We’re knocking on the door of 2023, and farmers are beginning to lock in their production plans for next season. As you help your customers firm up their decisions, take time to prioritize goals for your ag retail business, too. Here are some actions that can help make 2023 your best year yet.
The end of the year is an ideal time to reflect on your business’s successes and missed opportunities in 2022. Gather your team and start collaborating on goals for next year. Here are some questions worth discussing:
- What were the biggest struggles for our business this year?
- What went well for us this year?
- Did our year-end sales align with our projections?
- What opportunities do you see for capturing more business next season?
- What market factors could influence our business next year?
- What are the top concerns for our customers right now?
- Are there new services we should consider offering? If so, what are they?
- What processes, technologies or procedures should we change or adopt?
As you know, the past couple of years have been challenging for ag retail. Supply chain disruptions, product shortages and volatile pricing have made it hard to plan, meet customer demands and make a profit. Moving forward, ag retailers will need to take a broader market view to remain nimble in a dynamic business environment. That means keeping a pulse on what’s happening in both domestic and global markets and preparing for disruptions.
You may also need to broaden your product lineup and services and seek relationships with new suppliers and manufacturers to build a more flexible offering for your customers. When you know what products are out there, you’ll have more success finding suitable alternatives when availability becomes tight.
Global competition and logistical factors have lengthened planning timelines for securing products. The days of operating on a “just in time” mentality are over, and successful companies can’t rely on guesswork in today’s volatile environment. That will require ag retailers to tighten their sales projections and look 12 to 24 months ahead to plan for customer needs.
Fortunately, digital tools can help increase sales forecasting and supply management accuracy.
Growers Rally™ gives you complete visibility into every aspect of the sales process to ensure more accurate planning. You’ll get real-time information about what products and prices have been planned, booked or contracted. Growers Rally also helps you keep track of your inventory, so you’re never left wondering what’s available to sell.
While labor is tight for nearly every industry right now, agriculture has been especially hard hit. According to the 2022 CropLife 100 Survey, approximately six in 10 ag retail respondents listed labor as their number one concern, with last year’s main issue, supply chain disruptions, running a distant second. The long hours, remote rural locations and often inflexible schedules can deter students and job hunters from a career in ag retail. Today, many companies have gone to remote or hybrid roles, which adds much more flexibility for workers. While that’s good for employees, many employers, including ag retailers, that can’t offer those benefits often lose out on top talent.
You should look at your benefits and compensation package to recruit and retain the best people. A recent report from Glassdoor says that the number one reason US workers aged 25-54 choose to search for new jobs is for higher pay. Rising inflation has escalated the need for competitive wage increases. If you’re not in a position to raise salaries, look for other creative ways to entice workers. For example, adding more paid time off, offering stipends for professional development or providing more flexible work schedules can make you more competitive as you search for top talent.
As you plan for labor needs, think about how the industry is changing and what skills will be in the highest demand for your organization. As more farmers go digital, having employees with technology aptitude is important for your business’s growth. Employees with strong marketing and business knowledge and soft skills critical for selling are also essential as you build a strong ag retail team.
Omnichannel selling allows retailers to engage customers through multiple digital and physical touchpoints. It’s an ideal strategy for ag retail, which values strong relationships as part of the selling process. The omnichannel business combines online sales and resources with in-person support to create a seamless buying experience. As customers engage with retailers across different channels, their information and data move with them to create a consistent buying experience.
A 2019 McKinsey report states that digital investments will be critical for ag retailers’ sales growth in the coming years for three reasons:
- There will be more turnover in farm management as older generations hand the reins to younger farmers. More than one-quarter of buyers 35 and younger purchase agricultural products online today, more than any other age band, and nearly 60 percent say that online ordering will be their preferred route going forward.
- Online channels lead to greater loyalty. McKinsey data show that farmers who buy online tend to stick with that channel over other options. Only one-third of farmers who buy online later decide to buy from physical channels as well.
- Non-digital farmers are open-minded about online purchasing. As many as 45 percent of farmers who don’t currently use online channels say they’re open to doing so in the future. Of these respondents, 56 percent say they would buy more than half of their seed online if buying from a known brand, while 44 percent say they would buy the majority of their seed online if they could get the lowest price.
Each year brings a different variety of opportunities and challenges for ag retailers. While a solid growth plan is mandatory, you must also build flexibility into your execution strategy. Stay nimble and keep your customers’ best interests in mind as you make decisions. Ultimately, your farmers’ success is directly tied to your business’s success. When you build a plan that anticipates your customers’ challenges and provides timely, cost-effective solutions, you’ll be in an excellent position to win in 2023.
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