A Clear Direction

RoGator 1286c sprayer

This past July, a significant change took place with AGCO Application Equipment’s Ag-Chem brand, one of the market leaders in the self-propelled sprayer and floater businesses. Instead of buying products directly from the company, customers began making their whole good purchases from Ag-Chem’s parts and service partners. Several of the selected dealers also carry Caterpillar products, and Ziegler Ag Equipment, which represents Ag-Chem in Minnesota, most of Iowa, and Wisconsin, provides a strong example of the new one-stop Ag-Chem dealer.

Of course, adds Steve Koep, vice president of the application equipment division for Ag-Chem parent AGCO, most RoGator and TerraGator customers were probably unaware of the change. And that, he says, is exactly how it should be.

“Many of the changes with this move took place internally within our company and the dealers’ organization,” says Koep. “From the customers’ perspective, the change should have been almost transparent. In most cases, their sales rep didn’t change, so the ‘face of Ag-Chem’ remained consistent for them.”

But that’s not to say this move by Ag-Chem isn’t a significant development in the company’s 45-year history. That’s part of the reason why Koep invited CropLife® magazine to sit down with Ag-Chem and Ziegler representatives this fall to discuss what this move means — and will mean — for everyone involved.

A Working Relationship

Truthfully, the relationship between Ag-Chem and Ziegler dates back several years, when the manufacturer first shifted the responsibility for its parts and service activities to the dealer network. Under this system, Ziegler employs a mobile fleet of fully-equipped service trucks to provide maintenance and service to customers on-site. Technicians in this fleet also conduct regular maintenance checks, oil and coolant analyses, and other optional services to extend equipment life.

At the time this was done, says Doug Pottinger, sales manager for application equipment at Ziegler, it was a pretty visible change for Ag-Chem customers, with a few bumps appearing in the road along the way. “There were a lot of cases where the customers were dealing with servicemen or parts people that were new to the business,” he says. “In those cases, you were bringing in a guy that had all kinds of experience with hydraulic and electrical systems, but he wasn’t the RoGator man that the customer had a long-term relationship with. It took a year to get these servicemen up to where they were adequate, according to the customer, and two years to get to the point where the customer was saying ‘this guy really knows what he’s doing.’ Ultimately, though, things worked themselves out.”

However, according to Koep, there were some drawbacks to this kind of “split” sales/service landscape. “I think the customer was kind of stuck between the direct sales organization and the dealer organization supporting the product,” he says. “It wasn’t conducive to efficiency because neither organization ultimately owned the customer relationship.”

Al Pearson, vice president, agricultural division for Zieg­ler, shared a similar view. “When we put together a five-year strategic plan, the No. 1 recommendation we made to AGCO was asking for the sales side of the business,” says Pearson. “The way we saw it, this business was the perfect match for us. It would help us drive volume, dollars, and synergies with the parts and service business we already were responsible for.”

Starting July 1, AGCO transferred responsibility for its Ag-Chem product sales to Ziegler and several other Caterpillar dealer locations (with plans to add 38 dealers, totalling 323 locations nationwide by the end of 2008). This allows dealers such as Ziegler to sell and service Ag-Chem products through a single point of contact. “In terms of the process this time around, it’s a lot smoother,” says Pottinger. “Previously, an AGCO salesperson would sell the customer an Ag-Chem product. Then, their first service call would be made by someone from Ziegler. Now, the logo on the orders is a Ziegler logo, the machine is sold by Ziegler, registered by Ziegler, and the warranty is covered by a Ziegler employee. It makes one entity accountable for Ag-Chem’s success and customer satisfaction in each territory.”

Market Driven

In many ways, this kind of sales/service structure mirrors that of Ag-Chem’s largest equipment rivals, says Koep. “But I don’t think any of our competitors can provide as timely or consistent service over as wide a geography as the Caterpillar people can,” he adds.

Furthermore, the shift of machine sales to dealers such as Ziegler will better position Ag-Chem to take advantage of some of the rapidly shifting dynamics taking place within the self-propelled sprayer and floater businesses.

“In 2007, the market for sprayers with product tanks ranging from zero to 1,000 gallons was down approximately 20%,” says Koep. “On the flip side, the market for sprayers with 1,000-gallon-plus tanks was up approximately 20%. That sales group probably includes some large growers, but it’s mostly made up of commercial applicators. This group makes many more planned replacement equipment purchases than other customers tend to, so a single-source sales/service structure like the one we’ve created with dealers such as Ziegler is a better fit for their needs across the board.”

Moving into the 2008 season, Koep expects the self-propelled sprayer to stay relatively flat as growers shift from corn to less application-intensive soybeans. Floaters, on the other hand, could see some healthy growth as dry fertilizer application potentially continues to increase.

Forward Progress

One year from now, both Ziegler and Ag-Chem representatives expect to see significant growth take place with their business relationship as well as the customers both serve. “We will be learning together and I think we will be successful together,” says Pearson. “It’s a great opportunity for everyone involved.”

Koep agrees. “I think this is the perfect relationship because everybody wins,” he says. “Ag-Chem wins because the company creates more volume. Ziegler wins because it creates more volume and ties the customers into its business. And, most importantly, the Ag-Chem customer wins because he’s no longer stuck in the middle between a sales-only organization and a parts/service-only organization. Everything is now under one flag.”

Leave a Reply

Equipment Stories
EquipmentTop 30 IRON WORKS Cartoons Of All Time
April 29, 2015
When CropLife IRON first started publishing more than a decade ago, long-time Publisher Al Strohmaier decided to start a cartoon Read More
EquipmentMeeting Changing Liquid Storage Needs
October 10, 2014
Tank and containment choices are expanding with shifts in farming practices and the economy. Read More
Precision AgGoogle Glass: New Tool For Ag
October 8, 2014
New wearable smart technologies such as Google Glass show potential to greatly impact how we accomplish the business of feeding the world. Read More
Equipment2014 Product Of The Year Voting
September 19, 2014
The deadline to vote for the 2014 CropLife IRON Product of the Year is October 31. Please cast your vote today to help us determine the winner. Read More
Top 100 Articles
CropLife 100The Andersons Acquires South Dakota Plant Nutrient Manufacturer Kay-Flo
May 20, 2015
The Andersons, Inc., ranked No. 22 on the CropLife 100, has purchased Kay Flo Industries of North Sioux City, SD. “This Read More
CropLife 100North Central Farmers Elevator, Wheat Growers Unification Approved By Board, Still Awaits Member Approval
May 13, 2015
The Boards of Directors for North Central Farmers Elevator (NCFE) and Wheat Growers (WG) have voted to approve the Unification Read More
CropLife 100AgGateway’s Barcoding Initiative Progressing Nicely
May 8, 2015
According to legend (or Wikipedia), the first step towards modern bar codes came back in 1948, when Bernard Silver, a Read More
CropLife 100Pinnacle Agriculture Acquires Minnesota Retailer
April 14, 2015
Pinnacle Agriculture Holdings, LLC, ranked No. 6 on the CropLife 100,  has successfully acquired Liebl Ag, LLC in Ada, MN.  Read More
CropLife 100CHS, Aurora Cooperative Complete Fertilizer Storage, Grain Shuttle Loading Facility
April 13, 2015
CHS Inc., the nation’s leading cooperative and ranked No. 5 on the CropLife 100, and Aurora Cooperative (ranked No. 21) Read More
CropLife 100GROWMARK Acquires Missouri Refined Fuels Terminal
April 2, 2015
Bloomington, IL-based GROWMARK and Magellan Pipeline Co. have entered into an agreement in which GROWMARK will acquire the refined fuels Read More
Latest News
ManagementA New Sprayer Company & UAV Research In The Spotlig…
May 21, 2015
CropLife’s Paul Schrimpf and Eric Sfiligoj talk about a Dutch sprayer manufacturer entering the U.S. with a super-sized entry and Read More
HerbicidesFirst U.S. Sale Of Enlist Duo Herbicide Made By Dow Agr…
May 21, 2015
Dow AgroSciences has recorded the first U.S. sale of Enlist Duo herbicide with Colex-D Technology. This marks the first commercial Read More
CropLife 100The Andersons Acquires South Dakota Plant Nutrient Manu…
May 20, 2015
The Andersons, Inc., ranked No. 22 on the CropLife 100, has purchased Kay Flo Industries of North Sioux City, SD. “This Read More
EquipmentNORAC Options Coming To TerraGator
May 19, 2015
Utilizing NORAC’s Standard Control technology, boom height control is now available for TerraGators with Airmax Precision 2 and Benson Booms. This Read More
Crop InputsHelena Introduces New Soil Health Product
May 19, 2015
Helena Chemical Co. is helping agricultural producers maximize yields and efficiency with the introduction of Liquid Chisel, a new product Read More
Stewardship4R Nutrient Management Planning Certification Now Avail…
May 19, 2015
The American Society of Agronomy (ASA) and the International Certified Crop Adviser (ICCA) program announce a new specialty certification in Read More
Environmental Defense Fund logo
Paul SchrimpfEnvironmental Defense Fund: Appreciating Partners
May 19, 2015
I WAS deep in the throes of preparation for the Commodity Classic meeting that took place this past February, trying Read More
WebinarsUpcoming Webinars
May 19, 2015
Register for one of our upcoming Webinars or access our archive of past Webinars to view recordings of presentations that may be of interest to you. Read More
Syngenta Sign
Seed/BiotechSyngenta Responds To Lawyer’s Victory Claim In Vi…
May 18, 2015
A plaintiff’s lawyer has issued a public statement claiming that damages have been awarded in the Agrisure Viptera corn lawsuits Read More
StewardshipCould Australian Water Trading Approach Fit In Californ…
May 18, 2015
Ten years of drought isn’t a good thing. It doesn’t help the bottom line of farmers or the health of Read More
SpreadersDutch Sprayer Manufacturer To Enter U.S. Market
May 18, 2015
Dutch self-propelled sprayer manufacturer Agrifac Machinery has announced intentions to enter the U.S. market with two models of sprayers available Read More
FertilizerTFI Weighs In On Fertilizer Rail Transport Bill
May 14, 2015
With today’s House Committee on Transportation and Infrastructure as a backdrop, The Fertilizer Institute (TFI) registered its support for policies Read More
ManagementA Visit To The 2015 Environmental Respect Spirit Award …
May 14, 2015
CropLife’s Paul Schrimpf and Eric Sfiligoj talk about a recent visit to the CPS Spirit winner in St. Stephen’s Church, Read More
StewardshipBayer Entomologist Issues Statement On Annual Honeybee …
May 13, 2015
Richard (Dick) Rogers, Principal Scientist / Entomologist, Bayer Bee Care Center for Bayer CropScience LP, today issued the following statement Read More
Crop InputsKansas State Researchers Announce Resistant Kochia Brea…
May 13, 2015
Kansas State University researchers say new research helps explain why an invasive weed is developing resistance to a well-known herbicide, Read More
RR2X soybeans surround untreated check (center)
HerbicidesUSDA Study: Glyphosate Application More Prevalent In So…
May 13, 2015
Glyphosate—known by many trade names, including Roundup—has been the most widely used pesticide in the United States since 2001. It Read More
AdjuvantsHelena Chemical Introduces New Drift Control Adjuvant J…
May 13, 2015
Helena Chemical Co. introduces Justified, an innovative drift control agent designed to improve the performance and precision of spray applications Read More
CropLife 100North Central Farmers Elevator, Wheat Growers Unificati…
May 13, 2015
The Boards of Directors for North Central Farmers Elevator (NCFE) and Wheat Growers (WG) have voted to approve the Unification Read More