Land­power boss flags chal­lenges for field days

In the fi­nal in­stal­ment of Mandy Parry-Jones’ in­ter­view with Merv Ge­orge, the Land­power boss says the way ma­chin­ery companies are in­ter­act­ing with farm­ers is changing.

Australian Farmers & Dealers Journal - - FEATURE INTERVIEW -

MERV Ge­orge knows the Aus­tralian ma­chin­ery in­dus­try land­scape bet­ter than most. The Land­power Aus­tralian direc­tor is at the helm of one of the largest pri­vately owned farm ma­chin­ery distrib­u­tors in Aus­trala­sia, which in­cludes a grow­ing net­work of branded CLAAS Har­vest Cen­tres and in­de­pen­dent deal­ers. Over al­most four decades the com­pany has es­tab­lished it­self as a lead­ing provider of agri­cul­tural ma­chin­ery, with long-stand­ing brand part­ner­ships with Euro­pean man­u­fac­tur­ers like CLAAS, AMAZONE, Seed Hawk and Grimme. It ser­vices a wide range of farm sec­tors, of­fer­ing com­bine har­vesters, potato har­vesters, trac­tors, hay and for­age equip­ment, spread­ers, sprayers and tillage tools. Mr Ge­orge says the con­tin­u­ing evo­lu­tion of farm­ing and ma­chin­ery is ush­er­ing ma­jor changes in the in­dus­try which will present chal­lenges and op­por­tu­ni­ties in the years to come. He says ma­chin­ery man­u­fac­tur­ers and distrib­u­tors are re­con­sid­er­ing the value of ex­hibit­ing at field days. “It's very ex­pen­sive to go to for deal­ers and distrib­u­tors but they are a way of life for the coun­try. There is a cer­tain amount of pres­sure to sup­port field days as they are sup­port­ing the agri­cul­tural com­mu­nity's way of life,” he said. But ac­cord­ing to Mr Ge­orge, where once there were or­ders on the day that doesn't hap­pen any­more and the ma­chines cost a se­ri­ous amount of money to trans­port to the dis­play site, es­pe­cially con­sid­er­ing the lo­ca­tion of some of the field days. “Many of the shows have be­come side shows and the peo­ple still go to them as a day out but the ma­chin­ery be­comes some­thing to sit on and comes sec­ond as part of the day out,” he said. “The farmer will al­ways want a prod­uct cheaper … in my trav­els around the world, they are all the same. They are very nice peo­ple but all of them want it cheaper. “So if you want to take cost out of the sys­tem hav­ing fewer deal­ers will help – less build­ings, less over­heads, less cost but the de­liv­ery cost from the man­u­fac­turer in the US or Europe. Mr Ge­orge said the in­dus­try was al­ways un­der pres­sure to re­duce its costs and that go­ing to field days and re­gional shows is a sig­nif­i­cant with a very mar­ginal re­ward. “Field days where you can dis­play your prod­ucts work­ing have some value, but I was at field day re­cently which cost a lot of money to at­tend. A lot of money, a lot of or­gan­is­ing but very few peo­ple,” he said. Mr Ge­orge be­lieves tra­di­tional ma­chin­ery field days are un­der threat as the in­ter­ac­tion be­tween farm­ers and the ma­chin­ery in­dus­try changes. “More suc­cess­ful today is where man­u­fac­tur­ers run their own dis­play days. So you can have a ‘come and drive day' where you have a range of the man­u­fac­turer's trac­tors or prod­ucts in a field,” Mr Ge­orge said. “They are more suc­cess­ful be­cause there's more up-time for the farmer in the cabin where they can ac­tu­ally use the machine and com­pare it to what they own in an en­vi­ron­ment where they are with ex­perts. Whereas a field day al­lows them to sit in a very fancy cab and I'm as­sum­ing they've all got fancy cabs.” Mr Ge­orge said broad­acre crop­pers, dairy farm­ers and the forestry in­dus­try all shared the goal of pro­duc­ing more vol­ume, more ef­fi­ciently. He said Land­power saw value in tak­ing in­no­va­tive farm­ers off­shore to places like Europe to help de­velop skills and knowl­edge in re­la­tion to the lat­est broad­acre tech­nol­ogy. “They are peo­ple that are lead­ers, peo­ple who want to learn. They're prob­a­bly high achiev­ers of the in­dus­try,” he said. On the sub­ject of ed­u­ca­tion, Mr Ge­orge said the iso­la­tion of many farm­ers and their fam­i­lies had a more of a pos­i­tive im­pact on their school­ing. “By def­i­ni­tion they live in a ru­ral en­vi­ron­ment many hundreds of kilo­me­tres from ma­jor towns. Of­ten the par­ents can't drop the kids off to school, there's no pub­lic trans­port that they can catch to school so many of them are en­rolled at the finest schools Aus­tralia has to of­fer,” Mr Ge­orge said. “This of­ten leads to cour­ses in some of the best uni­ver­si­ties that the coun­try has to of­fer. These kids are well ed­u­cated and savvy and once they go back home they bring with them de­grees in agriculture, eco­nom­ics or science and put these to good use in their farm­ing com­mu­ni­ties and their own prop­er­ties.” Mr Ge­orge said a sim­i­lar level of ter­tiary

qual­i­fi­ca­tions was not fil­ter­ing through to the ma­chin­ery in­dus­try in the same fash­ion. “His­tory would show you that most of peo­ple that have come into the (ma­chin­ery) busi­ness have worked their way from trade school,” said Mr Ge­orge. “There are very few peo­ple in our side of the busi­ness that are com­ing through the univer­sity sys­tem.” “The prob­lem with the in­dus­try today is how to at­tract grad­u­ates and im­prove that whole brain horse­power? How we do that is the chal­lenge for our in­dus­try be­cause is it viewed from the out­side as a sexy busi­ness to be in?” An­other change tipped to ap­pear on the hori­zon for the in­dus­try is the way farm­ers think about their own­er­ship of their equip­ment. He says the ma­chin­ery man­u­fac­tur­ers and re­tail­ers need to con­sider the op­ti­mal pe­riod of first time own­er­ship, which cur­rently it stands at around three years but should be more like five years, he says. “It's been tra­di­tional for sales peo­ple to move the ma­chin­ery on af­ter three years, re­plac­ing the farmer's har­vester or trac­tor af­ter three years but this causes a prob­lem, as there is a very small mar­ket for large trac­tors or com­bine har­vesters and an even smaller one for secondhand ones,” Mr Ge­orge said. “The first owner has look at five or six years of own­er­ship, not two and three. He should be locked into a con­tract for five or six years with a ser­vice con­tract, so he doesn't have to worry about the ser­vice. That's the fu­ture in my view.” “What hap­pens then is that the machine has been writ­ten down to a lower value af­ter five or six years, and there is a much bet­ter secondhand mar­ket with farm­ers who want a cheaper machine.” Mr Ge­orge be­lieves that as the mar­ket grows with larger cor­po­rate farms and larger pri­vate farm­ers they are go­ing to be smarter and teleme­try will pay its part and ma­chines will have to stay longer and be more ef­fi­cient with less break­downs be­cause of pre­ven­ta­tive work. He pre­dicts deal­er­ships will stock fewer parts in the fu­ture be­cause they won't be able to af­ford to carry too many parts, and deal­er­ships' glossy show­rooms will grad­u­ally be­come a thing of the past. “The idea that we park a com­bine har­vester to climb around in Moree is prob­a­bly go­ing to fin­ish,” said Mr Ge­orge. “It's a cost to the dealer that he can't af­ford.” “These ma­chines are worth so much money it makes more sense for those cus­tomers that are get­ting se­ri­ous and want to see the prod­uct to fly them to a more cen­tral lo­ca­tion where they see and feel the prod­uct.”

Land­power Aus­tralia direc­tor Merv Ge­orge.

Land­power’s Mel­bourne head­quar­ters.

The fu­ture of field days is be­ing ques­tioned by the ma­chin­ery in­dus­try.

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