Above: Jon (left) and Terry Peters were looking for "something better" for preparing seedbeds when they purchased a compact disc and liked it enough to start selling the equipment.
You might think that looking after 14,000 acres of corn, soybeans, wheat and Pioneer seed beans, while baling straw for local dairies and operating two grain elevators would be enough to keep the five Peters brothers busy enough. But a couple of years ago, they decided they could somehow fit selling farm equipment into their work schedules, as well.
It wasn’t necessarily something they were looking to do, but rather it was something they were looking for that introduced them into the world of ag equipment retailing. Today, along with their farming chores, each of the brothers participate in selling tillage tools and planting equipment through Peters Bros. Farm Supply, LLC in Memphis, Mich.
The farmer/dealer isn’t an entirely new concept, but it’s getting more attention these days. For shortline farm equipment makers, developing or expanding an effective sales network of independent retailers has become their most daunting challenge. The ongoing trend of dealer consolidation along with the OEMs push for “dealer purity” is causing manufacturers to seek alternative distribution channels. Some, like Horsch, are finding working with farmers who are willing and capable of setting up a retail operation can be effective.
Looking for ‘Something Better’
Jon and Terry Peters handle most of the planting for the farming operation and they “were looking for something better” when it came to seedbed preparation. “Jon and I ran the planters and we were never happy with the way our field cultivators worked the ground,” says Terry.
Peters Bros. Farm Supply, LLC, Memphis, Mich.
The five Peters brothers, including (l-r) Bryon, Jon, Scott, Randy and Torry, share the responsibilities involved with the farming and equipment retail operations.
Dealership founded: 2012
Product lines: Horsch tillage and planting equipment
Principle business: Farming 14,000 acres
Crops: Corn, Soybeans, Seed Corn, Wheat, Straw
Employees: 5 brothers (Randy, Bryon, Jon, Scott and Terry) and 8 additional full-time employees
Equipment: 9-FWD tractors, 5 with FWA, 3 sprayers, 5 combines, 3 corn heads, 9 compact discs,
John Deere planters, 1 Horsch Maestro planter, assorted other pieces
To see what else was out there, Jon headed down to the 2012 National Farm Machinery Show in Louisville to look into the compact discs coming out of Europe that they had heard about. He stumbled across the Horsch booth there.
He had also looked at some others, but “didn’t think they would be as a good of a fit” as the Horsch Joker. “I liked the way it was designed, the way it was built. I just felt that it was going to work,” says Jon. They ended up buying two 37-foot units.
As soon as they got it home they assembled it and hooked it up to their 550 horsepower tractor. I knew after the first few discs that this was the kind of dirt I want to plant into.”
On top of it, it could be pulled at between 10-12 mph. “Ten is about normal for us because we’re going 3-4 inches deep,” says Terry.
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‘We’ve Got Customers’
In the process of purchasing the compact discs, the Peters brothers discovered there was no dealer in Michigan for the equipment. Jon says that got him thinking, “Well, we’ve got a grain elevator and we’ve got a customer base. There’s no reason why we can’t sell farm machinery too. That’s pretty much how it evolved.” In August 2012, Peters Bros. Farm Supply, LLC sold its first ever piece of tillage equipment.
According to Jon, selling equipment is no different than selling their seed corn. “I mean you got customers, you keep them happy. It’s the same thing with farm machinery.”
That first year as equipment retailers, Peters Bros. moved 28 compact discs. Since then, they estimate they’ve moved between 45-50 units, plus the 9 they use themselves.
They’ve also sold some Horsch Tiger deep tillage units, which they also use on their farm. This past spring, the Peters brothers tested out Horsch’s new Maestro planter and will sell it as well.
In addition to using some statewide and national publications to advertise, Terry says that word of mouth has been their most effective form of marketing. He says it’s very typical to get a telephone call and hearing, “My next door neighbor has one. How do I get one of those?”
Apparently whatever they’re doing is working. “We’ve got customers in New York State, Illinois, Florida, of course, Michigan and Ontario,” says Jon.
The ‘Extra Mile’
Like other traditional farm equipment dealers, Peters Bros. Farm Supply also carries spare parts, while at the same time handling that segment of the business in a way that most dealers couldn’t afford to do.
First, because they also use the equipment they’re selling, they keep parts on hand at all times. “The same machine we sell, we use,” says Jon. “The corn planter’s a prime example. We’ll have a whole complete unit here because we’re using it ourselves and we can’t afford to be down just like any customer can’t be down. So we keep parts for ourselves and for our customers.”
The brothers say the new planter isn’t as complicated as it looks because of its modular design, including the electric motors for each row unit. “Basically, the motor is a single module that you switch out. It’s pretty straightforward. We won’t try to diagnose what’s wrong with it. We’ll keep replacements in stock and send the defective one back to factory and let them work on it. Horsch also has good product and parts support,” says Jon. “That was one thing I found with them is that they’re really good about keeping you informed and helping you out if you have an issue.”
The Peters Bros. also believe in customer service. If need be, Jon says, “It wouldn’t be anything for me to get up at 3 o’clock in the morning and run a part to a customer by morning, wherever he’s at in the state of Michigan. I kind of enjoy doing it and farmers get a kick out of seeing us actually go the extra mile.”
That “extra mile” often includes doing things that go against the grain of most traditional equipment dealers, like giving parts away.
Jon explains, “When I sell a Joker to a farmer, I’ll give him a boatload of parts with it. I say this is what I think you’ll probably need. Nine times out of 10 they’ve never experienced that. If I go up to an area, say north of here 40 miles, and a guy needs a bearing, I’ll give him four bearings, and tell him if somebody else needs one, give it to them.”
In fact, the Peters brothers equate the goodwill of no-charge parts to marketing. “We think that if you’re happy, you’re our best advertising. We can spend $1,000 a week on advertising at the drop of a hat, or we can give away $1,000 worth of parts. I’ll tell you that $1,000 in parts will go farther than the $1,000 of advertising, every time.”
At Peters Bros. Farm Supply, every job is everyone’s job. “We don’t assign work and say one person does all this and that person does all of that,” says Terry. “All five brothers are all involved. It’s nothing for a machine to come in and all five of us work on putting it together. It’s all shared responsibility.”
Paperwork and financing responsibilities tend to fall on Jon with help from Terry. “Jon really handles most of the bookwork, especially on the Horsch machinery. I do a lot of it with our John Deere equipment, but all of my numbers go through him so he can enter them in the computer. We believe all the financial stuff needs to be handled by one person because none of us would know what the others are doing if we were all entering the numbers. So it all goes through one central location.”
Jon adds, “I might oversee the financial stuff, but I’ve got to answer to a lot of brothers.”
As far as expanding their product line, the brothers say, they’ll probably never handle anything that’s too complicated. “Anything with a motor would be an issue for us. Corn planters are about as far as we want to go,” they say.
“The emission control on these new engines are pretty bad in terms of complexity,” says Terry. “Keeping up with the computers, the valves, the different sensors that go bad is not something we want to get into. We see how other dealers struggle with this stuff and it’s hard to believe they can make any money fixing a tractor these days. But it’s hard to tell a farmer that when he needs to replace a $15 sensor and you see what the tech has to go through; it’s mind boggling.”
Jon adds, “That’s why they charge $350,000 or $400,000 for a tractor.”