Margin Minders

Employee training

Maintaining profitable margins requires more than just good recordkeeping and aggressive selling. In today’s tight markets, finding innovative ways to deliver more value to your customers can keep even your most challenging market segments profitable.

In this article, some of the marketing experts from Agriliance offer their advice on how to mind, and maybe boost, your company’s sales margins.

1. Don’t just sell seed; promote the package. Biotech traits in the major crops are now available from nearly every seed company, so more emphasis is being put on identifying advantages in yield and genetics that are part of a solid seed package, says Peter Peerbolte, director of seed traits and seed treatments. “When the next generation of biotech traits arrives, such as drought tolerance and greater nitrogen efficiency, there will be competition to offer those traits exclusively for a year or two, but overall competition in seed will continue to center around who can provide the best package of products and information,” says Peerbolte.

2. Sell the value of seed treat­ments. Seed treatments offer dealers a way to create new revenues while offering producers early-season seed and seedling disease and insect protection. The key to generating revenues with a seed treater is to be dedicated to selling the value of seed treatments, says Nathan Wright, business manager for seed treatments and grain protectants. “The dealership may have purchased the seed treater for use primarily on soybean or cotton seed, but they should also be looking for other crops to use it with, such as fungicides on wheat,” says Wright. “The more units you treat, the quicker the payback.”

3. Mix in more products. An­other way to boost margins on seed treatments is to add other products to the treatment mix, he says. “Is there benefit in adding a seed-applied insecticide, fungicide, or inoculant into the mix? Is there value you can market to the producer? Often the answer is yes,” says Wright.

Other seed enhancement products, such as micronutrients, can be delivered via the seed coating to boost early season plant growth. “Agriliance’s new Advanced Coating Zn is a good example,” says Wright. “Field tests on corn the past two seasons have demonstrated a noticeable response to the addition of Zn, with faster emergence and better stands.”

With spray adjuvants, you need to sell on value, not price, says Bob Herzfeld, adjuvants business manager. “Farmers are certainly price conscious, but they will pay for something that works, so show them how these products will make their herbicides or insecticides more effective,” says Herzfeld. “A good example is how a water conditioner such as Alli­ance will help their glyphosate work better, especially on tough weeds and in dry conditions, or if they have hard water.”

Deposition agents offer great value in making insecticide and fungicide applications more effective, he notes. “InterLock, for example, actually increases droplet speed by as much as 40%, which delivers it down below the crop canopy for much better control, and keeps up to 20% more active ingredient in your field,” says Herzfeld.

4. Don’t miss opportunities in stored grain. Grain protectants are another product area that hold a lot of promise for boosting profitability this coming season, says Wright. “With the expected increase in corn acres, and more of it going into on-farm storage, there is a real opportunity to sell the benefits of grain protectants,” he says. “Actellic, for example, can protect against key pests in corn up to 18 months, and there are no shipping restrictions after use. And a typical 4- to 8-cent-per-bushel cost to the producer seems like a fairly affordable form of grain storage insurance.”

5. Charge enough for applying product. Field applications services are often under-valued, usually because the dealer doesn’t have an accurate sense of the costs, says Jeff Speckman, equipment marketing specialist. “You should be using the custom application segment of the business as a revenue stream and not subsidizing it with product margins,” says Speckman.

6. Take advantage of new technologies. Larger sprayer equipment with auto-boom technology may be worth the investment if you have enough acres to cover, says Speckman. “The new technologies solve many of the challenges of running a wider boom, and help reduce operator stress,” he says.In fertilizer applicators, the latest upgrades in spinner technology provide great accuracy for a smaller investment and less maintenance cost than air-powered applicators, he notes. “They’re not a replacement for air technology but give you a lower-cost way to apply dry fertilizers on more acres, just as accurately,” says Speckman.

7. Spread fertilizer buying risk. With major supply changes occurring in the fertilizer markets over the last two years, dealers and growers need to take a longer view of their purchases, says Bruce Vernon, director of crop nutrient marketing and risk management services. “They need to consider buying product at least eight months out to ensure adequate supplies, but that can leave them vulnerable to price volatility,” says Vernon. “That’s why they need a risk management plan.”

To meet this growing dealer need, Agriliance has developed the Risk Management Service for Crop Nutrients, which provide dealers with market analysis and position-track software, access to a secure Web site that provides constantly updated global market intelligence, and customized consulting with a dedicated risk management advisor.

8. Train your people. Good service is key to retaining customers and winning new ones, but providing a high level of service requires well-trained people. “The level of technical knowledge that employees need to have today is very high, and regular training is essential,” says Jim Tiedke, agronomy production manager. “We try to meet that need by offering many types of training, including classroom, in-field, and online formats.”

9. Know your sales productivi­ty. Tracking the cost-to-return ratios of your sales force, individually and as a group, can help you to make the best use of each person, says Tiedke. “It’s not just about accountability but about finding ways to help your sales force do the best that they can.”

10. Market your expertise. If you’re not making money on the services you offer, maybe you need to focus more on selling your expertise, and adjusting your rates to account for it, Tiedke says. “Agriliance provides great technical training for agronomists, applicators, and salespeople. If your dealership takes advantage of that, then you can use it to differentiate your services from those of the competition” he says. “When you talk about service, it’s all about the people and their level of knowledge and training, so emphasize that.”

Leave a Reply

Management Stories
ManagementMACA 2014: The State Of The Agricultural Industry, And Then Some
October 9, 2014
The trade association’s annual gathering featured speakers from across agriculture and beyond. Read More
StewardshipA Multi-Layered Approach To Water Quality
October 6, 2014
Illinois event highlights research and technology designed to better monitor and improve water quality — and the benefits of cooperative, coordinated effort. Read More
StewardshipMichigan Agriculture Leaders On Toledo Water Ban: We Want To Be Part Of The Conversation
August 8, 2014
Leaders of Michigan agricultural organizations said Thursday that the government should not have a “knee-jerk reaction” based on last weekend’s water ban in Toledo due to fertilizer run-off in Lake Erie. Read More
ManagementRussia Bans U.S. And EU Ag Product Imports In Ukraine Sanctions Battle
August 7, 2014
Russian President Vladimir Putin has banned the import of agricultural goods from countries that have imposed sanctions on Russia. Read More
Top 100 Articles
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
CropLife 100Wilbur-Ellis Acquires South Dakota Retailer
April 2, 2015
Wilbur-Ellis Co.’s Agribusiness Division, a recognized leader in precision agriculture technology and the distribution and marketing of plant protection, seed Read More
CropLife 100The McGregor Co. Closes Smith-Kem Acquisition
April 2, 2015
The McGregor Co. — ranked No. 16 on the CropLife 100 list of largest U.S. ag retailers — has completed Read More
CropLife 100BRANDT Commemorates National Ag Day
March 20, 2015
The Illinois agriculture community gathered at BRANDT global headquarters on March 18 to celebrate National Ag Day behind this year's theme Sustaining Future Generations. Read More
Latest News
ManagementMissouri Experts: Spring Planting Slow Start Won’…
April 20, 2015
In the first of the agronomy teleconferences with Extension specialists, University of Missouri Extension climatologist Pat Guinan said the slow Read More
Carl Casale of CHS
Industry NewsCooperative CHS Reports Net Income Of $471.5 Million Fo…
April 20, 2015
CHS Inc., the nation’s leading farmer-owned cooperative and a global energy, grains and foods company, has announced company net income Read More
Industry NewsCHS Insurance Names New Director Of Sales
April 17, 2015
Bryan Lewis has been named director of sales for CHS Insurance, the nation’s largest agribusiness insurance broker and full-service insurance Read More
Mature Waterhemp in Corn
HerbicidesGenetic Literacy Project: There’s No Such Thing A…
April 17, 2015
Read the latest “analysis” on GMOs from Consumer Reports and you’ll “learn” that glyphosate, the chemical developed by Monsanto (its Read More
HerbicidesNew Resistance To 2,4-D Discovered In Australia
April 17, 2015
In a world-first case of herbicide resistance, researchers have confirmed that sowthistle weed in the south east of South Australia Read More
ManagementNews From RTP Company Visits and Growers Buying Older S…
April 16, 2015
Paul Schrimpf and Eric Sfiligoj discuss recent trips to the Research Triangle Park area and market seed sales trends. Read More
soybean field
StewardshipNew ASABE Standard Establishes Framework For Sustainabl…
April 16, 2015
The American Society of Agricultural and Biological Engineers (ASABE) has initiated a project to develop a new standard to establish Read More
MicronutrientsSouthern States: An Inside Look At Our Tissue Sampling …
April 15, 2015
Remember learning about the food pyramid in school? The nutritional diagram recommends the proper amount of nutrients you need on Read More
Industry NewsArysta Adds New U.S. Fungicides Marketing Manager
April 15, 2015
Arysta LifeScience North America recently hired Deneen Sebastian as its Marketing Manager for U.S. Row Crops, Fungicides. Most recently, Sebastian Read More
FungicidesVerdesian Launches Phosphite-Based Cereal Fungicide
April 14, 2015
A new, phosphite-based fungicide designed for improved suppression of deoxynivalenol (DON) in wheat and barley infected by Fusarium head blight Read More
Mature Waterhemp in Corn
HerbicidesSURVEY: Close To 90% Of Growers Battle Weed Resistance
April 14, 2015
Herbicide resistance management continues to be a priority for corn and soybean growers, and they’re working together more effectively to 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
StewardshipFMC Corp. Joins Sustainable Agriculture Alliance
April 14, 2015
FMC Corp. has joined Field to Market: The Alliance for Sustainable Agriculture, a multi-stakeholder initiative working to define, measure and Read More
Industry NewsArysta Adds Two To Goëmar Sales Team
April 14, 2015
Arysta LifeScience North America recently announced two new additions to the Goëmar sales team: Steve Kelly, Technical Service Manager – Read More
Valley Variable Rate Irrigation
Precision AgVariable Rate Irrigation Gains Followers
April 14, 2015
Irrigation systems have had the ability to apply different amounts of water throughout a field for decades, using timers that Read More
CropLife 100CHS, Aurora Cooperative Complete Fertilizer Storage, Gr…
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
Soybean field
Industry NewsThree Ag Co-ops Poised For Possible Merger
April 13, 2015
Following months of study and preparations, the Board of Directors for United Farmers Coop (UFC), Farmers Elevator Cooperative (FEC) and Read More
Eric SfiligojAgriculture Braces For More Belt-Tightening
April 13, 2015
Spring is in full bloom across the U.S. and ag retailers and their grower-customers are busily getting into high gear. Read More