Editor’s Note: Kelly Mathison has nearly 30 years of experience in the farm equipment industry. He became a partner at single-store John Deere dealership in 1996, which later merged with Enns Brothers in Brandon, Manitoba. Mathison was named the 2011 equipment dealer of the year by the Canada West Equipment Dealer Association (CWEDA). He joined the Western Equipment Dealers Assn.’s Dealer Institute in 2015.
Thanks for your interesting history on “Looking Back What Happened to Equipment Manufacturers in the Early 1980s Farm Crisis.”
I got my 1st job in a dealership parts dept in 1981. I recall 21.5% interest rates. On the bright side, it was a good time to learn about inventory management and expense control.
I got a part time job in a parts department at Tenold Farm Equipment in Estevan, Sask. in ‘81. We carried White, Minneapolis Moline, Steiger, Morris, Friggstad, Cockshutt, Melroe and numerous other lines. At only 19 years old, I was very wet behind the ears. Gordon and Henrietta Tenold were the owners, their son Dean was coming into the business at the time. Dean mentored me in parts. I don’t think I fully appreciated the scope of changes they were facing until many years later. Trying to calm customer fears, stocking inventory and parts for lines that may not survive.
Over the next 35 or so years, I rolled through the highs and lows of our industry, but I must say none could compare with those days. I think a part of what I learned back then guided me to keep a eye on debt, inventory and the strength of suppliers. A colleague of mine, Gord Thompson, said we had the benefit of getting into the industry at that time. I think he was correct.
Another story I could share. In 1985, I got a job with a small company called Bruin Agrinational. They had contracts to distribute Flexi Coil and Kelli-Bilt products into Australia. I was excited to go to Australia, I liked the Friggstad product and now that it was owned by Flexi-Coil, I couldn’t wait to fill the order books. What I didn’t know was the previous distributor of Friggstad had written orders for product with Aussie dealers & they had taken delivery with “limited time interest free” terms through BorgWarner finance. Not many dealers were willing to sign new orders when they had a containers of unsold products that were now fully interest bearing (at double digit rates).
I think this was a major factor in forcing companies to adopt true “consignment terms.” Over the next 10 years working at Flexi-Coil we only allowed dealers to carry a small representative stock. Most product had to be pre-sold (retailed) before it was built. This was a challenge to predict manufacturing runs, but it proved to be a successful strategy for companies like Flexi-Coil.
When I joined the John Deere dealership in 1996, my business partner Ed Mazer had strict rules around the level of interest we were willing to pay on new or used inventory. Obviously he learned valuable lessons in the 80’s too! I seem to recall being referred to as “old school.” That was OK by me.