Roundtable: Talking Things Through

Having come out of a highly challenging boom-and-bust cycle, seven retailers from across the country took stock of themselves and the industry last month at the first-ever CropLife State of the Industry Roundtable at the Agricultural Retailers Association Conference.

Both near- and short-term issues took center stage during the brisk one-hour event, including seed selling challenges, working with larger and more sophisticated grower-customers, moving forward in the fertilizer market, and identifying reasons for optimism in the season ahead.

Fertilizer has certainly been the predominant issue, and the retail panelists offered their thinking and strategies heading into 2010.

“We have implemented a contract with our customers and stress the importance that once you buy it, it is yours,” said Jeff Eggleston, vice president of agronomy at Hintzsche Fertilizer, Maple Park, IL. “I think that this has become very common throughout the Midwest.” The company is also evaluating product lines and looking at them from a risk-benefit perspective.

“If some of the products we carry are not that profitable and there is a lot of risk, we probably will be hesitant to be long in those products,” he continued. “Of course, if they are products our growers need and will use, we will make sure we have them on hand.”

Dave Coppess, vice president of Heartland Co-Op in West Des Moines, IA, said 2010 will be a year of transition in fertilizer “as we readjust to the experience we had with fertilizer being upside down and as we lost the favor of a lot of our customers. We are using this as an opportunity to be aggressive in our marketplace and reestablish ourselves as their favorite supplier.”

Educating Growers

Talking to growers about managing fertilizer risk and providing more options for working with the retailer will be important initiatives for Wisconsin River Agronomy, says Scott Firlus, vice president of agronomy.

“We are educating the farmer on how to lock in margins by selling grain and buying crop nutrients at the same time,” said Firlus. Internally, the retailer is working a lot tighter with its grain facilities than it has in the past.

“We are doing more contracts with farmers, and when we do pre-sell, it is a contracted commitment,” said Dan Weber, president of Ceres Solutions, Crawfordsville, IN. “We deliver and they take it at contracted prices; we don’t do the blanket pre-pay anymore.”

Weber says they are adjusting by trying to form a better partnership with growers. “With larger operations, we hold two business meetings with growers a year and include the agronomy, technical and procurement people to give growers a feel for where the market is going. The technical people are there to ensure we are talking about yield monitoring, grid sampling, and some of the technology tools to make them more efficient.”

“We are looking at our sales team and marketing team,” notes Coppess. “Realigning it a little differently than has been historically done, trying to position it not only for the present but for the next generation farmer. We have the opportunity to make changes and position ourselves for the long term.”

Partnering With Growers

According to Eggleston, growers are getting larger in Hintzsche’s area and they are demanding different services than they did 10 years ago. “I would say a lot of the successful ones are really good business people,” he said.

In response, Hintzsche is looking at making adjustments to its infrastructure and will address some of the people skills needed to help salespeople recognize and accommodate changing grower demands. “We are also looking at our pricing philosophy and structure and making sure that it reflects what growers are requesting,” says Eggleston.

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