To say this has been a challenging year would be a gross understatement. In areas of the Corn Belt, the growing season was cursed with too much rain and now not enough. In the Southeast, the season started hot and dry and never let up. On the plains, hail and extreme weather has taken its toll. The markets are all over the place with massive rallies and equal selloffs. Irrigation ditches have collapsed, and packing plants have caught fire. There are plenty of reasons for the ag equipment market to struggle right now — just like every year.
The struggles in the farm equipment market are different than in years past, but every year brings a new set of struggles and setbacks. Sometimes it feels like growers and dealers are glutens for punishment but, if it were easy, everyone would do it, right?
When asked, “Why do you do what you do?” farmers and ranchers describe the passion they have for job, the land, crops and the animals. They say there is nothing on the Earth they would rather do.
I think the same is true for those of us in the farm equipment business. Dealers endure the market cycles feel the same pain when things get tight. Dealers have to be creative to find new market niches and ways to conduct business with customers.
As my team and I try to be two steps ahead of the market and try to predict the future, we first have to understand our market. I am terrible about thinking if it is happening here, it is happening everywhere. I get slapped in the face more often than I care to admit, but I keep pouring over the data and trendlines in hopes I can stay ahead of the curve.
In my opinion, one of the most effective tools I have in managing equipment is my network of other dealers, wholesalers, independent equipment brokers and auctioneers. Nothing paints a better picture of what is happening in the overall market then talking to these folks regularly. Having a network that spans coast-to-coast and boarder-to-boarder is priceless.
Not only do I get a feel for the overall market, but I also have the chance to build relationships to buy, sell and trade equipment. When I have something Red on my lot and a Red contact has something Green on their lot, the possibility for a win-win is high.
“Never underestimate the power of your network...”
I recently attend the Dealership Minds Summit in Peoria, Ill. Kim Schmidt and the rest of the Farm Equipment crew did a great job as usual. The breakout sessions and group sessions were great. I found some take ways I brought back to the dealership, but none more important than the conversations I had with old friends and new alike.
Each year, I like to attend as many of these type events as I can. I have a chance to talk to a cross-section of the country and find out what is happening in their area and how it is effecting equipment sales. I compare to my market and data I have collected to see if there is some new opportunity, good or bad. It never fails I walk away with something I hadn’t considered or wasn’t on my radar.
My network consists of big and small dealerships, representing every color of equipment. The more chances I have to grow my network, the more chances I have to be profitable in my area’s market. I have a better awareness of opportunities I would have otherwise not been aware of.
While at DMS, I had a conversation with a friend who was having luck selling a competitive brand of combine overseas. In my trade area, I fight the same brand of combine. The next deal I am on where one of these combines are involved my friend will be the first call I make.
Never underestimate the power of your network. Who knows, the next phone call you make might be the difference between a profit and a loss on the deal you are working. Speaking of which, I have a phone call to make. Best of luck with the fall selling season, and be aware of your local market, as well as the national market.
Farm Equipment‘s Ask the Expert: Used Equipment series is brought to you by Iron Solutions.
At Iron Solutions, we provide used equipment valuations, market intelligence and a suite of integrated, cloud-based business systems custom-tailored for the equipment industry. Our proprietary model is built on actual dealer sales transaction data. Learn more…