H&R Agri-Power, Hopkinsville, Ky.
Pictured Above: “I don’t know anybody at Deere or Case corporate,” says farmer Joe Sisk (left) talking to H&R Agri-Power’s Jeff Morgan (right) about farmer loyalties. “Neither is going to know if they lose me as a customer.”
Joe Sisk: We have almost always been completely John Deere power harvesting. We’ve been with Deere power and combines probably since back in early 60s. Grandpa got started with the Deere letter tractors that were fantastic, and the dealership in town worked well. Once he got there and everything was so interchangeable, he kept using it. That drove the loyalty. He took a lot of pride in the equipment and kept it clean and maintained.
Some of it was brand loyalty, but more so the loyalty to the dealership. It’s a great product, but a lot of them are today. These big companies are underestimating how loyal the farmer is to his dealer and that’s getting lost in this consolidation.
Jeff Morgan: Service is a priority for us because our brand doesn’t get a 65% market share like Deere. We had to focus on service. You’ve started buying more from us than your dad and grandfather did. Is service a factor in that?
Sisk: Absolutely. Parts and service, especially parts. When farmers are really busy, we get ugly about parts not being in stock. If it’s a common part that breaks a lot in the field and you don’t keep it, you’re going to lose us. Assuming the equipment’s reliable, then the only thing that’s going to prohibit me from being successful with a piece of equipment is if I can’t get it fixed. The brand loyalty only goes so far as the stuff’s performing correctly.
Morgan: I’m seeing a softening on absolute brand preference. Your generation seems less interested in whose badge is on the side as long as it’s the right solution.
Sisk: That’s right. I don’t care about stickers on a MacDon header. When my Dad was 45, he might’ve said, “Well those two stickers don’t match.” I don’t even think about it. It’s probably generational.
Sisk: Back to our discussion about corporate entities, some of these outfits have ended up with people who are smart, great business people, good people, but who have no practical concept of what we’re doing. And so, they think we’re just being hard asses when we say, “We must have that part at 6 p.m. on Saturday night.” We’re working.
I know H&R has gotten big too. But as these corporate equipment companies force consolidation, what they don’t understand is that it’s important for me to really know the person I’m dealing with.
You know, other businesses are going through this too. They say, “If we consolidate these things, we can make it more efficient and make more money.” We want to be efficient too, but farmers are different. The most efficient thing to do is go plant corn 8 hours a day for 20 days. But we plant corn 20 hours a day for 8 days. That’s not very efficient, but it’s what must happen for it to work.
“Because if I no longer know either party, it’s easier to walk off and trade with someone else…”
– Joe Sisk
You need to make money, I know. But sizing things out with fewer people doing more, you end up with people with little practical knowledge of farming. This may not be fair as I go to your Hopkinsville, Ky., store where all the big guys are, but you were down at Russellville, Ky., for 10 years, right? (Morgan nods). Someone needs to be in charge.
Morgan: Yeah, each store needs a go-to person. We try to use Hopkinsville as a model to replicate for the other locations. Of course, as the footprint gets a little broader, too, you get into some different crop rotations and cultures change. We need to adapt to those locations individually.
Sisk: I still want my point of contact, preferably in service. He doesn’t need to do everything, but see I’m taken care of. When you lose that contact in these dealerships, you don’t necessarily lose the business, but you will lose the loyalty.
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Morgan: We see this as very important because our salespeople need to be your point of contact, even though they’re not the service manager, the delivery guy, or F&I person. That’s the reason we use account managers; your one stop.
Sisk: Because if I no longer know either party, it’s easier to walk off and trade with someone else. Without it, there’s isn’t a lot of stuff that ties people anymore.
You guys at H&R have good contact with farmers and know what’s going on. If it’s a weekend when everybody’s having a panic attack trying to cut wheat, you stay open later. Somebody hangs around there. Somebody pops in on Saturday or Sunday afternoon and drops parts out their front door. And that drives a tremendous amount of loyalty because I lose so much money if I can’t run.
Morgan: This statement is overused in the industry, but it’s true. “We’re not in the equipment business. We’re in the people business.”
Sisk: People are discounting it. Somebody’s got a patent and figured something out that’s tough for another competitor to beat. But for the most part, you can functionally work through any machine. Say I’m running Kinze or Deere and there’s a problem. There’s something else I can use. Every now and then there’s a piece of equipment that one outfit has that the other one can’t match. Nobody else had a twin like Kinze. They swept the market and had everyone in the double crop market forever. But then the John Deere 1790 came in and it took over.
“Shortlines are huge for us because if the only lead-in item we have with you is a $400,000 unit, it’s difficult to bridge that gap…”
– Jeff Morgan
So, when people think a farmer is always red or green and won’t leave, that isn’t true. They’ll do it if it was made easy to do.
Morgan: That was our presence on your operation. We were a specialty supplier for a long time. Grain carts, Kinze planters, DMI tillage products and some hay equipment when you were in livestock. That was our presence in your operations.
Sisk: I guess I never thought about shortlines as a way into our farm, but any size farm is going to use a lot of shortline stuff. My shortline pieces outnumber the big pieces because we don’t turn a tractor but every 7 or 8 years.
Morgan: Shortlines are huge for us because if the only lead-in item we have with you is a $400,000 unit, it’s difficult to bridge that gap. But if people come to me and they need a Bush Hog or a Land Pride rotary cutter — and if that’s the only business I can do with you as we get started — it’s an opportunity. We can demonstrate how we do business and start building that relationship at a much lower price point. And then as we go forward, hopefully that cutter leads to a grain cart, which leads to a planter and then to a tractor and combine. It’s a process. I can tell you if we didn’t have those shortlines, our job would be a lot more difficult in conversion accounts.
Sisk: I didn’t even think about that. I’m thinking about my contact with Terry Martin all these years; it was Bush Hogs and Woods and it was all shortline stuff.
Morgan: Yeah, and you two built a relationship over that.
Sisk: That’s true. You know it’s funny that you say that. It does drive a relationship, because one of those pieces gets traded every year. Our farm tends to keep our high-dollar pieces around forever, so we might go 6 years without trading a major piece and that would be fewer contacts.
Sisk: Another thing that binds people so tightly now, especially my age and older, is this precision stuff. The younger guys that work for me think it’s ridiculous, but it’s something that gives me a lot of anxiety. When somebody talks about a different color tractor, my blood pressure spikes. I start to worry about going to the field and something not working. Case would show up and say it’s Deere’s problem and Deere will say the same thing. And then I’ve got a screwed-up deal. That comfort in one color has been tying me up tight.
Morgan: It does. That’s probably the biggest hurdle we’ve got. We have people that want to change colors, but they don’t want to abandon what they know is working now. We’ve been able to plug in and make things work, but it didn’t have the full functionality that farmers want. That bridge is getting easier with ISO and now we’ve got so many third-party helpers and solutions too. The big manufacturers recognize that. They even used it as a marketing weapon at one time. That is, if you’re going to run this planter, you need this tractor. Everyone was guilty of that, but we’re getting better.
Sisk: Yeah, that was smart. It kept me where I was for a long time. But now someone can say, “We’re going to make it work with that other guy.” And everybody’s got to scramble to make it happen. If not, I’m going to go the guy that makes my life easy. For a long time, nothing talked to the other, especially on these high-level things like planter clutches and pressures. So, the first person that blinks and says, “No, we’re going to go after that other market” is going to blow the model up.
Joe Sisk will be presenting at the 2018 National Strip-Tillage Conference in Iowa City, Iowa July 26-27. For more on this event, also planned by the editors of Farm Equipment, visit www.striptillconference.com.
And then they’re all going to talk. In the next 4-6 years, maybe earlier than that, you’re going to be able to back a red tractor to a green planter or a green tractor to a red planter and plug them up and go to the field. It’ll work just like my 3 same colored tractors and planters where I don’t have to do anything else.
Morgan: Yeah, I think so.
Sisk: It’ll be a big deal, because then I can walk into any dealership and buy any brand without having to go over every detail about RTK or whatever. That’ll be as true for a green guy coming to red and vice-versa.
Sisk: Before, that stuff was scary when we brought it to the farm. And I mean scary. It’s a big deal to go plant 1,000 acres of corn and worry the whole time it won’t be right. The stress went up on each new piece you brought to the farm -— until you see it work.
Morgan: Yeah, you just need to get comfortable with it.
Sisk: Do I see a time when I’ll be running other color tractors and combines? Yeah, I think those trends already changed. Remember when commodity prices were high and we were all trying different things and playing with different pieces of equipment? That carries over in our minds; that we tried other brands and the farm didn’t come unwound.