CPS buys Wigmore

[bigzee]

Another "little" independent bites the dust. This rumour has finally come true after about 3 years. I guess the Broadass fiasco came to the forefront. I'm not sure how my farm could with stand a $5.1 mill loss. Personally, I supported Wigmore a lot, but for the past 2 yrs their prices went up substantially. I wasn't going to pay for someone else's mistakes.

[wmoebis]

I know it may or may not have anything to do with subject. But does anyone know what happened to Hudye farms case?

[farmaholic]

Wasn't Wigmore part of, or one of, those vertically intergrated farming companies that had access to wholesale input prices.....and still couldn't make it?

[farmaholic]

Maybe Input Retailers should make sure that "feather in their hat"(larger than life customer), is indeed the feather of an eagle and not that of a turkey.

Maybe "deals" on inputs should be based on risk and not volume. Therefore, the customers who pay their bills---on time, or prebuy with cash should get a better deal than the large(or small) high risk credit accounts.

A bunch of small good accounts are worth more than one large bad account.

[Flatlander]

Business plan was ,
1.buy input dealer in area
2.go into surrounding country side run up rent on area land
3. Plan to haul production out of area to previously owned processing, thereby bypassing local businesses
4. Wonder where all the business went from input store. Why are area farmers not buying here?
5. Go on national media, print, tv, any who will listen and tell how this new integrated way is the model of the future.
And just never really figure out how it does work and what went wrong

Instead of business plans, consultants, and all the rest, 5-10$ for a cup of coffe and a piece of pie for a conversation with a local in a coffee shop farmer would have saved everyone a lot of grief.
You will always be remembered as those guys that ran up rent rates, rates are still here, where are they?

[hobbyfrmr]

I dont think anyone is on retailers books anymore. They shuffled the credit risk to farmers' cash, Bank lines of credit and FCC financing for inputs years ago. They just have to suggest shortage of supply to encourage farmers to pay in advance. That should cash flow the majority of the business and the non compliant customers pay more for whatever is left in the shed in the appropriate season. Its a good business model. If farmers have trouble, it the lenders problem, not the retailer.
I dont recall the exact number of millions, but FCC and another big bank paid for Broadacre's ambitions.

[farmaholic]

You are probably right hobby, but there is probably the odd retailer who still might get caught extending credit to a high risk customer.

So if Local Joe Blowhard, who was either out of or had no FCC/Bank credit and had no cash, came to the Chem shed and wanted product, would you turn him away? Or give him credit?

I don't see the difference between FCC/Bank or the Retailer not getting paid....

[hobbyfrmr]

Im pretty sure there is a lot of wealth on these big farms, thats why they are doing it, the economies of scale. These folks are excellent managers in all business aspects of the farm, not the old "hayseed" sterotypes.

[LEP]

Actually hobby a lot of the accounts are full recourse back to the dealer. So the input dealer doesn't worry until things are bad then they go very bad.

[hobbyfrmr]

I didnt know that. I thought it was more cut and dry.

[iceman]

Actually hobby a lot of the accounts are full recourse back to the dealer. So the input dealer doesn't worry until things are bad then they go very bad.

Was told once the FCC buy now pay later loan reverts back to the input supplier at a point after a default has occurred.

Yup when the shit hits the fan a lot of people will get wet

Ice out