Where there were once 50 farms, and the opportunity to sell and service 100 tractors, 50 mowers, 50 rakes, 50 manure spreaders, 200 wagons, 50 forage harvesters, 50 balers, etc., there are now 5 farms.
The customer base is shrinking and the equipment is getting bigger. That kills your volume, and you have to move volume to make money. If you're fighting over a handful of customers with another Deere dealer across town, it hurts both dealers.
It's really a form of "mercy killing" on the part of Deere to tell the smaller dealerships to sell out or close. Otherwise these dealers would probably drive their businesses straight into bankruptcy and make Deere look bad doing it. Man cannot profit on parts sales alone.
Farms are consolidating and getting bigger. The dealerships need to follow suit.
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Today's Featured Article - Picking Corn - by Rick Nikolich. It was the day before Christmas shutdown at work and I asked our lead engineering expert Scott Andrzejewski what he was going to do over the holidays. He said that he had some corn that he still needed to pick with an antique one-row New Idea corn picker. Scott has a nice farm about an hour north of Lansing in St. Johns, MI. He wanted to get the rest of his corn in by the next day (Christmas Eve). We had about an inch of new snow on the ground and single digit temperatures. So in the bac
... [Read Article]
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