It’s been a challenging year for equipment sales in North America, but dealerships that focus on efficient shops and timely customer service are likely doing better than most.

That appears to be the case at Titan Machinery’s Holdrege, Neb.,  store. General Manager Marcus Dunbar says business is slightly better than expected, with few shortages of parts or labor going into the summer following planting season. 

Dry conditions in May meant some pastures were slow to green up, some farmers delayed planting and ran their cows on cover crops. He doesn’t expect to see a huge jump up or down in equipment sales over the summer compared to last year, but the outlook is “cautiously optimistic” at this point of the year, he says. 

In its first-quarter earnings call, Titan Machinery reported its parts and service business in agriculture was stable despite the ongoing industry decline for equipment. And Titan announced the recent acquisition of the Farmers Implement & Irrigation New Holland stores in Brookings and Watertown, S.D. 

“It just shows that we’re still growing even when times look a little tougher,” he says. “I would say everything for everybody is down slightly, but lead times are better, parts availability is better. We were able to order more inventory, and aged items were sold or transferred out. So, it looks pretty good at this point. There are still some items sitting here longer than we’d like, and we’re addressing that.”

This spring, the Trump administration backed off on some threatened tariffs, which Dunbar says is helping business a little bit. Trade tensions mostly affect the parts business, but Titan Machinery has plans in place to adjust. 

“That was a hot-and heavy-change for a month and a half, but I would say that has settled down,” he says, adding that executives are still watching events closely due to conflict in the Middle East.

USDA Secretary Brooke Rollins visited farms in Nebraska recently and announced “Farmers First” legislative policies that included changes to how a family farm is defined. The USDA implored Congress to expand Section 179, which allows eligible small businesses to deduct the full purchase price of qualifying farm and business equipment up front. 

Rollins also asked Congress to restore 100% bonus depreciation expensing. If phased out in 2025, family farms would be unable to immediately deduct their business investments. 

Dunbar, obviously, is supportive of anything that helps farmers, including Section 179. 

“It’s a useful tool, for a large or small operation, to be able to utilize that to cover taxes when the time comes. Ag supports 75-80% of the economy in a lot of states. It’s a useful tool and needs to be kept around and expanded if possible.”  

Focusing on Parts & Service

Dunbar says parts and service is the bread and butter of Titan’s Holdrege store and his staff is always looking for new ways to improve customer service, knowing most of them are production farmers under a lot of pressure to be as efficient as possible.

Even with a smaller dealership and a veteran staff, Parts Manager Randy Young still has plenty of challenges to navigate, including keeping staffing levels as a high enough level to make sure customers are taken care of. Being part of a large corporation means being more detail oriented in operations. 

“There’s a lot more checks and balances and more spreading around with inventory grouping, which we did do before in the Fairbanks (International) days,” Dunbar says.

“We looped parts between the 6 stores and spread out the parts inventory. One store may not have every item at every store, but it was within a 50-mile radius to grab what somebody might need. And that way you could handle more inventory to cover more customer needs. Now we’re running more vehicles back and forth, I would say than we used to by far.” 

The challenges forced on the industry by COVID also caused disruptions in the supply chain that are still being felt now, although the problem is less severe. Available parts during the pandemic might have been 1,000 miles away and dealers didn’t always want to share inventory. 

“It’s easier to work with people that have the parts now,” Young says. “They’re more willing to give things up.”

If parts aren’t available, that can bog down a service department and that’s something Dunbar and his employees try to avoid. Many suppliers either went out of business or cut staff, due to supply and demand issues, during COVID and they’re having difficulty finding reliable staff.

Keeping the service department staffed and running effectively is a top priority at the Holdrege dealership, along with training to handle an ever-changing world of technology. “There’s a lot of talent. And just like Nebraska football recruiting kids younger and younger, we do the same thing. You never know where you’re going to find the next good kid,” Marcus Dunbar says. John Dobberstein

Dunbar emphasizes the need to evaluate a customer’s machine prior to it coming into the shop, “for logistical purposes” so parts are on hand and jobs aren’t stalled out. In the Kearney store right now, Dunbar says, one service tech has 3 jobs idle due to the lack of needed parts. He notes some of the repairs being performed are on equipment that the dealership doesn’t handle mainstream but techs can still repair.

“Being able to inspect the unit before it comes in lets you order parts and have them here in a timely manner so you could keep workflow moving,” Dunbar says. “It’s easier to source parts now, but it’s not the supply chain we had prior to COVID by any means. 

“Our guys have done a good job of finding other sources for parts. Other dealerships, as well as CNH and Titan have made it easier to access other dealerships to find parts that are sitting in inventory at some other place.”

Shop Manager Joanna Bantum says the dealership wants to keep efficiency at 100% and productivity at 85%, which is a work in progress. In addition to internal goals, “our main focus is our customer and getting them taken care of, especially during harvest and planting,” she explains. 

The dealership is considering a parts delivery service that would allow customers to pick up parts they’ve ordered in secure boxes. Titan staff are still working out logistics, including determining a home base where the routes will run out of, and key locations for the boxes that will reach more people. 

“Honestly, I don’t see it being a huge revenue generator. It’s more of a customer experience than anything, just like our oil truck is,” Dunbar says. 

“In front of every store we have a parts box for after-hours pick up so customer can call ahead and have us bill their account. Or if other stores are looking for a part that they need to complete a job ticket or something, they can come over pick it up after hours and nobody has to be here.

“If you pick a small town within a 30-mile radius, customers could, for example, go to church get groceries or whatever and they can grab their parts out of the parts bin. It’s convenient.” 

Dunbar and his staff are mulling ways to improve service efficiencies even further by leveraging technology already available. He’s already at full staffing but would like to add another precision tech who would specifically do installs on planters, tractors and sprayers. 

He’s also in talks about adding a lube technician who has their own truck to work his area between Kearney and Holdrege to handle maintenance on construction equipment and tractors that have preventive maintenance agreements.

“Most units are tracked with GPS/telematics. If a unit is 20 hours away from needing an oil change, we want to make sure we get all the parts here loaded and get that customer to set up an appointment and we can bring it to the shop or we can do on-farm service. Those are things evolving in the industry. We’re logistically figuring that out.” 

Running the parts-and-service business efficiently comes down to not only technology, but communication, notes Dunbar, who started his career in the service department at Titan’s Kearney store 30 miles away.

He assigned one of his techs to be a service advisor so customers can call in and ask him for technical advice if they want to try fixing a problem on their own or someone can visit them on site to troubleshoot problems. 

“I don’t care if you have 13 technicians or 20 or 6, there’s going to be days when they’re all busy and you can’t just, at a drop of the hat, go see another customer. Scheduling is big, and communication is big for both parties. You do the best you can with what you have at the time.”

Customer of the Future

Most customers at the dealerships Dunbar manages are serious production farmers, although there are a few hobbyists who buy a small tractor, skid steer or other equipment to care for an acreage.

Dunbar has given a fair amount of thought about what the future dealership customer will look like and how to best align services and inventory to their needs. The average age of a farmer in the U.S. is 58, and looming retirements will lead to the largest generational transfer of farm wealth in history. 

Rollins has called for the 2018 Farm Bill’s Commission on Farm Transitions be enacted to identify how the USDA and the U.S. Treasury Department could support farm transitions while ensuring that operations remain in production. 

USDA says it will also engage with agricultural tax and legal professionals to develop tools that facilitate orderly transition of agricultural operations from one generation to the next. Rollins also called on state and local governments to work with the USDA on local solutions to eliminate or minimize death tax penalties.

Farmers from earlier generations may have chosen the occupation as a lifestyle choice, while younger farmers may look at the decision more strictly from a business perspective. Dunbar sees corporate farms filling the void as farms transition ownership.

The Holdrege dealership wants to keep efficiency at 100% and productivity at 85%, which is a work in progress. In addition to internal goals, “Our main focus is our customer and getting them taken care of, especially during harvest and planting,” says Shop Manager Joanna Bantum. John Dobberstein

“Everything’s growing. Just coming from a small family farm and looking at the future, sometimes that weighs on you. There’s a lot of guys getting to retirement age and they don’t have kids who are interested in it and looking to come back. 

“Some might have a grandson or a granddaughter that wants to come back and take it over but there’s a lot of guys in their 70s and 80s and very late 60s who are still farming. So, you’re trying to figure out who the customer of the future is going to be. What do they look like?,” he says, noting smartphones, laptops and technology is a huge driving factor. 

“When I was young, an ATV was a luxury item and now everybody’s got a $50,000 side-by-side, but they’re a handy, useful tool.”

The demographics of future customers drive not only customer service efforts, but what inventory Dunbar chooses to place on the lots. Do customers want machines with all the creature comforts or just a simple chore tractor? 

“When you’re discussing this as a group you try and hit the highs and the lows and spec equipment correctly, to have correctly optioned equipment around that people want to buy. But it is a challenge to figure it all out,” he says.

“Just ordering a simple planter, for example. You can get a ground drive with a simple mechanical transmission, you can get markers or you can deck it out with all Precision Planting with DeltaForce, CleanSweep. It’s tough to spec it all to set equipment here for what’s going to meet somebody’s needs. Every operation is different, and they all have ideas of how to get there.”

Ramping Up Training

Along with helping the customer of the future, developing the employee of the future is also important. A fair amount of training got paused or was done online during COVID, which was especially tough for service techs because of the need to get hands-on, in-person training in electronics, hydraulics or other areas, Dunbar says, adding that not every person learns at the same level online. 

Online training is still part of the program but hands-on learning, and recruitment efforts, have ramped up again. That has become crucial as more and more technology is part of the equipment they service. 

“Back when I was a service guy we had three ESTs in the store split between 13 or 14 techs,” Dunbar recalls. “I was one of the younger ones that got to use one because some of the older guys didn’t prefer to. But now every one of our service technicians has a $13,000 EST because you must go out and hook up to things — where before it was just once in a while with a hitch controller, a combine, downloading software or yield and moisture monitors. 

Managers at Titan Machinery’s Holdrege, Neb., dealership attack efficiency challenges in the shop by getting customers’ machines evaluated ahead of time and getting parts stocked and ready, rather than simply reacting to equipment issues. John Dobberstein

“Now it’s on every piece of equipment. That evolution came rapidly and is constantly evolving.”

Bantum and the Holdrege store as a whole is working hard to get students interested in mechanics early on in. 

“There’s a lot of people that don’t want to do this work anymore. So getting them in school young and interested is the most important thing. And having a long-term career goal here,” Bantum says.  

The Holdrege community started doing a ‘Diesel Days’ event each year for high school students to learn about mechanical technology and other related areas. They spend the night at a local college and visit one of the Titan stores. “There’s a lot of going at local high schools, just meeting with their FFA chapter or their shop teachers. 

“We work fairly closely with some of them, and they give us a pretty good idea of one or two kids that might have an interest in that being a career path they’re looking for,” whether it’s service, parts, sales or accounting. “There’s a lot of talent. And just like Nebraska football recruiting kids younger and younger, we do the same thing. You never know where you’re going to find the next good kid. 

“We have an Edge program to bring in part-time kids so they can test us out, we can test them out. I would say it is an excellent program for both parties to just see what the kids like and see if they are a fit before we offer sponsorships.”

“It’s a pretty amazing program,” says Bantum, “and an opportunity for these kids to get a full ride pretty much. And an opportunity and a career.”