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 100The Andersons Starts Venture Capital Subsidiary
January 26, 2015
The Andersons has established Maumee Ventures, a venture capital subsidiary designed to foster promising innovations that strategically align with the company’s core businesses. Read More
CropLife 100CHS Partners With Northern Partners Coop On Fertilizer Warehouse
January 21, 2015
In addition, the two companies will form a joint venture to build and operate a grain barge loading facility that will handle corn, soybeans and wheat for export through the CHS terminal at Myrtle Grove, LA. Read More
CropLife 100Wilbur-Ellis Move To Colorado Complete
January 20, 2015
Wilbur-Ellis Co. announces the opening of its new Agribusiness Division location in the Denver, CO, Metro Area. The new facility will host key personnel as the company shifts the base of its Agribusiness operations from California to Colorado. Read More
CropLife 100United Suppliers, McGregor Co., Five Others To Form Aligned Ag Distributors
January 20, 2015
These companies will continue to operate as independently owned and operated businesses, however, their crop protection divisions will now be formally aligned under the umbrella of Aligned Ag Distributors. Read More
CropLife 100Bozeman Named SEEDWAY Chief Operating Officer
January 16, 2015
He succeeds Donald Wertman, who will retire at the end of August 2015 after 40 years with the GROWMARK subsidiary. Read More
CropLife 100Wilbur-Ellis’ Craig Bair Honored For Safety Contributions To Ag Aviation
January 14, 2015
The William O. Marsh Safety Award recognizes significant achievements in safety, safety education or an outstanding operational safety program. Read More
Latest News
Seed/BiotechDow Details Enlist Trait Stacking Standards
January 30, 2015
Dow says it will allow the Enlist trait to be stacked with advanced glyphosate traits only, and will not allow stacking with the first generation of the Roundup Ready trait. Read More
ManagementCropLife Retail Week: IFCA’s Jean Payne on Illinois wat…
January 30, 2015
Editor Eric Sfiligoj shares insight from the Illinois Fertilizer and Chemical Association conference including a chat with IFCA President Jean Read More
ManagementOABA Conference Set To Highlight Trends, Technology And…
January 29, 2015
The third annual Ohio AgriBusiness Association (OABA) Industry Conference is set to take place February 4-5. Read More
FertilizerThe Fertilizer Institute President Jahn Testifies Befor…
January 28, 2015
The committee hearing, "Freight Rail Transportation: Enhancing Safety, Efficiency, and Commerce," looked at challenges facing our nation's freight rail network created by higher demand, rules and regulations and infrastructure needs. Read More
HerbicidesPurdue University Acquires Technology For Herbicide Mol…
January 28, 2015
Protea's LAESI DP-1000 Instrument System will be used in Purdue's College of Agriculture, the Department of Botany and Plant Pathology, for the molecular imaging of herbicide active ingredients and other related compounds to optimize herbicide applications and improve weed management.  Read More
FertilizerH.J. Baker Hires New Crop Peformance Marketing Manager
January 27, 2015
As Marketing Manager for the Crop Performance division, Usman Khalid will work out of H.J. Baker’s global headquarters in Westport, CT, and will drive new initiatives for the division. Read More
CropLife 100The Andersons Starts Venture Capital Subsidiary
January 26, 2015
The Andersons has established Maumee Ventures, a venture capital subsidiary designed to foster promising innovations that strategically align with the company’s core businesses. Read More
Exclusive state-of-the art Stueve Construction designed “Vista View” Elevated Control Room.
Eric Sfiligoj2015 Agricultural Market Read: Mixed
January 26, 2015
The agricultural market could look radically different this year, profit-wise, depending upon which segment you do business in. Read More
Edward Chell Biosafe
Crop InputsBioSafe Systems Names Ed Chell California Territory Man…
January 26, 2015
BioSafe Systems has announced the recent addition of Ed Chell as California Territory Manager for the agrichemical division, supporting the crop protection, water treatment and food safety business segments. Read More
InsecticidesBayer CropScience Introduces Sivanto Insecticide
January 26, 2015
Sivanto precisely targets key damaging pests at multiple insect life stages to prevent damage to plants and help minimize the spread of diseases from insect carriers. Read More
ManagementRetail Collaboration, Communicating Agriculture’s Good …
January 23, 2015
Editors Paul Schrimpf and Eric Sfiligoj discuss the recent creation of Aligned Ag Distributors, and the US Farmers and Ranchers Read More
FertilizerOSU Expert: Toledo Water Crisis A Turning Point For Ohi…
January 23, 2015
The August 2014 water crisis in Toledo, OH, impacted Ohioans’ views of Lake Erie algae problems by increasing the attribution of blame of algae growth on agriculture. Read More
FertilizerH.J. Baker Launching TIGER XP
January 22, 2015
Tiger-Sul introduces this next generation sulphur-bentonite product with a proprietary activator – ensuring farmers have a well-balanced nutrient replacement program. Read More
Crop InputsH.J. Baker Expands China Sales Force
January 21, 2015
Global Agricultural firm H.J. Baker announced that sales veteran Shi Dongshen has joined their Shanghai office in China. This newest hire follows the recent opening of their Lianyungang Sulphur Bentonite Plant. Read More
CropLife 100CHS Partners With Northern Partners Coop On Fertilizer …
January 21, 2015
In addition, the two companies will form a joint venture to build and operate a grain barge loading facility that will handle corn, soybeans and wheat for export through the CHS terminal at Myrtle Grove, LA. Read More
Matt Hopkins5 Bold Predictions For Ag Retail In 2015
January 21, 2015
This past year was filled with ups and downs for the nation’s top ag retailers, but what will 2015 have in store? Read More
SoftwareDeere Launches App Center
January 20, 2015
The John Deere App Center provides users the ability to search and find apps most useful to their business or operations. Read More
Crop InputsNew Syngenta Herbicide Approved In Soybeans, Sunflowers
January 20, 2015
Syngenta will sell BroadAxe XC herbicide in 2015 for use on soybeans, sunflowers and dry peas Read More