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

Management2016 CTIC Cover Crop Survey: 33% Report ROI From Cover Crops
July 28, 2016
Insight from 2,020 farmers from across the country reflected enthusiasm for cover crops and—for the fourth year in a row—found Read More
ManagementNew Rabobank Report Calls for Farmer ROI Focus
July 25, 2016
As U.S. row crop farmers brace themselves for a third year of negative margins, Rabobank believes farmers must lower the Read More
ManagementGROWMARK Meeting Visit, Company Takeover Updates, and RNC Invite
July 22, 2016
Editors Paul Schrimpf and Eric Sfiligoj discuss their recent speaking engagement at GROWMARK’s eastern event, crop protection company merger rumors, Read More
ManagementLand O’Lakes Announces SUSTAIN Business Unit, Other Changes
July 20, 2016
Land O’Lakes, Inc. today announced the formal organization of a new business unit, SUSTAIN, and its leadership. SUSTAIN will focus Read More
Trending Articles
Southeast Farmers Coop - Finished Building
Retail FacilitiesNew Stueve Facilities Offer Ag Retailers Speed, Accuracy
July 9, 2016
Leading the industry in planning and constructing dry fertilizer storage and chemical warehouse solutions, Stueve Construction helped three ag retailers Read More
Heritage Cooperative
Retail FacilitiesKahler Automation Designs State-Of-The-Art Facility For Heritage Cooperative
July 4, 2016
Heritage Cooperative in Marysville, OH, needed an efficient liquid, dry and grain facility to serve the many needs of their Read More
The Andersons Waterloo
ManagementFirst Indiana Facility Certified Under 4R Nutrient Stewardship Certification Program
June 27, 2016
The 4R Nutrient Stewardship Certification Program has announced that The Andersons, Inc.’s Waterloo, IN, facility has been added to its Read More
Food IT
Industry NewsCalifornia Event Will Mix Ag And Tech Professionals To Explore IT Solutions
June 20, 2016
Silicon Valley is hot on agriculture, and an upcoming event in California will bring together the food and tech industries Read More
Monsanto Luling Plant
Eric SfiligojWhat’s Next For Monsanto?
May 31, 2016
For the folks at Monsanto’s headquarters in St. Louis, MO, it has been an eventful few weeks. Back on May Read More
Soybean Plant closeup
Industry NewsMonsanto Rejects Bayer Bid; Open To More Talks
May 25, 2016
Monsanto Co, the world’s largest seed company, turned down Bayer AG’s $62 billion acquisition bid as “incomplete and financially inadequate” Read More
Latest News
FertilizerGypsum Added To List Of Conservation Practices
July 28, 2016
Crop farmers in a growing number of states may be eligible for financial assistance from the USDA’s Natural Resources Conservation Read More
Management2016 CTIC Cover Crop Survey: 33% Report ROI From Cover …
July 28, 2016
Insight from 2,020 farmers from across the country reflected enthusiasm for cover crops and—for the fourth year in a row—found Read More
Palmer pigweed seedhead in cotton
HerbicidesStudy: Fall Weed Controls Can Make Significant Impact O…
July 28, 2016
An article published in the latest issue of the journal Weed Science shows that adopting harvest-time and post-harvest weed controls Read More
InsecticidesSyngenta: Beware Of Early Stinkbug Threat To Soybeans
July 28, 2016
With the record warm temperatures this past winter and confirmations from early entomologist reports, Syngenta encourages growers to monitor stinkbug Read More
Peanut field
Crop InputsVerdesian Introduces New Inoculant For Peanuts
July 28, 2016
As planning begins for the next growing season, Verdesian Life Sciences adds Primo Power CL, a new liquid inoculant, to Read More
Soil Young Corn
Crop InputsSmithsonian: 5 Things to Know About New GMO Labeling Bi…
July 27, 2016
On July 14, the House of Representatives passed a bill requiring large food companies to label products containing genetically modified Read More
Palmer pigweed in soybean stubble
HerbicidesSpecial Issue Of Weed Science Explores Human Aspects Of…
July 27, 2016
Weeds that evolve resistance to herbicides are a serious threat to global agricultural production. In this Special Issue of Weed Science, Read More
CHS Primeland
CropLife 100CHS Businesses In Washington, Idaho Combining For Great…
July 27, 2016
As full-service ag retailers, CHS Primeland and CHS Farmers Co-op collectively serve farmers and other customers in 15 counties in Read More
Storage Tanks at Nachurs
Crop InputsNACHURS Joins Field to Market
July 27, 2016
NACHURS announced today that it has joined Field to Market: The Alliance for Sustainable Agriculture, a leading multi-stakeholder initiative working Read More
Illinois Researchers
FertilizerMeasure Of Age In Soil Nitrogen Could Help Precision Ag…
July 26, 2016
What’s good for crops is not always good for the environment. Nitrogen, a key nutrient for plants, can cause problems Read More
Kochia
Crop InputsNufarm Launches New Herbicide for Resistant Kochia
July 25, 2016
Nufarm introduces Scorch herbicide for U.S. farmers and ranchers combating a broad range of troublesome broadleaf weeds. A unique premix Read More
ManagementNew Rabobank Report Calls for Farmer ROI Focus
July 25, 2016
As U.S. row crop farmers brace themselves for a third year of negative margins, Rabobank believes farmers must lower the Read More
Syngenta Sign
Crop InputsBloomberg: Syngenta-Chem China Deal on Track for Regula…
July 25, 2016
Syngenta AG, which has agreed to be taken over by China National Chemical Corp. for $43 billion, said talks with Read More
ManagementGROWMARK Meeting Visit, Company Takeover Updates, and R…
July 22, 2016
Editors Paul Schrimpf and Eric Sfiligoj discuss their recent speaking engagement at GROWMARK’s eastern event, crop protection company merger rumors, Read More
Crop InputsMonsanto: EU Approves Roundup Ready 2 Xtend Imports
July 22, 2016
Monsanto Co. announced today that the European Commission has granted import approval for Roundup Ready 2 Xtend soybeans. This milestone Read More
Syngenta headquarters in Basel, Switzerland
Crop InputsSyngenta Announces Alfalfa Seed Split Off
July 22, 2016
On September 1, 2016, Syngenta will transfer sales and distribution of alfalfa seed to the NEXGROW branded business that is Read More
Dow DuPont
Crop InputsDuPont, Dow Shareholders Approve Merger
July 21, 2016
DuPont and The Dow Chemical Company announced that, at their respective special meetings of stockholders held today, stockholders of both Read More
ManagementLand O’Lakes Announces SUSTAIN Business Unit, Oth…
July 20, 2016
Land O’Lakes, Inc. today announced the formal organization of a new business unit, SUSTAIN, and its leadership. SUSTAIN will focus Read More