Retails

[ABfarm]

Since everything is flooded here and I’m kind of sick listening to our fearless leader PM ramble and watch Eastern Canada swoon in his dribble, I gave some thought to our Ag retailing industry. Don’t know why but it is bothering me. With pretty much all major crop protection products now generic, I find myself not needing advice from the local retail anymore. I mean sure walk the field if you want (this year bring your rubber boots and hip waders) but I pretty much know my weeds and how to rotate herbicide groups. What value is this young $75000 a year cost adding to my operation? I don’t think things are all that rosy in retail land either as I see a trend moving away from certain companies to ones the retail finds the most profitable. If FBN (I have never used or bought from them) forges ahead with really attractive online pricing and have distribution points for pick up and I save a few bucks, I really don’t think it changes anything for me. If I need an agronomist I’ll hire an independent one that isn’t pushing a product line. Sure sometimes things change last minute so it would be nice to give something back and switch but I could see me purchasing 3/4 of my stuff ahead of time. But that sucks too because I do believe in supporting my local community, giving young people an opportunity to reside in my small town, but honestly margins are so thin, I have to put those feelings aside to survive. At the end of the day, the profitability is just not here on the farm to support my family. Then we get 5 years of wet in a row, 2 spring thrashings and now a total wipe out and I’m worried for it all. I’ll survive, but I know others won’t. If it wasn’t for Ag this small town suffers. The grocery store, our implement dealer, our Coop, our hardware store- it’s a cycle. There is always someone going to seed the land but they might get forced to deal with the grain companies as credit will be given via the crop they are putting in. FCC and the local Coop can’t compete - they don’t have the security. I’m not tying up a quarter section to buy inputs. Even with all of that it is still the iron that is killing us. We all love the fancy controls and gadgets but does it really save us money? A new combine is $750000 plus? A drill $600000? Like wtf. I can’t pencil it. Add more acres, sure one paper that might work but then you ‘mud’ in the added land because spring never goes as planned and don’t get it thrashed in the fall. Is that really profitable?
Just wondering if anyone else has these same thoughts. Am I off based? Is this whole Ag economy going to get flipped on its head?

[Sheepwheat]

Between a string of terrible years, not being able to come close to competing for land to grow, and just simply seeing the changes and the writing on the wall, my farm had to change or most likely die.

No, you are not alone in these thoughts. It has gotten crazy.

Thankfully, there are different ways to farm and look at things.

[farmaholic]

Cut where you can.
Who needs a sales agronomist? Your own boots on the ground and internet and book resources can teach you alot. Provincial extension services can help too.
Don't get me started on the cost of land rent or purchase prices, both are ridiculous. And if someone wants to bite my head off for suggesting land costs are too high and why would I want to see the value of my asset depreciate.....the answer is my land isn't for sale but I may also like to buy a bit more and prices have gone beyond the land's ability to pay for itself. Would I accept less than the current high market price if I was selling....no. The problem for some people who want yo buy land is they need for it yo pay for itself, not just an investor looking for somewhere to dump excess cash.
There are way too many people making a living in and off of Ag that are adding zero value.... "Ag More Than Ever"
And yup machinery costs are right out of hand and the cost of repairs and service calls with parts has gotten retarded, if you don't have the tooling or physical ability to attempt the repair yourself. And look at the layers of parasitism in some machinery dealerships.

Go ahead, turn the whole thing on it's head......its about time!!!

[ABfarm]

Cut where you can.
Who needs a sales agronomist? Your own boots on the ground and internet and book resources can teach you alot. Provincial extension services can help too.
Don't get me started on the cost of land rent or purchase prices, both are ridiculous. And if someone wants to bite my head off for suggesting land costs are too high and why would I want to see the value of my asset depreciate.....the answer is my land isn't for sale but I may also like to buy a bit more and prices have gone beyond the land's ability to pay for itself. Would I accept less than the current high market price if I was selling....no. The problem for some people who want yo buy land is they need for it yo pay for itself, not just an investor looking for somewhere to dump excess cash.
There are way too many people making a living in and off of Ag that are adding zero value.... "Ag More Than Ever"
And yup machinery costs are right out of hand and the cost of repairs and service calls with parts has gotten retarded, if you don't have the tooling or physical ability to attempt the repair yourself. And look at the layers of parasitism in some machinery dealerships.

Go ahead, turn the whole thing on it's head......its about time!!!

I think it has to turn on its head. Im sorry but I cannot pay an extra $15 a jug to help pay for a junior agronomist. I had a call about fungicide the other day. I mean wtf planet are you on? Protect what you have? lol. There is nothing here to protect dude - if you are checking fields you should know that. I think these companies thinking Agronomy is going to save them are in for a rude awakening. You need smart people at retail, not necessarily agronomists.

[furrowtickler]

I think it has to turn on its head. Im sorry but I cannot pay an extra $15 a jug to help pay for a junior agronomist. I had a call about fungicide the other day. I mean wtf planet are you on? Protect what you have? lol. There is nothing here to protect dude - if you are checking fields you should know that. I think these companies thinking Agronomy is going to save them are in for a rude awakening. You need smart people at retail, not necessarily agronomists.

Just use your own common sense and find advice from someone likewise
May save you thousands and thousands.
Just because the crop is there , I agree it does not have to have fungicide
Most retails treat it like Franks red hot sauce lol

[Horse]

So is it realy a retail problem or a farmer problem,take out the need to be bigger and better than your neibour ,and the prestiege of new iron and a lot of the current problems go away. Land rent who sets the price???? More imputs less per unit return,as I have said before how much are you growing as to how much you are buying ,with all the fert,spray,new tech,and so on.
There is no shame in running old low tech equipt and low imputs and being profitable. Keep an eye on ROI and equiptment cost per acre,adding more acres to dilute those costs only work to a point.

[furrowtickler]

So is it realy a retail problem or a farmer problem,take out the need to be bigger and better than your neibour ,and the prestiege of new iron and a lot of the current problems go away. Land rent who sets the price???? More imputs less per unit return,as I have said before how much are you growing as to how much you are buying ,with all the fert,spray,new tech,and so on.
There is no shame in running old low tech equipt and low imputs and being profitable. Keep an eye on ROI and equiptment cost per acre,adding more acres to dilute those costs only work to a point.

Or cut land prices and rents in half to help relieve financial stress

[seldomseen]

I have a couple of different nephews that are now living with young Sales Agronomists and at a Recent family event the conversation turned to growing a garden. Neither one had the slightest idea how to go about planting and maintaining a garden so I am not sure how they could help you grow a crop.

[ABfarm]

So is it realy a retail problem or a farmer problem,take out the need to be bigger and better than your neibour ,and the prestiege of new iron and a lot of the current problems go away. Land rent who sets the price???? More imputs less per unit return,as I have said before how much are you growing as to how much you are buying ,with all the fert,spray,new tech,and so on.
There is no shame in running old low tech equipt and low imputs and being profitable. Keep an eye on ROI and equiptment cost per acre,adding more acres to dilute those costs only work to a point.

Problem I see is that the middle guy is the one who is going to disappear. Not all of them, but those are the ones at huge risk. In order to run a half ass decent set of equipment they need more land. More land at the wrong time (the last 5 years here) and they are gone. So there are the smaller guys doing what they are doing, diversified into livestock and the super large grain farmer. Large guys are tied to grain co in order to get inputs based on grain contracts. Independents, Coops cant extend them credit. It is going to cause a shift in retailing. Now add the online versions selling the same generic for less. The value proposition for the Independent/Coop has been the technical support piece. Do we need that? How can they compete anymore. We are setting up for a huge shift in the retailing world.

I did ramble on which I tend to do and I totally agree most of on here probably have bought a shiny piece of iron we didnt need. But damn it when we get 5 days to seed or harvest, the shit we have better work too. Is all this variable rate stuff and sectional control worth it? We are paying for shit we arent even using.

[blackpowder]

Local retail useful in the level of service and local product knowledge.
Outsource your experts, way cheaper than one, in house source.
Chem reps lie, LoL.
Land here hasn't payed for itself by itself in decades.
Our small town slowly rotting anyway.
Reset?? Perhaps.
Consider how much longer a medium to smaller farm can afford to own a combine?? How can the factories stay open charging what we can afford??
Has anyone here studied what that one piece of equipment really costs???
Worst one by a mile.

[ABfarm]

Local retail useful in the level of service and local product knowledge.
Outsource your experts, way cheaper than one, in house source.
Chem reps lie, LoL.
Land here hasn't payed for itself by itself in decades.
Our small town slowly rotting anyway.
Reset?? Perhaps.
Consider how much longer a medium to smaller farm can afford to own a combine?? How can the factories stay open charging what we can afford??
Has anyone here studied what that one piece of equipment really costs???
Worst one by a mile.

So how can a local independent pay for that technical person to provide the local knowledge and service? I dont think we can afford to pay extra for it? Maybe a couple bucks a jug but if its more we cant anymore? You are right about new equipment. The service department is keeping the dealerships open. Rural towns are going to get hit hard. These businesses are their only tax revenue other then the few houses. But it isnt the farmers fault. He is just the only one contributing to these economies now. Without him its dead.

[ajl]

I am in the other corner of the county from you ABfarm and we just got dumped on again. My crops are in a claim position so that means no fungicide around here. Simple decision making. Is there an app for that? Retails if they are going to survive will have to start offering realistic pay packets. Trouble with canuckistan is that our labor market is so distorted with government being by far the largest employer. In order to fix this mess government is going to have to lead with layoffs and pay and benefit decreases so as to stop market labor market distortion.

[helmsdale]

You've got:
-"the guys" who plan a rotation for you.
-"the guys" who plan fertility for you.
-"the guys" who scout your fields and come up with high clearance solutions all year for you.
-"the guys" who market it for you.
-"the guys" at the accounting firm who do all the financial magic for you.
-"the guys" on your payroll who do most of the labor for you.
-"the guys" at the service department who keep all the equipment owned by some other guys who are nice enough to lease it to you.
-"the guys" at the law firm who cover your ass for you.
-"the guys" at the bank who keep saying YES to you provided all the rest of "the guys" haven't misspent these guys' monopoly money.

We call these guys leaches, but it seems they're the only smart ones. No skin in the game and all sorts of guys willing to throw those other guys monopoly money at them. And if you ever get tired of being on the phone coordinating all "the guys", or mother nature gets you in a pickle, you phone "the guys" at RB auction, and the realty office and tell them to find a new guy who's willing to retire you to the city with some more of that monopoly money.

FUN!

[Misterjade9]

So, I hire a private agrology company to do my soil tests and about 1000acs. of VR. I find them very reasonable and knowledgeable in helping me form a fertility plan. They sure would like to scout all my acres but that is another 4 bucks an acre and I view that as my job. It would be another 24K just for scouting, that is not a bad wage to pay myself for something I think I should be doing anyways.

[LEP]

Not sure what guys are paying for agronomy advice now. Not too many years ago guys were paying $6 an acre. Honestly I can’t believe that people pay that kind of money for that.

Not sure what marketing advice is worth but if you can’t put the effort into becoming a journeyman in both these areas you either have too many acres or you shouldn’t be in the business. IMO.