Mark D. Core
Executive Vice President, Chief Marketing Officer,
Vermeer Corp., Vella, Iowa
President & CEO,
JCB Inc, Savannah, Ga.
Pictured Above: The most successful specialty farm equipment companies are those that are on a continuous path of innovation, say Mark Core (left) of Vermeer Corp. and Richard Fox-Marrs (right), of JCB Inc. But remaining innovative along with supporting a strong, robust dealer channel are the biggest challenges for these manufacturers.
Mark Core: I’m intrigued with the JCB product line and the fact that you’re family owned, like Vermeer. Within agriculture, what’s your distribution look like?
Richard Fox-Marrs: We have around 180 points of distribution for ag. It’s targeted at the geographic regions where we see the greatest opportunity for our material handling products. So, we haven’t set off on a project to carpet the whole of North America with distribution. We’ve tried to say, “Where’s the markets for our products?” and build strong distribution in those territories.
Core: So, you’re trying to be a specialist in material handling?
Fox-Marrs: That’s exactly it. A specialist in material handling, and there’s a heavy bias for our material handling sales to customers with livestock in their operations as well. So, we can quickly break this huge company down into some smaller pockets, if you like, and focus on those areas where the business resides.
Core: This is similar to us being focused specifically on hay tools. We’re trying to be the best round baler manufacturer and marketer in the world. As similar companies in terms of not being “full line,” but highly innovative specialists within our niche markets, what’s our biggest challenge moving forward?
Fox-Marrs: I think securing strong and robust distribution as we go forward will remain the bigger challenge, but the word you used, Mark, is innovation. There’s always a place for companies that innovate. Maybe some of our, to use your phrase, full line competitors, are not as innovative as they might like to think. This is what gives us an opportunity and a place in the market.
Core: I agree with your comments. We believe, ultimately, we drive distribution through innovation. We must have leading-edge, market-driven type products. Our dealers and potential dealers want to be a part of what nobody else can get their hands on. I think you ultimately build that with human capital. It starts with the most talented people you can possibly have. Then, as a privately owned company, we’re allowed to manage in a more long term fashion and invest in support.
How much effort are you spending on making life easy for your dealers? We’re asking ourselves, “What do we focus on and what can we do to reduce the pain points?” We’re not exclusive with nearly any of our agricultural dealers, so we need to make it easy to sell Vermeer products, especially for multi-line dealers.
Fox-Marrs: That was a question I was going ask you. We need to “simplicate” and not complicate. We’ve got a wide range of product in our portfolio. So, we’ve tried to simplify our range down to a number of products where we’re absolutely sure the product is right, the support is right, the marketing materials are right. We use the iPad a lot with a system we call the JCB Hub. For every product in the group, we have the 5 fast facts, or 5 compelling reasons we want salespeople to remember for each machine. If they don’t know anything else, they have at least these 5. We try to put a consultative sales guide in their pocket or on their iPad, so you can get that person to deliver the message that you want him or her to deliver.
We’re also completely online with our dealers with parts, pricing, etc. But we’re asking where’s the price point for customers to purchase equipment online? What would a customer buy online from the Vermeer range?
Core: We haven’t taken the step to offer parts online yet. It’s being considered, but we would drive it back through our dealer organization. I don’t know if there is a price point that would make sense with wholegoods because of trade-ins. But if we can make money for the dealer, make money for ourselves and make it easy 24 hours a day, maybe there is. We just haven’t got our arms around used equipment and setting the machine up and training the customers online.
“Securing strong and robust distribution as we go forward will remain the bigger challenge, and there’s always a place for companies that innovate…”
– Richard Fox-Marrs
I think it’s interesting in terms of how much information can we share from a service, maintenance and an operating perspective. I think there is a line where customers are calling dealers with questions, but they’re not invoicing-type events. With a niche business, how do we create enough online content that it’s just as good as we can find to fix, say a washing machine or a vehicle, and make it more seamless and more instant for a customer but not take income away from our dealers? For example, we’ve got some dealers on the industrial side of our business that are using Uber to deliver parts. It’s getting them twice as quick and cheaper. I think developments like these are changing the buying experience.
Regarding our ag-focused dealers, what do you think are their biggest challenges today?
Last fall we had a series of regional meetings around the country and if we put a word cloud together of everything they told us, the most often used word would be “labor.” I think we all know that labor’s an issue for our end users as well. So now we have a full time person at Vermeer who recruits for our dealers.
Fox-Marrs: On behalf of the dealers?
Core: Yes. It can be as basic as LinkedIn searches and postings, and those kinds of things. Or it can be way more intense where we supply them with 3 or 4 people. The dealers have to make the decision about whether it’s the right person.
I see us having an opportunity to provide services to our dealers where we have expertise as a corporation. We just recently worked with our industrial dealers on engagement with employees and how to try to improve that to increase their customers’ experience. We now have 2 full time people at Vermeer who are doing dealer marketing, where the dealers pay us for local marketing because they’re not big enough to be able to afford it.
“We must have leading-edge, market-driven type products. Our dealers want to be a part of what nobody else can get their hands on…”
– Mark Core
We’re also helping them with IT support, local website development, social media marketing, recruiting, employee performance management and those kinds of things. Can we be a partner of theirs and allow them to be successful, but not have 30 locations?
Fox-Marrs: During a recent dealer council meeting, one specific thing the dealers asked us to help them with was the onboarding of new people. We’re not at the stage where you are, where you’re helping to recruit, but once they find that person and bring them into the dealership, how do we work with the dealer to give the new person, what we call, the “yellow injection?” How do you get them oriented with the dealer’s systems? We show them how to work with the JCB Hub, how they can conduct factory visits, do quotes and get training materials. They wanted help to get the new people off on a good footing.
We’re also continually working on [employee] retention and helping dealers keep people in place. It is interesting. On the technical side, one of the biggest retention items is training and people feeling like they’ve got a career path; routine training so they feel that they’re going somewhere. Your comment is right, as an industry we can do more. They’re working with some of the most technically advanced products you’re ever likely to see.
Core: It’s amazing how many deals we’re involved with in helping the dealer. It’s awesome consulting with the dealer, but we can’t handle every situation. The reality is we get a lot of end users who call directly to our tech service, and there’s a debate whether we should take those calls or not.
Fox-Marrs: We’ve got telematics on the vast majority of our machines, and that’s a system we call an in-house live link, but it’s telematic. We’re remotely monitoring the vast majority of our machines, looking for fault codes and diagnostic situations. One thing we’re trialing in a part of the world is a system called Up Time Plus. It’s an iPhone app-type system where we actually give the customer the ability to hit a red button on their phone and say, “My production machine is down.” These are higher-end machines, so this is a Fastrac tractor-type product, where you know at a certain time of year, if that machine is down, it’s a real problem for the customer.
Core: It alerts you at JCB with operational data?
Fox-Marrs: Yes, simultaneously. It puts us in a proactive situation, where we’re contacting a multi-franchise dealer, and saying, “This guy’s invested $300,000, we’re going find a way to get him sorted today.”
We put it through field trial last harvest season in the UK. It’s a system that we’re contemplating putting in here, but you need to be ready for it. You need to have the support there to do it. This is what we’re absolutely focused on; being the best that we can be from this perspective.
Core: We have been looking at AgriSync that provides more efficient, two-way Face-Time system that we can go from us to dealer and dealer to customer. I think there are some ways through technology that we’re going to make everybody’s life better if we just embrace it. What will Google Glass look like in the future where a dealer is looking at the problem while our tech service person, the expert who deals with that every day, is at the factory saying, “Look, I can see what you’re talking about there. Here’s the adjustment, here’s what may be wrong or how we can make it right.”
All of these kinds of technologies fall in the lap of opportunity for shortline, specialist tech companies, because they’re low cost, very open-source type technologies that allow us to take our expertise and explode it without bricks and mortar.