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

A finished Willmar 16-ton side-shooting tender.
TendersNew Production Facility Helps Willmar
July 17, 2014
In 1963, a group of businessmen started Willmar. Today, a half-century later, the company is one of the ag industry’s longest-running brands. Read More
SprayersHooded Sprayers Help Minimize Spray Drift
May 15, 2014
Willmar Fabrica­tion's hooded sprayers have the potential to minimize pesticide drift, especially when combined with other drift reduction technologies, such as drift retardant adjuvants or low-drift nozzles. Read More
Nozzles18 Spray Nozzles That Reduce Drift, Optimize Coverage
May 7, 2014
This year’s line-up of tips feature the versatility to handle any spray job. View photos and product descriptions of the latest nozzles on the market in our slideshow. Read More
NozzlesChanging Crop Protection Landscape Demands Drift Advances
May 1, 2014
New weed control systems and growing public pressure mean technologies to minimize drift can’t come fast enough. Read More

Trending Articles

Green Valley Ag facility
Retail FacilitiesGreen Valley Ag Adopts A.J. Sackett’s Precision Fertilizer Blending® Technology At New Facility
July 8, 2014
Sackett's Precision Fertilizer Blending® Technology is making huge strides around the world. Green Valley Ag adopts the technology at its new facility to support its advancing agronomic needs. Read More
Retail FacilitiesWaconia Manufacturing Builds Facility Designed For Speed, Efficiency
July 7, 2014
To make its new hub facility more efficient, Cooperative Elevator enlisted the aid of Waconia Manufacturing. Read More
EquipmentSummer Show Preview 2014: Superior Sprayers Take The Field
July 3, 2014
In this final installment of our coverage of the major categories of Big IRON that retailers can expect to test-drive at this summer’s events, here is a look at 19 sprayers. Read More
Scouting a soybean patch at Green Valley Ag.
EmployeesCropLife Compensation Survey: Battling Talent Drain
July 2, 2014
Retailers too often lose employees to companies outside of agriculture, while recruiting efforts are most often limited to competitors and other ag-focused organizations. Read More
HerbicidesDow AgroSciences Introduces SureStart II Herbicide
June 16, 2014
The enhanced formulation has improved viscosity and increased stability under heat and controls more than 60 high-anxiety grasses and broadleaf weeds found in corn fields. Read More
HerbicidesBASF Investing $270 Million To Expand U.S. Herbicide Production
June 11, 2014
BASF has invested more than $270 million to expand herbicide production capacities in the U.S., including more than 20 new products to be launched over next two years. Read More

Latest News

HerbicidesWillowood To Market Glufosinate
July 28, 2014
Willowood USA recently announced that Federal EPA has approved its technical registration for glufosinate. Read More
InsecticidesHow To Scout For Corn Earworms In Corn
July 28, 2014
In her weekly report, University of Missouri Agronomy Specialist Jill Scheidt discusses what to look for when scouting for corn earworm. Read More
Crop InputsDuPont Pioneer, Weyerhaeuser Enter Technology License A…
July 28, 2014
The agreement brings together agricultural and forestry know-how to sustainably improve crop productivity for corn growers around the world. Read More
EquipmentAGCO Launches Global iPad App
July 28, 2014
The free AGCO Global iPad App can be downloaded from the Apple iTunes Store and features the full family of RoGator self-propelled sprayers and TerraGator high-floatation spreaders. Read More
Eric SfiligojYuma Centennial Ag Supply Earns 2014 National Environme…
July 28, 2014
Colorado-based ag retailer receives top trophy in 24th annual DuPont Crop Protection/CropLife ceremony. Read More
CropLife 100Pinnacle Forms Alliance With Wildlife Managment, Seed O…
July 25, 2014
The strategic alliance will provide Tecomate with key wildlife products, processing facilities, distribution centers and sales through Pinnacle’s ever-growing retail network. Read More
ManagementFranken Presses White House On RFS Support
July 25, 2014
Al Franken and a group of Senate democrats recently met with senior White House official John Podesta to urge the administration to change its position on an EPA proposal. Read More
ManagementASA, FarmLink To Launch ‘Operation Benchmark̵…
July 25, 2014
The American Soybean Association (ASA) and FarmLink are teaming up to help farmers close the $11 billion gap between what they harvested in 2013 and what they could harvest annually. Read More
StewardshipNorthey: Farmers Commit $1.4 Million to Try New Water Q…
July 25, 2014
The practices that are eligible for funding include cover crops, no-till or strip till and using a nitrification inhibitor when applying fall fertilizer. Read More
Precision AgFarmers Learn How Changing World Will Impact Iowa
July 24, 2014
Technology and understanding global consumer demand for Iowa farm products brought hundreds of farmers and agribusiness leaders to Ames recently for the annual Iowa Farm Bureau Federation Economic Summit. Read More
HerbicidesPurdue: Late Season Weeds May Require Manual Removal
July 24, 2014
Hand-rouging and pulling late season weeds by hand may be the best way to remove them, more so than using a herbicide, a Purdue Extension weed scientist says. Read More
Soybean Field
InsecticidesTransform WG, Closer SC Insecticides Receive R&D 10…
July 23, 2014
Dow AgroSciences has received the award from R&D Magazine for Transform WG insecticide and Closer SC insecticide with Isoclast active. Read More
EquipmentKinze, Raven Team Up On 4900 Planter Monitor
July 23, 2014
Kinze Manufacturing announces a partnership with Raven Industries to develop a standalone monitor solution for the Kinze 4900 series planter. With this new Read More
LegislationNew Farm Bill Continues To Confuse As Growers Await USD…
July 23, 2014
The new five-year Farm Bill eliminates many of the direct payments previously payed to growers and could benefit from USDA clarification, reports a Toledo Blade columnist. Read More
EquipmentPrecisionAg.com Relaunches With Responsive Design For M…
July 22, 2014
PrecisionAg, the worldwide leader in precision agriculture information and analysis, announces the launch of its completely redesigned website, PrecisionAg.com. Read More
FungicidesEPA OKs Two Willowood Fungicides
July 21, 2014
The EPA has approved Willowood Azoxy 2SC and Willowood AzoxyProp Xtra. two widely used broad spectrum, preventative fungicides with systemic and curative properties. Read More
Precision AgFarmers Learning Fast As UAVs Take Off
July 17, 2014
Farmers and others interested in how UAVs can be used in agricultural applications were able to learn more about the technology during the recent Precision Aerial Ag Show. Read More
CropLife 100Bobby Knight, Richard Petty To Highlight Ag PhD Field D…
July 17, 2014
Attendees at the July 24 Ag PhD Field Day at Hefty Farms will learn about the latest agricultural technologies, and get a chance to meet legendary sports figures Bobby Knight and Richard Petty. Read More