Jon Kinzenbaw: Well, I don’t know, it was 150 employees, and I just told them what had happened. And then I said, “you know, Deere needs to know that if they can’t build — they were hiding behind they couldn’t produce enough.” They didn’t have the money, they didn’t have the parts and they didn’t have the facility. Three excuses not to produce row units and I told them employees, I said, “now we know that we can assemble more rows in a day than they claim that they can do with our workforce. So, we’re going to get the message across if they have more trouble, we’ll build their row units, too.” And the employees really got a kick out of that, the fact that I told them we could build theirs, too. When they had a strike we offered to build their row unit and they sent some guys in, but then they were afraid — I think they were afraid to admit and they tiptoed around it.
Susie Veatch: I think ultimately, though, our people really rallied around the fact that we’re in this battle that seems insurmountable because we’re very small by comparison, I think the book titles it David vs Goliath, but to see the employees rally around to see the community and quite frankly a lot of people were praying for us through that battle and the ultimate glory goes to God out of that, because there were just things that happened in that that we never could have orchestrated with our own human minds, but He literally led us through that battle and gave us the victory and allowed us to move on. Yes, it was a difficult time and the company and everything was on the line, but we really saw we can prevail through all of those around us working together with the Lord’s help and we’ve moved forward and we’ve grown a lot over the years.
And I think, too, in the face of adversity, adversity makes you strong. No matter who you are as a human being, whatever trial, adversity you’re facing you learn through that and you learn okay, am I going to stand up and go out and fight the battle or am I going to give up? And we did, and we won, and we’ve continued on. It’s been exciting, too, to see how even in the last 10 to 15 years that I’ve been back in the company, obviously I’ve grown up in it, but to see us continue to grow and continue to innovate and to lead the market in various planting innovations and to know the great products that we have that our name is on. It’s very different for I think a publicly traded organization, and Dad’s always said the name on the product is not the name of the man typically leading the company — but our last name is on it and so we wanted to live up to the expectations of quality and durability and again those are things that we talked about.
Mike Lessiter: Right. Learn a lot about your own people during a situation like that, right?
Susie Veatch: Yeah.
Mike Lessiter: And all the suppliers and dealers who were letting you know they were in your corner, you did a very good job of thanking those people in the book.
Jon Kinzenbaw: We had a supplier, numerous suppliers that came in when we were told that well our competitor — we can’t get this and we can’t get this and we just can’t — we don’t have the money, we don’t have the parts, blah-blah, there was a shortage of this, shortage of that. You know we went down the line and since we had the copy of that thing bolt by bolt, nut for nut, piece for piece to be successful, we did embarrass Deere. We bought every one of those parts except one that was supposedly they refused to sell it, it was proprietary. I’ll never forget the company. It was a little company that had a bearing and a sprocket and they said no, we build that for Deere and we won’t break that agreement. We went down the road and found another guy to make the part for us and got beyond it. And within 2 years, we found that the major company had breached that trust and had gone out to another supplier and they come back begging us to buy that bearing that they wouldn’t sell it to us 2 years prior. So, even that company bet wrong I think.
Mike Lessiter: We were talking about the dealers earlier. So in the early days did you go — were you going direct?
Jon Kinzenbaw: At a time, yes, we did. We sold in fact we used to sell the wagon with just a flat cash reward if they sold one. And we had dealers 10, 15 years later when I went to the dealer structure, the dealer would get a discount, he’d give it away, give it away here, the dealers get so mad, said I don’t know why you don’t just go back and give us a $500 allotment to selling a wagon. Then they’re all out there the same, they can’t cut the price, but they give away the 500, but that’s it. So, that was how that got started, before we had dealers we sold a few dealers in for $500. But, originally we sold all the wagons and all the planters direct to the farmer. In 1980 was when we first started putting in some dealers.
Susie Veatch: Yeah, you know, with the dealer network it’s exciting. Obviously, we’ve grown that over the years and every year for probably the last, oh 6 or 7 years, we go out annually and deliver market share awards to the top dealer in every district. But the one thing that we hear very often from dealers is that the Kinze brand is very profitable to them. And that’s one reason they choose to sell Kinze is obviously they have to make a profit, but then to have the brand name and the quality and the reputation that we have behind it. There’s going to be less and less dealers, but so long as there’s dealers out there that aren’t getting too much pressure from one brand or another to not take on other products, they very much desire to have the Kinze brand.
They hear from other dealers maybe Kinze line is a very profitable line, I want to have that line. We don’t put dealers on top of dealers, but as a whole the Kinze line is very profitable and then the Kinze products hold their resale value. And we see that time and time again, whether it’s at auctions, he goes to a lot of auctions, just was at one. So, those again are all great things for our dealer network because we need our dealers to sell and service our product, but it’s going to be a good business for them to be in as well.
Mike Lessiter: Right, because there is more pressure today than there was a few generations ago.
Susie Veatch: Yeah.
Mike Lessiter: You have to have that to withstand that.
Susie Veatch: Yeah. And you know when you look at, there’s really three of us that are major players here in the U.S., the red guys, the green guys and us, and we’re #2 in market share here in the U.S. And so in order for us to stay in that position, and in order for the farmer to put a blue planter behind a green or a red tractor, we have to have the innovative features that he desires and the planter that gets the job done in the narrow window of time he’s got to get crop in the ground and of course provides value to him as he trades and then buys a new one.
Mike Lessiter: I want to talk about your path to the company here. So, if you can kind of take me back from high school, when you started working in the company, and where you went after and came back. If you can kind of capsulate that timeline for us.
Jon Kinzenbaw: You’re going to tell him my story about…
Susie Veatch: I know why you’re laughing because you’re going to tell the story of my first job when I turned 14 and was able to actually have a job in the company, and my job at the time…
Jon Kinzenbaw: $5 an hour, 40 hours a week, pretty simple math, right?
Susie Veatch: Yeah, and at that time the accounting department they had a lot of paper that — everything was paper, we weren’t automated as much as we are today, and literally there were stacks of paper that had to be shredded. It was confidential stuff that we couldn’t just throw in the trashcan. So, my job, one of the main jobs was shredding paper and doing a lot of the grunt work as a first job. So, I’ll let him tell the story because he’ll tell it better.
Jon Kinzenbaw: Well, end of the — she had to wait 2 weeks to get a check for the first week because there’s always a delay, so she gets that $200 check but it was only 100-and-some dollars, and well where’s the rest of my money? Now, she sat at the supper table and we talked openly about taxes, withholding taxes, all those different things, but it didn’t affect her, right, because she didn’t think it come out of hers, she was expecting $200.
Mike Lessiter: Teachable moment.
Susie Veatch: That’s right, teachable moments. So, I guess growing up in the company and being involved in it from a kid and then those summers from the time I was 14 being able to work out there up through college. And then when I got into college I interned in other companies just to get other experiences as I got later in college. But those early years I eventually rotated throughout pretty much every area in the organization, which was good, too, to just understand and not do one thing. And, I always thought one day I might come back to the business, but Dad always said if you’re going to come back you need to go be successful somewhere else, which was good, I appreciated that, and I think our employees appreciated it, too. And for me it gave me so much more appreciation that when I did come back fulltime, when I came back in 2005 then after having been in college and work for Caterpillar and had a great experience at Caterpillar. But, you appreciate so much more what you have when you have a viewpoint of something else. I worked with great people there, but nothing holds a candle to the great people that we have in our business. Again, just all the through from our employees to our dealers, the whole network. And it’s fun, too, to come back as an adult, those people, those early dealers and early employees that have been there many years that I remember as a kid, that remember me as a kid, and then to come back and of course be involved at the level that I am now. So it’s been a fun journey and we’ve grown a lot over the last 10 years. Of course the last couple years we’ve been in this down ag market, but again we talked about adversity earlier, you figure out okay what do we need to do now to go and grow again and move in a forward motion. And it’s those times that you have the unexpected that really makes you think through and re-approach and try different things. And again we’ve got a great team of people, a great executive team as well that we work with because it’s much bigger than either he or I could run without the great team of people in the areas of expertise that they have and they advise us when we work together and make decisions, and that’s really what it’s all about.
Jon Kinzenbaw: So, she’s been back 16, no about 12 years, but I told her when I got 50 years in she could become president, and she didn’t forget that.
Mike Lessiter: How do you think each of you are similar in your approach and how do you think you’re different?
Susie Veatch: Yeah, well obviously there’s a lot of I think I’ve learned a lot just over the years by listening to him. And even we talked earlier about the dinner table conversation, those things that you learn to critically think as a kid, so we were always challenged to think business-minded like, even as kids, because that’s what we talked about at the dinner table. And the tremendous respect that I have for what he’s done and what he’s built. And then it was — to come back in and be involved — and we joked about the president title, but it’s like do I really want that title because that’s in a way that’s a really big responsibility and elevating my role even more so at least by title. Obviously, there’s a lot of things that I’ve been doing and that haven’t changed and I’ll keep doing. But to be able to work alongside him and learn and as we have different scenarios of things happen, to be able to have his eye of well, you know, I’ve got this many years of wisdom, experience to draw upon that I obviously haven’t had.
But every year now that I’m back and the longer that we work together there’s more that you start feeling comfortable with like yeah, that’s how Dad would handle it and that’s how I know he’d want us to make this decision as we work together because his role now, he’s able to take time to enjoy some of his hobbies and what he does so he doesn’t have to be involved in the level of detail in the day to day like I am. Yet when we make major decisions we include him and he very much has a say in those major decisions. But there’s a lot of day to day decisions that add up that could become major that you really have to make sure we are aligned as owners in the decisions that I’m making and I’m saying okay, how would he think through this and what would he want me to do in this situation. So, in that way I think I’m wired very similar to him in that the ability to critically think and to think through and what’s right. And in some scenarios they’re not black and white, whether it’s involving an individual, might be an employee situation where it’s not black and white and you have to make a fair decision, something you wouldn’t do for one that you wouldn’t do for all. That’s the difference of being private owners is being able to be involved in people’s lives.
And then obviously his area has been he loves the engineering and if he’s going to pop in we’ll usually find him down with the engineers or out in the proto shop. I enjoy the day to day business side and I think you’d say probably over the years, you didn’t enjoy some of the day to day administration stuff that I do, so that’s where we complement each other well. And then at the same time he’s worked really hard to mentor the team of engineers we have. So, some day when he’s not here, it’s not, “oh my goodness, he’s not here what do we do?” But they’ve been mentored and we’ve got a great team down there and a lot of expertise and they also know how he thinks when we design product, and again carrying that quality reputation forward and into the future and into the second generation.
Jon Kinzenbaw: She’s got the work ethic and the tenacity to hang in there and do that stuff, where a lot of people would be scared out I think. She’s learned to grab on and grab ahold and do it. But we also have both learned to surround ourselves with people that can do the things we can’t do. And if you’re afraid to hire somebody that’s smarter than you are, you got a problem. And if I needed somebody in accounting, we hired people that could do that and we’ve had good people and advisors from the accounting people, we have attorney, some of those we’ve had, hiring employees that can design and do tooling. I’m pretty — I’d be a pretty good tool maker now, but I learned that from employees. And there’s a lot of things that I’d be pretty good at now that I learned by watching or hiring people that can do it.
So you surround yourself with people that can get the job done. And if they can’t get the job done, you also got to be willing to part company because you can’t keep them all around. Once in a while you find a dead wood. An interesting thing that I always tell, I did it just here a while back, I said if you want to know whether this guy is working or not, you take 10 times at random, you’re out there if you’re the foreman, and you think about it, look and see what Sam’s doing. And you see him standing and jawing, you write that down. And then you wait a day or so and you happen to run into him again and you write down what he’s doing. If he’s standing and jawing you write that down. 10 times you go through that routine and how many times you catch him standing, talking versus getting the job done, is just about what you’ve got. It just almost without fail. We had a guy that was in a position he didn’t belong in, I’d been watching him for a long time, the foreman was over his head, he wasn’t even paying attention. I pointed it out, told him what to look for, and before I got back to see how he was doing, he’d gone from step 1 to step 2 and he had him back on the line; took him clear off of the job he was doing. And I said when you do that, you make sure you put him on a job you can measure. Don’t give him a job over here beside Sam and Sarah and let their numbers affect his. You get one that he does all by himself and you watch, and if his numbers are all alright, then fine, but if he’s dogging it you’ll know. And that sometimes you got to be tough when you do that, and I’ve known this guy for 40 years and I hated to put the pressure on, but I can’t afford to pay them guys. The other thing we find is when you do that with a what I call sometimes dead wood, a lot of the other guys will say oh, it’s about time. They’re sitting there watching this, too, but they don’t have the authority to say anything and they’re just waiting and hoping that you figure it out.
Susie Veatch: But in a business our size you occasionally have those situations, and as owners that’s probably one of the biggest challenge that can be the most draining. Anybody you talk to that owns a business where there’s people involved, when you have those issues, again for us fortunately they’re few and far between, but when you have them they are very draining because obviously to keep a great work environment for the others you can’t not deal with situations, otherwise it just creates a bad environment for even the good people that are working really hard.
Mike Lessiter: That’s a good segue into something I wanted to ask you guys. If someone was coming in and said, “Susie, describe what the culture is like within Kinze Manufacturing.” What are the words that pop into your head?
Susie Veatch: Well, that’s actually pretty easy because we talk about that with every interview candidate, we talk about it in all employee meetings, we talk about it in dealer meetings. But our culture is defined by our five core values. Integrity, excellence, innovation, customer focus and mutual respect. And we asked my dad and mom probably 20 years ago, they went on a vacation and we tasked them with coming back and defining what are the core values that Kinze was started upon and that are true today. And those were the values that they came back with and wrote a paragraph about each.
Now that’s not to say somebody won’t have a bad day, we all have bad days, but as a whole anyone interacting with Kinze should see those themes exhibited in their interactions. But those core values really are what defines our culture and what we’re all about. And you know that we hit 50 years 2 years ago, what’s the next 50 years? I don’t know, but I’ll tell you one thing, so long as we’re part of the family, those core values will be a part of our company in what we do and who we are.
Mike Lessiter: So, we’re in a succession transition change, like a lot of businesses are, and Jon Kinzenbaw has passed on to you the things that are must have’s for the business moving forward and there’ll come a day somewhere down the line where you’ll need to pass the keys to someone. What are the things that you’ll want that — if you’re writing a letter to your successor, the handful of things that are the non-negotiables that we’re going to do business this way, this is how we do it.
Susie Veatch: Yeah, I would go back to the core values and I’d really emphasize integrity, because that’s one thing that today seems to be lost in our culture as a whole. I mean there’s still a lot of great good people out there, but as a whole people seem more willing to compromise on integrity and you know it’s a slippery slope. You do one little thing here and you think oh, nobody will notice this, but then it’s like a big snowball that starts getting momentum going down a hill. And we encounter that a lot in our international business because many of the countries that we do business in, part of their culture is just assume you’re going to do an under the table deal and we make it very clear to our dealers internationally we will not do under the table deals. We will do everything above board and with integrity because that’s what we are all about. So that would be the thing I would emphasize the most because if you don’t have integrity, you might as well not have anything else because if people can’t trust their interactions with Kinze or with Kinze employees, then it’s pretty much game over no matter how great of a product you have or how customer focused you are because ultimately the customer isn’t going to trust doing business with us, they’ll go elsewhere. And so we take that really seriously and we know that that’s an important part of our lives as owners and that’s how we want others to interact with us and that’s how we want our people to interact with others is to always put that integrity first.
As business owners, the ultimate challenge is wanting to provide a good place to work for people in the community and support the livelihood of families. Obviously, we build a product and we’re in business to make money. Yes, there’s challenges, whether it’s people challenges or you get in a legal situation that’s a battle and a challenge or whatever it might be, but I think one of the things we always come back to is we’re fortunate to have we believe the best workforce that we could ever ask for right there in the Midwest, a lot of people that came from farms and understand how the product is used, the end product that they’re putting together. And then a great group of dealer network that really believes in our product and stands behind it and promotes it. Because we can promote our product there locally, but it takes dealers to expand that footprint and to be able to sell the product and the support to the end customer.
So, there’s been numerous challenges along the way that you’d have with any business, but the reward is always looking back and saying hey, not only are we building a great product that’s helping to feed the world, but we’re also able to provide a great working environment for a bunch of employees both here in Williamsburg and then we’ve got a global operation, a factory over in Vilnius, Lithuania, and another workforce over there. To be able now to expand that around the world, and even making the move to go from a distributor of our product globally to having dealers globally and now having that factory globally to be able to support the product needs over there. It’s exciting to see the growth and the changes and we put a lot of hard work into that and you take a risk, but in the end it’s very rewarding to see the results of that.