for.”
Sfiligoj is the Editor for both CropLife and CropLife IRON magazines. He travels regularly to cover industry events and has been dedicated to the ag retail industry since he joined the staff in 2000.